S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8474
 
                             I N  S E N A T E
 
                             February 2, 2024
                                ___________
 
 Introduced  by  Sen.  LANZA  -- read twice and ordered printed, and when
   printed to be committed to the Committee on Finance
 
 AN ACT to incorporate the city of Staten Island; to enact a charter  for
   the  city of Staten Island; to provide a period of transition prior to
   the establishment of the city of Staten Island; to amend the education
   law, in relation to the establishment of the city school  district  of
   the  city of Staten Island; to amend the education law, in relation to
   the transfer of the college of Staten Island of the city university of
   New York to the state university of New York; to amend  the  judiciary
   law,  in  relation  to  providing for the judiciary within the city of
   Staten Island; to amend the public housing law, the education law, the
   public authorities  law  and  the  private  housing  finance  law,  in
   relation  to  providing membership on certain authorities for the city
   of Staten Island; to amend the executive law, the elder  law  and  the
   social  services  law,  in  relation  to probation and social services
   within the city of Staten Island; to amend the county law, in relation
   to the treatment of the county of Richmond in similar fashion to coun-
   ties within a city having a population of  one  million  or  more;  to
   amend  the  election  law,  the  state finance law and the surrogate's
   court procedure act, in relation to making conforming changes relating
   to the establishment of the city of Staten Island; to amend the gener-
   al municipal law, in relation to the city of Staten Island  industrial
   development  agency; to amend the local emergency housing rent control
   act, the emergency tenant protection act of nineteen seventy-four, the
   general business law and the real property tax law, in relation to the
   continuation of existing housing regulations for the  city  of  Staten
   Island;  to  amend  the  tax  law,  the  state finance law, the public
   authorities law and the New York state financial emergency act for the
   city of New York, in relation to applicability of the authority of the
   financial control board; to amend the general city law, chapter 772 of
   the laws of 1966 relating to imposition of a city business tax and the
   tax law, in relation to providing authority for  the  city  of  Staten
   Island  to  continue  presently  applicable taxes within such city; to
   enact the administrative  code  of  the  city  of  Staten  Island,  in
   relation  to  procedures and administration of essential city services
   and the authority of such city to impose taxes; and  making  appropri-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD13972-01-4
 S. 8474                             2
 
   ations  to  advance moneys for the establishment of the city of Staten
   Island and the city school district of the city of Staten Island

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
                       THE CITY OF STATEN ISLAND ACT
 
                                 CONTENTS
 
 SECTION(S)     SUBJECT
 
  1-001         Short title.
  1-002         Legislative history, findings and intent and statement of
                  purposes.
  1-003         Definitions.
  1-004         Incorporation.
  2-001         Charter of the city of Staten Island.
  3-001         Legislative findings and declaration of purposes.
  3-002         Elections.
  3-003         Staten Island city government-transition.
  3-004         Employees of the city of Staten Island.
  3-005         Assistance to the city of Staten Island.
  3-006         Provision of municipal services on the city of Staten
                  Island.
  3-007         Debt, property, obligations and other allocations.
  3-008         Continuance of municipal services.
  3-009         Powers of the city of Staten Island to adopt and amend
                  local laws.
  3-010         Powers of the city of Staten Island relating to home
                  rule powers.
  4-001-4-020   City school district of the city of Staten Island.
  5-001-5-003   Transfer of The College of Staten Island.
  6-001         Interim court structure for the city of Staten Island.
  7-001-7-002   New York city housing authority.
  7-003-7-005   New York city construction fund.
  7-006-7-008   New York city municipal water finance authority.
  7-009         New York city housing development corporation.
  7-010         Dormitory authority act; court facilities and combined
                  occupancy structures.
  7-011         New York city school construction authority.
  8-001-8-023   Municipal powers; authority of the county of Richmond
                  and the city of Staten Island.
  9-001-9-017   Municipal services; city of Staten Island.
 10-001-10-008  Landlord-tenant relationships.
 11-001         Constitutional real property tax limitations; city of
                  Staten Island.
 12-001-12-020  Municipal assistance corporation for the city of New York;
                  revenues.
 13-001         Taxes; tax collection authority.
 14-001         Administrative code of the city of Staten Island.
 15-001         Appropriations; transition government and establishment of
                  the city of Staten Island.
 15-002         Appropriation; city school district of the city of Staten
 S. 8474                             3

                  Island.
 16-001         Severability.
 17-001         Effective date.
   Section  1-001.  Short title. This act shall be known and may be cited
 as "The City of Staten Island Act".
   § 1-002. Legislative history, findings and  intent  and  statement  of
 purposes. 1. The legislature hereby finds, determines and declares:
   (a)  that  Article  IX,  section  1 of the New York State Constitution
 states that "effective local self-government and intergovernmental coop-
 eration are purposes of the people of the state" and subdivision (a)  of
 section  2  of  Article IX, further declares that "the legislature shall
 provide for the creation and organization of local government;"
   (b) that consistent with these constitutional provisions and in  order
 to  provide for an effective republican form of government in accordance
 with the constitution of the United States of America, the people of the
 state of New York, represented in the senate  and  assembly,  did  enact
 chapter 773 of the laws of 1989, as amended by chapter 17 of the laws of
 1990,  which  authorized  the borough of Staten Island, upon approval by
 referendum to consider formally separating from its  existing  municipal
 government, authorized the creation of a charter commission for the city
 of  Staten Island, authorized, upon approval of a subsequent referendum,
 the adoption of a charter, and most importantly,  required  that  within
 three  months of adoption of the charter by the voters of Staten Island,
 the charter commission submit  to  the  governor  and  the  legislature,
 proposed  legislation enabling the borough of Staten Island to disengage
 and separate from its existing municipal government, and that only  upon
 enactment  of  such enabling legislation, could the charter for the city
 of Staten Island take effect;
   (c) that the legislature, in requiring  the  subsequent  enactment  of
 enabling  legislation  before  a  charter  for the city of Staten Island
 could take effect, reaffirmed its paramount constitutional authority  to
 distribute  the  powers  of local government, as between city and county
 governments, as it deems best;
   (d) that preserving historical and natural boundaries, as well as  the
 integrity of political subdivisions of the state, and providing meaning-
 ful  representation  of  the  smaller  boroughs  in the city of New York
 affairs, are among those legitimate state interests and  policies  which
 have been validated by the federal courts;
   (e)  that  the  people of the state of New York enacted chapter 773 of
 the laws of 1989, as subsequently amended, to provide a process by which
 the people of Staten Island could carefully study and consider the legal
 disengagement and separation of the borough of Staten  Island  from  the
 city  of New York as an acceptable means of implementing the substantial
 state interest in providing  effective  local  self-government  for  the
 citizens of Staten Island; and
   (f)  that  the  issues  of  legal  disengagement and separation of the
 borough of Staten Island from the city of New  York  raise  concerns  of
 statewide importance, not limited to Staten Island residents or New York
 city residents.
   2. The legislature further finds, determines and declares:
   (a) that the New York State Constitution entitles the people of Staten
 Island to "effective local self-government;"
   (b) that the existing charter of the city of New York does not provide
 meaningful  representation  to  the  borough of Staten Island, therefore
 precluding "effective local self-government;"
 S. 8474                             4
 
   (c) that given the constraints of  the  United  States  Supreme  Court
 articulated  in  BOARD  OF  ESTIMATE OF THE CITY OF NEW YORK V.  BEVERLY
 MORRIS, 489 US 103 (1989), the  only  viable  alternative  to  providing
 "effective  local self-government" is legal disengagement and separation
 from  the  city  of  New York and the creation of the new city of Staten
 Island;
   (d) that such legal separation of Staten Island from the city  of  New
 York  is  economically feasible, with minimal fiscal impact on the state
 of New York;
   (e) that the city of New York should have a meaningful  role  and  the
 opportunity  to provide significant input in the process by which Staten
 Island legally disengages and separates  from  the  city  of  New  York,
 including participation in a transition period, but the city of New York
 should not in the exercise of the aforesaid role, be permitted to unila-
 terally prevent the legal disengagement and separation of Staten Island;
 and
   (f)  that  in  connection  with the process of legal disengagement and
 separation, there is hereby specifically delegated to a group of  repre-
 sentatives  from  both  the  city  of  New York and the proposed city of
 Staten Island the task of evaluating and accounting for  the  allocation
 of  all  assets  and  liabilities, as well as the provision of municipal
 services during the transition period, all of which shall be  determined
 in the context of the overall best interest of the state of New York.
   3. The legislature further finds, determines and declares:
   (a)  that  by virtue of the authority vested in the legislature by the
 New York State Constitution to provide for the "creation  and  organiza-
 tion  of local governments" as well as for "effective local self-govern-
 ment" and "intergovernmental cooperation," the interests of  the  people
 of the state would be served and promoted by the separation and creation
 of a new municipality to be called the city of Staten Island; and
   (b)  that  in furtherance of such purposes, the recommendations of the
 charter commission shall be implemented in connection with the  creation
 of the city of Staten Island.
   4.  The  legislature  further  finds, determines and declares that the
 establishment of the city of Staten Island is authorized by the New York
 State Constitution, constitutes a state purpose for the benefit  of  the
 people  of the state of New York and therefore the city of Staten Island
 Act is hereby enacted.
   § 1-003. Definitions. As used in this act, the following  terms  shall
 have the following meanings:
   1.  "Effective  date of this charter" shall mean the first of November
 next succeeding the date on which this act shall have become a law.
   2. "Date of incorporation of the city of Staten Island"  or  "date  of
 incorporation" shall mean the date on which the city of Staten Island is
 incorporated,  the  first  of  January next succeeding the date on which
 this act shall have become a law.
   3. "Date of establishment of the city of Staten Island"  or  "date  of
 establishment" shall mean the date on which the city of Staten Island is
 first  authorized to exercise full municipal authority, except for judi-
 cial authority, over the citizens and territory of the  city  of  Staten
 Island, the first of July in the second year next succeeding the year in
 which this act shall have become a law.
   4.  "Transition period" shall mean the period of time between the date
 of incorporation and the first of July in the second year next  succeed-
 ing  the year in which this act shall have become a law from and includ-
 ing the date of incorporation until the date of establishment.
 S. 8474                             5
 
   5. "Preceding municipality" shall mean the  city  government  for  the
 geographical  area  of  the  city  of Staten Island existing immediately
 prior to the incorporation of the city of Staten Island and which  shall
 exercise full municipal powers and duties for such area during the tran-
 sition period.
   6. "Judiciary transition period" shall mean the period of time between
 the  date  of  incorporation  of  the city of Staten Island and December
 thirty-first in the fifth year following such incorporation or until the
 provisions of article 5-C of the judiciary law are  specifically  super-
 seded by state law.  At the conclusion of the judiciary transition peri-
 od, the city of Staten Island shall be authorized to exercise full judi-
 cial  authority  over  the  citizens and territory of the city of Staten
 Island.
   § 1-004. Incorporation. The city of Staten Island is  hereby  incorpo-
 rated on the first of January next succeeding the date on which this act
 shall  have  become  a  law.  The  boundaries  of  such city shall be as
 described in section 1-02 of the charter of the city of Staten Island as
 set forth in section 2-001 of this act.  During  the  transition  period
 such  city  shall not have the powers or duties of a municipality except
 those which are provided for pursuant to this act  to  provide  for  the
 transition  of government and the establishment of such city. During the
 transition period, the preceding municipality shall possess and exercise
 full municipal powers and duties for the area  to  become  the  city  of
 Staten  Island  except for those powers and duties as may be provided by
 the provisions of this act.  Powers and duties of  the  city  of  Staten
 Island  not  yet  in effect shall remain with the preceding municipality
 until such time as those powers and duties are transferred to  the  city
 of  Staten  Island  pursuant  to  the  provisions of this act. Except as
 otherwise provided by this act, full powers and duties shall devolve  to
 the  city  of Staten Island on the first of July in the second year next
 succeeding the date on which this act  shall  have  become  a  law.  The
 following  powers,  duties  and functions regarding the judiciary during
 the judicial transition period and other matters as  jointly  determined
 by  the  city of Staten Island and the preceding municipality in accord-
 ance with the provisions as outlined elsewhere  in  this  act,  will  be
 shared by both municipalities. The city of Staten Island shall be estab-
 lished  on the first of July in the second year next succeeding the date
 on which this act shall have become a law, on which  date  the  city  of
 Staten  Island  shall  possess  full  municipal powers and duties as are
 provided under law and the preceding municipality shall cease to possess
 municipal powers and duties regarding the city of Staten Island.
   § 2-001.  Charter of the city of Staten Island.  The city  charter  of
 the city of Staten Island is enacted to read as follows:
                    Charter of the City of Staten Island
 
                             Table of Contents
 Preamble
 Chapter  1 General Provisions
 Chapter  2 Powers of the City
 Chapter  3 Mayor
 Chapter  4 Common Council
 Chapter  5 Comptroller
 Chapter  6 The Budgetary Process: Expense and Capital
 Chapter  7 Planning Department
 Chapter  8 Franchises
 Chapter  9 Contracting
 S. 8474                             6
 
 Chapter 10 Referendum and Amendment
 Chapter 11 Property of the City
 Chapter 12 Personnel Management
 Chapter 13 Equal Employment Practices Commission
 Chapter 14 Collective Bargaining
 Chapter 15 Transitory Provisions
 Chapter 16 Labor Relations
 
                   CHARTER OF THE CITY OF STATEN ISLAND
 
                                 Preamble
   The  People  of  Staten  Island,  exercising  their right to propose a
 government of their choosing through which all people can be effectively
 represented, do hereby adopt this Charter.
   The birth of a city, must, of necessity, take  place  in  an  aura  of
 excitement and great expectations. When it occurs at a time when society
 is  experiencing strong institutional challenges in a climate of skepti-
 cism, it places heavy burdens on those  responsible  for  leadership  to
 sustain  a  commitment  by the people to live and function together as a
 community.
   The provision of a structure of governance at the local  level  is  an
 extraordinary and crucial responsibility. Sophocles wisely observed that
 "the  city  is  the people." The City of Staten Island must place a high
 premium on assuring meaningful participation of  its  citizenry  in  the
 governmental decisions affecting their lives.
   We  must  respect the principles of equality and of the social dignity
 of all of our residents and provide for the complete development of  the
 individual,  promoting  actions  which  favor the advancement of men and
 women in realizing their fullest potential.   We must  embrace  policies
 that  promote and give effectiveness to the rights of every person, with
 particular attention to those who face special challenges,  in  striving
 for a full life.
   We  must  assert a policy of favoring equal opportunity employment for
 all women and men. We must foster a culture that is  peaceful  and  non-
 violent  and  that safeguards the rights of all inhabitants to carry out
 their lawful activities on Staten Island.
   We should give strong supportive  efforts  for  the  conservation  and
 defense  of  the  environment along with the advancement of the cultural
 and natural values that sustain them. We consent to be governed  by  the
 new municipality in the belief that a smaller, localized city government
 may effectively and responsibly balance the needs of the people with the
 cost of providing municipal services.
   The  City  of  Staten Island can serve as a model for the promotion of
 the common welfare, the guarantor of individual liberties and the guard-
 ian of the social, spiritual, economic  and  cultural  concerns  of  its
 inhabitants.
   We  believe this act of self determination to be in the best interests
 of the people of Staten Island and the people of the City  of  New  York
 and  we  hope that together, as sister cities, we can work cooperatively
 in efforts of regional concern and for the betterment of New York State.
                                 Chapter 1
                            General Provisions
   § 1-01. Incorporation.
   The citizens of the State of New York from time to time inhabitants of
 the territory in the County of Richmond, included in the boundaries  set
 forth  in  section  1-02  of this chapter, shall be known as the City of
 S. 8474                             7
 
 Staten Island, and shall be a municipal corporation in perpetuity  under
 the name of "The City of Staten Island."
   § 1-02. Boundaries.
   The  City of Staten Island shall consist of all the territory known as
 Richmond county, which shall contain all that part of the state, bounded
 on the north by the center line of the Kill Van Kull which  center  line
 would extend easterly to the extension of the center line of North River
 and  Upper New York Bay, then on the east by the extension of the afore-
 mentioned center line of Upper New York Bay  running  southerly  through
 the  Narrows  between  Richmond  county  and Kings county and continuing
 through Lower New York Bay to the Atlantic Ocean,  and  bounded  on  the
 south  east  by  the  Atlantic Ocean to the boundary of the state of New
 York and the state of New Jersey at Raritan Bay, and on the west follow-
 ing the center line of the Kill Van Kull and  the  center  line  of  the
 Arthur  Kill which is the boundary between the state of New York and the
 state of New Jersey, including Staten Island, Island of Meadows,  Pralls
 Island,  Hoffman  Island, Swinburne Island, that part of Shooters Island
 within the state of New York, and all other  islands  or  parts  thereof
 situated within the aforedescribed bounds.
                                 Chapter 2
                            Powers of the City
   § 2-01. Powers.
   The  city  shall  have and may exercise all powers necessary for local
 self-government and any additional powers and authority which are now or
 may be hereafter granted to it under the Constitution or  laws  of  this
 State,  as  fully and completely as though such powers were specifically
 enumerated in this Charter and no enumerations of particular  powers  in
 this  Charter  shall  be held to be exclusive but shall be held to be in
 addition to this general grant of powers.
   § 2-02. Purposes.
   All city powers shall  be  used  to  serve  and  advance  the  general
 welfare,  health,  happiness, safety and aspirations of its inhabitants,
 present and future, and to encourage their  full  participation  in  the
 process of governance.
                                 Chapter 3
                                   Mayor
   § 3-01. Executive power.
   The  executive  power  of the city shall be vested in and exercised by
 the mayor as chief executive officer.
   § 3-02. Election; term.
   The mayor shall be elected at the first general election following the
 effective date of this charter and every  fourth  year  thereafter.  The
 mayor shall hold office for a term of four years commencing on the first
 of January after each such election.
   § 3-03. Qualifications.
   The mayor shall be a citizen of the United States, a qualified elector
 of the city, and shall have been a resident of the city for at least one
 year immediately preceding his/her election.
   § 3-04. Deputy mayor.
   The  mayor  shall  appoint  and  at pleasure remove a deputy mayor who
 shall have such powers and duties as may be assigned by  the  mayor  and
 who  shall  act  temporarily  as  mayor in case of the mayor's temporary
 inability, absence or illness as is provided by this charter.
   § 3-05. Removal of the mayor.
   The mayor may be removed from office by the governor upon charges  and
 after  service  upon him or her of a copy of the charges and an opportu-
 S. 8474                             8
 
 nity to be heard in his or her  defense.  Pending  the  preparation  and
 disposition  of charges, the governor may suspend the mayor for a period
 not exceeding thirty days.
   § 3-06. Succession.
   (a)  In  case  of the suspension of the mayor from office, the mayor's
 temporary inability to discharge the powers and duties of the office  of
 mayor  by  reason  of sickness or otherwise, or the mayor's absence from
 the city, the powers and duties of the office  of  mayor  shall  devolve
 upon  the  deputy  mayor  or an acting mayor in case of a vacancy in the
 office of deputy mayor pending a special election to fill the vacancy in
 the office of mayor as provided in  subdivision  (c)  of  this  section.
 While  so  acting  temporarily as mayor the deputy mayor or acting mayor
 shall not exercise any power of appointment to or removal  from  office;
 and  shall  not,  until such suspension, inability or absence shall have
 continued nine days, sign, approve or disapprove any local law or resol-
 ution, unless the period during which the mayor can  act  thereon  would
 expire  during  said  nine days in which case the deputy mayor or acting
 mayor in case of a vacancy in the office of deputy mayor shall have  the
 power to disapprove the same within forty-eight hours before the time to
 act expires.
   (b) In case of a failure of a person elected as mayor to qualify, or a
 vacancy  in the office caused by the mayor's resignation, removal, death
 or permanent inability to discharge the powers and duties of the  office
 of  mayor,  such  powers  shall  devolve upon the deputy mayor or acting
 mayor in case of a vacancy in the  office  of  deputy  mayor  pending  a
 special  election to fill the vacancy for the remainder of the unexpired
 term in the office of mayor as  provided  in  subdivision  (c)  of  this
 section, such special election to take place thirty days after the proc-
 lamation that such vacancy exists.
   (c)  Within seven days of the occurrence of a vacancy in the office of
 mayor, the council shall proclaim the date for the special  election  to
 fill  the  vacancy  required by this subdivision and such election shall
 take place thirty  days  after  said  proclamation.  The  council  shall
 provide  notice  of  such  proclamation  to  the city clerk and board of
 elections and publish notice thereof, and the board of  elections  shall
 mail  notice  of  such election to all registered voters within the city
 and shall conduct such special election thirty days after the  proclama-
 tion.
   (d) A party nomination of a candidate for the special election to fill
 a vacancy in the office of mayor for the remainder of the unexpired term
 shall be made in the manner prescribed by the rules of the party.
   (e)  An  independent  nominating petition for the nomination of candi-
 dates to fill the vacancy must be signed by registered voters  numbering
 five  per  centum  of the total number of votes cast for governor at the
 last gubernatorial election in the  city  of  Staten  Island,  excluding
 blank  and void votes, except that not more than two thousand signatures
 shall be required upon any such petition.
   (f) Any vacancy in the office of mayor that occurs  after  July  tenth
 and on or before September nineteenth in any year shall be filled at the
 general election held in such year.
   (g)  Any  vacancy  that  occurs on or after September twentieth in any
 year and not later than thirty-seven days before the  first  Tuesday  in
 December  shall  be filled at a special election to be held on the first
 Tuesday in December in such year.
 S. 8474                             9
 
   A person elected to fill a vacancy in the office of mayor at a special
 election shall take office immediately upon qualification and  fill  the
 vacancy for the remainder of the unexpired term.
   § 3-07. Appointment and removal of officers and employees.
   (a) The mayor shall appoint the heads of administrations, departments,
 all  commissioners,  and  all  other  officers not elected by the people
 including a city clerk, except as otherwise provided in this charter  or
 by law.
   (b)  The  mayor,  whenever  in his or her judgment the public interest
 shall so require, may remove from  office  any  public  officer  holding
 office  by  appointment  from  a  mayor of the city, except officers for
 whose removal other provision is made by law. No  public  officer  shall
 hold  his  or  her  office  for  any  specific term, except as otherwise
 provided by law.
   § 3-08. General Powers.
   (a) The mayor, subject to this charter, shall exercise all the  powers
 vested in the city, except as otherwise provided by law.
   (b) The mayor shall have the power:
   1.  to  supervise, direct and control, subject to law, the administra-
 tive services and departments of government;
   2. to see that the ordinances of the city and laws  of  the  city  and
 state are properly administered and enforced;
   3. to prepare and submit to the council an annual report of his or her
 work,  which  shall  be made public and which shall include a summary of
 agency service goals, performance measures and actual performance  rela-
 tive to goals for each service delivery program and an appendix of those
 programs  which provide abatements or reductions of taxes for businesses
 in the city;
   4. to prepare and submit a budget message and an  expense  budget  and
 capital  budget annually to the council for its consideration and neces-
 sary action in accordance with this charter and the city code;
   5. to call special sessions of the council;
   6. to approve or to veto acts of the council in the manner  prescribed
 by this charter;
   7.  to  inquire into the conduct of any city department, agency, board
 or commission, except elected officials and their offices; and  to  make
 investigation as to municipal affairs and, for that purpose, may subpoe-
 na  witnesses,  administer  oaths and compel production of books, papers
 and other evidence. Failure to obey such subpoena or to  produce  books,
 papers  or evidence as ordered under this section shall be punishable as
 a misdemeanor;
   8. to create or abolish bureaus, divisions  or  positions  within  the
 executive  office of the mayor or city departments as he or she may deem
 necessary to fulfill mayoral duties;
   9. to delegate to or withdraw from any member of said  office,  speci-
 fied  functions,  powers  and duties, except the mayor's power to act on
 local laws or resolutions of the council or to appoint or  remove  offi-
 cials;
   10.  to  perform  all such duties as may be presented for the mayor in
 this charter, or other law, or by act of the council.
   (c) Notwithstanding any other provision of law, the mayor  shall  have
 the  powers of a finance board under the local finance law and may exer-
 cise such powers without regard to any provision of law prescribing  the
 voting  strength  required  for  a  resolution or action of such finance
 board, provided, however, that whenever the mayor determines that  obli-
 gations should be issued and the amount thereof, the mayor shall certify
 S. 8474                            10
 
 such  determination to the comptroller who shall thereupon determine the
 nature and term of such obligations and shall arrange for  the  issuance
 thereof.
                                  Chapter 4
                              Common Council
   § 4-01. Legislative power.
   The  legislative power of the city shall be vested in and exercised by
 the common council, hereinafter referred to as the  council,  except  as
 otherwise provided by this charter.
   § 4-02. Number, election and terms of office of council members.
   (a)  The  council  shall  consist of fifteen members each elected from
 separate council districts. Eight council members shall be elected  from
 districts  denominated  "A" districts and seven council members shall be
 elected from districts denominated "B" districts.    The  eight  council
 members  who  represent  "A"  districts  shall be elected at the general
 election to be held in the years ending in  seven,  one  and  five.  The
 seven  council  members  who represent "B" districts shall be elected at
 the general election to be held in the years ending in seven,  nine  and
 three.
   (b)  The boundaries and designations of the council districts shall be
 drawn and specified pursuant to section 5 of chapter 773 of the laws  of
 1989  and  shall remain in effect until altered or changed in accordance
 with the provisions of this charter. Council members shall be elected at
 the first general election following the effective date of this charter,
 except as otherwise provided  by  transition  provisions.  The  term  of
 office  of  a council member shall begin on January first following such
 election and shall be for either  a  four-year  or  two-year  period  as
 provided in subdivision (a) of this section or until a successor is duly
 elected and qualified.
   § 4-03. Qualifications.
   Each  council member shall be a citizen of the United States and shall
 have been resident of the city for one year immediately preceding his or
 her election and shall reside in the district from which  elected  while
 serving  as a council member. Removal of residence from the city or from
 the council district following election or during  the  term  of  office
 shall  constitute  immediate  forfeiture  of  office and a vacancy shall
 exist in the district from which the council member was elected.
   § 4-04. Organization.
   The council shall determine the rules of its own  proceedings  at  the
 first stated meeting of the council in each year. The council by majori-
 ty  vote  of  all its members shall elect one member as speaker and such
 other officers as it deems appropriate.
   § 4-05. Vacancy.
   (a) The office of a  council  member  shall  become  vacant  upon  the
 member's death, resignation, removal from office or forfeiture of office
 in  any  manner  authorized  by law. A council member shall forfeit that
 office if the council member violates any express  prohibition  of  this
 charter  or  lacks at any time during the term of office for which he or
 she was elected any qualification for the office prescribed by the char-
 ter or by law.
   (b) Within seven days of the occurrence of a vacancy in  the  council,
 the  mayor  shall  proclaim  the date for a special election to fill the
 vacancy required by this subdivision and such election shall take  place
 thirty  days  after said proclamation. The mayor shall provide notice of
 such proclamation to the city clerk and board of elections  and  publish
 notice  thereof,  and  the  board of elections shall mail notice of such
 S. 8474                            11
 
 election to all registered voters  within  the  district  in  which  the
 vacancy has occurred and shall conduct such special election thirty days
 after the proclamation.
   (c) A party nomination of a candidate for the special election to fill
 a  vacancy  in the council for the remainder of the unexpired term shall
 be made in the manner prescribed by the rules of the party.
   (d) An independent nominating petition for the  nomination  of  candi-
 dates  to  fill  the vacancy must be signed by voters numbering five per
 centum of the total number of votes cast in the district for governor at
 the last gubernatorial election in the city, excluding  blank  and  void
 votes, or as provided by the New York state election law.
   (e)  Any vacancy that occurs in the council after July tenth and on or
 before September nineteenth in any year shall be filled at  the  general
 election held in such year.
   (f)  Any  vacancy  that  occurs on or after September twentieth in any
 year and not later than thirty-seven days before the  first  Tuesday  in
 December  shall  be filled at a special election to be held on the first
 Tuesday in December in such year.
   A person elected to fill  a  vacancy  in  the  council  at  a  special
 election  shall  take office immediately upon qualification and fill the
 vacancy for the remainder of the unexpired term.
   § 4-06. Powers.
   (a) All legislative power shall be vested in a council.
   (b) The council shall have the following additional powers:
   1. to employ or retain its own staff and consultants including a clerk
 of the council;
   2. to conduct investigations in accordance with the provisions of this
 charter;
   3. to designate an acting mayor within seventy-two hours of the occur-
 rence of a vacancy in both the office of mayor and the office of  deputy
 mayor;
   4.  to  approve  appointments  as  provided in this charter, except as
 otherwise mandated by law;
   5. to exercise the power of removal as provided in this charter;
   6. to override the veto of a mayor by a two-thirds  vote  of  all  the
 members;
   7.  to  disapprove  within thirty days any proposed designation by the
 department of city planning of a landmark, landmark site, interior land-
 mark, scenic landmark or historic district, provided  however,  that  in
 the  absence  of  any  such  disapproval  the proposed designation shall
 become effective thirty days after having been referred to  the  council
 by the department of city planning;
   8.  to  call  a  meeting at any time between the council and the mayor
 jointly to discuss legislation or business of the city in  general,  and
 by  a two-thirds vote of all the members to compel the attendance of the
 mayor at a council hearing; and
   9. to exercise other powers conferred by this charter.
   § 4-07. Clerk of the council.
   (a) The council shall appoint a clerk who shall perform such duties as
 may be prescribed by law. The clerk so appointed shall be the  clerk  of
 the  council  and  shall serve at the pleasure of the council. The clerk
 shall attend the  meetings  of  the  council,  keep  a  journal  of  its
 proceedings and discharge such other duties as may be prescribed by this
 charter or other law.
   (b)  The clerk shall keep each local law passed in a book provided for
 that purpose, with proper indices, which book shall be deemed  a  public
 S. 8474                            12
 
 record  of such local laws, and each local law shall be attested by said
 clerk. The clerk shall cause to be published  all  notices,  advertising
 matters  or proceedings as required by the provisions of this charter or
 by  other  law.  It  shall  be  the  duty  of the clerk to keep open for
 inspection at all reasonable  times  the  records  and  minutes  of  the
 proceedings of the council.
   § 4-08. Investigations.
   The council shall have the power to investigate any matters within its
 jurisdiction  relating  to  the  property, affairs, or government of the
 city, or to any other powers of the council, or to the  effectuation  of
 the  purposes  or provisions of this charter or any laws relating to the
 city, and to incur expenses therefor  which  shall  be  a  general  city
 charge  in  the  absence of an appropriation. The council shall have the
 power to require the attendance and examine  and  take  testimony  under
 oath  of  such  persons  as  it  may  deem  necessary and to require the
 production of books, accounts, papers and other evidence relative to the
 inquiry kept by any person which may relate to such investigation or the
 attendance of any person having knowledge of the subject matter  of  the
 investigation.
   § 4-09. Local laws.
   (a) Except as otherwise provided by law, all legislative action by the
 council  shall  be  by local law. Every local law shall contain only one
 subject. The title shall clearly refer to the subject matter.
   (b) The council shall take no final action on any legislation until  a
 minimum  of  three days, exclusive of Sundays, has elapsed from the date
 of its introduction, unless the mayor shall have  certified  as  to  the
 necessity  for its immediate passage and such local law be passed by the
 affirmative vote of two-thirds of  all  the  council  members;  provided
 however  that  general  plans,  development  plans  and  amendments  and
 revisions thereto shall not be so certified.
   (c) Every local law passed by the council shall be  certified  by  the
 clerk  of  the  council and shall be presented to the mayor for approval
 prior to its effective date. The mayor shall sign the legislation within
 ten days if approved, but, if  not,  shall  return  it  to  the  council
 together with a written statement of his or her objections. The council,
 within  thirty  days  may  reconsider any legislation disapproved by the
 mayor and may pass it by a two-thirds vote of all the  members.  If  the
 mayor  fails  to  sign or return legislation to the council with reasons
 for disapproval, it shall become law as of its  effective  date,  thirty
 days after submission to the mayor.
   (d)  No proposed local law or budget modification shall be voted on by
 a council committee or the council unless it is accompanied by a  fiscal
 impact statement containing the following information:
   1.  the  fiscal  year  in which the proposed law or modification would
 first become effective and the first  fiscal  year  in  which  the  full
 fiscal impact of the law or modification is expected to occur;
   2.  an estimate of the fiscal impact of the law or modification on the
 revenues and expenditures of the city during the fiscal  year  in  which
 the  law  or  modification  is  to  first  become  effective, during the
 succeeding fiscal year, and during the first fiscal year  in  which  the
 full fiscal impact of the law or modification is expected to occur; and
   3. a list of sources of information used in its preparation.
   (e)  All  agency heads shall promptly provide to any council committee
 any information that it requests to assist  it  in  preparing  a  fiscal
 impact statement.
   § 4-10. Districting commission.
 S. 8474                            13
 
   (a)  There  shall  be  a  districting  commission  consisting of seven
 members appointed as provided in this section.
   (b)  Each  member  of  the commission shall be a citizen of the United
 States and shall have been a resident of the city  for  one  year  imme-
 diately preceding his or her appointment.
   (c)  The majority leader in the council shall appoint three members of
 the commission.
   (d) The minority leader in the council shall appoint  two  members  of
 the commission.
   (e)  If  only  one  political party has a council delegation, then the
 chairpersons of the county committees of the  political  party  with  no
 council  delegation  which, at the time of the last general election for
 council preceding the time at which such appointments are required to be
 made, had the second and third highest number  of  votes  cast  in  that
 election, shall each appoint one member of the commission.
   (f)  The  mayor  shall appoint two additional members who shall not be
 members of the same political party.
   (g) In the event of a vacancy by death, resignation  or  otherwise,  a
 new  member  enrolled  in the same political party from which his or her
 predecessor was selected shall be appointed in the same  manner  as  the
 member whose departure from the commission created the vacancy and shall
 serve for the balance of the term remaining.
   (h) The members of the commission shall elect one of the seven members
 to serve as the chair of the commission.
   § 4-11. Powers of the districting commission.
   (a)  Following  each  decennial census, the commission shall prepare a
 plan for dividing the city into districts for the  election  of  council
 members.
   (b)  The commission shall submit its plan to the council for its final
 adoption and such plan shall not be subject to  any  mayoral  action  in
 order to become effective.
   § 4-12. Community advisory boards.
   (a)  The  common council is hereby authorized to create, by local law,
 one or more community advisory board districts and corresponding  commu-
 nity  advisory  boards  to  consider the needs of such districts, and to
 cooperate with, consult, assist and advise members of the  common  coun-
 cil,  as well as any public officer, agency, and local administrators of
 such agencies, with respect to any matter relating to the welfare of the
 residents of such districts.
   (b) The number of community advisory boards and the number of  members
 appointed  to  serve  on such board or boards shall be determined by the
 common council as it deems appropriate.
   (c) In addition, the boundary lines of the  community  advisory  board
 districts created hereunder shall be coterminous with the boundary lines
 of  one  or  more council districts so that no council district shall be
 included in more than one community advisory board district.
   (d) Members of the  community  advisory  boards  shall  serve  without
 compensation  and shall serve for not more than two (2) consecutive two-
 year terms so as to maximize the opportunities  for  meaningful  partic-
 ipation  in local government for all city residents, and to preserve the
 spirit and long-standing tradition of excellent  voluntarism  on  Staten
 Island.

                                 Chapter 5
                                Comptroller
   § 5-01. Election; term.
 S. 8474                            14
 
   The  comptroller  shall  be elected by the electors of the city at the
 same time and for the same term  as  this  charter  prescribes  for  the
 mayor.  The  comptroller shall serve for a term of four years commencing
 on the first of January following such election and until a successor is
 elected and qualified.
   § 5-02. Powers and duties.
   (a) The comptroller shall have the following powers and duties:
   1.  to  advise the mayor and the council on the financial condition of
 the city or any phase thereof;
   2. to make recommendations, comments and criticisms in regard  to  the
 operations, fiscal policies and financial transactions of the city as he
 or she may deem advisable;
   3.  to  audit and investigate all matters relating to or affecting the
 finances of the city, including without limitation  the  performance  of
 contracts  and  the  receipt and expenditure of city funds, and for such
 purpose shall have the power to require the attendance and  examine  and
 take  the  testimony  under  oath of such persons as the comptroller may
 deem necessary;
   4. to submit an annual report to the mayor  and  the  council  showing
 revenues, receipts and expenditures, the sources from which the revenues
 and funds are derived and how they have been disbursed;
   5.  to  inspect, revise and prescribe the form of reports and accounts
 of the agencies, trusts, the council and units of government;
   6. to audit all agencies, trusts, the council and units of  government
 whenever  the  comptroller  decides  it  is  necessary or is directed to
 conduct such an audit either by the mayor or by the council.  The  comp-
 troller shall be entitled to obtain access to agency records required by
 law  to  be kept confidential, other than records which are protected by
 the  privileges  for  attorney-client  communications,   attorney   work
 products,  or material prepared for litigation, upon a representation by
 the comptroller that necessary and appropriate steps will  be  taken  to
 protect the confidentiality of such records.
   (b) The comptroller shall establish a regular auditing cycle to ensure
 that  one  or more of the programs or activities of each city agency, or
 one or more aspects of each agency's operations,  is  audited  at  least
 once  every  four  years.  The audits conducted by the comptroller shall
 comply with generally accepted government auditing standards. In accord-
 ance with such standards, and before any draft or final audit  or  audit
 report,  or  portion  thereof, may be made public, the comptroller shall
 send a copy of the draft audit or audit report to the head of the audit-
 ed agency and provide the agency, in writing, with a reasonable deadline
 for its review and response. The comptroller shall include copies of any
 such agency response in any draft or final audit  or  audit  report,  or
 portion thereof, which is made public. The comptroller shall send copies
 of all final audits and audit reports to the mayor and the council.
   (c)  The comptroller shall establish for his or her office and for all
 city agencies a uniform system of  accounting  and  reporting  based  on
 generally accepted accounting principles.
   (d)  The  comptroller shall perform such other functions and duties as
 may be required by other provisions of this charter or by law.
   § 5-03. Qualifications.
   The comptroller shall be a citizen of the United States,  a  qualified
 elector  of  the city, and shall have been a resident of the city for at
 least one year immediately preceding his or her election.
   § 5-04. Deputy comptroller.
 S. 8474                            15
 
   The comptroller shall appoint and at pleasure remove  a  deputy  comp-
 troller who in case of a vacancy in the office or in case of the illness
 or  inability  of  the comptroller to act shall have the same powers and
 perform the same duties as the comptroller. The  qualifications  of  the
 nominee for the position of deputy comptroller shall be submitted to the
 council by the comptroller and the nominee may be requested to appear in
 person before the council to respond to questions concerning those qual-
 ifications.
   § 5-05. Vacancy.
   (a)  Any  vacancy  in  the  office  of  comptroller shall be filled by
 special election in accordance with the provisions of this charter.   In
 the  event  of a vacancy in the office of the comptroller or whenever by
 reason of sickness, absence from the city or suspension from office, the
 comptroller shall be prevented from  attending  to  the  duties  of  the
 office, the deputy comptroller shall act as comptroller.
   (b)  Within seven days of the occurrence of a vacancy in the office of
 comptroller, the mayor shall proclaim the date for the special  election
 required  by  this subdivision and such election shall take place thirty
 days after said proclamation. The mayor shall  provide  notice  of  such
 proclamation to the city clerk and board of elections and publish notice
 thereof,  and  the board of elections shall mail notice of such election
 to all registered voters within the city and shall conduct such  special
 election thirty days after the proclamation.
   (c) A party nomination of a candidate for the special election to fill
 a  vacancy  in  the office of comptroller for the remainder of the unex-
 pired term shall be made in the manner prescribed by the  rules  of  the
 party.
   (d)  An  independent  nominating petition for the nomination of candi-
 dates to fill the vacancy must be signed by registered voters  numbering
 five  per  centum  of the total number of votes cast for governor at the
 last gubernatorial election in the city, excluding blank and void votes,
 except that not more than two thousand signatures shall be required upon
 any such petition.
   (e) Any vacancy in the office of comptroller that  occurs  after  July
 tenth  and on or before September nineteenth in any year shall be filled
 at the general election held in such year.
   (f) Any vacancy that occurs on or after  September  twentieth  in  any
 year  and  not  later than thirty-seven days before the first Tuesday in
 December shall be filled at a special election to be held on  the  first
 Tuesday in December in such year.
   A  person  elected to fill a vacancy in the office of comptroller at a
 special election shall take office immediately  upon  qualification  and
 fill the vacancy for the remainder of the unexpired term.
 
                                  Chapter 6
                          The Budgetary Process:
                            Expense and Capital
   § 6-01. Budgetary responsibilities of the mayor.
   (a) The mayor shall annually prepare and submit to the council prelim-
 inary  and  executive  budgets,  each  of which shall present a complete
 financial plan for the city and its agencies for the ensuing fiscal year
 and the three succeeding fiscal years. Each such budget shall consist of
 three parts: the expense budget, which shall set forth  proposed  appro-
 priations for the operating expenses of the city including debt service,
 and interfund transfers; the capital budget and program, which shall set
 forth  proposed  appropriations  for  capital  projects; and the revenue
 S. 8474                            16
 
 budget, which shall set forth the estimated and anticipated revenues and
 receipts of the city, as well as any other anticipated sources and  uses
 of funds.
   (b)  The  mayor  shall  appoint  the  director of the budget who shall
 assist the mayor in the preparation and the administration of the  budg-
 et.  The  director shall perform all such duties in regard to the budget
 and related matters as the mayor may direct. The director shall have the
 power personally or through representatives, to survey each  agency  for
 the purpose of ascertaining its budgetary requirements. The director may
 require  any  agency,  or  any  officer or employee, to furnish data and
 information and to answer inquiries pertinent to the exercise of any  of
 the director's duties in regard to the budget and related matters.
   § 6-02. Spending pursuant to appropriations.
   (a)  No money, except for grants or gifts from private entities, shall
 be paid from any fund under the management of  the  city,  or  any  fund
 under  the management of any agency or officer of the city, or any other
 entity the majority of the members of whose board are city officials  or
 are  appointed  directly  or  indirectly  by  city  officials, except in
 pursuance of an appropriation by the council  or  other  specific  legal
 authorization provided, however, that:
   1.  if at any time the council shall fail to make an appropriation for
 the payment of debt service on any debts of the city as they  fall  due,
 or  for the payments to the several sinking funds, the officer responsi-
 ble for the collection of taxes shall set apart, from the first revenues
 thereafter received applicable to the general fund of the  city,  a  sum
 sufficient to pay such amounts and shall so apply such sum; and
   2.  money,  the  ownership  and equitable title of which belongs to an
 individual, corporation, organization or government other than the  city
 and  which  is  being  held by any agency or officer of the city pending
 transfer of such money to such individual, corporation, organization  or
 government in accordance with the terms and conditions pursuant to which
 it  was  placed  in the custody of such agency or officer, may be trans-
 ferred to such individual, corporation, organization  or  government  by
 such  agency  or  officer  without an appropriation by law provided such
 transfers are made in accordance with such terms and conditions; and
   3. money or other financial resources may only be transferred from one
 fund to another without specific  statutory  authorization  for  such  a
 transfer  if  that  money  or  those other financial resources are being
 loaned temporarily to such other fund and  an  accurate  accounting  and
 reporting  of the balance of financial resources in each fund and of the
 amount due by each fund to each other fund is made at the  end  of  each
 month; and
   4.  grants or gifts from private entities exempt from the requirements
 of this section, and expenditures of such funds,  shall  be  subject  to
 disclosure,  at  least  annually,  by the responsible agency, officer or
 entity in a form and containing such  information  as  the  mayor  shall
 prescribe for this purpose by rule.
   (b)  The head of each agency of the city, and each entity the majority
 of the  members  of  whose  board  are  city  officials  or  individuals
 appointed  directly or indirectly by city officials, shall, on or before
 the fifteenth of October in each year, submit to the mayor and the coun-
 cil, in such form as the mayor  shall  prescribe,  a  statement  of  the
 sources, amounts and disposition of all money received by such agency or
 entity,  or  by  a  unit  or officer of such agency during the preceding
 fiscal year, other than money appropriated for the use of such agency or
 entity by the council, or money paid by such agency or entity  into  the
 S. 8474                            17
 
 city  treasury  and reported in the annual report of the comptroller for
 such fiscal year. The mayor shall ensure that copies of such  statements
 are  available for public inspection, and shall designate a city officer
 to maintain copies of such statements for such purpose.
   § 6-03. Fiscal year.
   The  fiscal year of the city shall commence on July first in each year
 and shall terminate at midnight on the ensuing June thirtieth.
   § 6-04. Budgetary process and timeline.
   Except where noted otherwise, each step should be taken not later than
 the dates indicated below.
   (a) Ten-year capital strategy.
   1. Draft: November first in each even-numbered year.
   2. Report and hearing on the first draft: January  sixteenth  in  each
 odd numbered year.
   3. Mayor's issuance: April twenty-sixth in each odd numbered year.
   4.  Comparison of adopted budget and ten-year capital strategy: thirty
 days after the budget is adopted in each year.
   (b) Revenue estimation report of the comptroller and mayor.
   1. The comptroller shall certify to the mayor the actual revenues  for
 the previous fiscal year: October thirty-first.
   2.  The  mayor  shall  report  comparing  actual revenues to estimated
 revenues in the budget as adopted for the previous fiscal year: November
 fifteenth.
   (c) Departmental estimates and the mayor's preliminary  budget  public
 hearings: such date as the mayor may direct.
   (d) Report of the comptroller on capital debt and obligations:  Decem-
 ber first.
   (e)  Report  of the comptroller on the state of the city's finances to
 the council: December fifteenth.
   (f) Preliminary certificate of the mayor on  capital  debt  and  obli-
 gations  to  the council and comptroller: January sixteenth. At any time
 up to the submission of the executive capital budget to the council, the
 mayor may amend such preliminary certificate.
   (g) Preliminary budget submitted to the council: January sixteenth.
   (h) Finance commissioner's estimate of assessed valuation, and  state-
 ment  of  taxes  due and uncollected submitted to the mayor and council:
 February fifteenth.
   (i) Comptroller's statement of debt service: March first.
   (j) The council's operating budget. March  tenth:  the  council  shall
 approve and submit to the mayor estimates of its financial needs for the
 ensuing fiscal year.
   (k) Council committees' preliminary budget hearings on:
   1.  program  objectives and fiscal implications of preliminary budget,
 draft ten year capital strategy, city planning director's report on  the
 draft strategy, and the status of capital projects and expense appropri-
 ations previously authorized; and
   2. recommendations for any changes in the unit of appropriation struc-
 ture,  or any change in the memorandum of understanding of the terms and
 conditions regarding such units of appropriations; and
   3. the council's findings and the net effect  of  the  changes  recom-
 mended  on  the  preliminary capital budget shall not exceed the maximum
 amount set forth in the preliminary certificate: March twenty-fifth.
   (l) Executive budget, the four-year financial plan and budget  message
 with  any  accompanying reports and schedules submission for the ensuing
 fiscal year: April twenty-sixth.
 S. 8474                            18
 
   (m) Proposed local laws and home rule requests necessary to  implement
 the  recommendations  made  in the executive budget: as soon after April
 twenty-sixth as is practicable.
   (n)  Executive budget hearings: the council shall hold public hearings
 on the budget as presented by the mayor between May  sixth  and  twenty-
 fifth.
   (o) Amendment and adoption of the executive budget: by June fifth.
   1.  The  council may alter the contents of the budget within the total
 revenues estimated by the mayor and the maximum debt for capital, except
 for the amounts set aside for the repayment of debt.
   2. The budget when adopted by the council shall become effective imme-
 diately, except appropriations for the council or  appropriations  added
 to  the  mayor's executive budget by the council or any changes in terms
 and conditions or in the  memorandum  of  understanding  regarding  such
 terms and conditions shall be subject to the mayor's veto.
   3. If an expense budget has not been adopted by the fifth of June, the
 expense  budget  and tax rate adopted as modified for the current fiscal
 year shall be deemed to have been extended for the new fiscal year until
 such time as a new expense budget has been adopted.
   4. If a capital budget and a capital program have not been adopted  by
 the  fifth of June the unutilized portion of all prior capital appropri-
 ations shall be deemed reappropriated.
   (p) Veto of the mayor.
   1. The mayor, not later than the fifth day after the council has acted
 upon the budget or capital program submitted with the executive  budget,
 may disapprove:
   (i) any increase or addition to any such bill or program;
   (ii) any change in any term or condition of the budget;
   (iii)  any change in a memorandum of understanding regarding the terms
 and conditions; or
   (iv) any item, term, condition, or provision of a memorandum  included
 in  the budget.   The mayor's objections shall be returned in writing to
 the council by such date.
   2. The council by a two-thirds vote of all the  members  may  override
 any  disapproval  of  the mayor; however, if no action by the council is
 taken within ten days of such disapproval, the expense budget  shall  be
 deemed adopted as modified by the mayor's disapprovals.
   (q) Statement of the amount of the budget and estimate by the mayor.
   1.  The  mayor  shall  submit  to  the  council,  immediately upon the
 adoption of a budget, a  statement  of  the  amount  of  the  budget  as
 approved  by the council for the ensuing fiscal year and the mayor shall
 prepare and submit to the council not later than the fifth  of  June  an
 estimate of the probable amount of:
   (i)  receipts  into  the  city treasury during the ensuing fiscal year
 from all the sources of revenue of the general fund; and
   (ii) all receipts other than those of the general fund  and  taxes  on
 real  property.  The mayor may include in the statement of the amount of
 the budget as approved by the council a confirmation of such amount, and
 thereby waive mayoral veto power.
   2. If, as a result of the exercise of the mayor's veto, the amount  of
 the  budget  for  the ensuing fiscal year differs from the amount of the
 budget approved by the council, not later than two days after the budget
 is finally adopted the mayor shall prepare and submit to the  council  a
 statement  setting forth the amount of the budget for the ensuing fiscal
 year, and the council shall, if necessary, fix new annual tax rates.
 S. 8474                            19
 
   3. The mayor, prior to establishing the final estimate of revenues for
 the ensuing fiscal year as required by this section, shall consider  any
 alternative estimate of revenues and which is accompanied by a statement
 of  the  methodologies and assumptions upon which such estimate is based
 in  such detail as is necessary to facilitate official and public under-
 standing of such estimates.
   4. Any person or organization may, prior to May fifteenth,  submit  to
 the mayor an official alternative estimate of revenues for consideration
 by the mayor. Such estimate shall be in a form prescribed by the mayor.
   (r) Fixing of tax rates.
   1.  The  council  shall  fix the annual tax rates immediately upon the
 approval of the budget. The council shall deduct  the  total  amount  of
 receipts  as  estimated  by the mayor from the amount of the budget, for
 the ensuing fiscal year, and shall cause to be raised  by  tax  on  real
 property  such  sum as shall be as nearly as possible but not less than,
 the balance so arrived at, by fixing tax rates in cents and  thousandths
 of a cent upon each dollar of assessed valuation. The tax rates shall be
 such  as to produce a balanced budget within generally accepted account-
 ing principles for municipalities.
   2. If a budget has not been adopted by the  fifth  of  June,  the  tax
 rates  adopted  for the current fiscal year shall be deemed to have been
 extended for the new fiscal year until such time  as  a  new  budget  is
 adopted.
   3. In the event the mayor exercises the veto power, the council shall,
 if necessary, fix new annual rates not later than the date the budget is
 finally adopted, in accordance with the requirements of paragraph one of
 subdivision (s) of this section.
   (s) Completing the assessment rolls and fixing of tax rates.
   Notwithstanding  the provisions of the above subdivisions or any other
 provisions of law to the contrary:
   1. if the city council has not fixed the tax  rates  for  the  ensuing
 fiscal  year on or before the fifth of June, the commissioner of finance
 shall be authorized to complete the  assessment  rolls  using  estimated
 rates  and  to  collect the sums therein mentioned according to law. The
 estimated rates shall equal the tax rates for the current fiscal year;
   2. if, subsequent to the fifth of June, the council shall, fix the tax
 rates for the ensuing fiscal year  at  percentages  differing  from  the
 estimated  rates, real estate tax payments shall nevertheless be payable
 in accordance with paragraph one of this subdivision  at  the  estimated
 rates.  However,  in  such  event, prior to the first of January in such
 fiscal year, the commissioner  of  finance  shall  cause  the  completed
 assessment  rolls  to  be  revised to reflect the tax rates fixed by the
 council, and an amended bill for the  installment  or  installments  for
 such  fiscal year due and payable on or after the first of January shall
 be submitted to each  taxpayer  in  which  whatever  adjustment  may  be
 required  as  a result of the estimated bill previously submitted to the
 taxpayer shall be reflected.
   (t) Appropriation, certification and publication.
   Not later than the day after the budget is finally adopted the  budget
 and  the several amounts therein specified as appropriations or units of
 appropriation shall be and become appropriated to the  several  purposes
 therein named. The budget shall thereupon be filed in the offices of the
 comptroller and the city clerk, and shall be published forthwith.
   (u) Council completion of assessment rolls.
   At  such annual meeting to adopt the budget the council shall cause to
 be set down in the assessment rolls, opposite to the  several  sums  set
 S. 8474                            20
 
 down  as the valuation of real property, the respective sums, in dollars
 and cents, to be paid as tax thereon, rejecting the fractions of a cent.
 It shall also cause to be added and set down the aggregate valuations of
 the real property, and shall transmit to the comptroller of the state by
 mail a certificate of such aggregate valuation.
   (v) Collection of real property tax.
   1.  Immediately  upon the completion of the assessment rolls, the city
 clerk shall produce the proper warrants authorizing  and  requiring  the
 commissioner  to collect the several sums therein mentioned according to
 law. Such warrants need be signed only by the speaker of the council and
 countersigned by the city clerk.    Immediately  thereafter  and  on  or
 before  the  thirtieth  of  June,  the  assessment  rolls of the city as
 corrected according to law and finally completed, or a fair copy  there-
 of, shall be delivered by the speaker to the commissioner with the prop-
 er  warrants, so signed and counter signed, annexed thereto. At the same
 time the speaker shall notify the comptroller of the amount of taxes  in
 each book of the assessment rolls so delivered.
   2.  The  commissioner upon receiving the assessment rolls and warrants
 shall immediately cause the assessment rolls and warrants  to  be  filed
 with the city clerk.
   (w) Mayor's financial plan update: thirty days after budget adopted.
   §  6-05.  Format of expense budget departmental estimates, preliminary
 expense budget, and executive expense budget.
   (a) The expense budget departmental estimates, the preliminary expense
 budget, and the executive expense budget for each year shall consist  of
 proposed  units of appropriation for personal service and proposed units
 of appropriation for other than personal service for the ensuing  fiscal
 year.
   (b)  Each  agency head, for the departmental estimates, and the mayor,
 for the executive budget, shall submit:
   1. a statement of the impact of the proposed units of appropriation on
 the level of services to be provided during the ensuing fiscal year; and
   2. for each community within the city as identified in  the  council's
 hearings  on  local and neighborhood budget needs, a written response to
 each of the expense budget priorities included in the committee's recom-
 mendations of budget priorities submitted in accordance with  provisions
 of  this  charter, including the disposition of each such priority and a
 meaningful explanation of any disapprovals contained in  such  estimates
 or budget.
   (c)  Each  proposed  unit  of appropriation shall represent the amount
 requested for personal service or for other than personal service for  a
 particular  program,  purpose, or activity within an agency, department,
 organization or institution; provided, however, that a  single  unit  of
 appropriation for personal service or a single unit of appropriation for
 other  than personal service may represent the amount requested for more
 than one particular program, purpose, or activity for an agency, depart-
 ment, organization or institution if the council  has  adopted,  on  the
 recommendation  of  the  mayor, or if the council has adopted on its own
 initiative and the mayor has approved, a resolution  setting  forth  the
 names,  and a statement of the programmatic objectives, of each program,
 purpose, or activity for an agency, department, organization, or  insti-
 tution  to be included in such a single unit of appropriation. Copies of
 such resolutions must be included as  an  appendix  to  any  preliminary
 budget,  executive  budget, and adopted budget to which they apply.  If,
 in accordance with such a resolution, a proposed unit  of  appropriation
 for  other  than  personal  service  shall  represent  the  total amount
 S. 8474                            21
 
 requested for other than personal service for  more  than  one  proposed
 unit  of  appropriation for personal service, the amount of such unit of
 appropriation for other than personal service which is allocable to each
 unit of appropriation for personal service shall be set forth for infor-
 mational  purposes  at  the  end  of each such unit of appropriation for
 personal service. If, in accordance with such a resolution,  a  proposed
 unit  of  appropriation  for  personal service shall represent the total
 amount requested for personal service for more than one proposed unit of
 appropriation for other than personal service, the amount of  such  unit
 of appropriation for personal service which is allocable to each unit of
 appropriation  for  other  than  personal service shall be set forth for
 informational purposes at the end of each such unit of appropriation for
 other than personal service.
   (d) Each proposed unit of appropriation contained in the  departmental
 estimates,  the  preliminary  expense  budget  and the executive expense
 budget shall be accompanied by a statement of  the  programmatic  objec-
 tives  of  the  program,  purpose,  activity for the agency, department,
 organization or institution involved.
   (e) Each proposed unit of appropriation contained in the  departmental
 estimates  and  the  executive  budget  shall be supported by line items
 showing how the total amount of such unit is determined.
   (f) The departmental estimates shall be in such form and contain  such
 further  information  as  may  be  required by the mayor or by law. Such
 departmental estimates shall be public records and which  shall  at  all
 reasonable times be open to public inspection.
   (g)  For  each  city  agency  that  has local service districts within
 communities as defined by local law, where practicable, shall contain  a
 statement  of  proposed  direct expenditures in meaningful categories of
 information, in each such service district.
   § 6-06. Preliminary expense budget.
   The preliminary expense budget shall contain proposed expenditures and
 a forecast of revenues for the ensuing fiscal year, including, for  each
 tax  revenue  source  which represents five percent or more of the total
 forecast of tax revenues, a detailed statement of  the  methodology  and
 assumptions  used  to determine the forecast of revenues estimated to be
 received from such source in sufficient detail  to  facilitate  official
 and public understanding of the manner in which such forecasts are made,
 shall indicate proposed units of appropriations for personal service and
 for other than personal service, shall include a financial plan covering
 estimates of expenditures and revenues for the four ensuing fiscal years
 in  such  years,  shall  include  the  departmental  estimates of agency
 expenditures for the ensuing fiscal year together with proposed  sources
 of  revenue  for  each unit of appropriation specified therein and shall
 present a plan to ensure balance between the expense and revenue budgets
 during the ensuing fiscal year.
   § 6-07. Contents of the executive expense budget.
   (a) There shall be included in the budget:
   1. Units of appropriation, prepared according to this chapter, in such
 amounts and upon such terms and conditions as may be determined  by  the
 mayor. Such appropriations shall include:
   (i)  the  amounts  required  by  law to be appropriated to the several
 sinking funds as certified by the comptroller;
   (ii) the amount required to pay the interest  and  principal  of  city
 obligations as certified by the comptroller;
   (iii) an amount, as certified by the comptroller, equal to the average
 of  all  expenditures during each of the five preceding fiscal years for
 S. 8474                            22
 
 the payment of the expense of the removal of snow and ice, exclusive  of
 salaries  and wages of regular employees of the city except for overtime
 work and for work on Sundays and holidays, and exclusive of the purchase
 of equipment;
   (iv) the several amounts which are payable from sources other than the
 real  estate tax levy, provided however that amounts appropriated pursu-
 ant to chapter nine of this charter which are allocable to a  particular
 program,  purpose, activity or institution, shall be included for infor-
 mational purposes only;
   (v) such other amounts as may be required by law;
   (vi) such amounts as shall be determined in  the  manner  provided  in
 this chapter to be necessary to pay the expenses of conducting the busi-
 ness of the city for the ensuing fiscal year and for other lawful public
 purposes; and
   (vii) a reserve for unanticipated contingencies.
   2. An identification of the proposed appropriations, being proposed by
 agency  and  project  type and, within project type, by personal service
 and other than personal  service,  for  the  maintenance  of  all  major
 portions of the capital plant, as such terms are defined in section 6-16
 of this chapter.
   3. The terms and conditions under which appropriations shall be admin-
 istered.
   (b)  All  such  units  of appropriation and other amounts shall be set
 forth without deduction of revenues from any source except as  otherwise
 provided by law.
   (c)  The budget message, which shall not be deemed a part of the budg-
 et, shall include:
   1. an explanation;
   2. itemized information and supporting schedules;
   3. recommendations for any changes in revenue sources and fiscal oper-
 ations;
   4. an itemized statement of  the  actual  revenues  and  receipts  and
 accruals of the general fund and of all other revenue sources;
   5.  a  listing  of  the  sources and amounts of all revenues and other
 monies of a nonrecurring nature;
   6. a four-year financial plan, containing:
   (i) for each agency, for all existing programs, forecasts of  expendi-
 tures  for the ensuing fiscal year and the succeeding three fiscal years
 at existing levels of service;
   (ii) forecasts of revenue by source from existing sources  of  revenue
 for the ensuing fiscal year and the succeeding three fiscal years; and
   (iii)  for  each  new  or expanded program, an indication of when such
 program is projected to be fully implemented and a forecast of the annu-
 al recurring costs for such program or program  expansion  after  it  is
 fully implemented;
   7.  for  each  agency, a comparison of the proposed appropriations for
 the ensuing fiscal year;
   8. an explanation of principal changes in performance goals and  indi-
 cators;
   9.  an  itemized  statement, covering the city's entire capital plant,
 except for those portions of the capital plant which have been committed
 to the care and control of the board of education;
   10. a presentation of the maintenance activities proposed by the mayor
 to be completed during the ensuing fiscal year;
   11. a statement of any substantive  changes  in  the  methodology  and
 assumptions used to determine the revenue estimates;
 S. 8474                            23
 
   12. a statement of the implications for the orderly development of the
 city; and
   13.  a  certificate  setting  forth  the  maximum  amount  of debt and
 reserves.
   § 6-08. Adoption of expense budget and memorandum of understanding.
   Adoption of expense budget with regard to a memorandum of  understand-
 ing contained in the terms and conditions.
   (a)  The council may increase, decrease, add or omit any amount in the
 expense budget as submitted by the mayor, or change any terms and condi-
 tions of the amount in that category, as stipulated in this chapter; the
 mayor may disapprove any increase or addition  to  the  amounts  in  the
 categories,  or  any  change in any term and condition of the budget, as
 stipulated in this chapter, the mayor's disapproval may be overridden by
 a two-thirds vote of all of the members of the council. As part of these
 procedures the final adopted budget shall  have  within  its  terms  and
 conditions  a  memorandum  of understanding, the final format and/or the
 actual character of which shall be determined jointly by the actions  of
 the  council  and  mayor  consistent  with the provisions for adopting a
 local law. Such memorandum of understanding may include  the  provisions
 by  which  the  executive may have to schedule the timing and amounts of
 expenditure or delay of expenditure and in what ways those  expenditures
 may  be  scheduled  or  delayed  and  if  agreed  to  through the normal
 provisions of adopting the budget, the priority of re-scheduling and  or
 delaying those appropriated expenditures or any part thereof those units
 of  appropriations. These details of the memorandum of understanding are
 not to preclude or substitute for normal budget modification  procedures
 as  detailed  below;  they are intended to deal with those circumstances
 not covered by budget modification and/or normal impoundment  procedures
 as detailed below.
   (b)  All  spending  for services shall be in accordance with the terms
 and conditions of the expense budget as adopted; provided, however, that
 during any fiscal year  the  mayor  shall  notify  the  council  of  any
 proposed  modification of such a term or condition, at least thirty days
 before the intended effective date of the modification in  the  term  or
 condition.  These provisions are not to affect, hinder or substitute for
 the normal procedures regarding budget modification  or  impoundment  as
 stipulated elsewhere in this chapter.
   § 6-09. Appropriations for goods, services or construction.
   Appropriations  for the procurement of goods, services or construction
 or the provision of services, utilities, or facilities by  a  department
 responsible  for general services for other agencies and institutions in
 accordance with the authority of a department  responsible  for  general
 services under the provisions of this charter shall be made to a depart-
 ment  responsible for general services but shall be segregated under the
 name of the agency or institution for which they are intended and  shall
 be  considered  and  accounted  for  as  appropriated for such agency or
 institution. Nothing herein contained shall prevent the  designation  of
 part  of  such appropriations as a general stores account or under other
 appropriate designation to enable a department responsible  for  general
 services  to  maintain  a  stock  in  anticipation of requirements or to
 provide services, utilities or facilities for joint use by more than one
 agency or institution.
   § 6-10. Expense budget administration.
   (a) Except as otherwise provided by  law,  no  unit  of  appropriation
 shall  be  available  for expenditure by any city agency until schedules
 fixing positions and salaries and setting forth  other  expenses  within
 S. 8474                            24
 
 the units of appropriation are established pursuant to the adopted budg-
 et,  the  administration  of  which is subject to the provisions of this
 chapter, the state civil service law, and other applicable law.
   (b) The mayor shall establish and may modify for each agency:
   1. quarterly spending allotments for each unit of appropriation and
   2.  aggregate  position  and  salary limits for each unit of appropri-
 ation, which shall be made available for  public  review  upon  adequate
 notice.  No  agency  shall  expend  any  sum in excess of such quarterly
 spending allotments, or exceed aggregate position and salary limits. The
 mayor may set aside specified sums as necessary reserves which shall not
 be included in the quarterly spending allotments until released  by  the
 mayor. Each agency shall administer all monies appropriated or available
 for  programs  and  purposes  of the agency in accordance with quarterly
 allotment plans proposed by the agency and approved or modified  by  the
 mayor.  Each such plan shall set forth by units of appropriation for the
 quarter of the fiscal year during which it is to remain in effect:
   (i) rates  of  expenditures  for  personal  services  and  other  than
 personal services;
   (ii)  ceilings on the total number of uniformed, civilian and pedagog-
 ical employees; and
   (iii) the total amount of funds to be spent or committed by the agency
 during such quarter.
   (c) The mayor shall keep informed during the  course  of  each  fiscal
 year,  of  the progress of expenditures and the receipt of revenues, and
 it shall be the duty of all agencies, when requested by  the  mayor,  to
 supply all information needed for this purpose.
   (d)  The mayor may assume direct responsibility for the administration
 of the schedule required to be filed by  the  agency  head  pursuant  to
 subdivision  (a) of this section when in the mayor's judgment the fiscal
 condition of the city so requires or when an agency:
   1. is expending funds in excess of the quarterly spending allotments;
   2. is otherwise not complying with spending  allotments  or  aggregate
 position and salary limits; or
   3.  is  not  maintaining adequate accounts pursuant to requirements of
 this charter.
   (e) Whenever the mayor determines, pursuant to the provisions of  this
 charter  or  other relevant statutes, that the full amount of any appro-
 priation should not be available for expenditure during the fiscal year,
 the mayor shall notify the council of such determination and the  impli-
 cations  and  consequences  of those impoundments for service levels and
 programmatic goals affected. The mayor shall respond  in  writing  to  a
 request by the council for an explanation of why an appropriation should
 not be expended.
   (f)  The  head  of  each agency shall establish the procedure by which
 charges and liabilities may be incurred on behalf of the agency.    Such
 procedures  shall ensure that no officer or employee, on behalf of or in
 the name of the agency, shall incur a liability or an  expense  for  any
 purpose  in  excess  of  the amount appropriated or otherwise authorized
 therefor, and no charge, claim or liability shall exist or arise against
 the city for any sum in excess of the amount appropriated  or  otherwise
 authorized for the particular purpose.
   § 6-11. Budget modification.
   (a)  Subject  to the quarterly spending allotments and aggregate posi-
 tion and salary limits established pursuant to applicable provisions  of
 this  charter,  of the state civil service law and of other law, changes
 in schedules, within units of appropriation, may be made by the head  of
 S. 8474                            25
 
 each  agency.  Any  such  changes shall be reported to the mayor and the
 comptroller not more than ten days after the effective date thereof, and
 shall be made available for public review upon adequate notice.
   (b)  The  mayor during any fiscal year may transfer part or all of any
 unit of appropriation to another unit of appropriation, except that when
 any such transfer:
   1. shall be from one agency to another; or
   2. shall result in any unit of appropriation having been increased  or
 decreased by more than five per centum or fifty thousand dollars, which-
 ever  is  greater, from the budget as adopted for such unit of appropri-
 ation, the mayor shall notify the council of the proposed action. Within
 thirty days after the first stated meeting of the council following  the
 receipt  of such notice, the council may disapprove the proposed action.
 Written notice of any transfer pursuant to  this  subdivision  shall  be
 given  to  the  comptroller  and  shall be published as soon as possible
 after such transfer.
   (c) The provisions of this section shall not be  deemed  to  authorize
 any transfer from appropriations required by law.
   (d) The council may during any fiscal year transfer part or all of any
 unit  of  appropriation  within  the  council appropriation to any other
 council unit of appropriation for any of its programs or projects or for
 any other purpose, solely by adoption of a council resolution. Each such
 transfer shall be published and written notice thereof shall be given to
 the mayor and to the comptroller not  less  than  ten  days  before  the
 effective date thereof.
   (e)  The  procedures and required approvals pursuant to the amendment,
 adoption of the budget, veto of the  mayor  and  appropriation,  certif-
 ication and publication of the budget, without regard to the dates spec-
 ified therein, shall be followed in the case of:
   1. any proposed amendment to the budget respecting the creation of new
 units of appropriation,
   2. the appropriation of new revenues from any source except for reven-
 ues from federal, state or private sources in regard to the use of which
 the  city has no discretion provided, however, that the mayor shall give
 notice to the council of the receipt and  proposed  utilization  of  any
 such revenues, or
   3.  the  proposed  use  by the city of previously unappropriated funds
 received from any source. Any request by the mayor respecting an  amend-
 ment  to  the  budget  that  involves an increase in the budget shall be
 accompanied by a statement of the source of current  revenues  or  other
 identifiable  and  currently available funds required for the payment of
 such additional amounts.
   § 6-12. Quarterly account of council budget.
   The council shall be required to publish quarterly accounting  of  its
 actual  and  planned  expenditures, in sufficient detail to indicate the
 positions and their purposes which have been  funded,  as  well  as  the
 activities and categories of materials and supplies purchased.
   § 6-13. General fund.
   All  revenues of the city, of every administration, department, board,
 office and commission thereof, and of every other division of government
 within the city, from whatsoever source except taxes on real estate, not
 required by law to be paid into any other fund or account shall be  paid
 into a fund to be termed the "general fund."
   § 6-14. Expenditure reports.
   Any public or private agency, authority, corporation, board or commis-
 sion  which  receives  city  funds  and  is not otherwise subject to the
 S. 8474                            26
 
 requirements of section 6-10 of  this  chapter  shall  submit  quarterly
 reports  of  the expenditure of such funds to the mayor in such form and
 detail as the mayor may prescribe.
   § 6-15. Self-dealing among members of the governing boards of charita-
 ble institutions.
   (a)  Any  charitable  institution  which receives any payment from the
 city of Staten Island charitable  institutions  budget  shall  pass  and
 implement by-laws which will:
   1. require disclosure to the agency responsible for the administration
 of  charitable  institutions  budget  and approval by such agency of the
 material terms of any  contract  or  transaction,  direct  or  indirect,
 between  an institution and any member of its governing board, any part-
 nership of which he or she is a member or any corporation in which he or
 she holds ten per centum or more of the outstanding common stock;
   2. preclude any member of the governing board of any institution  from
 sharing,  participating  or  benefiting,  directly or indirectly, in the
 proceeds from any contract  or  transaction  entered  into  between  the
 institution and any third party unless such participation or benefit has
 been  approved  in  advance by the agency and the governing board of the
 institution has  approved  the  transaction  by  a  two-thirds  majority
 excluding the vote of member to be benefitted;
   3.  require each member of its governing board to submit to the agency
 each year a disclosure statement  including  such  member's  name,  home
 address,  principal  occupation  and  business interests from which such
 member or such member's spouse received income equal to or greater  than
 ten percent of their aggregate gross income during the previous year.
   (b) At the discretion of the agency, any payment or any portion of any
 payment  may  be  withheld from any institution which has failed to pass
 and implement such by-laws.
   § 6-16. Definitions of capital projects and budget terms.
   As used in this charter:
   (a) The term "capital project" shall mean:
   1. a project which  provides  for  the  construction,  reconstruction,
 acquisition  or installation of a physical public betterment or improve-
 ment which would be  classified  as  a  capital  asset  under  generally
 accepted  accounting  principles  for  municipalities or any preliminary
 studies and surveys relative thereto or any underwriting or other  costs
 incurred in connection with the financing thereof;
   2.  the  acquisition of property of a permanent nature including wharf
 property;
   3. the acquisition of any furnishings, machinery, apparatus or  equip-
 ment  for  any  public betterment or improvement when such betterment or
 improvement is first constructed or acquired;
   4. any public betterment involving either a  physical  improvement  or
 the  acquisition  of real property for a physical improvement consisting
 in, including or affecting:
   (i) streets and parks;
   (ii) bridges and tunnels;
   (iii) receiving basins,  inlets  and  sewers,  including  intercepting
 sewers,  plants  or structures for the treatment, disposal or filtration
 of sewage, including grit chambers,  sewer  tunnels  and  all  necessary
 accessories thereof;
   (iv) the fencing of vacant lots and the filling of sunken lots;
   (v) any other project allowed to be financed by the local finance law,
 with the approval of the mayor and the comptroller; or
   (vi) any combination of the above.
 S. 8474                            27
 
   (b) The term "pending" shall mean not yet completed.
   (c)  The  term  "standards"  for  each category of capital projects to
 which they apply shall include: maximum gross  and  net  areas  allowed;
 types  of  programs  which  may be operated in the facility; performance
 requirements  for  environmental  systems;   allowable   materials   and
 finishes;  maximum areas allowed for different functions and activities;
 approximate cost limits per square foot of construction; and such  other
 items designated by the mayor or by resolution of the council.
   (d)  The  term "scope of project" or "proposed scope of project" shall
 mean a description of a capital project included in the  capital  budget
 that  contains  specific guidelines for the design and implementation of
 such project consistent with the standards for the appropriate  category
 of capital projects and includes each of the following items of informa-
 tion which are relevant to the capital project involved:
   1. purposes and public to be served;
   2. programs to be conducted in the facility;
   3.  gross and net amounts of space and bulk for any building or struc-
 ture and for areas for different functions and activities;
   4. identification of  required  architectural,  engineering  or  other
 consultants and estimated fees for such consultants;
   5. estimated completion dates for scope, design and construction;
   6.  total  estimated  project costs, including costs for site acquisi-
 tion, preparation and tenant relocation, design, construction and equip-
 ment;
   7. estimated expenditures for the project for each fiscal  year  until
 its completion;
   8. estimated annual costs to operate programs within the facility when
 fully staffed and to maintain the facility; and
   9.  such  other  information  as  shall be required by the mayor or by
 resolution of the council.
   (e) The term "cost" shall include the contract liabilities and expend-
 iture incurred for work in carrying out  the  physical  improvement  and
 interest  thereon,  and  the compensation to be made to the owner of any
 real property acquired for the improvement as determined by a  court  or
 by agreement, and interest thereon.
   (f)  The  term "expenses" shall mean any expenses incurred in relation
 to an assessable improvement exclusive of cost and of  damages  assessed
 by the board of assessors.
   (g)  The term "street," as used in this chapter, shall include street,
 avenue, road,  alley,  lane,  highway,  boulevard,  concourse,  parkway,
 driveway,  culvert,  sidewalk,  crosswalk,  boardwalk,  and viaduct, and
 every class of public road, square and place, except marginal streets.
   (h) The term "real property" shall include all lands and improvements,
 lands under water, waterfront property, the water of any lake,  pond  or
 stream,  all  easements  and hereditament, corporeal or incorporeal, and
 every estate, interest and right, legal or equitable, in lands or water,
 and right, interest, privilege, easement and franchise relating  to  the
 same,  including  terms for years and liens by way of judgment, mortgage
 or otherwise.
   (i) The terms "maintenance" or "maintain" shall  denote  those  activ-
 ities  necessary  to  keep  the relevant portion of the capital plant in
 good repair so as to preserve its structural integrity  and  to  prevent
 its deterioration.
   (j) The term "major portion of the capital plant" shall mean:
   1. any capital asset
 S. 8474                            28
 
   (i)  which  is  a capital facility or system comprising a component of
 the public domain or infrastructure general fixed assets of the city  or
 a  building  comprising  a  component of the general fixed assets of the
 city; and
   (ii)  which, as of the effective date of this charter, or, as a result
 of any reconstruction or expansion after such date,  has  a  replacement
 cost  of  at least ten million dollars and a useful life of at least ten
 years, or if purchased or constructed after such date  has  an  original
 cost  of  at least ten million dollars and an original useful life of at
 least ten years; and
   2. any other capital asset of the city designated by the mayor for the
 purposes of this section; provided, however, that it shall  not  include
 any  asset  which  is  leased  to  or otherwise under the cognizance and
 control of a public benefit corporation or which is  otherwise  covered,
 pursuant  to  state law, by requirements which are substantially similar
 to the requirements of this section.
   § 6-17. Format of departmental estimates for capital projects, prelim-
 inary capital budget and executive capital budget.
   The departmental estimates for  capital  projects  and  the  executive
 capital  budget  shall  consist  of  a  detailed estimate of all capital
 projects pending or which the agency head, for  departmental  estimates,
 or  the  mayor,  for the executive budget, believes should be undertaken
 within the ensuing fiscal year and the three  succeeding  fiscal  years.
 Each agency head, and the mayor, for the executive budgets, shall submit
 a  written response to each of the capital budget priorities included in
 the council's recommendation of budget priorities for local  and  neigh-
 borhood  needs  submitted  in accordance with the section on preliminary
 budget hearings of this chapter.    Such  responses  shall  include  the
 response of the agency head and the mayor, as appropriate, regarding the
 disposition  of  each  such  priority and meaningful explanations of any
 disapprovals contained in such estimates or budget.
   § 6-18. Preliminary capital budget.
   The preliminary capital budget statements shall consist of:
   (a) a financial plan covering estimates of  capital  expenditures  for
 the four ensuing fiscal years;
   (b) departmental estimates for capital projects as provided in section
 6-19  of  this  chapter  together  with  the  cash flow requirements and
 proposed sources of funding for each project included in such estimates;
   (c) a capital program status report which  sets  forth  the  appropri-
 ations  for  each project included in the capital budget for the current
 fiscal year together with the expenditures to date; and
   (d) a summary description of the purpose of each capital  project  and
 the  needs  it will fulfill, the schedule for beginning and constructing
 the project, its period of probable usefulness and an appropriate  main-
 tenance schedule.
   § 6-19. Executive capital budget.
   (a) The executive capital budget shall set forth separately each capi-
 tal project, and shall include:
   1.  a  brief  description  and the location of each project; the total
 estimated cost of the project; the appropriations which have been previ-
 ously adopted for this project; the amount of appropriations recommended
 to be adopted for the ensuing fiscal year the aggregate amount of  which
 shall  not  exceed  the amount in the mayor's certificate; the amount of
 appropriations required thereafter to complete the project; the  sources
 of  funds  for  the  project including state, federal, private and other
 funds; the period of probable usefulness; the estimated additional annu-
 S. 8474                            29
 
 al maintenance and operation costs; and any terms and conditions of  the
 project;  the estimated dates of completion of final scope, final design
 and final construction; and
   2. a listing of all pending projects; and any recommendations that any
 pending  projects  be  modified, rescinded or postponed accompanied by a
 statement of the budgetary impact of any such action.
   (b) The executive capital program shall set  forth  for  both  program
 categories and individual projects:
   1.  a  statement  for each of the three succeeding fiscal years of the
 total dollar amounts necessary to complete projects initiated  in  prior
 years  and  projects proposed in the executive budget the amounts neces-
 sary for projects proposed to be  initiated  in  future  years  and  the
 amounts necessary for amendments and contingencies; and
   2. a statement of the likely impact on the expense budget of staffing,
 maintaining  and  operating  the capital projects included in or contem-
 plated by the capital program.
   § 6-20. Amendment.
   (a) Upon receipt of a recommendation in  writing  from  the  mayor  in
 manner  specified  herein,  the  council may amend the capital budget or
 capital program in the same manner as the adoption of the capital budget
 and capital program including the right to approve the  proposed  amend-
 ment  as  submitted  or  to  increase  or  decrease the amounts of funds
 proposed to be appropriated thereby, but only  if  funds  are  available
 within  the  capital  budget  and the applicable program category of the
 capital program, provided, however that the  mayor  may  only  recommend
 such  an  amendment relating to an appropriation included in the capital
 budget pursuant to this charter.
   (b) Upon the adoption of any such amendment by the council,  it  shall
 be certified by the mayor, the speaker of the council and the city clerk
 and the capital budget shall be amended accordingly.
   (c)  Not  later than five days after such certification such amendment
 shall be filed in the office of the comptroller and shall  be  published
 forthwith.
   § 6-21. Restrictions on capital projects.
   (a) No obligations of the city shall be issued or authorized for or on
 account  of any capital project not included in a capital budget, or for
 which funds have not been reserved in an appropriate program category of
 the capital program for any year of such program in which it is project-
 ed that funds will be expended for the completion of the project, or  in
 excess  of  the  maximum  amount  of  obligations which may be issued on
 account of such project as fixed in such capital budget; and  no  amount
 may  be  expended  on  account  of  any capital project in excess of the
 amount appropriated for such purposes in a capital budget,  except  that
 the  amount appropriated for such purposes may be increased by the mayor
 by not more than fifteen per centum thereof in order to meet  any  costs
 required  to  advance such project. Notice of any such increase shall be
 provided to the council together with a statement of identifiable  funds
 available for payment of the increase.
   (b)  Funds  included  in the capital budget for a capital project that
 are not obligated or committed during the fiscal year in which appropri-
 ated shall not be obligated or committed in the subsequent  fiscal  year
 unless  reappropriated  in  a  subsequent capital budget or an amendment
 thereto. A capital project included in a  capital  budget  that  is  not
 initiated  by the expenditure of funds within two years after its inclu-
 sion in the budget shall be eliminated from the budget.
 S. 8474                            30
 
   (c) The city may issue capital debt only to finance  capital  projects
 as  defined  in this charter. The capital budget may not include expense
 items that are properly includable only in the expense budget, as deter-
 mined in accordance with the accounting  principles  set  forth  in  the
 state  comptroller's  uniform  system of accounts for municipalities, as
 the same may be modified by the state comptroller, in consultation  with
 the city comptroller, for application to the city.
   (d)  No  capital  project  shall be included in the proposed executive
 capital budget or otherwise adopted as part of the capital budget or  as
 an  amendment  thereto  unless sufficient funds are available within the
 appropriate general program category of the capital program for any year
 of such program in which it is projected that additional  appropriations
 will be necessary for the completion of the project.
   § 6-22. Site selection.
   (a)  The  selection of sites for capital projects shall be pursuant to
 local law.
   (b) To the maximum extent feasible, final approval of  a  site  for  a
 capital project shall occur prior to or simultaneously with the approval
 of the scope of the project pursuant to this chapter.
   § 6-23. Project initiation; commitment plan.
   (a)  The  inclusion  of  a  capital  project  in the capital budget as
 adopted or amended shall constitute a direction and order to the  agency
 to  proceed  with the preparation of a scope of project pursuant to this
 chapter unless sufficient planning funds for such purpose have not  been
 appropriated  in the capital budget. The head of the agency shall notify
 the comptroller of the amount  of  appropriated  planning  funds  to  be
 encumbered for such purpose.
   (b)  The approval of a scope of project for a capital project pursuant
 to this chapter,  including  the  amount  of  obligations  necessary  to
 finance  the  design and construction of the project, shall constitute a
 direction and order to the agency to design the project,  unless  suffi-
 cient  funds  for such purpose have not been appropriated in the capital
 budget or are otherwise not available  within  the  appropriate  program
 category  of the capital program. Such approval shall constitute notifi-
 cation to the comptroller of the comptroller's authorization  to  expend
 appropriated design funds.
   (c) The approval of the final design for a capital project pursuant to
 this  chapter  shall  constitute  a  direction  and  order to the agency
 responsible for construction to prepare bid and award documents  and  to
 proceed  to  bid, unless sufficient funds for such purpose have not been
 appropriated in the capital budget or are otherwise not available within
 each year of the capital program in which it  is  projected  that  funds
 will  be expended for the completion of the project. Such approval shall
 constitute notification to the comptroller of the comptroller's authori-
 zation to expend appropriated construction funds.
   (d) The mayor shall require each agency to prepare and submit periodic
 reports, in regard to the progress of its  capital  projects,  including
 schedules  and  clear explanations of any delays for particular projects
 and summary information on each agency's record on  such  matters.  Such
 reports shall be published at least three times each year: within ninety
 days of the adoption of the capital budget; with the preliminary capital
 budget;  and  with  the executive capital budget, copies of such reports
 shall be transmitted by the mayor to the  council.  Such  reports  shall
 include,  for  each project, the dates set in the adopted capital budget
 for the completion of scope, design, and construction and any changes in
 such dates.
 S. 8474                            31
 
   1. The report issued with the executive budget shall include, for each
 new  capital  project  being  proposed  in  the  executive   budget,   a
 description  of  the  project  including, to the extent practicable, the
 information required to be included in a scope of project.
   2.  The  report  issued  following  the  adoption  of the budget shall
 include, for each capital project added to the budget, a description  of
 the  project  including,  to  the  extent  practicable,  the information
 required to be included in a scope of project.
   3. The report issued  following  the  adoption  of  the  budget  shall
 include,  for  each  capital  project for which a substantial change was
 made, a revised description of the  project  including,  to  the  extent
 practicable,  the  information  required  to  be  included in a scope of
 project.
   (e)  Any  capital  project  which  results  in  the   acquisition   or
 construction  of  a  capital asset which will be subject to the require-
 ments of this charter shall contain a provision requiring  a  comprehen-
 sive  manual  setting  forth the useful life of the asset and explaining
 the activities necessary to maintain the asset  throughout  such  useful
 life.
   (f)  The mayor may issue directives and adopt rules and regulations in
 regard to  the  execution  of  capital  projects,  consistent  with  the
 requirements  of  subdivisions  (a),  (b),  (c) and (d) of this section,
 which shall be binding upon all agencies.
   § 6-24. Improvements payable other than by city.
   Any owner of real property or any other person interested may apply to
 the council to authorize an improvement referred to in paragraph one  of
 subdivision  (a)  of  section  6-16 of this chapter, not included in the
 capital budget. The council may authorize such improvement to be made by
 the city or by such owner or other  person  interested  upon  compliance
 with the following conditions:
   (a)  such  owner or group or other persons interested shall enter into
 an agreement with the city, whereby they will either authorize the city,
 or themselves agree, to perform such work in accordance with such  plans
 and  specifications  approved by the agencies having jurisdiction there-
 over and under their supervision;
   (b) all of such work shall be done for the account of or at  the  sole
 cost  and expense of the person or persons applying for permission to do
 the same, who shall furnish to the city such security and in such amount
 as may be required to secure the payment of such cost and expense or the
 proper performance of the said work in the time and in the manner agreed
 upon, and shall further secure the city, in  the  latter  case,  against
 latent defects in such work for a period of two years;
   (c) such improvement shall be approved by the city planning department
 and reviewed pursuant to local law and charter provisions; and
   (d)  any  agreement providing for the performance of such work and the
 furnishing of such security, shall be  first  approved  by  the  council
 before the same shall become effective.
   § 6-25. Standards for capital projects.
   The  mayor shall prepare general standards and cost limits for catego-
 ries of capital projects and standards for the preparation of the  scope
 of  project  for  capital  projects of various types. Such standards and
 limits shall be submitted by the mayor to the council  for  review.  The
 proposed  standards  shall  become effective thirty days after they have
 been filed with the council unless within that time the council modifies
 or disapproves them or part of them, after conducting a public  hearing.
 Any  modification  by the council shall be subject to disapproval by the
 S. 8474                            32
 
 mayor in accordance with provisions of this charter and any such  disap-
 proval  shall  be  subject to override by the council in accordance with
 this charter.
   § 6-26. Scope of project.
   (a) Each agency, with respect to a capital project under its jurisdic-
 tion  included  in  a  capital budget, shall prepare a proposed scope of
 project within  appropriated  planning  funds.  The  proposed  scope  of
 project, or, in the case of a delay, an explanation for such delay along
 with  a  revised schedule, shall be submitted to the mayor and the coun-
 cil, by the date specified in the adopted capital budget  in  which  the
 capital  project  is  included.  Such  proposed scope shall identify all
 substantial differences between the guidelines for the  capital  project
 as  contained  in  such scope and the description of the capital project
 contained in the report issued pursuant to this charter at the time such
 project was proposed in the executive budget  or  following  the  budget
 adoption in which such project was added to the capital budget.
   (b)  Not  later than sixty days after receipt of the proposed scope of
 project from an agency pursuant to subdivision (a) of this section,  the
 mayor shall approve, modify, or disapprove the proposed scope of project
 and  notify  the agency and the council. In the case of a scope approved
 by the mayor with modifications, such notification shall include a  copy
 of the scope as approved.
   (c) No scope of project shall be approved by the mayor unless:
   1.  it contains the information required by paragraph four of subdivi-
 sion (d) of section 6-16 of this chapter and it conforms to the applica-
 ble standards for the type of project adopted pursuant to this  chapter,
 and
   2.  funds are available within the appropriate program category of the
 capital  program  that  can be reserved for each fiscal year required to
 complete the project.
   § 6-27. Design of capital project.
   (a) The proposed design and final design for a capital  project  shall
 be  made  available  for review by the council. The mayor or the mayor's
 representative shall review the final design to determine  its  conform-
 ance with the approved scope of project pursuant to this chapter.
   (b)  Works  of  art  may  be  provided  for each capital project which
 involves the construction or the substantial reconstruction of  a  city-
 owned  public  building  or structure the intended use of which requires
 that it be accessible to the public  generally  or  to  members  of  the
 public  participating  in,  requiring or receiving programs, services or
 benefits provided thereat. For the purposes of  this  section  a  police
 precinct house and a firehouse shall be deemed to be such buildings.
 
                                 Chapter 7
                            Planning Department
   § 7-01. Planning department.
   There  shall be a department of city planning consisting of a planning
 director and such subordinate employees as are  required  to  administer
 the planning program described herein.
   § 7-02. Planning director.
   The  mayor  shall appoint and shall have the power to remove the plan-
 ning director, who shall have had at least  five  years  of  appropriate
 professional  land  use  experience.  The planning director shall be the
 head of the planning department, and shall be responsible for the proper
 conduct of the affairs of the department and for the  execution  of  the
 S. 8474                            33
 
 planning  program prescribed in this charter and in local laws and rules
 consistent herewith.
   § 7-03. Powers, duties and functions.
   (a) The planning director, through the planning department, shall:
   1.  advise and assist the mayor and the council in regard to the phys-
 ical planning and public improvement aspects of the development  of  the
 city  and  on  all matters related to the planning program prescribed in
 this charter and in local law and rules consistent herewith;
   2. prepare the general plan and  revisions  thereof,  and  development
 plans  at  least  every  four  years  in  the year following the mayoral
 election and annual reviews thereof, for the improvement and development
 of the city;
   3. establish procedures for processing revisions to the  general  plan
 and to the four-year and one-year development plans;
   4. hold public hearings on such plans and revisions thereof and trans-
 mit  them,  with findings and recommendations thereon, through the mayor
 to the council for its consideration and action;
   5. prepare zoning resolutions, maps and rules and regulations and  any
 revision or amendments thereto in accordance with the general plan;
   6. prepare local laws or resolutions and rules and regulations govern-
 ing the subdivision of lands within the city and any revisions or amend-
 ments thereto;
   7. administer the zoning and subdivision local laws or resolutions and
 rules  and  regulations  adopted  thereunder  and any regulatory laws or
 resolutions which may be adopted to supplement or  replace  such  resol-
 utions;
   8. recommend periodic amendments to zoning resolutions and subdivision
 laws  or regulations, and provide opportunity for taxpayers to recommend
 periodic amendments to zoning resolutions and subdivision laws or  regu-
 lations;
   9. hold public hearings on land subdivision and zoning resolutions and
 amendments  thereto,  transmit  such proposed resolutions, with findings
 and recommendations thereon, through the mayor to the  council  for  its
 consideration and action;
   10.  establish  procedures for the review of land utilization applica-
 tions;
   11. review subdivision plats and zoning petitions;
   12. approve applications for special permits and variances within  the
 jurisdiction  of the department of city planning under the zoning resol-
 ution;
   13. collect data on population, housing and other relevant social  and
 economic  indicators  to  serve as a basis for planning recommendations;
 and may conduct continuous  studies  and  policy  analyses  on  economic
 development,  urban  design,  capital improvements, environmental impact
 assessment and such other subjects as the mayor or council may from time
 to time request;
   14. be custodian of the city map and thereon record all changes legal-
 ly authorized;
   15. administer the program prescribed  by  law  with  respect  to  the
 establishment  and regulation of landmarks, portions of landmarks, land-
 mark sites, interior landmarks, scenic landmarks and historic districts;
   16. hold public hearings on a  proposed  designation  of  a  landmark,
 landmark  site, interior landmark, scenic landmark or historic district,
 after notice of the proposed designation, notice of the hearing, and  an
 opportunity for comment to the affected property owner or owners;
 S. 8474                            34
 
   17.  submit  to  the council a report on the impact of any such desig-
 nation whether of a district or a landmark  to  the  zoning  resolution,
 projected  public  improvements,  and  any  plans  for  the development,
 growth, improvement or renewal of the area involved, and  a  recommenda-
 tion for council action with respect to any such designation;
   18. review the executive capital program and budget for conformance to
 the  purposes  of  the  general  plan  and  development  plans  prior to
 submission of the executive capital program and budget  to  the  council
 and  make a written report of his or her findings to the mayor and coun-
 cil at the time of submission of  such  executive  capital  program  and
 budget;
   19.  prepare,  in  consultation  with  the director of the budget, the
 draft ten-year capital strategy, and hold hearings on  such  draft,  and
 report his or her findings to the mayor and to the council;
   20.  consult with the appropriate State officials concerned with plan-
 ning and environmental quality to assure compliance  with  State  guide-
 lines  and  oversee  implementation  of  laws that require environmental
 reviews of actions taken by the city; and
   21. perform such other functions as are assigned by the mayor or other
 provisions of law.
   § 7-04. General plan.
   The general plan shall set forth the city's  broad  policies  for  the
 long  range  development of the city. It shall contain statements of the
 general social, economic, environmental  and  design  objectives  to  be
 achieved  for  the  general  welfare and prosperity of the people of the
 city through government action, city, state or federal.  The  statements
 shall  include, but not be limited to, policy and development objectives
 to be achieved with respect to the distribution of social benefits,  the
 most  desirable  uses  of  land within the city, the overall circulation
 pattern and the most desirable population densities within  the  several
 areas  of the city.  In conformance with such development objectives and
 policies the plan shall identify the general  location,  character,  and
 extent of streets and thoroughfares, parks, recreation facilities, sites
 for public buildings and structures, city and privately owned utilities,
 transportation  systems  and  facilities, housing, community facilities,
 future land  use  for  all  classifications  and  such  other  elements,
 features  and  policies  as will provide for the improvement of the city
 over the next ten years.
   § 7-05. Development plans.
   Development plans shall present detailed means  for  implementing  and
 accomplishing  the  development  objectives  and policies of the general
 plan within the several parts of  the  city.  The  mayor  shall  have  a
 comprehensive  four-year development plan which shall recommend a gener-
 alized land use development pattern to guide the growth of the city over
 the succeeding four-year period and a  one-year  development  plan  that
 delineates  the  city's  proposed  land  use  development  pattern for a
 succeeding twelve month period and is based upon the  development  goals
 and objectives specified in the city's four-year development plan.
   § 7-06. Adoption of the general plan and development plans.
   (a)  The  mayor  shall  submit annually to the council such plans that
 will include a general plan, four-year and  one-year  development  plans
 for  all  property  within  the city limits. The council shall adopt the
 general plan or revisions thereof and development  plans  or  amendments
 thereto  by  local law. Any local law or resolution adopting or revising
 the general plan shall be laid over for at least two weeks after  intro-
 duction. The mayor shall not certify as to the necessity for the immedi-
 S. 8474                            35
 
 ate  consideration  of any general plan, development plans, or revisions
 or amendments thereto. Public notice shall be provided at least ten days
 before adoption by the council.   Upon  adoption,  every  local  law  or
 resolution shall be presented to the mayor, and the mayor may approve or
 disapprove  it  pursuant to applicable provisions governing the approval
 or disapproval of a local law or resolution. If the mayor  approves  the
 local  law, the mayor shall sign it and return it to the clerk; it shall
 then be deemed to have been adopted. If the mayor disapproves it, he  or
 she  shall return it to the council with his or her objections stated in
 writing. The council at its next regular meeting may reconsider the same
 and if the votes of two-thirds of all the council  members  be  cast  in
 favor  of repassing such local law, it shall be deemed adopted, notwith-
 standing the objections of the mayor.
   (b) The general plan and all development plans shall be kept  on  file
 in the department of city planning.
   (c) The approved general plan and development plans shall be used as a
 guide  for the preparation of the city's capital improvement program and
 capital budget.
   (d) The mayor shall maintain an up-to-date zoning map of  all  proper-
 ties within the city limits.
   (e)  Following the annual updating and adoption of the city's develop-
 ment plans, the council shall  amend  the  city's  zoning  ordinance  to
 conform  it  to  the updated development plans in accordance with proce-
 dures prescribed by general law.
   § 7-07. Board of Appeals.
   (a) There shall be a board of appeals  which  shall  consist  of  five
 members  to be termed commissioners, three of whom shall be appointed by
 the mayor and two appointed by the council. Members shall serve a  stag-
 gered term of five years.
   (b)  Commissioners  shall  be chosen for their independence, integrity
 and civic commitment and for their professional competence in such areas
 as planning, architecture, and engineering. The  mayor  shall  designate
 one  of the members to serve as chair and one of the members to serve as
 vice-chair who shall act as chair in the absence of the chair or in  the
 event that a vacancy exists in the office of chair.
   (c)  Every member of the board shall receive a salary, which shall not
 be reduced during his or her term of office except in case of a  general
 reduction  of  salaries  and  in proportion to reductions of salaries of
 other officers with similar salaries. A member shall not engage  in  any
 other  occupation,  profession  or  employment. Members shall attend the
 hearings and executive sessions of the board,  and  shall  perform  such
 other duties as may be required by the chair.
   (d)  Vacancies  shall  be filled in the same manner as for an original
 appointment for the unexpired term of the member whose place has  become
 vacant and with a person having his or her qualifications.
   (e)  Any  member  may  be  removed  by  the mayor on proof of official
 misconduct, or of negligence in official duties,  inability  to  perform
 his  or her duties; but before removal he or she shall receive a copy of
 the charges and shall be entitled to a hearing before the mayor  and  to
 the assistance of counsel at such hearing.
   § 7-08. Meetings.
   Meetings  of  the  board shall be held at the call of the chair and at
 such other times as the board may determine. The chair, or in his or her
 absence the acting chair, may administer oaths and compel the attendance
 of witnesses. All hearings before the board shall be open to the  public
 and  shall  be before at least three members of the board, and a concur-
 S. 8474                            36
 
 ring vote of at least three members shall be necessary to a decision  to
 grant  an  application  or  an  appeal,  to revoke or modify a variance,
 special permit or other decision of the board,  or  to  make,  amend  or
 repeal  a  rule  or  regulation.  The  board  shall  keep minutes of its
 proceedings, showing the vote of each member upon every question, or  if
 absent  or  failing  to  vote, indicating such fact, and shall also keep
 records of its examinations and other official action. Such minutes  and
 such records shall be public records.
   § 7-09. Powers and duties.
   The board shall have the power:
   (a)  to  hear  and  determine appeals from the actions of the planning
 director in the administration of the zoning and subdivision resolutions
 and any rules and regulations adopted  pursuant  thereto,  which  appeal
 shall  be  sustained  only if the board finds that the director's action
 was based on an erroneous finding of a material fact, or that the direc-
 tor had acted in an arbitrary or capricious  manner  or  had  manifestly
 abused discretion;
   (b)  to  hear  and  determine appeals from the actions of the planning
 director on petitions for varying the application of the  zoning  resol-
 ution  with  respect  to  a specific parcel of land and may grant such a
 variance upon the ground of unnecessary hardship  if  the  record  shows
 that:
   1.  the applicant would be deprived of the reasonable use of such land
 or building if it were used only for the purpose allowed in that zone;
   2. the request of the applicant is due to unique circumstances and not
 the general conditions in the neighborhood, so that  the  reasonableness
 of the neighborhood zoning is not drawn into question; and
   3.  the use sought to be authorized by the variance will not alter the
 essential character of the locality, provided  however  that  the  board
 shall  specify  the particular evidence which supports the granting of a
 variance;
   (c) to hear and determine appeals from and review  any  recommendation
 by the planning director to designate a landmark, landmark site, interi-
 or landmark, scenic landmark or historic district;
   (d)  to make, amend and repeal rules and regulations for carrying into
 effect the provisions of the laws, resolutions, rules and regulations in
 respect to any subject-matter jurisdiction whereof is conferred  by  law
 upon  the board, and to include in such rules and regulations provisions
 applying to specific conditions and prescribing  means  and  methods  of
 practice  to effectuate such provisions and for carrying into effect the
 powers of the board;
   (e) to review, upon motion of any member of the board, any rule, regu-
 lation, amendment or repeal thereof, and any order,  requirement,  deci-
 sion  or  determination  from  which an appeal may be taken to the board
 under the provisions of this chapter or of any  law,  or  of  any  rule,
 regulation  or decision of the board; but no such review shall prejudice
 the rights of any person who has in good faith acted thereon  before  it
 is reversed or modified; and
   (f)  to  revoke  or modify, upon due notice and hearing, variances and
 special permits previously granted under the zoning  resolution  if  the
 terms and conditions of such grants have been violated.
   § 7-10. Procedure on appeals.
   (a) An appeal may be taken by an aggrieved party.
   (b)  Such  appeal may be taken within such time as shall be prescribed
 by the board by general rule, by filing with the officer from  whom  the
 appeal  is  taken  and with the board a notice of appeal, specifying the
 S. 8474                            37
 
 grounds thereof. The officer from whom the appeal is taken shall  forth-
 with  transmit  to the board all the papers constituting the record upon
 which the action appealed from was taken.
   (c)  The board shall fix a reasonable time for the hearing of appeals,
 and give due notice thereof to the parties, and decide the same within a
 reasonable time. If the appeal is from an order  revoking  a  permit  or
 approval,  the  hearing  shall  be  no later than at the third scheduled
 hearing of the board following the date of filing of the appeal, or five
 weeks following such date, whichever is sooner, and the decision of  the
 board  shall  be  rendered expeditiously. Upon the hearing any party may
 appear in person or by agent and/or attorney.
   (d) Any decision of the board under this section may  be  reviewed  as
 provided by law.
 
                                 Chapter 8
                                Franchises
   § 8-01. Franchises.
   All franchises, revocable consents and concessions shall be awarded in
 accordance with the following procedures:
   (a)  The  council  shall  have the power to grant, renew or extend any
 franchise, revocable consent or concession which extends for a period of
 three or more years, provided, however, that  any  franchise,  revocable
 consent  or  concession  which extends for a period of ten years or more
 shall require the approval of two-thirds of all the members; and
   (b) The mayor shall have the power  to  enter  into  an  agreement  to
 grant,  renew  or  extend  a  franchise, revocable consent or concession
 which extends for a period of less than thirty-six months.
 
                                  Chapter 9
                                Contracting
   § 9-01. Procurement.
   Except as otherwise provided in this charter or by statute, all goods,
 services or construction to be paid for out of the city treasury or  out
 of  monies  under  the  control  of or assessed or collected by the city
 shall be procured as prescribed in this chapter.
   § 9-02. Conditions.
   The  circumstances  under  which  procurement  may  be  used  for  the
 provision  of  technical, consultant or personal services, shall include
 circumstances where the use of procurement is:
   (a) cost effective or necessary to obtain special expertise;
   (b) necessary to provide a service not needed on a long-term basis;
   (c) necessary to avoid a conflict of interest; or
   (d) where personnel or expertise is not available in city government.
   § 9-03. Procedures.
   All contracts shall be awarded in accordance with the following proce-
 dures:
   (a) The mayor as the chief elected executive shall through his or  her
 appointees  have the power to enter into contracts on behalf of the city
 of Staten Island.
   (b) The comptroller shall, in accordance with provisions of this char-
 ter and with practices promulgated by state law, certify all  contracts,
 within  thirty  days  of  receipt of such contract, provided there is no
 cause not to certify. If the  comptroller  determines  that  a  contract
 cannot  be certified, he or she shall so notify the mayor and the common
 council within thirty days of receipt of such contract.  Reasons not  to
 certify   shall   include   but   not   be   limited   to  debarment  of
 S. 8474                            38
 
 vendors/contractors, unreasonable and/or onerous terms  and  conditions,
 financial  problems  or  inconsistencies,  and any other major cause not
 advantageous to the city that the comptroller can identify  and  justify
 through appropriate documentation.
   (c)  All contracts above ten thousand dollars, shall be let by compet-
 itive bidding, in compliance with current rules, regulations, guidelines
 and practices set forth by an appropriate national  government  procure-
 ment  officers  professional association or the conventions set forth in
 the generally accepted accounting practices or procedures as promulgated
 by the New York State comptroller's office, as agreed to by  the  mayor,
 the comptroller and approved by the common council; except that, when an
 emergency  as defined by local law is declared by the mayor to exist and
 is certified by the comptroller, expedited rules as promulgated  by  the
 mayor or the mayor's designee shall apply.
   (d)  Contracts  of  ten  thousand  dollars  or less may be let by sole
 source bid when an agency by rule determines  that  there  is  only  one
 source  for  the  required  good,  service  or  construction. The agency
 contract file shall contain a written determination that only one source
 is available for the required good, service or  construction,  including
 the  process  by  which  the  agency made such determination. The agency
 shall provide to the comptroller written documentation  to  support  its
 intention  to  let  a  sole  source contract.   This documentation shall
 include, but not be limited to, the qualifications of the vendor and the
 specific requirements of the contract.
   (e) If, for any contract above  ten  thousand  dollars,  there  is  an
 alteration,  renewal, or change in the terms and conditions or the scope
 of work which results in an increase or decrease of  greater  than  five
 per  centum of the original contract amount, then those contract changes
 must be certified by the comptroller.
   § 9-04. Notification of contract opportunities and awards.
   Each agency shall publish in the appropriate publication and in  news-
 papers  of  city, state or national distribution and trade publications,
 notice of:
   (a) the solicitation of bids or proposals  pursuant  to  this  chapter
 where  the  value  of  a contract for goods, services or construction is
 estimated to be above ten thousand dollars;
   (b) the award of  a  contract  for  goods,  services  or  construction
 exceeding ten thousand dollars in value. Each such notice of award shall
 indicate  the  name of the contractor, the dollar value of the contract,
 the procurement method by which the contract was let;
   (c) the comptroller shall promulgate rules providing for the  publica-
 tion  and  content of notices of contract actions required by this chap-
 ter. Such rules shall include but not be limited to provisions regarding
 the timing and frequency of notices, the required duration of  solicita-
 tion periods, and the form and content of notices.
   § 9-05. Agency contract files.
   Each agency shall maintain files containing all information pertaining
 to  the solicitation, award and management of each contract of the agen-
 cy. The agency contract files shall  contain  copies  of  each  determi-
 nation,  writing  or  filing  required  by  this chapter pertaining to a
 contract including the circumstances under which the procurement was let
 in accordance with section 9-02 of this chapter, and copies of all costs
 effectiveness analyses. Agency contract files shall be  open  to  public
 inspection  with  adequate protection for information which is confiden-
 tial.
   § 9-06. Centralized contract and contractor information.
 S. 8474                            39

   The mayor shall ensure that copies of all  city  contracts  and  other
 standard  information  regarding  city  contracts  and  contractors  are
 located in a central place which is accessible  to  the  public.    Such
 information shall include:
   (a) a copy of the contract;
   (b) information regarding the method by which the contract was let;
   (c)  such  standard documents as the contractor is required to submit,
 which shall be updated regularly;
   (d) information regarding the contractor's qualifications and perform-
 ance;
   (e) any evaluations of the contractor and any contractor responses  to
 such evaluation;
   (f)  any  audits  of the contract and any contractor responses to such
 audits;
   (g) any  decisions  regarding  the  suspension  or  debarment  of  the
 contractor; and
   (h) any analysis and determination of cost effectiveness.
   The  mayor  shall  ensure adequate public access to the information on
 contracts and contractors which shall  be  maintained  in  a  manner  to
 facilitate  public  review,  with  due  consideration  for  the  need to
 protect, where appropriate, the confidentiality of any such information.
   § 9-07. Adverse impact on public employees.
   In  the  event  that  a  proposed  contract  for  goods,  services  or
 construction may adversely affect public employees, the public employees
 union, if any, shall be advised no later than three months in advance of
 the  contract  being let of the nature, scope, and approximate dates, of
 the contract, and the reasons therefor. Except that, when  an  emergency
 as  defined  in  subdivision  (c)  of section 9-03 of this chapter is in
 effect, some or all of the provisions of this section may be omitted  or
 suspended  for the period of the emergency, but only for those contracts
 directly relevant to the management of that emergency or as a result  of
 the emergency.
   The  public  employer  will provide such union as soon as practicable,
 with information, in sufficient detail, so that the union may prepare  a
 proposal  designed  to demonstrate the cost effectiveness of keeping the
 work in-house. Such information shall include, but not  be  limited  to,
 applicable  solicitation  to  vendors,  winning  bids,  descriptions  of
 services to be provided by vendors, and the  agency's  estimated  direct
 operating and administrative costs of contracting out the work.
   Not  less  than  thirty  days  prior to the award of the contract, the
 union shall have the opportunity to make a formal proposal to the public
 employer demonstrating that it is cost effective or that it  is  in  the
 best  interest  of  the public employer to continue to perform such work
 in-house. The public employer shall consider such proposal before making
 a final determination.
 
                                 Chapter 10
                         Referendum and Amendment
   § 10-01. Referendum on pending legislation.
   (a) The people of the city of Staten Island reserve to themselves  the
 right  to require the council to vote on proposed laws and amendments to
 the local laws as hereinafter provided.
   (b) The people shall have the power to require the council to vote  on
 proposed  bills  and resolutions by initiative petition. Each initiative
 petition shall support a bill or resolution which has been introduced in
 S. 8474                            40
 
 the council and shall be signed by five per centum of  the  total  votes
 cast on Staten Island at the previous general election.
   (c)  An  initiative  petition  when  signed by the requisite number of
 voters shall be submitted to the Staten Island board of elections  which
 shall  promptly determine whether the petition meets the requirements of
 subdivision (b) of this section. If the Staten Island board of elections
 determines those requirements are satisfied  it  shall  certify  to  the
 speaker  of  the  council  that  the bill or resolution supported by the
 petition is required to be considered in the council with  the  vote  of
 each member present recorded.
   (d)  No  petition shall be certified to the council after May first in
 any year. A petition which is not certified by the Staten  Island  board
 of  elections  before May first shall be certified to the council on the
 first day of the next legislative session.
   (e) The council shall have sixty days  from  receipt  of  a  certified
 petition  to  vote on the bill or resolution which is the subject of the
 petition. If the council fails to vote on such bill or resolution within
 sixty days, such bill or resolution shall be deemed to have passed.
   (f) City funds, facilities or employees may not  be  used  to  solicit
 signatures on an initiative petition or to support or oppose the signing
 of such a petition provided, however, that elected officials may solicit
 such signatures or oppose the signing of such a petition.
   (g)  The  council  shall, by local law, prescribe the form and content
 of, and the procedures for, initiative petitions  consistent  with  this
 section. The council may, by local law, provide for the reporting of the
 identity  of any person who expends money to affect any initiative peti-
 tion and the amount of any money so expended.
   § 10-02. Charter amendment.
   (a) Amendments to this charter shall be adopted  by  referendum  only,
 except  for  those changes that are syntax and/or spelling changes which
 may be effected, altered or amended by local law as adopted by the coun-
 cil and the mayor as provided for in this  charter.    The  council  may
 place  an  amendment  on  the  ballot by a vote of two-thirds of all the
 members.
   (b) Referendum in order to amend the charter shall  take  place  as  a
 ballot  issue  to  be decided by affirmative vote of the majority of the
 qualified electors of the city voting thereon, it shall take  effect  as
 prescribed in such referendum.
   (c) The referendum shall be placed on the ballot by petition of quali-
 fied electors of not less than five per centum of the total vote cast in
 the  city  of  Staten Island at the last gubernatorial general election.
 The petition shall be filed in the office of the clerk of  the  city  of
 Staten Island for the submission to the electors of the city at the next
 general  election  therein  held  not  less  than  sixty days after such
 filing. The proposed amendment shall be set forth in full in such  peti-
 tion  which  may be made upon separate sheets and the signatures of each
 shall be authenticated in the manner provided  by  the  New  York  state
 election  law.  If  within  ten days after the filing of such petition a
 written objection thereto be filed with the office of the city clerk and
 the board of elections, the Supreme Court or any justice thereof of  the
 appropriate judicial district shall determine any question arising ther-
 eunder  and  make such order as justice may require as prescribed in the
 state election law.
 
                                Chapter 11
                           Property of the City
 S. 8474                            41
 
   § 11-01. Inalienable property.
   The rights of the city in and to its water front, ferries, wharf prop-
 erty,  bridges,  land  under  water,  public  landings,  wharves, docks,
 streets, avenues, highways,  parks,  waters,  waterways  and  all  other
 public places are hereby declared to be inalienable; but upon closing or
 discontinuance  of  any  street, avenue, park or other public place, the
 property may be sold or otherwise disposed of as may be provided by law,
 and leases of land under water, wharf property, wharves, docks and piers
 may be made as may be provided by law.
   § 11-02. Authority to acquire real property.
   (a) The city may acquire title in fee to real property or any interest
 therein whenever required for any public or municipal use or purpose  or
 for  the  promotion  of  public  utility,  comfort, health, enjoyment or
 adornment. Such title or interest shall be acquired according to law  by
 purchase,  gift,  devise, lease, condemnation or otherwise, and, subject
 to the provisions of this charter or other law may  sell,  lease,  mort-
 gage, hold, manage, and control such property as may now or hereafter be
 owned by it.
   (b)  The  council  by local law shall prescribe the procedures for all
 acquisitions of real and personal property by the city, including proce-
 dures for determining compensation and for appealing from such  determi-
 nation  without  prejudice  to  the  appellant. In addition to all other
 requirements of law, written notice of the application to  have  compen-
 sation  for  real  property ascertained in any proceeding brought by the
 city to acquire title to real property shall be given to the  owners  of
 all property affected by the proceeding to such application. Such notice
 shall state the purpose for which the property is to be acquired and the
 date  when  such  application will be presented and shall be made public
 not less than ten days prior to such proceeding. Any owner whose proper-
 ty has been taken in any such proceeding which has not been used for the
 purpose stated in the proceeding for acquisition shall have the right of
 first refusal to repurchase such property from the city after the  expi-
 ration  of  a  five-year  period from the date of the entry of the final
 decree in the proceeding for the price paid plus simple interest.
   § 11-03. Disposal of property of the city.
   No real property of the city may be sold, leased, exchanged or  other-
 wise disposed of except as specifically provided by law.
 
                                Chapter 12
                           Personnel Management
   § 12-01. Declaration of intent.
   (a)  The  personnel  policies  and practices of the city government in
 furtherance of this charter, the state civil service law and  rules  and
 other applicable law shall:
   1. preserve and promote merit and fitness in city employment;
   2.  ensure  that appointments and promotions in city service are made,
 and that wages are set, without regard  to  political  affiliation,  and
 without  unlawful  discrimination  based  on sex, race, color, religion,
 religious observance, national origin, disability, age, marital  status,
 citizenship  status  or  sexual orientation; and promote and support the
 efficient and effective delivery of services to the public.
   (b) Consistent with subdivision (a) of this section, the heads of city
 agencies shall have such powers, duties and responsibilities for person-
 nel management as they shall require to administer their agencies effec-
 tively and to supervise, evaluate, motivate, discipline, provide  incen-
 tives for and improve the skills of employees of the city.
 S. 8474                            42
 
   § 12-02. Department; personnel director.
   There  shall  be a department of personnel, the head of which shall be
 the personnel director. The personnel director shall have all the powers
 and duties of a municipal civil service commission provided in the state
 civil service law or in any other statute or local law other  than  such
 powers and duties as are by this chapter assigned to the mayor, the city
 civil service commission or the heads of city agencies.
   § 12-03. City civil service commission.
   (a)  There  shall  be  a  city civil service commission, consisting of
 three members, not more than two of whom shall be members  of  the  same
 political party. Members shall be appointed by the mayor, from a list of
 nominations  provided by the screening committee established pursuant to
 subdivision (b) of this section, for overlapping terms of six years.  Of
 the  members  first appointed, one shall serve for two years and one for
 four years and one for six years. The members shall be removable in  the
 manner  provided  for members of a municipal civil service commission in
 the state civil service law. A  vacancy  in  such  commission  shall  be
 filled in the same manner as regular appointments for the balance of the
 unexpired  term.  The  mayor  shall designate a member as chair and vice
 chair, respectively, for one-year terms.  Within appropriations for such
 purposes, the members of the commission shall be  reimbursed  on  a  per
 diem  basis  for attendance at regularly scheduled meetings and hearings
 of the commission.
   (b) There shall be a screening committee which  shall  submit  to  the
 mayor  a list of nominees, which shall include persons with knowledge or
 experience of the state civil service system, or  personnel  management,
 or  compensation practices, from which the mayor shall make appointments
 to the city civil service commission.  Such  screening  committee  shall
 consist  of  six  members, of whom three shall be appointed by the mayor
 and three shall be appointed  by  the  municipal  labor  committee.  The
 screening  committee  shall  submit the list of nominees upon the occur-
 rence of any vacancy on the commission or at least three months prior to
 the expiration of the term of any incumbent member.
   (c) The commission shall appoint a counsel, who shall not be  employed
 or  retained  by  any other city agency, and may appoint a secretary and
 such other subordinates as may be  necessary  within  the  appropriation
 therefor.
   (d)  The  civil  service  commission  shall have the power to hear and
 determine appeals by any person aggrieved by any action or determination
 of the personnel director made pursuant to section 12-04 of this chapter
 and may order such relief  as  it  deems  appropriate  or  necessary  in
 accordance  with  this  charter or the state civil service law. Any such
 appeal shall be taken by application in writing to the commission within
 thirty days after the action or determination appealed from. The commis-
 sion shall also have the powers  and  responsibilities  of  a  municipal
 civil  service  commission  under section seventy-six of the state civil
 service law. In accordance with the requirements of  this  charter,  the
 commission  shall  promulgate rules of procedure, including rules estab-
 lishing time schedules, for the hearings and  determinations  authorized
 by this section.
   (e)  The  commission shall have the power and duty to conduct reviews,
 studies, or analyses of the administration of  personnel  in  the  city,
 including the classification of titles by the personnel director.
   (f)  The  commission  shall prepare and transmit directly to the mayor
 departmental estimates as required by  this  charter.  The  mayor  shall
 include  such  proposed  appropriations for the commission as a separate
 S. 8474                            43

 agency in the preliminary and executive budgets as  are  sufficient  for
 the commission to fulfill the obligations assigned to it by this charter
 or other law.
   § 12-04. Personnel director; powers and duties.
   (a)  The personnel director shall have the following powers and duties
 in addition to the powers  and  duties  of  a  municipal  civil  service
 commission  provided in the state civil service law, and those vested in
 the personnel director as the head of the department, except  where  any
 specific  power or duty is assigned to the mayor, heads of city agencies
 or the civil service commission pursuant to this chapter:
   1. to recruit personnel;
   2. to make studies in regard to the grading and classifying  of  posi-
 tions  in the civil service, establish criteria and guidelines for allo-
 cating positions to an existing class of positions, and grade and estab-
 lish classes of positions;
   3. to schedule and conduct examinations for  positions  in  the  civil
 service;
   4.  to  establish, promulgate and certify eligible lists in the manner
 provided in the state civil service law, and the rules of the  personnel
 director;
   5.  to determine the appropriateness of eligible lists for the filling
 of vacancies in the manner provided in the state civil service  law  and
 the rules of the personnel director;
   6.  to  investigate  applicants for positions in the civil service; to
 review their qualifications, and to revoke or rescind any  certification
 or  appointment  by  reason  of the disqualification of the applicant or
 appointee under the provisions of the state civil service law,  and  the
 rules of the personnel director or any other law;
   7. to review any appointment of persons as provisional employees with-
 in  sixty days after appointment to assure compliance with this charter,
 the state civil service law, and any rule or regulation issued  pursuant
 to this charter or state civil service law;
   8.  to certify payrolls in accordance with the provisions of the state
 civil service law and the rules of the personnel director;
   9. to keep records regarding candidates for appointment to  the  civil
 service and officers and employees in the civil service;
   10.  to  develop  and  recommend to the mayor standard rules governing
 working conditions, vacations and leaves of absence; and career,  salary
 and wage plans providing for the creation, abolition and modification of
 positions  and  grades and fixing salaries of persons paid from the city
 treasury, subject to the provisions of this  charter,  the  state  civil
 service  law, other applicable statutes and collective bargaining agree-
 ments;
   11. to administer the city-wide incentive, training  and  development,
 and other such personnel programs of the city;
   12.  to  establish  and enforce uniform procedures and standards to be
 utilized by city agencies in establishing measures, programs  and  plans
 to  ensure  a  fair  and effective affirmative employment plan for equal
 employment opportunity for minority group  members  and  women  who  are
 employed by, or who seek employment with, city agencies. Such procedures
 shall  include  a  time schedule for the development of such plans which
 provides for the preparation by each agency of a draft plan, the  review
 of  such draft plan by the department of personnel, the equal employment
 practices commission, and such other agency as the mayor  requires,  and
 the  consideration  by the agency of any comments received on such draft
 S. 8474                            44
 
 plans prior to the adoption of a final plan as required by section 12-05
 of this chapter;
   13.  to establish a uniform format to be utilized by all city agencies
 in the preparation of the quarterly reports required by section 12-05 of
 this chapter. Such format shall provide for the presentation of  statis-
 tical  information regarding total employment, new hiring and promotions
 in a manner which facilitates understanding of an  agency's  efforts  to
 provide  fair  and  effective  equal opportunity employment for minority
 group members, women and members of other groups who are employed by, or
 who seek employment with, city agencies;
   14. to develop, in conjunction with other city agencies,  a  clearing-
 house  for  information  on  employment  and  educational  programs  and
 services for minority group members and women; and
   15. to provide assistance to minority group members and women employed
 by, or interested in being employed by, city  agencies  to  ensure  that
 such  minority  group  members  and women benefit, to the maximum extent
 possible, from city employment and educational assistance programs.
   (b) The personnel director shall have the following powers and  duties
 with  respect  to  the  personnel  management functions assigned to city
 agencies pursuant to subdivisions (a), (b),  (c),  and  (d)  of  section
 12-05 of this chapter:
   1.  to  aid  in  the  development of effective and efficient personnel
 programs and professional personnel staffs in the agencies of the  city;
 and  to convene the personnel officers of the agencies from time to time
 as a personnel council to consider personnel matters of inter-agency  or
 of city-wide concern;
   2.  to  approve agency plans and programs pursuant to section 12-05 of
 this chapter;
   3. to establish and enforce standards, guidelines and criteria for the
 personnel management functions assigned to the  agencies  and  to  audit
 performance by the agencies of such personnel functions;
   4.  to  reverse  or  rescind  any  agency personnel action or decision
 pursuant to an assignment or delegation of authority  in  this  chapter,
 upon a finding of abuse after notification to the agency and an opportu-
 nity to be heard;
   5. to hear and determine appeals by any person aggrieved by any action
 or determination of the head of an agency made pursuant to section 12-05
 of  this  chapter,  subject to review by the civil service commission as
 provided in subdivision (e) of section 12-03 of this chapter;
   6. to delegate to the head of an agency personnel management functions
 assigned to the personnel director where such delegation is  not  other-
 wise  prohibited  by  the state civil service law, and pursuant to terms
 and conditions prescribed by the director;
   7. to administer personnel programs of a city-wide nature or common to
 two or more departments where administration by separate agencies  would
 be impracticable and uneconomical;
   8.  to  annually  publish  and  submit  to  the mayor, council and the
 commission on equal employment practices a report on the  activities  of
 the department of personnel and city agencies to provide fair and effec-
 tive  affirmative employment practices to ensure equal employment oppor-
 tunity for minority group members and women who are employed by, or  who
 seek  employment with, city agencies. Such report shall include, but not
 be limited to, an analysis of the city government workforce  and  appli-
 cants  for  such  employment  by  agency,  title  and  classification; a
 description  of  each  agency's  employment  practices,   policies   and
 programs;  an  analysis  of  the  effectiveness of the city's efforts to
 S. 8474                            45
 
 provide fair and effective affirmative employment  practices  to  ensure
 equal  employment  opportunity  for minority group members and women who
 are employed by, or who seek employment with, city  agencies;  and  such
 legislative, programmatic and budgetary recommendations for the develop-
 ment,  implementation or improvement of such activities as the personnel
 director deems appropriate.
   (c) The personnel director  shall  promulgate  rules  and  regulations
 relating  to  the  personnel  policies,  programs and activities of city
 government in furtherance of and consistent with the state civil service
 law and this chapter. The personnel director shall transmit to the state
 civil service commission each proposed rule which must be  submitted  to
 such  commission, including any which establishes or reclassifies titles
 in the non-competitive or exempt class,  within  sixty  days  after  the
 public hearing has been held on such rule.
   (d)  The  personnel  director shall, at the time requested by the city
 civil service commission or the equal employment  practices  commission,
 provide  each  commission with all the information which such commission
 deems necessary to fulfill the duties assigned to it by the charter. The
 provisions of this subdivision shall not apply to any information  which
 is  required by law to be kept confidential or which is protected by the
 privileges for attorney-client communications, attorney  work  products,
 or material prepared for litigation.
   (e)  The  personnel  director  shall  submit a quarterly report to the
 mayor, the council, the civil service commission and the  equal  employ-
 ment  practices  commission. Such report shall specify, by agency and by
 title, including temporary titles:
   1. the number of provisional employees at the end of the second  month
 of the quarter;
   2.  the length of time such provisional employees have served in their
 positions; and
   3. the actions taken by the city to reduce the number of  such  provi-
 sional employees and the length of their service in such positions. Such
 reports  shall  be  submitted by the last day of March, June, September,
 and December of each year.
   § 12-05. Agency heads; powers and duties.
   (a) Subject to the state civil service law and  applicable  provisions
 of  this charter, heads of city agencies shall have the following powers
 and duties essential for the management of their agencies in addition to
 powers and duties vested in them  pursuant  to  this  charter  or  other
 applicable law:
   1. to recruit personnel;
   2.  to  participate  with the personnel department in job analyses for
 the classification of positions;
   3. to allocate individual positions to existing civil service titles;
   4. to allocate individual managerial or executive positions to manage-
 rial assignment levels;
   5. to assist the personnel department in the determination of  minimum
 qualifications for classes of positions and to review and evaluate qual-
 ifications of candidates for positions in the civil service;
   6. to assist the personnel director in the planning and preparation of
 open competitive examinations;
   7.  to  schedule  and  conduct  tests  other  than  written  tests for
 promotion to competitive class positions;
   8. to determine whether to hold an open competitive or promotion exam-
 ination to fill positions in the civil service subject to disapproval of
 the personnel director within thirty days;
 S. 8474                            46
 
   9. to plan and administer employee incentive and recognition programs;
   10.  to fill vacant positions within quarterly spending allotments and
 personnel controls pursuant to this charter;
   11. to administer and certify eligible lists for classes of  positions
 unique to the agency;
   12.  to make appointments to competitive positions from eligible lists
 pursuant to subdivision one of section  sixty-one  of  the  state  civil
 service  law, which authority shall not be abridged or modified by local
 law or in any other manner;
   13. to establish and administer performance evaluation programs to  be
 used  during  the  probationary  period and for promotions, assignments,
 incentives and training;
   14. to conduct  training  and  development  programs  to  improve  the
 skills, performance and career opportunities of employees;
   15.  to  ensure  and  promote  equal  opportunity  for  all persons in
 appointment, payment of wages, development and advancement;
   16. to administer employee safety programs;
   17. to maintain personnel records;
   18. to perform such other personnel management functions as are deleg-
 ated by the personnel director pursuant to this chapter or that are  not
 otherwise assigned by this chapter;
   19.  to establish measures and programs to ensure a fair and effective
 affirmative employment plan to provide equal employment opportunity  for
 minority  group  members  and  women  who  are  employed by, or who seek
 employment with, the agency and, in accordance with the  uniform  proce-
 dures  and standards established by the department of personnel for this
 purpose, to adopt and implement an annual plan to accomplish this objec-
 tive. Copies of such plans shall  be  filed  with  the  mayor,  council,
 department of personnel, equal employment practices commission, and city
 civil  service  commission  and  shall  be made available for reasonable
 public inspection; and
   20. to provide assistance to minority group members and  women  inter-
 ested  in  being  employed by city agencies to ensure that such minority
 group members and women benefit, to the maximum  extent  possible,  from
 city employment and educational assistance programs.
   (b)  Within one year from the effective date of this charter, the head
 of each agency shall prepare and submit to the mayor and  the  personnel
 director  a plan and schedule for the discharge of the powers and duties
 assigned in this section. No such plan shall take effect until  approved
 by the mayor.
   (c)  The mayor may modify, suspend, or withdraw for cause any power or
 duty assigned or delegated to the head of an  agency  pursuant  to  this
 section.
   (d)  Notification prior to each action or decision of an agency pursu-
 ant to this chapter which changes the status of an individual  employee,
 a  position,  or a class of positions shall be provided to the personnel
 director. The head of each agency shall certify on each payroll that all
 personnel actions and  transactions  of  the  agency  conform  with  the
 provisions of the state civil service law and this chapter, the rules of
 the personnel director and other applicable law.
   (e)  Before any new position in the city service shall be created, the
 agency head shall furnish the commissioner of finance with a certificate
 stating the title of the class of positions to which the position is  to
 be allocated. If the position is to be allocated to a new class of posi-
 tions,  the agency head shall request of the personnel director, and the
 personnel director shall furnish to the agency head and the commissioner
 S. 8474                            47
 
 of finance, a certificate stating the appropriate  civil  service  title
 for  the  proposed  position,  the  range  of salary of comparable civil
 service positions and a statement of the class specifications  and  line
 of  promotion  into  which such new position will be placed and any such
 new position shall be created  only  with  the  title  approved  by  the
 personnel director.
   (f)  The  heads of all agencies shall, except as otherwise provided by
 law, have power to appoint and remove, subject to the provisions of  the
 state  civil  service law, all chiefs of bureaus and all other officers,
 employees and subordinates in their respective administrations,  depart-
 ments  or  offices,  without  reference  to  the tenure of office of any
 appointee and to assign them their duties.    Nothing  herein  shall  be
 construed to preclude the mayor from entering into a collective bargain-
 ing agreement which provides for a procedure governing the discipline of
 employees, including their removal.
   (g)  The  heads  of  city agencies or their designated representatives
 shall fulfill the  requirements  for  agency  participation  in  matters
 affecting the management of the agency in advance of collective bargain-
 ing negotiations affecting employees.
   (h)  The  head  of each city agency shall ensure that such agency does
 not discriminate against employees or applicants for employment pursuant
 to federal, state and local law.
   (i) The head of each city agency shall quarterly publish and submit to
 the mayor, council, department of personnel, and  the  equal  employment
 practices  commission a report on the agency's efforts during the previ-
 ous quarter to implement the plan adopted pursuant to this section.
   (j) The head of each city  agency  shall  include  in  all  employment
 retention,  recruitment,  training  and  promotional program literature,
 advertisements, solicitations and job applications, such language as may
 be necessary to effectuate the purpose of this chapter.
   (k) The head of each city agency shall require each employment agency,
 or authorized representative of workers with which it has  a  collective
 bargaining  or other agreement or understanding and which is involved in
 the performance of recruitment and retention with the agency to  furnish
 a  written  statement that such employment agency, labor union or repre-
 sentative shall not discriminate against  employees  or  applicants  for
 employment  pursuant  to federal, state or local law and that such union
 or representative will cooperate in the implementation of  the  agency's
 obligations pursuant to this chapter.
   § 12-06. Management service.
   (a)  The  personnel  director, in consultation with the heads of agen-
 cies, shall develop and submit to the mayor a city-wide plan and  sched-
 ule  for  the  development of qualified and competent technical, profes-
 sional, management, administrative, and, supervisory  personnel  in  the
 civil  service  to  meet  the  managerial needs of city government.  The
 mayor shall approve, disapprove or modify the plan within one year after
 the effective date of this charter.
   (b) The city-wide plan shall establish a management service  for  city
 agencies and shall provide for:
   1.  membership  in  the  service of employees with significant policy,
 administrative, supervisory,  managerial  or  professional  duties  that
 require  the  exercise  of  independent  judgment  in the scheduling and
 assignment of  work,  program  management  or  planning,  evaluation  of
 performance or allocation of resources;
   2.  preference  for appointment into management service shall be given
 to qualified civil service employees pursuant  to  promotional  examina-
 S. 8474                            48
 
 tions  administered  in a manner consistent with the requirements of the
 state civil service law;
   3.  assessments of capacity and potential to perform managerial duties
 as part of competitive tests for entry into the service and  assignments
 within the service;
   4. a single managerial class of positions for each occupational series
 within the service with assignment levels within each such class;
   5.  a  plan  for  achieving  equitable  pay  scales for members of the
 service consonant with their duties and responsibilities;
   6. merit increases, incentive awards,  and  recognition  programs  for
 members of the services;
   7.  performance  evaluations for members of the service to be used for
 assignments, incentive awards, probationary period review, and discipli-
 nary action;
   8. a probationary period not to exceed one year  for  members  of  the
 service;
   9. management intern programs; and
   10. training and career development programs.
   (c)  The personnel director shall conduct city-wide programs and func-
 tions related to the management service; assist agencies in  the  imple-
 mentation of the management service plan; and review and evaluate agency
 performance under the plan.
   § 12-07. Appointments and promotions.
   (a)  All  appointments, promotions and changes in status of persons in
 the public service of the city shall be made in the manner prescribed by
 the constitution of the state and in accordance with the  provisions  of
 the state civil service law and other provisions of law not inconsistent
 therewith nor with this charter.
   (b)  Whenever  qualifications for the appointment of persons to public
 office are prescribed by law, the appointing officer shall, upon  making
 such  appointment,  file with the civil service commission a certificate
 that such appointment complies with such law.
   § 12-08. Power of investigation.
   The personnel director and the city  civil  service  commission  shall
 have  the  power  to make investigations concerning all matters touching
 the enforcement and effect of the provisions of the state civil  service
 law  insofar  as  it  applies  to the city and the rules and regulations
 prescribed thereunder, or concerning the  actions  of  any  examiner  or
 subordinate of the department, or of any officer or employee of the city
 or  of  any  county  within the city, in respect to the execution of the
 state civil service law; and in the course of  such  investigations  the
 personnel  director  of the city civil service commission shall have the
 power to administer oaths, to compel the attendance of witnesses, and to
 examine such persons as deemed necessary.
   § 12-09. No compensation to unauthorized employees.
   No officer of the city whose duty is to sign or  countersign  warrants
 shall  draw, sign or issue, or authorize the drawing, signing or issuing
 of any warrant on the commissioner of finance or other disbursing  offi-
 cer of the city for payment of salary to any person in its service whose
 appointment or retention has not been in accordance with the state civil
 service law and the valid rules in force thereunder.
   § 12-10. Examination for licenses.
   The  personnel  director shall, unless otherwise provided by law, have
 power, upon request of any person  charged  with  the  duty  of  issuing
 licenses  or  permits,  to  conduct,  under  rules and regulations to be
 established by the personnel director, examinations and tests to  deter-
 S. 8474                            49
 
 mine  the  qualifications  of  persons  applying  for  such  licenses or
 permits. The personnel director shall certify to the person having power
 to issue the license or permit the result of  any  such  examination  or
 test.
   §  12-11.  Officers  or  employees designated to serve in exempt civil
 service positions.
   (a) Notwithstanding any provision in this charter to the contrary, the
 mayor or head of an agency may designate any officer or employee occupy-
 ing a position in the competitive class of the civil service to serve in
 a position in the exempt class, and in such case, the officer or employ-
 ee so designated shall thereupon enter upon and exercise all the  powers
 and  duties  and  receive  the salary of such exempt position, and shall
 retain all the rights, privileges and status of such officer or  employ-
 ee's position in the competitive class.
   (b)  The  appointment  of  any person chosen to fill the position thus
 left vacant shall be temporary and shall terminate upon  the  return  of
 such officer or employee to such position as provided in subdivision (e)
 of this section.
   (c) Such designation shall be in writing and shall be filed and remain
 of  record  in the office of such agency, in the office of the personnel
 director and in the office of the mayor and shall remain in force  until
 revoked by the mayor or head of such agency, as the case may be.
   (d)  Service in such position in the exempt class shall be credited as
 service in the competitive class and  the  status  of  such  officer  or
 employee  in  respect  to  pensions  or otherwise shall not be adversely
 affected by such designation.
   (e) Upon the termination of the officer or employee's services in such
 exempt position, except by dismissal for cause in the manner provided in
 section seventy-five of the state civil service  law,  such  officer  or
 employee shall immediately and without further application return to the
 position  in  the  competitive class with the status, rights, privileges
 and salary enjoyed immediately prior to the designation to the  position
 in  the  exempt class as if service in the competitive position had been
 continuous.
   § 12-12. Residency exemption.
   Any employee who was previously employed by the city of New York,  and
 who  is appointed, reassigned or transferred to city employment, without
 a break in service shall be exempt from  any  residency  requirement  in
 connection with his or her employment or subsequent promotion, demotion,
 reassignment,  transfer  or  other  personnel change. For the purpose of
 this section, a break in service shall be defined as a  period  of  more
 than one year.
                                Chapter 13
                   Equal Employment Practices Commission
   § 13-01. Equal employment practices commission.
   (a)  There  shall  be  an  equal employment practices commission which
 shall review, evaluate and monitor the employment procedures,  practices
 and programs of any city agency and the department of personnel to main-
 tain  an  effective  affirmative  employment program of equal employment
 opportunity for minority group members and women who are employed by  or
 who seek employment with city agencies.
   (b) The commission shall consist of three members who shall be compen-
 sated  on  a per diem basis. The mayor, the council, and the comptroller
 shall each appoint one member. The mayor shall appoint a member to serve
 as the chair.
   (c) Members shall be appointed for four-year terms.
 S. 8474                            50
 
   (d) The commission may, within the appropriations available  therefor,
 appoint  an  executive director and such deputies, assistants, and other
 employees as may be needed for the performance of the duties  prescribed
 herein.
   (e)  The  commission may meet as necessary to implement the provisions
 of this chapter provided that the commission shall meet  at  least  once
 every eight weeks.
   §  13-02.  Duties and powers of the equal employment practices commis-
 sion.
   (a) The commission:
   1. shall monitor the employment policies, programs  and  practices  of
 each city agency; and
   2. monitor the coordination and implementation of any city affirmative
 employment  program  of  equal employment opportunity for minority group
 members and women who are employed by or who seek employment  with  city
 agencies,  including  the activities of the department of personnel, and
 the civil service commission, pursuant to chapter twelve of  this  char-
 ter,  and  any  other  agency  designated  by the mayor to assist in the
 implementation or coordination of such efforts, and  all  city  agencies
 required by section 12-05 of this charter to establish agency program.
   (b)  The commission may request and shall receive from any city agency
 such information, other than information which is required by law to  be
 kept  confidential  or  which  is privileged as attorney client communi-
 cations, attorney work products or material prepared for litigation, and
 such assistance as may be necessary to carry out the provisions of  this
 chapter.
   (c)  The commission shall communicate to any appropriate authority any
 information regarding suspected or alleged violations of this chapter.
   (d) The commission shall have the following powers and duties:
   1. to review the uniform standards, procedures, and  programs  of  the
 department  of  personnel pursuant to section 12-04 of this charter, and
 to review the plans adopted by city  agencies  in  accordance  with  the
 provisions  of  section  12-05  of this charter, and to provide any such
 agency or the department of personnel with such comments and suggestions
 as the commission deems necessary and appropriate;
   2. to recommend to the department of personnel, all city agencies,  or
 any  one  or more particular agencies, procedures, approaches, measures,
 standards and programs to be utilized by such agencies in their  efforts
 to  ensure  a fair and effective affirmative employment program of equal
 employment opportunity for minority group  members  and  women  who  are
 employed by or seek employment with city agencies;
   3.  to  recommend  to any city agency actions which such agency should
 consider including in its next annual plan as required by section  12-05
 of this charter;
   4.  to advise and, if requested, assist city agencies in their efforts
 to increase employment of minority  group  members  and  women  who  are
 employed by or who seek employment with city agencies;
   5.  to  audit  and evaluate the employment practices and procedures of
 each city agency and their efforts to ensure fair  and  effective  equal
 employment  opportunity  for  minority  group members and women at least
 once every four years  and  whenever  requested  by  the  civil  service
 commission  or  the human rights commission or whenever otherwise deemed
 necessary by this commission;
   6. to make such policy, legislative and budgetary  recommendations  to
 the  mayor,  council,  the department of personnel or any city agency as
 S. 8474                            51
 
 the commission deems necessary to ensure  equal  employment  opportunity
 for minority group members and women;
   7.  to  publish  by the fifteenth of February of each year a report to
 the mayor and the council on the activities of the  commission  and  the
 effectiveness  of  each city agency's affirmative employment efforts and
 the efforts by the department of personnel to  ensure  equal  employment
 opportunity  for minority group members and women who are employed by or
 seek to be employed by city agencies;
   8. to establish appropriate advisory committees;
   9. to serve with such other agencies or officials as shall  be  desig-
 nated by the mayor as the city liaison to federal, state and local agen-
 cies  responsible  for  compliance with equal employment opportunity for
 minority group members and women who are employed by or who seek  to  be
 employed by city agencies; and
   10.  to  take  such other actions as are appropriate to effectuate the
 provisions and purposes of this chapter.
   § 13-03. Compliance procedures.
   (a) The commission shall conduct such study or investigations and hold
 such hearings as may be necessary to determine whether agencies  are  in
 compliance  with  the  equal employment opportunity requirements of this
 chapter and chapter twelve of this charter.
   (b) For the purpose of ascertaining facts in connection with any study
 or investigation authorized by this chapter, the commission  shall  have
 power  to compel the attendance of witnesses, to administer oaths and to
 examine such persons as they may deem necessary. The commission  or  any
 agent  or  employee  thereof duly designated in writing by them for such
 purposes may administer oaths  or  affirmations,  examine  witnesses  in
 public  or  private  hearing, receive evidence and preside at or conduct
 any such study or investigation.
   (c) If the commission makes a preliminary  determination  pursuant  to
 section  13-02  of  this  chapter,  that  any  plan, program, procedure,
 approach, measures or standard adopted or utilized by any city agency or
 the department of personnel does not provide equal  employment  opportu-
 nity;  and/or if the commission makes a preliminary determination pursu-
 ant to this chapter and chapter twelve of this charter, that  an  agency
 has not provided equal employment opportunity the commission shall noti-
 fy  the  agency in writing of this determination and provide an opportu-
 nity for the agency to respond. If the commission,  after  consideration
 of  any  such  response  and after consulting with the agency, concludes
 that the corrective actions, if any, taken or planned by the agency  are
 not  sufficient to correct the non-compliance identified in the prelimi-
 nary determination, it should make a  final  determination  in  writing,
 including  such recommended corrective action as the commission may deem
 appropriate. The agency shall within thirty days thereafter  respond  to
 the  commission  on  any  corrective action it intends to make and shall
 make monthly reports to such commission on the progress of such  correc-
 tive action. If the commission, after a period not to exceed six months,
 determines  that  the  agency  has  not  taken appropriate and effective
 corrective action, the commission shall notify the agency in writing  of
 this  determination  and  the commission may thereafter publish a report
 and recommend to the mayor whatever appropriate  corrective  action  the
 commission  deems  necessary  to ensure compliance with equal employment
 opportunity pursuant to the requirements of  this  chapter  and  chapter
 twelve  of  this charter.   Within thirty days of such determination the
 agency shall submit a written response to the commission and the  mayor.
 The  mayor  after  reviewing  the commission's findings and the agency's
 S. 8474                            52
 
 response, if any, shall order and publish such action as he or she deems
 appropriate.
                                Chapter 14
                           Collective Bargaining
   § 14-01. Office of collective bargaining; director.
   There  shall  be an office of collective bargaining, the head of which
 shall be the director of such office, who shall be  the  person  holding
 the  office  of  chairman  of  the board of collective bargaining.   The
 director may appoint, and at pleasure remove, two deputies.
   § 14-02. Board of collective bargaining.
   There shall be in the office  of  collective  bargaining  a  board  of
 collective  bargaining, which shall consist of five members. Two members
 of the board shall be city members, two members of the  board  shall  be
 labor  members,  and  one  impartial  member who shall be the chair. The
 mayor shall have the power to appoint the city members of the  board  to
 serve  at  the mayor's pleasure, and the labor members of the board from
 designations by the municipal  labor  committee.  Each  labor  and  city
 member  shall  have  an alternate, who shall be appointed and removed in
 the same manner as the member for whom he or she is the  alternate.  The
 chair  shall  be  elected  by  the  unanimous vote of the city and labor
 members, and shall serve for three year terms.
   Notwithstanding any other provision of law, a labor member may not  be
 removed  from  the  board  except  upon  request  of the municipal labor
 committee, or except for cause, as hereinafter provided. Any member  may
 be  removed  for  cause  by a majority of the entire board, including at
 least one city member and one labor member, after having  been  given  a
 copy of the charges against him and an opportunity to be heard in person
 or  by counsel in his or her defense upon not less than ten days notice.
 Vacancies in the office of a city member or  a  labor  member  shall  be
 filled  in the same manner as herein provided for appointment. Vacancies
 in the office of an impartial member occurring otherwise than by expira-
 tion of term shall be filled by unanimous vote of  the  city  and  labor
 members for the unexpired balance of the term.
   § 14-03. Bureau of certification.
   There  shall  be  in  the  office of collective bargaining a bureau of
 certification, which shall be administered by the  impartial  member  of
 the board of collective bargaining.
   § 14-04. Powers and duties.
   The  office of collective bargaining, the board of collective bargain-
 ing and the bureau of certification shall have such  powers  and  duties
 with  respect  to  labor relations and collective bargaining as shall be
 prescribed by law and which shall be substantially equivalent to chapter
 3 of title 12 of the New York city administrative code as it existed  on
 the date this charter was submitted pursuant to subdivision c of section
 4 of chapter 773 of the laws of 1989 and shall also provide for a Staten
 Island municipal labor committee.
   § 14-05. Compensation.
   (a)  Board of collective bargaining; bureau of certification director.
 The city members and the  labor  members  of  the  board  of  collective
 bargaining  and  their  alternates shall serve without compensation. The
 director shall be salaried for his or her services as director, chair of
 the board of collective bargaining,  and  administrator  of  the  bureau
 certification.  The  director  and  all  members of both such boards and
 their alternates shall be  entitled  to  receive  a  per  diem  fee  and
 reimbursement  for  their  actual and necessary expenses incurred in the
 performance of their duties.   Fifty percent of the  salary,  fees,  and
 S. 8474                            53
 
 expenses  provided  for in this subdivision shall be paid by the members
 of the municipal labor committee, under rules and regulations issued  by
 the  board  of  collective  bargaining, which rules may provide how such
 costs shall be distributed among such members.
   (b)  Members  of mediation and impasse panels; arbitrators. Members of
 mediation and impasse panels, and arbitrators, shall be paid a per  diem
 fee  to  be determined by the board of collective bargaining, unless the
 parties to the particular dispute shall have agreed to a different  fee,
 and shall be reimbursed for their actual and necessary expenses incurred
 in  the  performance  of  their duties.   The public employer and public
 employee organization which are parties to the particular negotiation or
 grievance shall each pay fifty percent of such  fees  and  expenses  and
 related  expenses  incidental to the handling of deadlocked negotiations
 and unresolved grievances.
   (c) Appointment of counsel and attorneys. The director may  appoint  a
 counsel  and  attorneys,  who, at the direction of the bureau of certif-
 ication or the board of collective bargaining may appear for and  repre-
 sent  the  office  of  collective  bargaining or either of the aforesaid
 boards in any legal proceeding.
   § 14-06. Publication of collective bargaining agreements.
   Not later than sixty calendar days after the execution of a collective
 bargaining agreement, a copy shall be published in a newspaper of gener-
 al circulation in the city together with a statement by the mayor:
   (a) of the total costs and current and future budgetary  and  economic
 consequences of the agreement, and
   (b)  of  the  implications  and  likely impact of the agreement on the
 efficient management of city  agencies  and  the  productivity  of  city
 employees.
   § 14-07. Budgeting for agreements.
   (a) So far as practicable, each collective bargaining agreement cover-
 ing  city  employees  shall be executed prior to the commencement of the
 fiscal year during which its provisions shall first be in effect.
   (b) No part of any retroactive wage  or  salary  settlement  shall  be
 charged to the capital budget.
                                Chapter 15
                           Transitory Provisions
   §  15-01.  Rights  of  officers  and employees of the city of New York
 preserved.
   (a) Nothing in this charter  contained  shall  affect  or  impair  the
 rights  or  privileges  of officers or employees of the city of New York
 who are transferred, reassigned, appointed or otherwise employed by  the
 city in relation to the personnel, appointment, salaries, ranks, grades,
 tenure  of  office,  promotion,  removal, pension and retirement rights,
 civil rights or any other rights or privileges of officers or  employees
 of the city generally or officers or employees of any agency.
   (b)  There shall be no layoffs of officers or employees of the city of
 New York classified municipal civil service as a result of  transfer  of
 functions  or work currently being performed by employees or officers of
 the city of New York to the city of Staten Island.  The city shall guar-
 antee the continued employment of all officers and employees of the city
 of New York who are performing  duties  and  functions  related  to  any
 municipal  governmental operation affecting the city of Staten Island at
 the time this charter takes effect.
   § 15-02. Transfer of officers and employees in  case  of  transfer  of
 functions.
 S. 8474                            54
 
   Wherever  by any provision of this charter functions, powers or duties
 are assigned to any agency which have been heretofore exercised  by  the
 city  of  New  York, its agencies, boards, corporations or other related
 entities, all officers and employees in the classified  municipal  civil
 service  who  at the time when such charter provisions shall take effect
 are engaged in the performance of such functions, powers or duties shall
 be transferred to the agency to which such functions, powers  or  duties
 are  assigned by this charter, without examination and without affecting
 existing compensation or pension or  retirement  rights,  privileges  or
 obligations of such officers and employees. Furthermore, any employee to
 be  transferred  to the city pursuant to this charter shall be given the
 option to remain in the employ of the city of New York  without  diminu-
 tion  of  rights,  privileges,  salary  and  benefits.  Any employee not
 included in such transfer shall be able to protest the decision pursuant
 to the procedures set forth in section seventy of the civil service law.
   § 15-03. Continuity of employee representation.
   Employees transferred from the city of New York to the city except for
 those designated managerial or confidential shall be included in employ-
 er - employee negotiating units comparable to existing units in the city
 of New York. With respect to employees to be placed in such  negotiating
 units,  the  public  employee  organization  recognized  or certified to
 represent the employees in comparable city of New York negotiating units
 shall be recognized as the city unit representative.
   § 15-04. Continuity of collectively bargained benefits.
   All rights, privileges and benefits provided by collectively bargained
 agreements to city of New York employees shall  be  continued  for  such
 employees  transferred,  reappointed  or  otherwise employed by the city
 until such time as successor collective bargaining agreements are  nego-
 tiated.
   § 15-05. Future alterations of the negotiating units.
   Future  alterations of the city negotiating units shall be made pursu-
 ant to article fourteen of the state civil service  law  and  office  of
 collective bargaining implementing legislation.
   § 15-06. Establishment of new titles.
   (a)  The city shall consult and bargain on all terms and conditions of
 employment  with  the  appropriate  public  employee  organization  with
 respect  to  the establishment of any new titles which are similar to or
 reasonably related to titles already represented by such public employee
 organizations in the city or in the city of New York.
   (b) Any such titles for  which  terms  and  conditions  are  bargained
 pursuant  to  subdivision  (a)  of  this  section  shall be deemed to be
 successor titles within the meaning of applicable law. So  long  as  the
 responsibilities  of employees in these titles are reasonably related to
 the  responsibilities  of  employees  currently  represented  by  public
 employee  organizations,  such titles shall be accredited or placed in a
 negotiating unit represented by such public employee organizations.
   § 15-07. Dispute resolution.
   If a dispute arises, the office of collective bargaining shall  deter-
 mine  which  public  employee  organization  is appropriate to represent
 transferees, other hires, or employees in a new title on  the  basis  of
 the  title's  community of interest with titles in the city and the city
 of New York.
   § 15-08. Existing rights and remedies preserved.
   No existing right or remedy of any character shall be lost or impaired
 or affected by reason of the adoption of this charter.
 S. 8474                            55
 
                                Chapter 16
                              Labor Relations
   § 16-01. Department; commissioner.
   (a)  There is established a department of labor relations, the head of
 which shall be the commissioner of labor relations.
   (b) The commissioner of labor relations is hereby authorized to repre-
 sent the mayor in the conduct of all  relations  between  the  city  and
 labor  unions, associations, or other organizations representing employ-
 ees of the city. The commissioner of labor relations shall be  responsi-
 ble for the conduct of all relations and she or he shall establish broad
 city wide policy governing them.
   (c)  The  appropriate  city  staff agencies shall render advice to the
 commissioner of labor relations on questions of law, finance,  personnel
 policy, operations and management.
   § 16-02. Powers and duties.
   (a)  The  commissioner  of  labor relations is authorized to negotiate
 labor agreements with the unions certified as representing  the  various
 groups  of  city  employees, and to prepare and sign labor agreements on
 behalf of the mayor.
   (b) The heads of all city departments and agencies and  the  staff  of
 the  office  of the mayor shall cooperate fully with the commissioner of
 labor relations in carrying out his or her responsibilities.  This coop-
 eration shall include, but not be limited to the following:
   1. notice and transmittal to the commissioner of  labor  relations  of
 all  inquiries  and  requests  from  labor unions, associations or other
 organizations representing employees of the city soliciting  interpreta-
 tion of any agreement;
   2.  actions by city departments or agencies based upon interpretations
 of collective bargaining agreement shall  not  be  taken  without  prior
 consultation with the commissioner of labor relations;
   3.  agreements,  contracts or understandings, verbal or written, shall
 be consummated between the head of any city department or agency or  one
 of  his  or  her  subordinates, and a union or organization representing
 employees of that agency, only after prior consultation  and  review  by
 the commissioner of labor relations;
   4.  grievance  and  dispute settlement procedures such as arbitration,
 mediation,  fact-finding  and  labor-management  conference  discussions
 relating  to city employee labor disputes or grievances, either advisory
 or binding, shall be entered into by city departments or  agencies  only
 after  prior  consultation  and  review  of  the  commissioner  of labor
 relations. Such settlement procedures shall  be  processed  through  and
 handled by the department of labor relations;
   5.  city  departments and agencies shall not unilaterally change, in a
 substantial way, the working conditions of their employees without prior
 consultation with the commissioner of labor relations;
   6. city departments and agencies shall not  take  disciplinary  action
 against any employee or group of employees involved in a labor relations
 dispute  without  prior  consultation  with  the  commissioner  of labor
 relations;
   7. city departments and agencies shall  provide  the  commissioner  of
 labor  relations with all necessary information needed in the conduct of
 labor negotiations affecting employees in their  departments  and  shall
 participate with the commissioner of labor relations in the negotiations
 as, in the opinion of the commissioner of labor relations, may be neces-
 sary from time to time;
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   8.  heads of city departments and agencies and the staff of the office
 of the mayor shall give notice to the commissioner of labor relations of
 all meetings held with labor unions, associations,  or  other  organiza-
 tions representing city employees;
   9.  heads  of city departments and agencies and the staff of the mayor
 shall consult with the commissioner of  labor  relations  prior  to  the
 issuance  of  any  public or press statement relating to labor relations
 with city employees;
   10. the labor relations officer of each  city  department  and  agency
 shall  act  as  liaison with the department of labor relations and shall
 keep that department informed of employee relations problems in  his  or
 her  department  or  agency.  In particular, he or she shall immediately
 notify the department of labor relations of  any  threatened  or  actual
 strike,  work  stoppage,  job  action,  mass resignation or picketing by
 employees of his or her department or agency.
   § 3-001. Legislative findings and declaration of purposes.
   The legislature hereby finds and declares that it is essential that  a
 municipal  corporation  of  the  city  of Staten Island be authorized to
 represent the interests of the city of Staten Island during the  transi-
 tion  period  prior  to  the  date of establishment of the city, provide
 preparation for the operations of the city  and  provide  financing  for
 such transition period and initial funding for the city.
   § 3-002. Elections.
   1.  The  board  of elections of the city of New York shall provide for
 the election of a mayor, a city comptroller and  a  common  council,  as
 provided for in chapter 773 of the laws of 1989, as amended, for a poli-
 tical subdivision of the state to be known as the city of Staten Island,
 at  the general election to be held in November next succeeding the date
 on which this section shall have become a law in the county of Richmond.
 Such expenses for such election will be reimbursed  by  the  state  from
 those  moneys  to  be allocated as general state aid to a city of Staten
 Island.  Chapter 7 of title 3 of the administrative code of the city  of
 New  York,  known as the "New York City Campaign Finance Act", shall not
 apply to such elections.
   2. The Mayor elect and common council elect  of  the  city  of  Staten
 Island, upon the constitutional oath of office, are hereby authorized to
 represent  the  interests  of  the city of Staten Island, and as govern-
 mental officers of the city of Staten Island  are  authorized  to  enter
 into  negotiations  as  provided  under  this  act  and  enter into such
 purchase or employment contracts as would be authorized  for  such  city
 subsequent  to  the  date of establishment. Any such contracts or agree-
 ments from such negotiations shall be binding upon the  city  of  Staten
 Island.
   3. The mayor elect, the comptroller elect and the common council elect
 shall  take  the  oath of office on the first of January next succeeding
 the date on which this act shall have become a law, at  which  time  the
 city shall be incorporated. The mayor, city comptroller and common coun-
 cil  shall establish accounts according to the provisions of the charter
 of the city of Staten Island and appoint such other city officers as may
 be necessary in accordance with the provisions of the city charter.
   § 3-003. Staten Island city government-transition.
   1. Short title. This section may be cited as the "Staten  Island  City
 Government-Transition Act".
   2. Definitions. For the purposes of this section:
   (a) "City" means the city of Staten Island.
 S. 8474                            57
 
   (b)  "Director of management and budget" means the director of manage-
 ment and budget of the city of Staten Island.
   (c)  "Corporation"  means the municipal corporation as created by this
 section.
   (d) "Mayor" means the mayor of the city of Staten Island.
   (e) "Comptroller" means the comptroller of the city of Staten Island.
   (f) "State" means the state of New York.
   (g) "Bonds" and "notes" means revenue bonds  and  notes  respectively,
 issued by the corporation pursuant to this section.
   (h) "Revenues" means all aid, rents, fees, charges, payments and other
 income and receipts paid or payable to the municipal corporation for the
 account  of the city of Staten Island, including any payment required to
 be made to the corporation by this section.
   (i) "Operating expenses" means all expenses incurred by the government
 in the administration of the municipal  corporation  including  but  not
 limited to salaries, administrative expenses, insurance premiums, audit-
 ing  and  legal expenses and fees and expenses incurred for professional
 consultants and fiduciaries.
   (j) "Capital reserve fund requirement" means as of any particular date
 of computation, an amount of money equal to the amount required, for the
 then current fiscal year of the municipal corporation, to  pay  interest
 during  such  fiscal year on all bonds of the corporation outstanding on
 said date of computation, the principal  amount  of  all  bonds  of  the
 corporation outstanding on said date of computation which matures during
 such  fiscal year and the amount of sinking fund payments payable during
 such fiscal year with respect to any bonds of the corporation  outstand-
 ing on said date of computation.
   (k)  "Sinking fund payment" means the amount of money specified in the
 resolution authorizing bonds as payable into a  sinking  fund  during  a
 particular  fiscal  year  for  the retirement of term bonds which mature
 after such fiscal year, but shall not  include  any  amount  payable  by
 reason only of the maturity of the bond.
   3.  General powers as a municipal corporation. The city shall have the
 following powers in addition to those specially conferred  elsewhere  in
 this  act: (a) to sue and be sued; (b) to have a seal and alter the same
 at pleasure; (c) to make and alter  by-laws  for  its  organization  and
 internal management and, subject to agreements with noteholders or bond-
 holders, to make rules and regulations governing the use of its property
 and facilities; (d) to make and execute contracts, leases, subleases and
 all  other  instruments  or  agreements  necessary or convenient for the
 exercise of its powers and functions under this section; (e) to purchase
 real or personal property necessary and  convenient  for  its  municipal
 purposes; to execute and deliver deeds for real property held in its own
 name; and to sell or otherwise to dispose of such real or personal prop-
 erty  that,  in the judgment of the city, is no longer necessary for its
 municipal purposes; (f)  to  appoint  officers,  agents  and  employees,
 prescribe  their  duties  and qualifications and fix their compensation;
 (g) to commence any action to protect or  enforce  any  right  conferred
 upon it by any law, contract or other agreement; (h) to borrow money and
 to  issue  negotiable notes or bonds or other obligations and to fund or
 refund the same, and to provide for the rights of  the  holders  of  its
 obligations;  (i)  subject  to the provisions of any contract with note-
 holders or bondholders, to invest any funds held in reserves or  sinking
 funds,  or  any funds not required for immediate use or disbursement, at
 the discretion of the city, in  obligations  of  the  state  or  federal
 government, obligations the principal of and interest on which are guar-
 S. 8474                            58
 
 anteed by the state or federal government, or obligations of agencies of
 the  federal  government  which  may,  from  time  to  time,  be legally
 purchased by savings banks of the state as investments of funds  belong-
 ing  to  them  or  in  their control and which have been approved by the
 state comptroller or in secured time deposits or other interest  bearing
 accounts  secured  by such obligations; (j) subject to the provisions of
 any contract with noteholders or bondholders, to purchase notes or bonds
 of the city; (k) to procure insurance against any loss in  such  amounts
 and from such insurers as it deems desirable; (l) to engage the services
 of  consultants on a contract basis for rendering professional and tech-
 nical assistance and advice; (m) to contract for and to accept any gifts
 or grants or loans of funds or property or financial or other aid in any
 form from the federal government or any agency or instrumentality there-
 of, or from any other source and to comply with the terms and conditions
 thereof; (n) as security for the payment of the principal of and  inter-
 est  on any bonds so issued and any agreements made in connection there-
 with, to pledge all or any part of its revenues; (o) to enact such local
 laws to take effect on the date of establishment as shall  be  necessary
 to provide for effective transition of government; and (p) to do any and
 all  things  necessary or convenient to carry out its purposes and exer-
 cise the powers expressly given and granted in this act.
   4. Notes and bonds of the city. The city shall have power and is here-
 by authorized from time to time to issue its negotiable notes and  bonds
 in conformity with applicable provisions of the uniform commercial code,
 the local finance law and the state finance law.
   § 3-004. Employees of the city of Staten Island.
   1.  Notwithstanding  any  inconsistent  provisions  of  this  act, the
 appointment and promotion of all employees of and for the city shall  be
 made  in  accordance  with the provisions of the state civil service law
 and shall be subject to the jurisdiction  of  the  state  civil  service
 commission and the compensation for such employees shall be fixed by the
 city.
   2.  Any  municipality  and  the  city shall have the power to agree to
 provide for the transfer to the city of agents, employees and facilities
 of such municipality  to  enable  the  city  to  fulfill  its  municipal
 purposes.   Employees of such municipality to be transferred to the city
 pursuant to this act shall be automatically appointed and transferred to
 the city in the same or equivalent classification and position they hold
 at the time of the transfer.   The city,  its  officers  and  employees,
 shall  be subject to article fourteen of the state civil service law and
 for all purposes the city shall remain and be deemed "public  employer".
 Employees  who  are  members or beneficiaries of any existing pension or
 retirement system shall continue to have such rights, privileges,  obli-
 gations  or  status with respect to such system as are prescribed by law
 on the date this act takes effect, and all such employees who have  been
 appointed  to  positions  in  municipal  service  in accordance with the
 provisions of the state civil service law under the rules  of  the  city
 civil service commission shall have the same status with respect thereto
 in the service of the city as they had in prior municipal service.
   3.  Transfer rights. Notwithstanding any other provision of law, there
 shall be no layoffs of officers or employees of  the  preceding  munici-
 pality, its agencies, authorities, boards, corporations or other related
 entities  as  a  result  of  the transfer of functions or work currently
 performed by these officers and employees to the city of Staten  Island.
 All  such  employees  who have been assigned to work on Staten Island or
 who have been substantially engaged in the performance of a function  to
 S. 8474                            59
 
 be  transferred  to  the  city  of Staten Island shall be transferred to
 positions in employment by the city of Staten Island upon the establish-
 ment of the city of Staten Island and shall retain  all  rights,  privi-
 leges,  benefits  and salaries to which any such employee was previously
 entitled as an employee of the preceding municipality.  Notice  that  an
 employee  is  subject  to transfer shall be given to an employee no less
 than twenty days prior to the effective date of transfer.  Any  employee
 so  notified may opt to remain in his or her employment by the preceding
 municipality rather than be transferred  by  so  informing  his  or  her
 employer  ten  days  prior to the transfer date.  Such employee shall be
 retained in employment by the  preceding  municipality  and  retain  all
 rights,  privileges,  benefits  and  salaries  to which the employee was
 entitled prior to the establishment of the city of Staten Island.
   4. Transfer mechanism. The mechanism for the transfer of the employees
 to the city of Staten Island shall be the subject of negotiations  among
 the  preceding municipality, the city of Staten Island and the appropri-
 ate public  employee  organizations.  The  parties  shall  negotiate  an
 appeals  process  for  employees  aggrieved  by their exclusion from the
 transfer. If the parties are unable to reach agreement  as  to  transfer
 issues, the parties shall submit such issues to mediation and, if neces-
 sary,  impasse  panels to be appointed in accordance with the collective
 bargaining provisions of the administrative code of the preceding  muni-
 cipality.  Transferees  represented by the public employee organizations
 shall be entitled to all rights and benefits which they were entitled to
 prior to transfer including, but not limited to, seniority  and  accrued
 annual and sick leave time.
   5.  Vacancies.  Any employee of the preceding municipality not subject
 to the transfer set forth in subdivision three of this section shall  be
 eligible  to  transfer  to  a  vacant position in a title in the city of
 Staten Island requiring the same, similar or related  duties  to  duties
 actually  performed  in  the  preceding municipality title by submitting
 written notice of intent to transfer to the city of Staten Island direc-
 tor of personnel within six months of the establishment of the  city  of
 Staten  Island.  The  preceding  municipality  shall  inform  in writing
 employees who are residents of Staten Island of their right to apply for
 transfer. Immediately upon receipt of any notice to transfer, the direc-
 tor of personnel shall establish for each city of  Staten  Island  title
 two  lists  of eligible employees who give timely notice in order of the
 employees' preceding municipality seniority in the title  requiring  the
 same,  similar or related duties. The first list shall include the names
 of transfer applicants who are domiciled in the city of Staten Island on
 the date of the submission of the notice. The second list shall  include
 the  names  of  transfer  applicants not domiciled in the city of Staten
 Island. Appointments to any vacant positions in these  titles  shall  be
 made  from  the  Staten  Island  domicile  list  and,  when that list is
 exhausted, from the second list until such lists are exhausted or  until
 a  period  of four years from the date of the establishment of the indi-
 vidual list has expired.
   6. Residency exemption. Any employee  of  the  preceding  municipality
 appointed, reassigned or transferred to city of Staten Island employment
 without  a  break in service shall be exempt from any residency require-
 ment in connection with his or her employment or  subsequent  promotion,
 demotion,  reassignment,  transfer  or  other  personnel change. For the
 purpose of this section, a break in service shall be defined as a period
 of more than one year. Notwithstanding any other provision of  law,  any
 Staten  Island  resident  employed  by  the preceding municipality or on
 S. 8474                            60
 
 leave of absence from such employment on the date of  the  establishment
 of the city of Staten Island shall be exempt from any residency require-
 ment  in connection with his or her preceding municipality employment or
 subsequent  preceding  municipality  promotion,  demotion, reassignment,
 transfer or other personnel change.
   7. Retirement. The city of Staten  Island  shall  participate  in  the
 State's retirement systems.
   (a)  On  and after the date of the establishment of the city of Staten
 Island, employees of the preceding municipality who are  transferred  to
 employment  in  the city of Staten Island shall thereupon become members
 of the appropriate state retirement system to the  extent  permitted  or
 required  by  the  provisions of the retirement and social security law,
 the education law or local  law,  as  appropriate,  and  the  employees'
 reserves  in  any  other  retirement  system shall be transferred to the
 appropriate New York state retirement system without request by them  or
 notice to the retirement systems, except that any such employee who is a
 member  of  one  of the retirement systems of the preceding municipality
 may elect to continue membership in such system. Any  election  pursuant
 to  this subdivision shall be made no later than the one hundred twenti-
 eth day succeeding the date on which  the  provisions  of  this  section
 become  effective,  by filing a written notice thereof with the adminis-
 trative head of the appropriate New York state,  preceding  municipality
 and  city  of Staten Island retirement systems, as appropriate, and once
 made and filed, shall be irrevocable. Upon the retirement of an employee
 who has made such an election, the calculation of final  average  salary
 by  the  retirement  system  of  the  preceding  municipality  shall  be
 performed as if the salary earned as a city of Staten Island employee on
 and after the effective date of this section was earned in employment of
 the preceding municipality. In the case of an employee  who  remains  or
 becomes a member of a New York state employees' retirement system pursu-
 ant  to this subdivision, the retirement system of the preceding munici-
 pality shall make a transfer of reserves, contributions and  credits  to
 such New York state employees' retirement system, in the manner required
 by section 43 of the retirement and social security law.
   (b) The comptroller of the preceding municipality shall certify to the
 comptroller  of  the  city of Staten Island and the state comptroller or
 other chief officer of a  state  pension  system  the  amount  of  money
 required  to  be  paid  by  the  city of Staten Island for pension costs
 resulting from elections made pursuant to paragraph (a) of this subdivi-
 sion and the comptroller of the city of Staten Island shall pay  to  the
 retirement  system  of  the  preceding municipality upon approval by the
 state comptroller or other chief officer of a state pension system,  the
 amounts  so  certified by the comptroller of the preceding municipality.
 The comptroller of the preceding municipality shall also certify to  the
 comptroller  of  the  city of Staten Island and the state comptroller or
 other chief officer of a  state  pension  system  the  amount  of  money
 required  to  be  contributed  by such employees. The comptroller of the
 city of Staten Island shall be authorized to provide for the withholding
 or withhold the contribution of such employees and the payment  of  that
 amount  to  the  retirement  system  of  the preceding municipality. The
 amount so certified pursuant to this paragraph shall be the same as  the
 amounts required to be contributed for similarly situated city employees
 by  the preceding municipality and by employees of the preceding munici-
 pality.
   8. Health insurance coverage. Health insurance coverage  for  city  of
 Staten  Island  employees,  persons  retired  from city of Staten Island
 S. 8474                            61
 
 employment and dependents  of  such  employees  and  retirees  shall  be
 provided  in  accordance  with the personnel and labor, health insurance
 coverage for municipal employees, persons retired from municipal employ-
 ment  and  dependents  of  such employees and retirees provisions of the
 administrative code of the preceding municipality unless the duly recog-
 nized public employee representative negotiates altered terms.
   9. Quasi-public entities. Rights and benefits of  employees  currently
 employed  by  public  authorities, boards, corporations and other quasi-
 public entities of the preceding municipality shall  be  preserved  upon
 any  transfer  of functions resulting from the establishment of the city
 of Staten Island.
   § 3-005.  Assistance to the city of Staten Island.
   With the consent of any municipality, the city of  Staten  Island  may
 use agents, employees and facilities of such municipality, paying to the
 municipality its agreed proportion of the compensation or costs.
   § 3-006. Provision of municipal services in the city of Staten Island.
   During  the transition period the mayor and comptroller of the city of
 Staten Island and the mayor and comptroller  of  the  preceding  munici-
 pality  are  authorized  to enter into agreements as to the provision of
 municipal services by the preceding municipality to the city  of  Staten
 Island  to be provided on or after the date of establishment of the city
 of Staten Island and the terms and conditions thereof.
   § 3-007. Debt, property, obligations and other allocations.
   1. (a) Proportion of debt to be assumed by the city of Staten  Island.
 The  proportion of the debt of the preceding municipality which shall be
 assumed by the city of Staten Island, as constituted by this act,  shall
 be  determined in the following manner: The mayor and the comptroller of
 the city of Staten Island, as representing the city of Staten Island and
 the mayor and the comptroller of the preceding municipality, are  hereby
 authorized  and  empowered to agree if they can, as to the amount of the
 debt of the preceding municipality, which should equitably and  properly
 be  assumed  by  the  city  of Staten Island. If the mayor and the comp-
 troller of the city of Staten Island and the mayor and  the  comptroller
 of the preceding municipality shall be unable to agree within six months
 after this section takes effect as to the proportion of said debt of the
 preceding  municipality  to be assumed by the city of Staten Island, the
 supreme court of the third judicial district shall have power to  deter-
 mine  the  proportion  of  said debt of the preceding municipality to be
 assumed by the city of Staten Island, and to enforce such  award,  deci-
 sion  and  determination  as shall be made in an action to be brought by
 and in the name of either of said parties not less than six  months  nor
 more  than  one  year  after  this  section takes effect. Nothing herein
 contained shall impair the obligation of any contract; and the  property
 and inhabitants of such part of the preceding municipality as is by this
 act  included within the city of Staten Island, shall continue liable to
 the existing creditors of  the  said  preceding  municipality,  in  like
 manner,  as  if  this  act  had  not been passed. But from and after the
 taking effect of this section, the preceding municipality shall have  no
 power  to  issue  any bond, obligation or other evidence of indebtedness
 which shall bind or render liable the property  or  inhabitants  of  any
 part  of  said municipality included within the city of Staten Island as
 hereby constituted. The apportionment of the debt of the preceding muni-
 cipality shall be determined according to the  relative  assessed  valu-
 ation of the real property included in, or remaining without the city of
 Staten Island.
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   (b)  Proportion  of  obligations  other than debt to be assumed by the
 city of Staten Island. The proportion of the obligations other than debt
 of the preceding municipality which shall be  assumed  by  the  city  of
 Staten  Island,  as  constituted by this act, shall be determined in the
 following  manner:  The  mayor and the comptroller of the city of Staten
 Island, as representing the city of Staten Island and the mayor and  the
 comptroller  of  the  preceding  municipality, are hereby authorized and
 empowered to agree if they can, as to  the  amount  of  the  obligations
 other  than  debt  of the preceding municipality, which should equitably
 and properly be assumed by the city of Staten Island. If the  mayor  and
 the comptroller of the city of Staten Island and the mayor and the comp-
 troller  of  the  preceding municipality shall be unable to agree within
 six months after this section takes effect as to the proportion of  said
 obligations  other than debt of the preceding municipality to be assumed
 by the city of Staten Island, the supreme court of  the  third  judicial
 district  shall  have  power  to  determine the proportion of said obli-
 gations other than debt of the preceding municipality to be  assumed  by
 the  city  of  Staten  Island,  and  to enforce such award, decision and
 determination as shall be made in an action to be brought by and in  the
 name  of  either  of said parties not less than six months nor more than
 one year after this section takes effect. Nothing herein contained shall
 impair the obligation of any contract; and the property and  inhabitants
 of  such  part  of the preceding municipality as is by this act included
 within the city of Staten Island, shall continue liable to the  existing
 obligees  of the said preceding municipality, in like manner, as if this
 act had not been passed. But from and after the taking  effect  of  this
 section,  the  preceding  municipality  shall  have  no power to bind or
 render liable the property or inhabitants of any part  of  said  munici-
 pality included within the city of Staten Island as hereby constituted.
   (c)  Disposition  of  real  and  personal property owned by or held in
 trust for the preceding municipality. All the real property owned by the
 preceding municipality and situated in that part   of said  municipality
 included  within  the city of Staten Island, as constituted by this act,
 is hereby vested in the said city of Staten Island and divested  out  of
 the  preceding  municipality,  and all of the real property owned by the
 preceding municipality and situated elsewhere in  said  municipality  is
 hereby vested in the preceding municipality and divested out of the said
 city  of Staten Island. All of the property owned by the preceding muni-
 cipality other than real property, including money, investments, securi-
 ties on investments and money held in trust  for  the  benefit  of  said
 municipality,  directly  or  indirectly,  shall  be  divided between the
 preceding municipality and the city of Staten Island, as constituted  by
 this act, and the proportion of the same to which  each shall, in equity
 and good conscience, be entitled to receive upon such division, shall be
 ascertained  and  determined  by  agreement by and between the mayor and
 comptroller of the preceding municipality, upon the one  side,  and  the
 mayor  and  the  comptroller of the said city of Staten Island, upon the
 other side, and in the case of their inability to agree upon such  divi-
 sion within six months after this section shall take effect, the supreme
 court  in  the third judicial district is hereby empowered to divide the
 same between them and to ascertain  and  award  to  each  its  equitable
 proportion thereof, and to enforce its determination thereon, and either
 of the said municipalities may institute and prosecute, in its own name,
 an  action  in  said  court for that purpose after the expiration of six
 months and before the expiration of one year after  this  section  takes
 effect.
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   (d)  Documents.  The  preceding municipality shall provide the city of
 Staten Island with all books, papers, documents and files held  by  such
 municipality  which  apply  primarily  to the area of the city of Staten
 Island and shall make available for copying by the city of Staten Island
 any  other  books,  papers,  documents  and  files which such city shall
 request as pertaining to such city in any other manner.
   2. (a) Proportion of debt to be assumed by the city school district of
 the city of Staten Island. The proportion of the debt of the city school
 district of the preceding municipality which shall  be  assumed  by  the
 city  school  district  of  the city of Staten Island, as constituted by
 this act, shall be determined in the  following  manner:  The  board  of
 education  of  the city school district of the city of Staten Island and
 the board of education of the city  school  district  of  the  preceding
 municipality,  are hereby authorized and empowered to agree if they can,
 as to the amount of the debt of the city school district of the  preced-
 ing  municipality, which should equitably and properly be assumed by the
 city school district of the city of  Staten  Island.  If  the  board  of
 education  of  the city school district of the city of Staten Island and
 the board of education of the city  school  district  of  the  preceding
 municipality  shall  be  unable  to  agree  within six months after this
 section takes effect as to the proportion  of  said  debt  of  the  city
 school  district of the preceding municipality to be assumed by the city
 school district of the city of Staten Island, the supreme court  of  the
 third  judicial district shall have power to determine the proportion of
 said debt of the city school district of the preceding  municipality  to
 be assumed by the city school district of the city of Staten Island, and
 to enforce such award, decision and determination as shall be made in an
 action  to  be  brought by and in the name of either of said parties not
 less than six months nor more than one year  after  this  section  takes
 effect.  Nothing  herein  contained  shall  impair the obligation of any
 contract; and the property and inhabitants of  such  part  of  the  city
 school district of the preceding municipality as is by this act included
 within  the  city  school  district  of the city of Staten Island, shall
 continue liable to the existing creditors of the city school district of
 the said preceding municipality, in like manner, as if this act had  not
 been  passed.  But from and after the taking effect of this section, the
 city school district of said preceding municipality shall have no  power
 to  issue  any  bond, obligation or other evidence of indebtedness which
 shall bind or render liable the property or inhabitants of any  part  of
 the  city  school district of said municipality included within the city
 school district of the city of Staten Island as hereby constituted.  The
 apportionment of the debt of the city school district of  the  preceding
 municipality  shall  be  determined  according  to the relative assessed
 valuation of the real property included in,  or  remaining  without  the
 city school district of the city of Staten Island.
   (b)  Disposition  of  real  and  personal property owned by or held in
 trust for the city school district of  the preceding municipality.   All
 the  real  property  owned by the city school district of  the preceding
 municipality and situated in that part of the city  school  district  of
 said  municipality  included within the city school district of the city
 of Staten Island, as constituted by this act, is hereby  vested  in  the
 city  school  district of the  city of Staten Island and divested out of
 the city school district of the preceding municipality, and all  of  the
 real property owned by the city school district of the preceding munici-
 pality and situated elsewhere in the city school district of the preced-
 ing  municipality  is  hereby  vested in the city school district of the
 S. 8474                            64
 
 preceding municipality and divested out of the city school  district  of
 the  city of Staten Island. All of the property owned by the city school
 district of the preceding municipality other than real property, includ-
 ing  money,  investments,  securities  on  investments and money held in
 trust for the benefit of the city school district of the preceding muni-
 cipality, directly or indirectly, shall  be  divided  between  the  city
 school  district  of  the  preceding  municipality  and  the city school
 district of the city of Staten Island, as constituted by this  act,  and
 the  proportion  of  the  same to which   each shall, in equity and good
 conscience, be entitled to receive upon such division, shall  be  ascer-
 tained and determined by agreement by and between the board of education
 of  the city school district of the preceding municipality, upon the one
 side, and the board of education of the city school district of the city
 of Staten Island, upon the other side, and in the case of their inabili-
 ty to agree upon such division within  six  months  after  this  section
 shall  take  effect, the supreme court in the third judicial district is
 hereby empowered to divide the same between them and  to  ascertain  and
 award  to  each  its  equitable  proportion  thereof, and to enforce its
 determination thereon, and either  of  the  said  school  districts  may
 institute  and  prosecute,  in its own name, an action in said court for
 that purpose after the expiration of six months and before  the  expira-
 tion of one year after this section takes effect.
   (c)  Documents. The city school district of the preceding municipality
 shall provide the city school district of the city of Staten Island with
 all books, papers, documents and files  held  by  such  school  district
 which  apply  primarily  to  the area of the city school district of the
 city of Staten Island, including its property, faculty and students, and
 shall make available for copying by the city school district of the city
 of Staten Island any other books, papers, documents and files which  the
 city  school  district  of  the  city  of Staten Island shall request as
 pertaining to the city school district of the city of Staten  Island  in
 any other manner.
   § 3-008. Continuance of municipal services.
   The  preceding municipality shall be obligated to continue to maintain
 during the transition period all municipal services and  related  equip-
 ment  and  supplies  at  a  level materially equivalent to that level of
 municipal services and related equipment and supplies for the  geograph-
 ical  area of the city of Staten Island as existing on the first of July
 in the year in which this act shall have become a law subject to  exist-
 ing budget restraints of the preceding municipality.
   §  3-009. Powers of the city of Staten Island to adopt and amend local
 laws.
   Notwithstanding the provisions of any other law, the common council of
 the city of Staten Island shall have the power to adopt  local  laws  in
 accordance  with the provisions of section 10 of the municipal home rule
 law; provided, however, that no such local law adopted during the  tran-
 sition  period shall be effective until the date of establishment of the
 city of Staten Island.
   § 3-010. Powers of the city of Staten Island  relating  to  home  rule
 powers.
   In  accordance  with the provisions of article IX of the constitution,
 the city of Staten Island during the transition period shall have all of
 the rights, powers, privileges and immunities granted to  local  govern-
 ments with respect to the power of the legislature to act in relation to
 the property or affairs of the city of Staten Island.
   § 4-001. City school district of the city of Staten Island.
 S. 8474                            65
 
   1.  The  territory of the city of Staten Island in the county of Rich-
 mond, on the date when this act shall take effect, shall be and is here-
 by constituted a city school district, and shall be known  as  the  city
 school  district  of  the city of Staten Island and shall have and enjoy
 all the powers and duties of a city school district under the provisions
 of the education law.
   2.  Such  district shall be under the control of a board of education,
 which shall be composed pursuant to the provisions of article 52 of  the
 education law.
   §  4-002.  Section 2550 of the education law, as amended by chapter 65
 of the laws of 1972, is amended to read as follows:
   § 2550.  Application of article.  This article shall apply to the city
 school districts of  the  following  cities  only:  New  York,  Buffalo,
 Rochester, Syracuse, STATEN ISLAND and Yonkers.
   §  4-003. Section 2552 of the education law is amended by adding a new
 subdivision e to read as follows:
   E. CITY SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND: NINE MEMBERS.
   § 4-004. Subdivisions 1, 2, 4, 5 and 6 of section 2553 of  the  educa-
 tion law, subdivision 1 as separately amended by chapters 211 and 441 of
 the laws of 1980, subdivisions 2, 4 and 5 as added by chapter 242 of the
 laws  of 1974 and subdivision 6 as amended by chapter 211 of the laws of
 1980, are amended to read as follows:
   1. No person shall be eligible to the office of member of a  board  of
 education  who  is not a citizen of the United States, who is not quali-
 fied to register for or vote at  an  election  in  accordance  with  the
 provisions of section 5-106 of the election law, and who, in the case of
 the city school district of the city of Yonkers, has not been a resident
 of  the  city school district for which he OR SHE is chosen for a period
 of at least three years immediately preceding the date  of  his  OR  HER
 election or appointment and who, in the case of the city school district
 of  the  city of Buffalo, in the case of a member to be elected at large
 is not a qualified voter of such city school district and  who  has  not
 been  a  resident  of such district for a period of at least three years
 immediately preceding the date of his OR HER election and in the case of
 a member elected from a city school subdistrict is not a qualified voter
 of such city school subdistrict and has not been a resident of the  city
 school  district  for  three  years  and  a  resident of the city school
 subdistrict which he OR SHE represents or seeks to represent for a peri-
 od of one year immediately preceding the date of his  OR  HER  election,
 and  who, in the case of the city school district of the city of Roches-
 ter, is not a qualified voter under section 5-102 of the election law of
 such city school district; AND WHO, IN  THE  CASE  OF  THE  CITY  SCHOOL
 DISTRICT  OF  THE CITY OF STATEN ISLAND HAS BEEN A QUALIFIED VOTER UNDER
 SECTION 5-102 OF THE ELECTION LAW OF SUCH CITY SCHOOL  DISTRICT  FOR  AT
 LEAST  NINETY DAYS IMMEDIATELY PRECEDING THE DATE OF HIS OR HER ELECTION
 OR APPOINTMENT; and who in the case of the city school district  of  the
 city  of  Syracuse has not been a qualified voter under section 5-102 of
 the election law of such city school district for at least  ninety  days
 immediately preceding the date of his OR HER election or appointment.
   2.   In the city school districts of the cities of Rochester and Syra-
 cuse the members of such board of  education  shall  be  chosen  by  the
 voters  at  large at either a general or municipal election, or at both.
 IN THE CITY SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND THE MEMBERS  OF
 SUCH  BOARD  OF  EDUCATION SHALL BE CHOSEN PURSUANT TO THE PROVISIONS OF
 SUBDIVISION ELEVEN OF THIS SECTION. In the city school district  of  the
 S. 8474                            66
 
 city  of  Buffalo the members of such board of education shall be chosen
 pursuant to the provisions of subdivision ten of this section.
   4.  In the city school districts of the following cities, the terms of
 such members shall be as follows:
   a. Rochester: Four Years;
   b. Syracuse: Four Years;
   c. Yonkers: Five Years; AND
   D. STATEN ISLAND: THREE YEARS.
   5. The terms of one-fifth of all the members of a board of  education,
 or of a fraction as close to one-fifth thereof as possible, shall expire
 annually  on  the  first  Tuesday  in  May,  except  in  the city school
 districts of the cities of Buffalo, Rochester, STATEN ISLAND  and  Syra-
 cuse.
   6.  If a vacancy occurs other than by expiration of term in the office
 of a member of a board of education in a district in which such  members
 are  elected  at  a general or municipal election, such vacancy shall be
 filled by appointment by the mayor until the next general  or  municipal
 election is held, and such vacancy shall then be filled at such election
 for  the  unexpired portion of such term, except that in the city school
 district of the city of Rochester  any  such  vacancy  shall  be  filled
 pursuant  to  the  provisions  of  subdivision  nine of this section and
 except further that any such vacancy on the board of  education  of  the
 city  school district of the city of Buffalo shall be filled pursuant to
 the provisions of subdivision ten of this section AND  EXCEPT  THAT  ANY
 VACANCY  ON  THE  BOARD  OF EDUCATION OF THE CITY SCHOOL DISTRICT OF THE
 CITY OF STATEN ISLAND SHALL BE FILLED  PURSUANT  TO  THE  PROVISIONS  OF
 SUBDIVISION ELEVEN OF THIS SECTION.
   §  4-005. Section 2553 of the education law is amended by adding a new
 subdivision 11 to read as follows:
   11. A. THE MEMBERS OF THE  BOARD  OF  EDUCATION  OF  THE  CITY  SCHOOL
 DISTRICT  OF THE CITY OF STATEN ISLAND SHALL BE ELECTED BY THE QUALIFIED
 VOTERS OF SUCH CITY AS PROVIDED HEREIN.
   B. THE MEMBERS OF THE BOARD OF EDUCATION SHALL  BE  ELECTED  AT  LARGE
 THROUGHOUT THE CITY AS PROVIDED FOR IN THIS SUBDIVISION.
   C.  (1) EVERY REGISTERED VOTER RESIDING IN THE CITY SCHOOL DISTRICT OF
 THE CITY OF STATEN ISLAND AND EVERY PARENT OF  A  CHILD  OF  SCHOOL  AGE
 UNDER  THE JURISDICTION OF SUCH SCHOOL DISTRICT WHO IS A RESIDENT OF THE
 CITY OF STATEN ISLAND FOR AT LEAST  NINETY  DAYS  IMMEDIATELY  PRECEDING
 SUCH  ELECTION  AND  AT LEAST EIGHTEEN YEARS OF AGE SHALL BE ELIGIBLE TO
 VOTE AT SUCH ELECTION FOR MEMBERS OF THE BOARD OF EDUCATION.
   (2) EACH CANDIDATE FOR MEMBER OF THE BOARD OF EDUCATION  OF  THE  CITY
 SCHOOL  DISTRICT  OF THE CITY OF STATEN ISLAND SHALL BE REQUIRED TO FILE
 PETITIONS CONTAINING AT LEAST FIVE HUNDRED SIGNATURES. NO PETITION SHALL
 CONTAIN ANY POLITICAL PARTY OR INDEPENDENT  BODY  NAME  OR  LABEL.  EACH
 PETITION  SHALL CONTAIN THE NAME OF ONLY ONE CANDIDATE AND SUCH PETITION
 SHALL BE FILED WITH THE CLERK OF THE BOARD OF ELECTIONS OF THE COUNTY OF
 RICHMOND NOT EARLIER THAN THE FIFTH  TUESDAY  AND  NOT  LATER  THAN  THE
 FOURTH  TUESDAY PRECEDING THE DATE ON WHICH AN ELECTION SHALL BE HELD. A
 CERTIFICATE OF ACCEPTANCE OR DECLINATION OF ANY INDIVIDUAL SO  NOMINATED
 SHALL  BE  FILED  NOT  LATER THAN THE THIRD DAY AFTER THE FOURTH TUESDAY
 PRECEDING THE ELECTION.
   D. NO PERSON SHALL BE ELIGIBLE FOR THE OFFICE OF MEMBER OF SUCH  BOARD
 OF  EDUCATION  WHO  IS  NOT A QUALIFIED VOTER UNDER SECTION 5-102 OF THE
 ELECTION LAW OF SUCH CITY SCHOOL DISTRICT. NO PERSON SHALL HOLD  AT  THE
 SAME  TIME  THE OFFICE OF MEMBER OF THE BOARD OF EDUCATION AND ANY OTHER
 ELECTIVE OFFICE NOR SHALL ANY HOLDER OF AN ELECTIVE OFFICE BE  A  CANDI-
 S. 8474                            67
 
 DATE FOR THE OFFICE OF MEMBER OF SUCH BOARD OF EDUCATION. NO EMPLOYEE OF
 THE  CITY SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND SHALL BE A MEMBER
 OF THE BOARD OF EDUCATION.
   E.  THE TERM OF OFFICE OF EACH MEMBER OF THE BOARD OF EDUCATION OF THE
 CITY  SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND SHALL BE THREE YEARS.
 VOTING WILL BE BY MEANS OF CUMULATIVE VOTING. EACH VOTER MAY CAST UP  TO
 NINE VOTES FOR THE CANDIDATE OR CANDIDATES OF HIS OR HER CHOICE BY CAST-
 ING  ALL OF HIS OR HER VOTES FOR A SINGLE CANDIDATE, BY CASTING ONE VOTE
 FOR EACH OF NINE CANDIDATES, OR BY ALLOCATING ANY  COMBINATION  OF  NINE
 WHOLE VOTES AMONG THE CANDIDATES. THE MAXIMUM NUMBER OF VOTES EACH VOTER
 MAY  CAST SHALL NOT EXCEED NINE. NOTHING IN THIS PARAGRAPH REQUIRES THAT
 A VOTER CAST MORE THAN ONE VOTE FOR ANY ONE CANDIDATE. THE  NINE  CANDI-
 DATES RECEIVING THE GREATEST NUMBER OF VOTES CAST SHALL BE ELECTED.
   F.    (1)    SUCH  ELECTION  FOR  SUCH OFFICE SHALL BE GOVERNED BY THE
 PROVISIONS OF THE ELECTION LAW IN THE  SAME  MANNER  AS  CANDIDATES  FOR
 OFFICE  GENERALLY  TO  BE  ELECTED  BY  THE VOTERS OF THE CITY OF STATEN
 ISLAND EXCEPT, AS THE CASE MAY BE, AS TO THE DATE OF THE ELECTION;  AND,
 FURTHER  PROVIDED,  HOWEVER,  THAT EACH SUCH CANDIDATE FOR ELECTION AS A
 MEMBER OF SUCH BOARD OF EDUCATION SHALL BE REQUIRED TO FILE  A  PETITION
 CONTAINING  SIGNATURES  OF  AT  LEAST  FIVE  HUNDRED VOTERS OF SUCH CITY
 SCHOOL DISTRICT.
   (2)  FOR THE ELECTION HELD IN MAY, IN THE  YEAR  NEXT  SUCCEEDING  THE
 DATE  ON  WHICH  THIS SUBDIVISION SHALL HAVE BECOME A LAW, SUCH PETITION
 SHALL BE DEEMED TO BE TIMELY FILED FOR SUCH ELECTION IF FILED  WITH  THE
 CLERK  OF  THE  BOARD OF ELECTIONS OF RICHMOND COUNTY ON OR BEFORE APRIL
 NINTH, IN THE YEAR NEXT SUCCEEDING THE DATE ON  WHICH  THIS  SUBDIVISION
 SHALL  HAVE  BECOME A LAW.  A PETITION SENT BY MAIL IN AN ENVELOPE POST-
 MARKED PRIOR TO MIDNIGHT ON APRIL NINTH, IN THE YEAR NEXT SUCCEEDING THE
 DATE ON WHICH THIS SUBDIVISION SHALL HAVE BECOME A LAW, SHALL BE  DEEMED
 TO  BE  TIMELY  FILED WHEN RECEIVED.  WRITTEN OBJECTION TO SUCH PETITION
 SHALL BE FILED WITHIN TWO DAYS AFTER THE FINAL DATE FOR FILING  OF  SUCH
 PETITION  AND  SPECIFICATIONS  OF THE GROUNDS OF THE OBJECTIONS SHALL BE
 FILED WITH THE BOARD WITHIN ONE DAY AFTER THE FILING  OF  THE  OBJECTION
 AND INSTITUTION OF COURT PROCEEDINGS RELATING THERETO SHALL BE COMMENCED
 NOT LATER THAN MAY SECOND, IN THE YEAR NEXT SUCCEEDING THE DATE ON WHICH
 THIS SUBDIVISION SHALL HAVE BECOME A LAW.
   G.  PETITIONS FOR THE NOMINATION OF MEMBERS OF SUCH SCHOOL BOARD SHALL
 BE ON WHITE PAPER CONTAINING THE REQUIRED SIGNATURES OF QUALIFIED VOTERS
 OF  THE  CITY  OF  STATEN ISLAND.   THE SHEETS OF SUCH PETITION SHALL BE
 NUMBERED CONSECUTIVELY, BEGINNING WITH NUMBER ONE, AT THE FOOT  OF  EACH
 SHEET.    SUCH  A  PETITION MUST SET FORTH IN EVERY INSTANCE THE CORRECT
 DATE OF SIGNING, THE FULL NAME OF THE SIGNER  AND  HIS  OR  HER  PRESENT
 RESIDENCE.    A  SIGNER  NEED NOT HIMSELF OR HERSELF FILL IN THE DATE OR
 RESIDENCE.
   H.  EACH SHEET OF SUCH A PETITION SHALL BE SIGNED IN INK AND SHALL  BE
 SUBSTANTIALLY IN THE FOLLOWING FORM:
   I,  THE  UNDERSIGNED, DO HEREBY STATE THAT I AM A DULY QUALIFIED VOTER
 OF THE CITY OF STATEN ISLAND, THAT MY  PRESENT  PLACE  OF  RESIDENCE  IS
 TRULY  STATED  OPPOSITE  MY SIGNATURE HERETO, I INTEND TO SUPPORT AT THE
 ENSUING ELECTION AND I DO HEREBY NOMINATE THE FOLLOWING NAMED PERSON  AS
 A CANDIDATE FOR NOMINATION (FOR THE PUBLIC OFFICE OF MEMBER OF THE BOARD
 OF EDUCATION OF THE CITY SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND AT
 LARGE..............DAY  OF....................,)  (FOR  THE  CITY SCHOOL
 DISTRICT.............DAY OF........,)
   IN WITNESS WHEREOF, I HAVE HEREUNTO SET  MY  HAND  THE  DAY  AND  YEAR
 PLACED OPPOSITE MY SIGNATURE.
 S. 8474                            68
 
                                                     ASSEMBLY   ELECTION
    DATE     NAME OF SIGNER     PRESENT RESIDENCE    DISTRICT   DISTRICT
 
  .......   ................      .............        ...        ...
  .......   ................      .............        ...        ...
  .......   ................      .............        ...        ...

   THE  PETITION  SHALL  BE  AUTHENTICATED BY WITNESSES.   SUCH STATEMENT
 SHALL BE ACCEPTED FOR ALL PURPOSES AS THE EQUIVALENT  OF  AN  AFFIDAVIT,
 AND  IF  FALSE  SHALL  SUBJECT  THE  WITNESS TO THE SAME PENALTIES AS IF
 HE/SHE HAD BEEN DULY SWORN.    THE  FORM  OF  SUCH  STATEMENT  SHALL  BE
 SUBSTANTIALLY AS FOLLOWS:
                            STATEMENT OF WITNESS
   I,....................,  (NAME OF WITNESS), STATE:  I AM A DULY QUALI-
 FIED VOTER OF THE STATE OF NEW YORK, AND NOW RESIDE IN THE CITY, TOWN OR
 VILLAGE OF..............., IN SUCH STATE,  AT  ................(FILL  IN
 STREET  AND  HOUSE  NUMBER AND POST OFFICE) THEREIN.  I KNOW EACH OF THE
 VOTERS WHOSE NAMES ARE SUBSCRIBED  TO  THIS  PETITION  SHEET  CONTAINING
 (FILL  IN NUMBER).............SIGNATURES AND EACH OF THEM SUBSCRIBED THE
 SAME IN MY PRESENCE AND UPON SO SUBSCRIBING  DECLARED  TO  ME  THAT  THE
 FOREGOING STATEMENT, MADE AND SUBSCRIBED BY HIM/HER, WAS TRUE.
     .....................
     SIGNATURE OF WITNESS
     DATE.......
   I.    THE  BOARD  OF  ELECTIONS  SHALL REFUSE TO ACCEPT SUCH PETITIONS
 SIGNED BY AN INSUFFICIENT NUMBER OF QUALIFIED VOTERS, OR PETITIONS WHICH
 ARE NOT TIMELY OR PETITIONS BEARING A  POLITICAL  PARTY  OR  INDEPENDENT
 BODY,  NAME  OR EMBLEM OR WHICH CONTAIN THE NAME OF MORE THAN ONE CANDI-
 DATE.
   J.  EXCEPT AS IT MAY BE MODIFIED BY THE PROVISIONS OF PARAGRAPH F   OF
 THIS  SUBDIVISION,  THE  PROVISIONS  OF THE ELECTION LAW WITH RESPECT TO
 ACCEPTANCES BY CANDIDATES NOMINATED BY INDEPENDENT NOMINATING  PETITIONS
 SHALL  APPLY  TO  CANDIDATES  NOMINATED BY PETITIONS FOR MEMBERS OF SUCH
 BOARD OF EDUCATION.
   K.  OBJECTIONS TO PETITIONS FOR THE  NOMINATION  OF  MEMBERS  OF  SUCH
 BOARD  OF  EDUCATION  AND  PROCEDURES  AND  REMEDIES  APPLICABLE TO SUCH
 OBJECTIONS SHALL BE THE SAME AS THOSE APPLICABLE TO INDEPENDENT NOMINAT-
 ING PETITIONS UNDER THE ELECTION LAW, EXCEPT AS IT MAY  BE  MODIFIED  BY
 THE PROVISIONS OF PARAGRAPH D OF THIS SUBDIVISION.
   L.   THE BOARD OF ELECTIONS SHALL CAUSE TO BE PRINTED OFFICIAL BALLOTS
 CONTAINING THE NAMES OF ALL CANDIDATES AS ABOVE  PROVIDED,  EXCEPT  THAT
 THE  BOARD  MAY REFUSE TO HAVE THE NAMES OF INELIGIBLE CANDIDATES PLACED
 ON SUCH BALLOTS.  THE NAMES OF THE CANDIDATES SHALL BE ARRANGED  ACCORD-
 ING TO LOT, AND SHALL NOT BEAR THE DESIGNATION OF ANY POLITICAL PARTY OR
 INDEPENDENT  BODY,  NAME  OR EMBLEM.   BLANK SPACES SHALL BE PROVIDED SO
 THAT VOTERS MAY VOTE FOR CANDIDATES WHO HAVE NOT BEEN NOMINATED FOR  THE
 OFFICES  TO BE FILLED AT SUCH ELECTIONS.  THE FORM OF SUCH BALLOTS SHALL
 CONFORM SUBSTANTIALLY TO THE FORM OF BALLOTS USED AT  GENERAL  ELECTIONS
 AS PRESCRIBED IN THE ELECTION LAW.
   M.    VOTING  FOR  THE  ELECTION OF MEMBERS OF SUCH BOARD OF EDUCATION
 SHALL BE BY VOTING MACHINE, IF PRACTICABLE, AND SHALL BE GOVERNED BY THE
 APPLICABLE PROVISIONS  OF  THE  ELECTION  LAW  WITH  RESPECT  TO  VOTING
 MACHINES.
   N.    IF A CANDIDATE, AFTER A PETITION IN HIS OR HER BEHALF SHALL HAVE
 BEEN DULY FILED WITH THE CLERK OF THE BOARD OF ELECTIONS, AND  PRIOR  TO
 THE  DATE  OF THE ELECTION, SHALL DECLINE TO ACCEPT THE NOMINATION, DIE,
 S. 8474                            69
 
 REMOVE FROM THE SCHOOL DISTRICT, ACCEPT OR BE A  CANDIDATE  FOR  ANOTHER
 ELECTIVE  OFFICE,  OR BECOME OTHERWISE DISQUALIFIED FOR SUCH CITY SCHOOL
 DISTRICT OFFICE, A FURTHER PETITION MAY BE FILED WITH SUCH CLERK,  NOMI-
 NATING  ANOTHER  CANDIDATE  IN HIS OR HER PLACE AND STEAD.  SUCH FURTHER
 PETITION SHALL IN ALL RESPECTS COMPLY WITH THE PROVISIONS OF  PARAGRAPHS
 F,  G AND I OF THIS SUBDIVISION, EXCEPT THAT IT MAY BE FILED AT ANY TIME
 UP TO AND INCLUDING THE FIFTEENTH DAY PRECEDING THE DATE OF THE ELECTION
 PURSUANT TO THE PROVISIONS OF THIS SUBDIVISION AND THE TIME WITHIN WHICH
 TO ACCEPT OR OBJECT TO SUCH FURTHER PETITION SHALL BE COMPUTED FROM  THE
 DATE OF FILING OR SAID FIFTEENTH DAY, WHICHEVER IS EARLIER.
   O.  WHENEVER A VACANCY SHALL OCCUR OR EXIST IN THE OFFICE OF MEMBER OF
 THE BOARD OF EDUCATION  EXCEPT  BY  REASON  OF  EXPIRATION  OF  TERM  OR
 INCREASE  IN  THE NUMBER OF MEMBERS OF SUCH BOARD, THE CANDIDATE WHO HAS
 RECEIVED THE NEXT HIGHEST TOTAL NUMBER OF VOTES IN THE PRECEDING  SCHOOL
 BOARD  ELECTION AS CERTIFIED BY THE BOARD OF ELECTIONS SHALL BE SELECTED
 TO FILL THE VACANCY. IN THE EVENT THAT NO CANDIDATE IS  AVAILABLE,  THEN
 THE  MAYOR  OF  THE CITY OF STATEN ISLAND SHALL APPOINT A PERSON TO FILL
 THE VACANCY FOR THE REMAINDER OF THE UNEXPIRED TERM.
   P.  THE MEMBERS SO ELECTED TO THE BOARD OF EDUCATION SHALL CONVENE  ON
 THE FIRST BUSINESS DAY IN JULY OF EACH YEAR AT THE TIME OF THE COMMENCE-
 MENT  OF  THEIR TERM OF OFFICE AND SELECT FROM THEIR MEMBERS A PRESIDENT
 WHO SHALL SERVE FOR A TERM OF ONE YEAR OR SUCH OTHER TERM, NOT EXCEEDING
 THE TERM OF HIS OR HER OFFICE, AS MAY BE FIXED BY THE  RULES  AND  REGU-
 LATIONS OF THE BOARD.
   Q.  THE  ELECTION  OF  MEMBERS  OF  THE BOARD OF EDUCATION OF THE CITY
 SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND SHALL  TAKE  PLACE  ON  MAY
 SECOND,  TWO  THOUSAND TWENTY-FIVE AND ON THE FIRST TUESDAY IN MAY EVERY
 THIRD YEAR THEREAFTER.  SUCH ELECTION SHALL BE CONDUCTED BY THE BOARD OF
 ELECTIONS OF THE COUNTY OF  RICHMOND  IN  THE  SAME  MANNER  AS  GENERAL
 ELECTIONS ARE CONDUCTED BY IT.
   R.  POLLS SHALL BE OPEN FOR VOTING FOR THE HOURS PRESCRIBED BY SECTION
 8-100 OF THE ELECTION LAW FOR PRIMARY ELECTIONS.   THE RESULTS  OF  SUCH
 ELECTIONS,  AFTER  CANVASSING,  SHALL  BE  CERTIFIED AND REPORTED BY THE
 BOARD OF ELECTIONS TO THE CITY CLERK AND THE BOARD OF EDUCATION OF  SUCH
 CITY.
   §  4-006.  Subdivision  2  of  section  2554  of the education law, as
 amended by chapter 27 of the  laws  of  2012,  is  amended  to  read  as
 follows:
   2. [To]  EXCEPT AS PROVIDED IN SUBDIVISION ONE OF SECTION TWO THOUSAND
 FIVE HUNDRED SEVENTY-THREE OF THIS ARTICLE, TO create, abolish, maintain
 and  consolidate such positions, divisions, boards or bureaus as, in its
 judgment, may be necessary for the proper and  efficient  administration
 of  its  work;  to  appoint a superintendent of schools, such associate,
 assistant, district and  other  superintendents,  examiners,  directors,
 supervisors,   principals,  teachers,  lecturers,  special  instructors,
 medical inspectors, nurses, auditors, attendance officers,  secretaries,
 clerks,  custodians,  janitors  and other employees and other persons or
 experts in educational, social or recreational work or in  the  business
 management  or  direction  of  its affairs as said board shall determine
 necessary for the efficient management of the schools and  other  educa-
 tional, social, recreational and business activities; provided, however,
 that  in  the city school districts of the cities of Buffalo, Rochester,
 and Syracuse appointment of associate,  assistant  and  district  super-
 intendents,  and other supervising staff who are excluded from the right
 to bargain collectively  pursuant  to  article  fourteen  of  the  civil
 service law shall, within the amounts budgeted for such positions, be by
 S. 8474                            70
 
 the  superintendent of such city school district; and to determine their
 duties except as otherwise provided herein.
   §  4-007.  Subdivision  8  of  section  2554  of the education law, as
 amended by chapter 576 of the laws  of  1964,  is  amended  to  read  as
 follows:
   8.  To  dispose  of,  in  the  city of New York AND THE CITY OF STATEN
 ISLAND, to the best advantage of the city of New York  OR  THE  CITY  OF
 STATEN  ISLAND,  either  by  sale or on the basis of money allowance for
 waste paper all books delivered to the several public  schools  of  such
 city  that  have  been  discarded either by reason of being obsolete, no
 longer required by the course of study, worn by long usage or  mutilated
 by  accident.  If  disposal  is  made by sale it shall be to the highest
 bidder and the money realized shall be paid into the city  treasury  and
 shall  at once be appropriated by the city to the special school fund of
 the board of education entitled "supplies". If disposal is made  on  the
 basis  of  money  allowance  for waste paper, it shall be to the highest
 bidder. Such discarded books may be disposed of  without  public  adver-
 tisement  or entry into a formal contract. Should the discarded books be
 in such condition that no sale or exchange can be made, or should  there
 be  reason  to  believe  that  such discarded books have become infected
 through disease among  the  pupils,  or  should  the  superintendent  of
 schools certify that such discarded books contain erroneous, inaccurate,
 obsolete  or  antiquated  subject matter, illustrations, maps, charts or
 other material, the committee on supplies of the board of education,  if
 such  books  cannot  be  sold, given away or otherwise salvaged as waste
 paper  without  danger  to  the  public  health,  may  authorize   their
 destruction  by  fire,  in  which  event  the  superintendent  of school
 supplies shall obtain and file in his office  a  certificate  that  such
 books  have  been so destroyed, signed by the principal of the school in
 which the books are located.
   § 4-008. Subdivision 14 of section 2554 of  the  education  law,  such
 section  as renumbered by chapter 762 of the laws of 1950, is amended to
 read as follows:
   14. To provide in the schools administered by the board  of  education
 of the city of New York OR THE CITY OF STATEN ISLAND, the proper book or
 books,  in  form as required by the by-laws of the board of education of
 such city, in which it shall cause the class teachers under  the  direc-
 tion and supervision of the principal to enter the names, ages and resi-
 dences  of  the  pupils  attending the school, the name of the parent or
 guardian of each pupil and the days  on  which  the  pupils  shall  have
 attended respectively, and the aggregate attendance of each pupil during
 the year, and also the day upon which the school shall have been visited
 by  the  superintendent  of schools or by an associate superintendent of
 schools or by an assistant superintendent, or by members of the board of
 education, or by members of the local school board, or by any  of  them,
 which entry shall be verified by such oath or affirmation of the princi-
 pal  as  may  be prescribed by the board of education of such city. Such
 books shall be preserved as the property of such board of education  and
 shall  at  all  times  be open to inspection by members of such board of
 education, by members of the local school boards and by the  superinten-
 dent  of  schools,  or by any associate superintendent of schools, or by
 the assistant superintendents.
   § 4-009. Subdivision 15 of  section  2554  of  the  education  law  is
 amended by adding a new paragraph b-1 to read as follows:
   B-1.  IN  THE CITY OF STATEN ISLAND, THE BOARD OF EDUCATION SHALL MAKE
 RULES AND REGULATIONS FOR THE  CONDUCT,  OPERATION  AND  MAINTENANCE  OF
 S. 8474                            71
 
 EXTRA  CLASSROOM  ACTIVITIES  AND  FOR  THE SAFEGUARDING, ACCOUNTING AND
 AUDIT OF ALL MONEYS RECEIVED AND DERIVED THEREFROM. IN THE CASE  OF  ANY
 EXTRA  CLASSROOM  ACTIVITY  AS IT SHALL DEEM PROPER, AND NOTWITHSTANDING
 THE  PROVISIONS  OF SECTION TWENTY-FIVE HUNDRED THIRTY OF THIS TITLE, IT
 MAY DIRECT THAT THE MONEYS RECEIVED OR DERIVED FROM THE CONDUCT,  OPERA-
 TION  OR  MAINTENANCE  OF  SUCH AN EXTRA CLASSROOM ACTIVITY BE DEPOSITED
 WITH THE CHIEF FISCAL OFFICER OF THE BOARD OF  EDUCATION,  WHO  IN  SUCH
 EVENT  SHALL  BE  THE TREASURER OF SUCH AN EXTRA CLASSROOM ACTIVITY, THE
 MONEYS OF WHICH ARE REQUIRED TO BE SO DEPOSITED. IN THE  PROCUREMENT  OF
 ARTICLES  AND  SERVICES  FOR THE CONDUCT, OPERATION AND MAINTENANCE OF A
 CAFETERIA OR RESTAURANT SERVICE, THE BOARD OF EDUCATION SHALL BE SUBJECT
 TO THE PROVISIONS OF SUBDIVISION  TEN  OF  SECTION  TWENTY-FIVE  HUNDRED
 FIFTY-SIX  OF THIS ARTICLE, EXCEPT THAT SAID BOARD OF EDUCATION NEED NOT
 HAVE DULY ADVERTISED FOR ESTIMATES IN ORDER TO CONTRACT FOR  SUCH  ARTI-
 CLES  OR  SERVICES  IN AN AMOUNT EXCEEDING ONE THOUSAND DOLLARS. IN SUCH
 CITY, THE BOARD OF EDUCATION SHALL ALSO HAVE POWER TO ASSIGN ANY OF  ITS
 OFFICERS  OR  EMPLOYEES  TO  PERFORM  SUCH DUTIES AS IT MAY PRESCRIBE IN
 CONNECTION WITH AN EXTRA CLASSROOM ACTIVITY AND TO DESIGNATE SUCH OF ITS
 OFFICERS AND EMPLOYEES WHEN SO  ASSIGNED  FROM  WHOM  A  BOND  SHALL  BE
 REQUIRED  FOR FAITHFUL PERFORMANCE OF THEIR DUTIES AND TO FIX THE SUM IN
 WHICH EACH SUCH BOND SHALL BE GIVEN.
   § 4-010. Section 2554 of the education law is amended  by  adding  two
 new subdivisions 29 and 30 to read as follows:
   29.  TO  ASSIGN, IN ITS DISCRETION, ONE OR MORE EMPLOYEES OF THE BOARD
 IN THE CITY OF STATEN ISLAND TO SERVE AS TRIAL EXAMINER  WITH  POWER  TO
 CONDUCT INVESTIGATIONS AND HEARINGS ON BEHALF OF SUCH BOARD.  EACH TRIAL
 EXAMINER SHALL REPORT THE RESULT OF ANY SUCH INVESTIGATION OR HEARING TO
 THE BOARD.
   30.  TO  EMPLOY  A  SUPERINTENDENT OF THE CITY OF STATEN ISLAND SCHOOL
 DISTRICT BY CONTRACT FOR A FOUR-YEAR TERM OF OFFICE, SUBJECT TO  REMOVAL
 FOR  CAUSE,  AT  A  SALARY  TO  BE FIXED WITHIN THE BUDGETARY ALLOCATION
 THEREFOR.
   § 4-011. Subdivision 5 of  section  2556  of  the  education  law,  as
 amended  by  chapter  480  of  the  laws  of 2014, is amended to read as
 follows:
   5. It shall be unlawful for a schoolhouse to  be  constructed  in  the
 city  of New York OR THE CITY OF STATEN ISLAND without an open-air play-
 ground attached to or used in connection with the same.  Existing  play-
 grounds shall not be sold, leased or transferred, or permanently author-
 ized  for  other  uses such as school building construction, renovation,
 placement or storage of building materials  for  such  work  that  would
 eliminate  the  use  of  such  playground space for outdoor recreational
 activities unless a plan is established and implemented to provide suit-
 able and adequate physical activities or space to accommodate the  phys-
 ical  and  recreational  needs  of  the  pupils  of  such  building. The
 provisions of this subdivision shall not apply to school construction or
 renovation activities that occur on or require the  use  of  such  play-
 grounds for a duration of no more than one year.
   §  4-012. Section 2556 of the education law is amended by adding a new
 subdivision 6-a to read as follows:
   6-A. AFTER A SITE HAS BEEN SELECTED AND PLANS AND SPECIFICATIONS FOR A
 BUILDING THEREON HAVE BEEN APPROVED AS PROVIDED  HEREIN,  THE  BOARD  OF
 EDUCATION  OF THE CITY SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND MAY,
 IN ITS DISCRETION, BY REGULATION DELIVER SUCH PLANS  AND  SPECIFICATIONS
 TO THE COMMON COUNCIL OR OTHER LOCAL LEGISLATIVE BODY WHICH MAY THEREUP-
 ON,  IN ITS DISCRETION, AWARD A CONTRACT FOR THE ERECTION OF SUCH BUILD-
 S. 8474                            72
 
 ING IN THE SAME MANNER AND IN ACCORDANCE  WITH  THE  PROVISIONS  OF  LAW
 REGULATING  THE  AWARDING OF CONTRACTS FOR THE CONSTRUCTION OF MUNICIPAL
 BUILDINGS OF SUCH CITY.
   §  4-013. Section 2556 of the education law is amended by adding three
 new subdivisions 10-b, 11-a and 13-a to read as follows:
   10-B. IN THE CITY OF STATEN ISLAND IF THE SEVERAL PARTS OF THE WORK OR
 LABOR TO BE DONE AND/OR THE SUPPLIES,  MATERIALS  AND  EQUIPMENT  TO  BE
 FURNISHED  SHALL  TOGETHER  INVOLVE  AN EXPENDITURE OF NOT MORE THAN TEN
 THOUSAND DOLLARS, THE SAME MAY BE PROCURED IN COMPLIANCE WITH THE PROCE-
 DURES ON CONTRACTING PROVIDED IN CHAPTER NINE OF THE CHARTER OF THE CITY
 OF STATEN ISLAND.
   11-A. IN ALL CONTRACTS BY THE BOARD OF EDUCATION OF  THE  CITY  SCHOOL
 DISTRICT  OF  THE  CITY  OF STATEN ISLAND, FOR THE CONSTRUCTION, REPAIR,
 ALTERATION OR REMODELING OF BUILDINGS OR FOR THE PURCHASE  OF  SUPPLIES,
 FURNITURE  OR  EQUIPMENT,  A  STIPULATION MAY BE INSERTED FOR LIQUIDATED
 DAMAGES FOR ANY BREACH, FAILURE OR DELAY IN THE PERFORMANCE THEREOF; AND
 SUCH BOARD OF EDUCATION IS AUTHORIZED AND EMPOWERED TO REMIT  THE  WHOLE
 OR ANY PART OF SUCH DAMAGES AS IN ITS DISCRETION MAY BE JUST AND EQUITA-
 BLE;  AND  IN  ALL  SUITS COMMENCED ON ANY SUCH CONTRACTS OR ON ANY BOND
 GIVEN IN CONNECTION THEREWITH IT SHALL NOT BE NECESSARY FOR SUCH  BOARD,
 WHETHER  PLAINTIFF  OR  DEFENDANT,  TO  PROVE ACTUAL OR SPECIFIC DAMAGES
 SUSTAINED BY REASON OF ANY SUCH BREACH, FAILURE OR DELAY, BUT SUCH STIP-
 ULATION FOR LIQUIDATED DAMAGES SHALL BE CONCLUSIVE AND BINDING UPON  ALL
 PARTIES.
   13-A.  THE  BOARD OF EDUCATION OF THE CITY SCHOOL DISTRICT OF THE CITY
 OF STATEN ISLAND MAY THROUGH ITS DULY  DESIGNATED  OFFICERS,  AGENTS  OR
 EMPLOYEES  ENTER  UPON  PUBLIC  OR  PRIVATE  PROPERTY FOR THE PURPOSE OF
 MAKING SURVEYS, SOUNDINGS OR TEST BORINGS NECESSARY FOR THE EXERCISE  OF
 THE POWERS OR THE PERFORMANCE OF THE DUTIES, OF SUCH BOARD OF EDUCATION,
 PROVIDED,  HOWEVER, THAT THE MAYOR HAD FORMALLY APPROVED THE ACQUISITION
 OF THE REAL PROPERTY AS A SCHOOL SITE.
   § 4-014. The education law is amended by  adding  three  new  sections
 2560-a, 2561-a, and 2562-a to read as follows:
   §  2560-A. LIABILITY OF BOARD OF EDUCATION OF THE CITY SCHOOL DISTRICT
 OF THE CITY  OF  STATEN  ISLAND.  1.  NOTWITHSTANDING  ANY  INCONSISTENT
 PROVISION OF LAW, GENERAL, SPECIAL OR LOCAL, OR THE LIMITATION CONTAINED
 IN  THE PROVISIONS OF ANY CITY CHARTER, ANY DULY APPOINTED MEMBER OF THE
 BOARD OF EDUCATION OF THE CITY SCHOOL DISTRICT OF  THE  CITY  OF  STATEN
 ISLAND,  THE  MEMBERS OF THE  SCHOOL BOARD OF SUCH CITY, THE TEACHING OR
 SUPERVISING STAFF, OFFICER, OR EMPLOYEE  OF  SUCH  BOARD,  MEMBER  OF  A
 COMMITTEE  ON  SPECIAL  EDUCATION  OR SUBCOMMITTEE THEREOF OR AUTHORIZED
 PARTICIPANT IN THE SCHOOL VOLUNTEER PROGRAM IN SUCH CITY SHALL BE  ENTI-
 TLED  TO  LEGAL  REPRESENTATION  AND  INDEMNIFICATION  PURSUANT  TO  THE
 PROVISIONS OF, AND SUBJECT TO THE CONDITIONS, PROCEDURES AND LIMITATIONS
 CONTAINED IN SECTION FIFTY-K OF THE GENERAL MUNICIPAL LAW,  EXCEPT  THAT
 ANY  JUDGMENT  OR  SETTLEMENT  PURSUANT TO THIS SECTION SHALL BE PAYABLE
 FROM THE MONEYS OF THE BOARD OF EDUCATION.
   2. NOTWITHSTANDING ANY INCONSISTENT PROVISION OF LAW, GENERAL, SPECIAL
 OR LOCAL, OR LIMITATIONS CONTAINED IN THE PROVISION OF ANY CITY CHARTER,
 IT SHALL NOT BE WITHIN THE POWER OF THE BOARD OF EDUCATION OF  THE  CITY
 OF  STATEN  ISLAND  TO  REQUIRE  A VOLUNTEER PARTICIPATING IN ANY SCHOOL
 ACTIVITIES TO EXECUTE A WAIVER OF RESPONSIBILITY IN FAVOR OF THAT  BOARD
 AS  A  CONDITION, EITHER EXPRESS OR IMPLIED, OF SUCH PARTICIPATION. SUCH
 WAIVER WOULD INCLUDE, BUT NOT BE LIMITED TO,  A  RELEASE  OF  ANY  PARTY
 AGAINST  WHOM THE VOLUNTEER MAY HAVE RIGHTS UNDER ANY EXISTING PROVISION
 OF LAW FOR PERSONAL INJURIES INCURRED DURING THE PERFORMANCE OF  AUTHOR-
 S. 8474                            73
 
 IZED VOLUNTEER DUTIES BY AN AUTHORIZED PARTICIPANT IN A SCHOOL VOLUNTEER
 PROGRAM.
   § 2561-A.  LIABILITY OF CERTAIN OFFICERS AND EMPLOYEES OF THE BOARD OF
 EDUCATION OF THE CITY SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND.  IF,
 IN ORDER TO FURNISH NEEDY CHILDREN OR MINORS WITH FOOD, SHOES, CLOTHING,
 AND OTHER NECESSITIES TO ENABLE THEM TO ATTEND SCHOOL AS CONTEMPLATED BY
 LAW  AND TO BENEFIT FROM INSTRUCTION, SUCH BOARD OF EDUCATION SHALL HAVE
 REQUIRED, IMPOSED OR PERMITTED, THE PERFORMANCE OF DUTIES BY ANY OF  ITS
 OFFICERS  AND EMPLOYEES, BECAUSE OF WHICH IT BECAME NECESSARY OR EXPEDI-
 ENT FOR ANY SUCH OFFICER OR EMPLOYEE TO ACT FOR SUCH BOARD OF EDUCATION,
 OR TO ACT FOR OR IN COOPERATION WITH ANY  OTHER  AGENCY  OF  GOVERNMENT,
 FEDERAL,  STATE  OR  MUNICIPAL,  THEN  IRRESPECTIVE OF THE FACT THAT THE
 AUTHORITY TO REQUIRE, IMPOSE OR PERMIT THE PERFORMANCE  OF  SUCH  DUTIES
 MAY NOT HAVE BEEN SPECIFICALLY CONFERRED UPON SAID BOARD OF EDUCATION BY
 PROVISIONS  OF THIS CHAPTER, SUCH BOARD OF EDUCATION SHALL BE LIABLE FOR
 AND SHALL ASSUME LIABILITY TO THE EXTENT THAT IT SHALL SAVE HARMLESS ANY
 SUCH OFFICERS OR EMPLOYEES FOR DAMAGES ARISING OUT OF THE NEGLIGENCE  OF
 ANY  SUCH  OFFICER OR EMPLOYEE WHILE ACTUALLY ENGAGED IN THE PERFORMANCE
 OF SUCH REQUIRED OR PERMITTED DUTIES, PROVIDED THE OFFICER  OR  EMPLOYEE
 AT  THE TIME WAS ACTING WITHIN THE SCOPE OF HIS OR HER DUTIES OR EMPLOY-
 MENT.
   § 2562-A.  PRESENTATION OF CLAIMS AGAINST THE BOARD  OF  EDUCATION  OF
 THE CITY SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND TO BE PLEADED.  1.
 NO ACTION OR SPECIAL PROCEEDING, FOR ANY CAUSE WHATEVER, SHALL BE PROSE-
 CUTED  OR  MAINTAINED  AGAINST THE BOARD OF EDUCATION OF THE CITY SCHOOL
 DISTRICT OF THE CITY OF STATEN ISLAND, UNLESS IT SHALL APPEAR BY AND  AS
 AN  ALLEGATION IN THE COMPLAINT OR NECESSARY MOVING PAPERS THAT AT LEAST
 THIRTY DAYS HAVE ELAPSED SINCE THE DEMAND, CLAIM OR  CLAIMS  UPON  WHICH
 SUCH  ACTION OR SPECIAL PROCEEDING IS FOUNDED WERE PRESENTED TO THE SAID
 BOARD OF EDUCATION FOR ADJUSTMENT, AND THAT THE OFFICER OR  BODY  HAVING
 THE  POWER  TO ADJUST OR PAY SAID CLAIM HAS NEGLECTED OR REFUSED TO MAKE
 AN ADJUSTMENT OR PAYMENT THEREOF FOR THIRTY DAYS AFTER SUCH PRESENTMENT.
   2.  THE SAID BOARD OF EDUCATION MAY REQUIRE ANY PERSON PRESENTING  FOR
 SETTLEMENT  AN  ACCOUNT OR CLAIM FOR ANY CAUSE WHATEVER AGAINST IT TO BE
 SWORN BEFORE IT OR A COMMITTEE THEREOF, OR BEFORE THE AUDITOR, OR BEFORE
 ANY PERSON DESIGNATED BY SAID BOARD, TOUCHING SUCH ACCOUNT OR CLAIM, AND
 WHEN SO SWORN, TO ANSWER ORALLY AS TO ANY FACTS RELATIVE TO THE JUSTNESS
 OF SUCH ACCOUNT OR CLAIM.  A MEMBER OF THE BOARD, THE  AUDITOR,  OR  ANY
 OTHER  PERSON DESIGNATED AS HEREINBEFORE STATED, SHALL HAVE THE POWER TO
 ADMINISTER AN OATH TO ANY PERSON WHO SHALL GIVE TESTIMONY TO  THE  JUST-
 NESS  OF  SUCH  ACCOUNT  OR  CLAIM, AND FOR THE PURPOSE OF SECURING SUCH
 TESTIMONY MAY ISSUE SUBPOENAS FOR THE ATTENDANCE OF WITNESSES.    WILFUL
 FALSE  SWEARING BEFORE THE SAID BOARD OF EDUCATION, A COMMITTEE THEREOF,
 THE AUDITOR, OR BEFORE ANY PERSON DESIGNATED AS HEREINBEFORE STATED,  IS
 PERJURY AND PUNISHABLE AS SUCH.
   §  4-015. Section 2566 of the education law is amended by adding a new
 subdivision 3-a to read as follows:
   3-A. IN THE CITY OF STATEN ISLAND, TO EXERCISE THE ADMINISTRATIVE  AND
 MINISTERIAL POWERS OF THE BOARD OF EDUCATION.
   §  4-016.  The  education  law  is  amended by adding two new sections
 2567-a and 2568-a to read as follows:
   § 2567-A. PROTECTION OF RIGHTS EXERCISED UNDER LICENSES  ISSUED  BY  A
 BOARD  OF  EDUCATION  IN  THE  CITY  OF STATEN ISLAND.   NO PERSON SHALL
 FORFEIT ANY RIGHT GIVEN TO HIM OR HER UNDER A  LICENSE  ISSUED  BY  SUCH
 BOARD  OF  EDUCATION, PURSUANT TO THIS CHAPTER, BECAUSE OF ABSENCE WHILE
 IN SERVICE IN THE ARMED FORCES OF THE UNITED STATES OR IN THE SERVICE OF
 S. 8474                            74
 
 THE AMERICAN RED CROSS.  ANY PERSON MAY AT ANY TIME  WITHIN  SIX  MONTHS
 AFTER  HIS  OR  HER  DISCHARGE  FROM  SERVICE IN THE ARMED FORCES OF THE
 UNITED STATES OR THE AMERICAN RED CROSS MAKE APPLICATION TO THE  LICENSE
 ISSUING  AUTHORITY BY AFFIDAVIT SETTING FORTH THAT HE OR SHE HAS BEEN IN
 SERVICE IN THE ARMED FORCES OF THE UNITED STATES  OR  THE  AMERICAN  RED
 CROSS  AND  HAS  BEEN  DISCHARGED  FROM  SUCH SERVICE AND THAT HE OR SHE
 DESIRES THE LICENSE THERETOFORE ISSUED TO HIM OR TO HER TO  BE  REISSUED
 AS  OF  THE  DATE  OF  SUCH APPLICATION, AND IT SHALL BE THE DUTY OF THE
 LICENSING AUTHORITY TO REINSTATE SUCH LICENSE AS OF THE  DATE  ON  WHICH
 APPLICATION IS MADE.
   §  2568-A.  SUPERINTENDENT  OF  SCHOOLS  AUTHORIZED TO REQUIRE MEDICAL
 EXAMINATION OF CERTAIN EMPLOYEES OF THE BOARD OF EDUCATION OF  THE  CITY
 SCHOOL  DISTRICT  OF  THE  CITY OF STATEN ISLAND.  THE SUPERINTENDENT OF
 SCHOOLS SHALL BE EMPOWERED TO REQUIRE ANY PERSON EMPLOYED BY  THE  BOARD
 OF EDUCATION OF THE CITY SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND TO
 SUBMIT TO A MEDICAL EXAMINATION BY A PHYSICIAN OR SCHOOL MEDICAL INSPEC-
 TOR  OF THE BOARD, IN ORDER TO DETERMINE THE MENTAL OR PHYSICAL CAPACITY
 OF SUCH PERSON TO PERFORM HIS OR HER DUTIES, WHENEVER IT HAS BEEN RECOM-
 MENDED IN A REPORT IN WRITING THAT  SUCH  EXAMINATION  SHOULD  BE  MADE.
 SUCH  REPORT  TO  THE  SUPERINTENDENT MAY BE MADE ONLY BY A PERSON UNDER
 WHOSE SUPERVISION OR DIRECTION THE PERSON RECOMMENDED FOR  SUCH  MEDICAL
 EXAMINATION  IS  EMPLOYED. THE PERSON REQUIRED TO SUBMIT TO SUCH MEDICAL
 EXAMINATION SHALL BE ENTITLED TO BE ACCOMPANIED BY A PHYSICIAN OR  OTHER
 PERSON  OF  HIS  OR HER OWN CHOICE.   THE FINDINGS UPON SUCH EXAMINATION
 SHALL BE REPORTED TO THE SUPERINTENDENT OF SCHOOLS AND MAY  BE  REFERRED
 TO  AND  CONSIDERED FOR THE EVALUATION OF SERVICE OF THE PERSON EXAMINED
 OR FOR DISABILITY RETIREMENT.
   § 4-017. Subdivision 1 of  section  2573  of  the  education  law,  as
 amended  by  section 3 of subpart D of part EE of chapter 56 of the laws
 of 2015, subparagraph ii of paragraph (a) as amended by chapter  201  of
 the  laws  of  2022  and  subparagraph ii of paragraph (b) as amended by
 chapter 345 of the laws of 2019, is amended to read as follows:
   1. (a) i. [Teachers] EXCEPT AS OTHERWISE PROVIDED FOR IN PARAGRAPH (C)
 OF THIS SUBDIVISION, TEACHERS and all  other  members  of  the  teaching
 staff,  appointed  prior to July first, two thousand fifteen and author-
 ized by section twenty-five hundred fifty-four of this article, shall be
 appointed by the board of education,  upon  the  recommendation  of  the
 superintendent  of  schools,  for  a probationary period of three years,
 except that in the case of  a  teacher  who  has  rendered  satisfactory
 service  as  a  regular  substitute  for  a  period of two years or as a
 seasonally licensed per session teacher of swimming in day  schools  who
 has  served  in  that  capacity  for  a period of two years and has been
 appointed to teach the same subject in day schools on an annual  salary,
 the probationary period shall be limited to one year; provided, however,
 that in the case of a teacher who has been appointed on tenure in anoth-
 er school district within the state, the school district where currently
 employed,  or  a  board of cooperative educational services, and who was
 not dismissed from such district or board as a result of charges brought
 pursuant to subdivision  one  of  section  three  thousand  twenty-a  or
 section three thousand twenty-b of this chapter, the probationary period
 shall  not  exceed  two  years; provided, however, that in cities with a
 population of one million or more, a teacher  appointed  under  a  newly
 created  license,  for  teachers of reading and of the emotionally hand-
 icapped, to a position which the teacher has held for at least two years
 prior to such appointment while serving on  tenure  in  another  license
 area  who  was  not dismissed as a result of charges brought pursuant to
 S. 8474                            75

 subdivision one of section three  thousand  twenty-a  or  section  three
 thousand  twenty-b of this chapter, the probationary period shall be one
 year. The service of a person appointed to any of such positions may  be
 discontinued  at any time during such probationary period, on the recom-
 mendation of the superintendent of schools, by a majority  vote  of  the
 board  of  education.  Each  person  who  is  not  to be recommended for
 appointment on tenure shall be so  notified  by  the  superintendent  of
 schools  in  writing not later than sixty days immediately preceding the
 expiration of his or her probationary period.  In city school  districts
 having  a  population  of  four  hundred  thousand or more, persons with
 licenses obtained as a result of examinations  announced  subsequent  to
 the twenty-second day of May, nineteen hundred sixty-nine appointed upon
 conditions that all announced requirements for the position be fulfilled
 within  a  specified period of time, shall not acquire tenure unless and
 until such requirements have been completed within  the  time  specified
 for the fulfillment of such requirements, notwithstanding the expiration
 of  any  probationary period. In all other city school districts subject
 to the provisions of this article, failure to maintain certification  as
 required  by  this  article  and  by the regulations of the commissioner
 shall be cause for removal within the meaning  of  subdivision  five  of
 this section.
   ii.  [Teachers]  EXCEPT  AS OTHERWISE PROVIDED FOR IN PARAGRAPH (C) OF
 THIS SUBDIVISION, TEACHERS and all other members of the  teaching  staff
 appointed on or after July first, two thousand fifteen and authorized by
 section  twenty-five  hundred  fifty-four  of  this  article,  shall  be
 appointed by the board of education,  upon  the  recommendation  of  the
 superintendent  of  schools,  for  a  probationary period of four years,
 except that in the case of  a  teacher  who  has  rendered  satisfactory
 service  as  a  regular  substitute  for a period of two years and, if a
 classroom teacher, has received annual professional  performance  review
 ratings  in each of those years, or has rendered satisfactory service as
 a seasonally licensed per session teacher of swimming in day schools who
 has served in that capacity for a period  of  two  years  and  has  been
 appointed  to teach the same subject in day schools on an annual salary,
 the teacher shall be appointed for a probationary period of  two  years;
 provided,  however, that in the case of a teacher who has been appointed
 on tenure in another  school  district  within  the  state,  the  school
 district where currently employed, or a board of cooperative educational
 services,  and  who  was  not dismissed from such district or board as a
 result of charges brought pursuant to subdivision one of  section  three
 thousand  twenty-a  or  section three thousand twenty-b of this chapter,
 the teacher shall be appointed for a probationary period of three years;
 provided that, in the case of a classroom teacher,  the  teacher  demon-
 strates  that  he  or  she  received  an annual professional performance
 review rating pursuant to section three  thousand  twelve-c  or  section
 three  thousand  twelve-d  of  this  chapter in his or her final year of
 service in such other school district or  board  of  cooperative  educa-
 tional  services;  provided,  however,  that, in the case of a classroom
 teacher who has been appointed for a probationary period during the  two
 thousand  twenty--two thousand twenty-one, the two thousand twenty-one--
 two thousand twenty-two or the  two  thousand  twenty-two--two  thousand
 twenty-three school year and who has been appointed on tenure in another
 school  district  within  the state, the school district where currently
 employed, board of cooperative educational services or state school  for
 the  blind  or deaf, and who was not dismissed from such district, board
 or state school for the blind or deaf as a  result  of  charges  brought
 S. 8474                            76
 
 pursuant  to  section  three thousand twenty-a or section three thousand
 twenty-b of this chapter, such teacher shall be appointed for  a  proba-
 tionary period of three years; provided that, in the case of a classroom
 teacher,  such  teacher  demonstrates  that he or she received an annual
 professional performance review rating pursuant to section  three  thou-
 sand  twelve-c or section three thousand twelve-d of this chapter in the
 two thousand seventeen--two thousand eighteen or two thousand  eighteen-
 -two  thousand nineteen school year in such other school district, board
 of cooperative educational services or state school  for  the  blind  or
 deaf; provided further, however, that in cities with a population of one
 million  or more, a teacher appointed under a newly created license, for
 teachers of reading and of the emotionally handicapped,  to  a  position
 which the teacher has held for at least two years prior to such appoint-
 ment  while  serving  on  tenure  in  another  license  area who was not
 dismissed as a result of charges brought pursuant to subdivision one  of
 section  three  thousand  twenty-a or section three thousand twenty-b of
 this chapter, the teacher shall be appointed for a  probationary  period
 of  two  years.   The service of a person appointed to any of such posi-
 tions may be discontinued at any time during such  probationary  period,
 on  the  recommendation  of the superintendent of schools, by a majority
 vote of the board of education. Each person who is not to be recommended
 for appointment on tenure shall be so notified by the superintendent  of
 schools  in  writing not later than sixty days immediately preceding the
 expiration of his  or  her  probationary  period.  In  all  city  school
 districts subject to the provisions of this article, failure to maintain
 certification  as required by this article and by the regulations of the
 commissioner shall be cause for removal within the meaning  of  subdivi-
 sion five of this section.
   (b)  i. [Administrators] EXCEPT AS OTHERWISE PROVIDED FOR IN PARAGRAPH
 (C) OF THIS SUBDIVISION, ADMINISTRATORS, directors, supervisors, princi-
 pals and all other members of the supervising  staff,  except  executive
 directors,  associate, assistant, district and community superintendents
 and examiners, appointed prior to July first, two thousand  fifteen  and
 authorized  by  section  twenty-five hundred fifty-four of this article,
 shall be appointed by the board of education, upon the recommendation of
 the superintendent or chancellor of schools, for a  probationary  period
 of  three  years. The service of a person appointed to any of such posi-
 tions may be discontinued at any time during the probationary period  on
 the  recommendation of the superintendent of schools, by a majority vote
 of the board of education.
   ii. [Administrators] EXCEPT AS OTHERWISE PROVIDED FOR IN PARAGRAPH (C)
 OF THIS SUBDIVISION, ADMINISTRATORS, directors, supervisors,  principals
 and  all other members of the supervising staff, except executive direc-
 tors, associate, assistant, district and community  superintendents  and
 examiners,  appointed  on  or after July first, two thousand fifteen and
 authorized by section twenty-five hundred fifty-four  of  this  article,
 shall be appointed by the board of education, upon the recommendation of
 the  superintendent  or chancellor of schools, for a probationary period
 of four years provided that such probationary period may be extended  in
 accordance  with  paragraph  (b)  of  subdivision  five of this section;
 provided, however, that in  the  case  of  a  principal,  administrator,
 supervisor,  or  other  member  of  the  supervising  staff who has been
 appointed on tenure pursuant to this chapter as an administrator  within
 an  authorized  administrative  tenure  area  in another school district
 within the state, the school district where  currently  employed,  or  a
 board  of  cooperative  educational  services, and who was not dismissed
 S. 8474                            77
 
 from such district or board as a result of charges brought  pursuant  to
 subdivision  one  of  section  three  thousand twenty-a or section three
 thousand twenty-b of this chapter, the principal, administrator,  super-
 visor  or other member of the supervising staff shall be appointed for a
 probationary period of three years. The service of a person appointed to
 any of such positions may be discontinued at any time during the  proba-
 tionary  period  on the recommendation of the superintendent of schools,
 by a majority vote of the board of education.
   (C) NOTWITHSTANDING THE PROVISIONS OF PARAGRAPHS (A) AND (B)  OF  THIS
 SUBDIVISION,  THE SUPERINTENDENT OF THE CITY SCHOOL DISTRICT OF THE CITY
 OF STATEN ISLAND SHALL HAVE THE AUTHORITY TO APPOINT, WITH THE  APPROVAL
 OF  THE  SCHOOL  BOARD,  PRINCIPALS  AND  CITY WIDE ADMINISTRATORS. SUCH
 SUPERINTENDENT MAY APPOINT ASSISTANT PRINCIPALS AND OTHER  CLERICAL  AND
 ADMINISTRATIVE  STAFF  WITHOUT  THE  APPROVAL  OF THE SCHOOL BOARD. SUCH
 ASSISTANT PRINCIPALS, CLERICAL AND ADMINISTRATIVE STAFF SHALL  SERVE  IN
 ACCORDANCE  WITH THE PROVISIONS OF PARAGRAPHS (A) AND (B) OF THIS SUBDI-
 VISION.
   § 4-018. Section 2576 of the education law is amended by adding a  new
 subdivision 4-a to read as follows:
   4-A.  IN  THE  CITY OF STATEN ISLAND SUCH ESTIMATE SHALL BE FILED WITH
 THE OFFICER AUTHORIZED TO RECEIVE OTHER  DEPARTMENT  ESTIMATES  AND  THE
 SAME  ACTED ON BY SUCH OFFICER AND BY THE COMMON COUNCIL OF SUCH CITY IN
 THE SAME MANNER AND WITH THE SAME EFFECT AS OTHER DEPARTMENT  ESTIMATES.
 THE  COMMON COUNCIL IS ALSO AUTHORIZED, IN ITS DISCRETION, TO INCLUDE IN
 SUCH BUDGET A SUM FOR ANY OF THE PURPOSES ENUMERATED IN PARAGRAPH  C  OF
 SUBDIVISION  ONE  OF  THIS  SECTION,  AND  ANY  FURTHER  AMOUNT FOR SUCH
 PURPOSES AS MAY BE AUTHORIZED BY A TAX ELECTION HELD IN SUCH CITY PURSU-
 ANT TO THE PROVISIONS OF THIS CHAPTER. AFTER THE ADOPTION OF SUCH BUDGET
 THE COMMON COUNCIL SHALL CAUSE THE AMOUNT THEREOF TO BE INCLUDED IN  THE
 TAX  AND  ASSESSMENT ROLL OF THE CITY AND THE SAME SHALL BE COLLECTED IN
 THE SAME MANNER AND AT THE SAME TIME AS OTHER  TAXES  OF  THE  CITY  ARE
 COLLECTED,  AND  PLACED  TO  THE CREDIT OF THE BOARD OF EDUCATION OF THE
 CITY SCHOOL DISTRICT OF SUCH CITY.
   § 4-019. Section 2579 of the education law is amended by adding a  new
 subdivision 4 to read as follows:
   4.  IF THE CITY OF STATEN ISLAND SHALL ISSUE OBLIGATIONS TO DEFRAY, IN
 WHOLE  OR  IN  PART,  THE  EXPENSE  OF THE CONSTRUCTION, IMPROVEMENT AND
 EQUIPMENT OF SCHOOL BUILDINGS OR THE PURCHASE OR ACQUISITION  OF  SCHOOL
 SITES,  THE  PROCEEDS  OF  THE SALE OF SUCH BONDS SHALL BE PAID INTO THE
 TREASURY OF THE CITY AND PLACED TO THE CREDIT OF THE BOARD OF  EDUCATION
 OF  THE  CITY  SCHOOL DISTRICT OF SUCH CITY.  AS SUCH OBLIGATIONS BECOME
 DUE THE MUNICIPAL AUTHORITIES OF THE CITY SHALL INCLUDE IN THE TAX LEVY,
 AND ASSESS UPON THE PROPERTY OF THE CITY, THE AMOUNT  NECESSARY  TO  PAY
 SUCH BONDS AND INTEREST THEREON.
   §  4-020. Additional transitory provisions relating to the city school
 district of the city of Staten Island. 1. The board of education of  the
 city  school  district  of the city of Staten Island shall possess those
 powers and duties as are authorized for a city school district  pursuant
 to  article 52 of the education law, as amended by this act. In further-
 ance of such powers and duties the board shall confer  with  the  mayor,
 the  comptroller and the common council of the city of Staten Island and
 the board of education of the preceding municipality for the purpose  of
 preparing  for  submission and implementation of a budget for the school
 year commencing on the first of July in the second year next  succeeding
 the  date  on  which  this  act shall have become a law and to take such
 other actions as may be necessary and appropriate  to  provide  for  the
 S. 8474                            78
 
 operation  of  the  city school district of the city of Staten Island on
 and after the date of establishment of the city of Staten Island.
   2. Fiscal and regulatory authority pertaining to the public schools to
 be  contained  within  the  city school district of the   city of Staten
 Island shall remain with the board  of  education  of  the  city  school
 district  of  the preceding municipality until the date of establishment
 of the city of Staten Island.
   3. All employees of the board of education of the city school district
 of the preceding municipality and such  other  employees  of  any  other
 public  entity  as may be transferred pursuant to the provisions of this
 act shall retain all rights, privileges, benefits and salaries to  which
 the  employee  was  previously  entitled  as an employee of the board of
 education of the preceding municipality. Transfers of employment to  the
 city  school district of the city of Staten Island shall be conducted in
 the same manner as is provided by for  the  city  of  Staten  Island  as
 provided in this act.  Such employees shall not suffer a loss of employ-
 ment  by reason of such transfer within a period of three years from the
 effective date of such transfer nor shall any such employees be  subject
 to  any  additional  employment  probationary  period  by reason of such
 transfer.
   4. During the transition period as defined in section  1-003  of  this
 act,  the  city  school district of the city of Staten Island may retain
 the services of a superintendent of schools, a chief  financial  officer
 and such other staff as to which funding shall have been provided by the
 mayor and the common council of the city of Staten Island.
   5. All actions deemed necessary and proper to implement the provisions
 of sections 4-001 through 4-019 of this act are hereby authorized.
   §  5-001. Transfer of the college of Staten Island. 1. The legislature
 finds that due to the establishment of the city of  Staten  Island,  the
 transfer of the college of Staten Island from the city university of New
 York  to  the  state  university  of  New York is a public purpose. Such
 transfer shall not affect the title to the real property of the  college
 of  Staten  Island  which  shall continue to be held by the state of New
 York, except that notwithstanding  the  provisions  of  paragraph  b  of
 subdivision 1 of section 6219 of the education law if such real property
 ceases  to  be  used  for college purposes, title to such property shall
 revert to the city of Staten Island as  successor  in  interest  to  the
 prior  municipal  government  of the geographical area of Staten Island.
 The college of Staten Island is hereby transferred to the state  univer-
 sity  of  New York. Such transfers shall include all furnishings, equip-
 ment, records and all other property normally allocated to  the  college
 of Staten Island by the city university of New York.
   2.  The  college  of Staten Island is hereby transferred from the city
 university of New York to the state university of New York. The  college
 of  Staten  Island shall continue to offer a full range of baccalaureate
 degree programs and associate degree programs, selected  masters  degree
 programs  and  provide  faculty  participation  in research and doctoral
 programs at the graduate center of the city university of New York.  The
 city  of  Staten  Island  shall  serve as local sponsor for the two year
 component of the college of Staten Island and such  component  shall  be
 subject to the provisions of section 6304 of the education law. Such two
 year  component  shall be a part of the state university of New York and
 shall not be governed by a community college board of trustees.
   3. (a) Whenever the term "city university of New York" is referred  to
 or  designated  in  any law, general, special or local, contract, lease,
 judgment, decision or document pertaining to the functions,  powers  and
 S. 8474                            79
 
 duties  relating  to  the  college of Staten Island hereby continued in,
 transferred and assigned to, or devolved upon, the state  university  of
 New  York, such reference or designation shall be deemed to refer to and
 include  the state university of New York, so far as such law, contract,
 lease, judgment, decision or document  pertains  to  matters  which  are
 within  its  jurisdiction  by reason of the redesignation, continuation,
 transfer, assignment and devolution of functions, powers and duties made
 by this act.
   (b)  All contracts, leases and other agreements entered  into  by  the
 city  university  of  New  York relating to the college of Staten Island
 before the effective  date  of  this  section  shall  be  conducted  and
 completed  by  the  state  university of New York in the same manner and
 under the same terms and conditions and with the same effect as  if  the
 same  had  been  conducted  and completed by the state university of New
 York. In addition, any contracts, leases and  other  agreements  entered
 into  by the state university of New York prior to the effective date of
 this section shall  remain  in  full  force  and  effect  and  shall  be
 conducted and completed by the state university of New York.
   (c)    All  rights,  title  and interest in personal property used for
 educational or administrative purposes of the college of  Staten  Island
 of  the city university of New York vested in the city university of New
 York on the effective date  of  this  section  are  hereby  transferred,
 assigned and devolved upon the state university of New York.
   (d)    No  existing  right  or  remedy of any character shall be lost,
 impaired or affected, nor shall any new right or remedy of any character
 accrue to or for the benefit of any person by reason of the transfer  of
 the college of Staten Island pursuant to the provisions of this act.
   (e)  No  action or proceeding based upon a cause of action which arose
 prior to the effective date of this section brought by  or  against  the
 board of trustees of the city university of New York, the city universi-
 ty  construction  fund, the board of trustees of the state university of
 New York or the college of  Staten  Island  shall  be  affected  by  any
 provision of this act.
   (f)  Any lease entered into by the city university of New York for the
 purposes  of  the  college of Staten Island before the effective date of
 this section is hereby transferred, assigned and devolved upon the state
 university of New  York,  notwithstanding  any  provision  that  may  be
 contained  therein  providing for the nonassignability of such lease and
 any such provision shall be deemed to be  void  as  against  the  public
 policy of the state and of no force and effect.
   4.  A  council  for the college of Staten Island is hereby established
 pursuant to section 356 of the education law. It shall  consist  of  ten
 members, nine of whom shall be appointed by the governor and one of whom
 shall be elected by and from among the students of the institution. Such
 voting  members  shall  be  subject  to  every provision of any general,
 special or local law,  ordinance,  charter,  code,  rule  or  regulation
 applying  to  the  voting  members  of  such  board  with respect to the
 discharge of their duties including, but not limited to those provisions
 setting forth codes of ethics, disclosure requirements  and  prohibiting
 business and professional activities. The election of the student member
 shall  be conducted in accordance with rules and regulations promulgated
 by the respective representative campus student association  in  accord-
 ance  with  guidelines established by the state university trustees. One
 member shall be designated by the governor as chairman. Vacancies  shall
 be  filled  for  the  unexpired  term  in  the  same  manner as original
 selections. The term of office for each council member  shall  be  seven
 S. 8474                            80
 
 years.  The  term of office for the student member shall be one year. In
 the event the student member ceases to be a student at  the  institution
 such member shall be required to resign. Members appointed by the gover-
 nor  may  be removed by the governor. Members elected by the students of
 the institution may be removed by such students in accordance with rules
 and regulations promulgated  by  the  respective  representative  campus
 student  association  in  accordance  with guidelines promulgated by the
 state university trustees. Members of  such  council  shall  receive  no
 compensation for their services but shall be reimbursed for the expenses
 actually  and  necessarily  incurred by them in the performance of their
 duties hereunder.
   5. All employees of the college of Staten Island of the city universi-
 ty of New York shall be transferred to employment in the state universi-
 ty of New York and shall retain all  rights,  privileges,  benefits  and
 salaries to which the employee was previously entitled as an employee of
 the city university of New York.
   Employees  of  the  college of Staten Island of the city university of
 New York transferred to employment in the state university of  New  York
 pursuant  to  the  provisions  of  this  act  shall not be involuntarily
 assigned to work outside the geographical  boundaries  of  the  city  of
 Staten  Island  nor shall any such employees suffer a loss of employment
 by reason of such transfer within a  period  of  three  years  from  the
 effective  date of such transfer nor shall any such employees be subject
 to any additional employment probationary  period  by  reason  of  their
 transfer.
   Employees  transferred  from  the college of Staten Island of the city
 university  of New York to employment in the  state  university  of  New
 York  except  for  those  designated managerial or confidential shall be
 included in employer - employee negotiating units comparable to existing
 units in the city university of the city of New York.  With  respect  to
 employees  to  be  placed in such negotiating units, the public employee
 organization recognized or  certified  to  represent  the  employees  in
 comparable  city  university  of  the city of New York negotiating units
 shall be recognized as the unit representative.
   All rights, privileges and benefits provided by collectively bargained
 agreements to employees of the city university of the city of  New  York
 shall be continued for such employees transferred, reappointed or other-
 wise  employed until such time as successor collective bargaining agree-
 ments are negotiated.
   The state university of New York shall  consult  and  bargain  on  all
 terms  and conditions of employment with the appropriate public employee
 organization with respect to the establishment of any new  titles  which
 are  similar  to  or reasonably related to titles already represented by
 such public employee organizations in the city university of the city of
 New York.
   Any such titles for which terms and conditions are bargained  pursuant
 to  this  subdivision  shall be deemed to be successor titles within the
 meaning of applicable law. So long as the responsibilities of  employees
 in  these  titles  are  reasonably  related  to  the responsibilities of
 employees currently represented by public employee  organizations,  such
 titles  shall  be accredited or placed in a negotiating unit represented
 by such public employee organizations.
   If a dispute arises, the office of collective bargaining shall  deter-
 mine  which  public  employee  organization  is appropriate to represent
 transferees, other hires, or employees in a new title on  the  basis  of
 S. 8474                            81
 
 the title's community of interest with titles in the state university of
 New York and the city university of the city of New York.
   No existing right or remedy of any character shall be lost or impaired
 or affected by reason of the adoption of this charter.
   6.  On  and after the first of July in the second year next succeeding
 the date on which this act shall have become a law, officers and employ-
 ees who become employees of the state pursuant to this act shall  become
 members of the New York state employees' retirement system to the extent
 permitted  or  required  by  the provisions of the retirement and social
 security law, except that any employee who is a member of the  New  York
 city  employees'  retirement  system may elect to continue membership in
 the New York city employees' retirement system. Any election pursuant to
 this section shall be made no later than the one hundred  twentieth  day
 after  the  effective  date  of this section, by filing a written notice
 thereof with the administrative head of the New  York  state  employees'
 retirement  system  and  the  New York city employees' retirement system
 and, once made and filed, shall be irrevocable. Upon the  retirement  of
 an  employee  who  has  made  such an election, the calculation of final
 average salary by the New York city employees' retirement  system  shall
 be  performed  as  if the salary earned as a state employee on and after
 such effective date were earned in New York city employment. In the case
 of an employee who becomes a member of the  New  York  state  employees'
 retirement system pursuant to this section, the New York city employees'
 retirement  system  shall make a transfer of reserves, contributions and
 credits to the New York  state  employees'  retirement  system,  in  the
 manner required by section 43 of the retirement and social security law.
   The  comptroller  of  the  city of New York shall certify to the state
 administrator the amount of money required to be paid by  the  state  of
 New  York  for  pension  costs resulting from elections made pursuant to
 this section. The comptroller of the state of New York shall pay to  the
 New  York  city employees' retirement system, upon approval by the state
 administrator, the amounts so certified by the comptroller of  the  city
 of  New York. The comptroller of the city of New York shall also certify
 to the state administrator the amount of money required to  be  contrib-
 uted  by  each  of such employees.   The comptroller of the state of New
 York shall be authorized to withhold the contributions of such employees
 and pay that amount to the New York city employees'  retirement  system.
 The  amount so certified shall be the same as the amounts required to be
 contributed for similarly situated city employees by  the  city  of  New
 York and by employees of the city of New York.
   § 5-002. Subdivision 3 of section 352 of the education law, as amended
 by chapter 13 of the laws of 2021, is amended to read as follows:
   3.  The  state university shall consist of the four university centers
 at Albany, Binghamton, Buffalo and Stony Brook, the designated  colleges
 of arts and sciences at Brockport, Buffalo, Cortland, Fredonia, Geneseo,
 New  Paltz,  Old  Westbury, Oneonta, Oswego, Plattsburgh, Potsdam [and],
 Purchase AND STATEN ISLAND, empire state college, the  agricultural  and
 technical colleges at Alfred, Canton, Cobleskill, Delhi, Farmingdale and
 Morrisville,  downstate  medical  center,  upstate  medical  center, the
 college of optometry, the college of environmental science and forestry,
 maritime college, the college of technology at Utica/Rome, the statutory
 or contract colleges at Cornell university and  Alfred  university,  and
 such  additional  universities, colleges and other institutions, facili-
 ties and research centers as have been or  hereafter  may  be  acquired,
 established,  operated or contracted to be operated for the state by the
 state university trustees.
 S. 8474                            82
 
   § 5-003. Paragraphs (f) and (g) of subdivision 2 and paragraph (d)  of
 subdivision  3  of  section  6204 of the education law, paragraph (f) of
 subdivision 2 as amended by chapter 306 and paragraph (g) of subdivision
 2 as added by chapter 305 of the laws of  1979,  and  paragraph  (d)  of
 subdivision  3 as amended by chapter 98 of the laws of 2010, are amended
 to read as follows:
   (f) The five trustees appointed by the mayor shall  include  at  least
 one resident of each of the [five] boroughs of the city of New York.
   (g)  The trustees appointed by the governor shall include at least one
 resident of each of the [five] boroughs of the city of New York.
   (d) (i) The board of trustees shall hold at least one  public  hearing
 each  year  in  each of the [five] boroughs of the city of New York. The
 purpose of such hearing shall be to  receive  testimony  and  statements
 from concerned individuals about university issues.
   (ii)  The  board  of  trustees shall fix the time, place, duration and
 format of each hearing.
   (iii) At least thirty days notice of the hearing shall be given by the
 chairperson of the board of trustees to all  of  the  trustees,  to  all
 presidents  of  educational units, to the chair of faculty-senate bodies
 of educational units, to all student  government  presidents  of  educa-
 tional units, to the borough president, the members of the city council,
 the  members of the board of estimate, the local community boards of the
 borough where the hearing is to be held and to the media.    The  notice
 shall  contain  the  time,  place  and date of the public hearing.  Such
 information shall be made electronically available on the city universi-
 ty of New York website. Any such meeting of the board of trustees  shall
 be  conducted  in  accordance  with article seven of the public officers
 law.
   (iv) At least three trustees shall attend each hearing.
   § 6-001. The judiciary law is amended by adding a new article  5-C  to
 read as follows:
                                ARTICLE 5-C
           INTERIM COURT STRUCTURE FOR THE CITY OF STATEN ISLAND
 SECTION 178.   DECLARATION OF LEGISLATIVE FINDINGS AND INTENT.
         178-A. CONTINUATION OF COURT PROCEEDINGS.
         178-B. JUDICIAL TRANSITION.
         178-C. JUDICIARY JURISDICTION.
         178-D. JUDICIARY; FAMILY COURT.
         178-E. JUDICIARY; CRIMINAL COURT.
         178-F. JUDICIARY; CIVIL COURT.
         178-G. JUDICIAL TRANSITION; STRUCTURE.
         178-H. UNIFIED COURT SYSTEM; SERVICES.
         178-I. JUDICIAL TRANSITION SERVICES.
         178-J. EFFECT OF EXISTING COLLECTIVE BARGAINING AGREEMENTS.
   §  178.  DECLARATION  OF LEGISLATIVE FINDINGS AND INTENT.  THE INTERIM
 COURT STRUCTURE ESTABLISHED FOR THE CITY OF STATEN ISLAND BY THIS  ARTI-
 CLE IS BEING ENACTED IN THE EXERCISE OF THE LEGISLATURE'S CONSTITUTIONAL
 AUTHORITY TO PROVIDE FOR THE CREATION AND ORGANIZATION OF UNITS OF LOCAL
 GOVERNMENT.  THE  LEGISLATURE  FINDS  THAT IT IS NOT POSSIBLE TO CREATE,
 FUND AND STAFF A NEW AND JURISDICTIONALLY DISTINCT COURT  STRUCTURE  FOR
 THE CITY OF STATEN ISLAND WHICH WOULD BE FULLY OPERATIONAL ON THE EFFEC-
 TIVE DATE OF SUCH CITY'S INCORPORATION.  THE LEGISLATURE ALSO FINDS THAT
 THE CREATION OF A JURISDICTIONALLY DISTINCT COURT STRUCTURE FOR THE CITY
 OF  STATEN  ISLAND  WOULD  LIKELY  DISRUPT THE ORDERLY ADMINISTRATION OF
 JUSTICE IN SUCH CITY AND THE COUNTY OF RICHMOND, UNNECESSARILY INCONVEN-
 IENCE AND CONFUSE LITIGANTS, AND  INCREASE  SIGNIFICANTLY  THE  COST  OF
 S. 8474                            83
 
 CONDUCTING  LITIGATION  WITHIN SUCH CITY AND COUNTY. THE PURPOSE OF THIS
 ARTICLE IS TO PREVENT AN INTERREGNUM IN THE OPERATIONS  OF  THE  UNIFIED
 COURT  SYSTEM IN CONNECTION WITH THE INCORPORATION OF THE CITY OF STATEN
 ISLAND AND ITS ORGANIZATION AS A FUNCTIONAL UNIT OF LOCAL GOVERNMENT. BY
 ESTABLISHING  AN  INTERIM COURT STRUCTURE FOR SUCH CITY, THE LEGISLATURE
 INTENDS TO RELIEVE TAXPAYERS AND LITIGANTS  OF  THE  EXPENSE,  INCONVEN-
 IENCE,  CONFUSION, AND DELAY THAT WOULD BE OCCASIONED BY THE CREATION OF
 A NEW COURT STRUCTURE FOR SUCH CITY. BY PRESERVING  THE  EXISTING  TRIAL
 COURT  STRUCTURE  IN THE COUNTY OF RICHMOND DURING THE PERIOD OF GOVERN-
 MENTAL REORGANIZATION FOLLOWING THE INCORPORATION OF THE CITY OF  STATEN
 ISLAND,  THE LEGISLATURE INTENDS THAT ALL INHABITANTS OF SUCH COUNTY AND
 CITY WILL CONTINUE TO POSSESS THE SAME RIGHTS AND ACCESS TO THE  UNIFIED
 COURT  SYSTEM THAT THEY POSSESSED IMMEDIATELY PRIOR TO THE INCORPORATION
 OF SUCH CITY.
   § 178-A. CONTINUATION OF COURT PROCEEDINGS. THE INCORPORATION  OF  THE
 CITY  OF  STATEN  ISLAND  SHALL  NOT ALTER THE JURISDICTION OF ANY COURT
 EXISTING IN THE COUNTY OF RICHMOND IMMEDIATELY PRIOR  TO  THE  EFFECTIVE
 DATE OF SUCH CITY'S INCORPORATION. ALL COURTS IN SUCH COUNTY ARE CONTIN-
 UED,  AND  NO  CIVIL  OR  CRIMINAL  APPEAL, ACTION OR PROCEEDING PENDING
 BEFORE ANY COURT OR ANY JUDGE OR JUSTICE ON THE EFFECTIVE DATE OF INCOR-
 PORATION SHALL ABATE OR BE IMPAIRED; AND EVERY SUCH  APPEAL,  ACTION  OR
 PROCEEDING  SHALL BE CONTINUED IN THE COURT IN WHICH SUCH APPEAL, ACTION
 OR PROCEEDING WAS PENDING IMMEDIATELY PRIOR TO SUCH EFFECTIVE DATE.
   § 178-B. JUDICIAL TRANSITION. THERE IS ESTABLISHED A JUDICIAL  TRANSI-
 TION  PERIOD  FOR THE CITY OF STATEN ISLAND.  SUCH PERIOD SHALL COMMENCE
 ON THE EFFECTIVE DATE OF SUCH  CITY'S  INCORPORATION  AND  TERMINATE  ON
 DECEMBER  THIRTY-FIRST IN THE FIFTH YEAR FOLLOWING SUCH INCORPORATION OR
 UNTIL THE PROVISIONS OF THIS  ARTICLE  ARE  SPECIFICALLY  SUPERSEDED  BY
 STATE LAW.
   §  178-C. JUDICIARY JURISDICTION. DURING THE JUDICIAL TRANSITION PERI-
 OD:
   (1) THE COUNTY OF RICHMOND SHALL BE DEEMED TO BE A COUNTY  WITHIN  THE
 CITY  OF NEW YORK FOR ALL PURPOSES OF ARTICLE SIX OF THE STATE CONSTITU-
 TION;
   (2) THE COUNTY OF RICHMOND SHALL BE DEEMED TO BE A COUNTY  WITHIN  THE
 CITY  OF  NEW  YORK FOR THE PURPOSES OF SECTION FIVE HUNDRED TWO OF THIS
 CHAPTER;
   (3) THE CITY OF STATEN ISLAND SHALL BE DEEMED TO BE A PART OF THE CITY
 OF NEW YORK FOR THE PURPOSES OF SECTION ONE HUNDRED FIFTY-FIVE AND ARTI-
 CLES TWO-A AND TWO-B OF TITLE TWO OF THE VEHICLE AND TRAFFIC LAW; AND
   (4) THE JUDGE OF THE SURROGATE'S COURT IN THE COUNTY OF RICHMOND SHALL
 BE DEEMED TO BE A JUDGE OF A SURROGATE'S COURT WITHIN THE  CITY  OF  NEW
 YORK  FOR THE PURPOSES OF SUBDIVISION C OF SECTION TWELVE OF ARTICLE SIX
 OF THE STATE CONSTITUTION.
   § 178-D. JUDICIARY; FAMILY COURT. NOTWITHSTANDING SECTION ONE  HUNDRED
 TWENTY-ONE  OF  THE  FAMILY  COURT  ACT, THE COUNTY OF RICHMOND SHALL BE
 DEEMED TO BE A COUNTY WITHIN THE CITY OF NEW YORK  DURING  THE  JUDICIAL
 TRANSITION PERIOD, AND THERE SHALL BE NO FEWER THAN THREE JUDGES OF SUCH
 COURT WHO SHALL BE RESIDENTS OF THE COUNTY OF RICHMOND. A VACANCY OCCUR-
 RING  IN  THE  OFFICE  OF  ANY SUCH JUDGE DURING THE JUDICIAL TRANSITION
 PERIOD SHALL BE FILLED BY THE MAYOR OF THE CITY OF  NEW  YORK  UPON  THE
 RECOMMENDATION OF THE MAYOR OF THE CITY OF STATEN ISLAND CONSISTENT WITH
 THE PROVISIONS OF SECTION TWO HUNDRED SIXTEEN-A OF THE FAMILY COURT ACT.
   §  178-E. JUDICIARY; CRIMINAL COURT. NOTWITHSTANDING THE PROVISIONS OF
 SECTIONS TWENTY AND TWENTY-TWO OF THE NEW YORK CITY CRIMINAL COURT  ACT,
 THE  CITY OF STATEN ISLAND SHALL BE DEEMED TO BE PART OF THE CITY OF NEW
 S. 8474                            84
 
 YORK DURING THE JUDICIAL TRANSITION PERIOD, AND THERE SHALL BE NO  FEWER
 THAN  THREE  JUDGES  OF SUCH COURT WHO SHALL BE RESIDENTS OF THE CITY OF
 STATEN ISLAND. A VACANCY OCCURRING IN THE OFFICE OF  SUCH  JUDGE  DURING
 THE  JUDICIAL TRANSITION PERIOD SHALL BE FILLED BY THE MAYOR OF THE CITY
 OF NEW YORK UPON THE RECOMMENDATION OF THE MAYOR OF THE CITY  OF  STATEN
 ISLAND  CONSISTENT  WITH THE PROVISIONS OF SECTION TWENTY-TWO OF THE NEW
 YORK CITY CRIMINAL COURT ACT.
   § 178-F. JUDICIARY; CIVIL COURT.  NOTWITHSTANDING  THE  PROVISIONS  OF
 SECTION ONE HUNDRED TWO-A OF THE NEW YORK CITY CIVIL COURT ACT, THE CITY
 OF  STATEN  ISLAND  SHALL  BE  DEEMED TO BE PART OF THE CITY OF NEW YORK
 DURING THE JUDICIAL TRANSITION PERIOD, AND THERE SHALL BE NO FEWER  THAN
 THREE  JUDGES OF SUCH COURT WHO SHALL BE RESIDENTS OF THE CITY OF STATEN
 ISLAND. A VACANCY OCCURRING IN THE OFFICE OF SUCH JUDGE  OTHERWISE  THAN
 BY  EXPIRATION  OF  TERM  DURING THE JUDICIAL TRANSITION PERIOD SHALL BE
 FILLED BY THE MAYOR OF THE CITY OF NEW YORK UPON THE  RECOMMENDATION  OF
 THE MAYOR OF THE CITY OF STATEN ISLAND CONSISTENT WITH THE PROVISIONS OF
 SECTION ONE HUNDRED TWO-A OF THE NEW YORK CITY CIVIL COURT ACT.
   §  178-G.  JUDICIAL  TRANSITION;  STRUCTURE.  THE MAYOR AND THE COMMON
 COUNCIL OF THE CITY OF STATEN ISLAND, IN  CONSULTATION  WITH  THE  CHIEF
 ADMINISTRATOR  OF  THE  COURTS,  SHALL DEVELOP A PLAN FOR AN APPROPRIATE
 COURT STRUCTURE FOR THE CITY OF STATEN  ISLAND  FOLLOWING  THE  JUDICIAL
 TRANSITION  PERIOD.  SUCH  PLAN  SHALL  INCLUDE  RECOMMENDATIONS FOR THE
 JURISDICTION OF EACH COURT, THE NUMBER OF  JUDGES  NEEDED,  A  PERSONNEL
 STRUCTURE  FOR  NONJUDICIAL  OFFICERS  AND EMPLOYEES, NECESSARY PHYSICAL
 FACILITIES, AND A FISCAL ANALYSIS OF EACH COMPONENT OF  THE  PLAN.  SUCH
 PLAN  SHALL  BE  SUBMITTED  TO  THE GOVERNOR, THE LEGISLATURE AND TO THE
 CHIEF JUDGE OF THE STATE, NO LATER THAN THREE YEARS FOLLOWING  COMMENCE-
 MENT OF THE JUDICIAL TRANSITION PERIOD.
   §  178-H.  UNIFIED  COURT SYSTEM; SERVICES. THE CHIEF ADMINISTRATOR OF
 THE COURTS IS AUTHORIZED TO DO ALL  THINGS  NECESSARY  TO  CONTINUE  THE
 EFFICIENT  OPERATION  OF  THE  UNIFIED COURT SYSTEM WITHIN THE COUNTY OF
 RICHMOND AND THE CITY OF STATEN ISLAND DURING  AND  AFTER  THE  JUDICIAL
 TRANSITION PERIOD.
   §  178-I. JUDICIAL TRANSITION SERVICES. DURING THE JUDICIAL TRANSITION
 PERIOD, THE MAYOR AND THE COMPTROLLER OF THE CITY OF STATEN  ISLAND  AND
 THE  MAYOR AND THE COMPTROLLER OF THE CITY OF NEW YORK ARE AUTHORIZED TO
 ENTER INTO AGREEMENTS RELATING TO THE PROVISION  OF  MUNICIPAL  SERVICES
 FOR THE COURTS WITHIN THE CITY OF STATEN ISLAND. SUCH MUNICIPAL SERVICES
 MAY INCLUDE, BUT SHALL NOT BE LIMITED TO, CORRECTIONAL SERVICES.
   §   178-J.   EFFECT  OF  EXISTING  COLLECTIVE  BARGAINING  AGREEMENTS.
 NOTWITHSTANDING ANY OTHER PROVISION OF LAW:
   (1) THE PROVISIONS OF  THIS  ARTICLE  SHALL  NOT  ALTER  ANY  EXISTING
 COLLECTIVE NEGOTIATING UNIT OF NONJUDICIAL EMPLOYEES OR ANY PROVISION OF
 A  COLLECTIVE  NEGOTIATING  AGREEMENT IN EFFECT ON THE EFFECTIVE DATE OF
 THIS ARTICLE.
   (2) TO THE EXTENT PERMITTED BY THE STATE CONSTITUTION, WHERE  A  JUDI-
 CIAL  OR  NONJUDICIAL OFFICER OR EMPLOYEE OF THE UNIFIED COURT SYSTEM IS
 REQUIRED AS A CONDITION OF HIS OR HER CONTINUED EMPLOYMENT TO RESIDE  IN
 THE  CITY  OF NEW YORK AND, ON THE EFFECTIVE DATE OF THIS ARTICLE, HE OR
 SHE RESIDES IN THE COUNTY OF RICHMOND, SUCH OFFICER OR EMPLOYEE SHALL BE
 DEEMED TO RESIDE IN THE CITY OF NEW YORK  FOR  SO  LONG  AS  HE  OR  SHE
 REMAINS  IN  HIS OR HER POSITION, PROVIDED HE OR SHE CONTINUES TO RESIDE
 IN THE COUNTY OR IN THE CITY OF NEW YORK.
   (3) THE NONJUDICIAL PERSONNEL OF THE COURTS AFFECTED BY  THIS  ARTICLE
 IN  OFFICE  ON  THE  EFFECTIVE DATE OF THIS ARTICLE SHALL, TO THE EXTENT
 PRACTICABLE, BE CONTINUED WITHOUT DIMINUTION OF SALARIES  AND  WITH  THE
 S. 8474                            85
 
 SAME  STATUS  AND  RIGHTS IN THE COURTS CONTINUED IN THE COUNTY OF RICH-
 MOND.
   §  7-001.  Section 31 of the public housing law, as amended by chapter
 829 of the laws of 1947, is amended to read as follows:
   § 31.  Scope of authority's jurisdiction.   The territorial  jurisdic-
 tion of an authority established for a city or village shall be cotermi-
 nous with the territorial limits of such city or village, and the terri-
 torial jurisdiction of an authority established for a town shall include
 all  such  town,  except  that  such  territorial jurisdiction shall not
 include any territory that lies within the boundaries  of  any  village,
 whether  such  village  has  or  has not established an authority.   The
 members of such town authority shall if they consent and when authorized
 by resolutions of the town board and  the  village  board,  act  as  the
 authority  in  and  for said village, the same as if it had been created
 especially for said village.
   THE FOREGOING NOTWITHSTANDING, THE NEW YORK  CITY  HOUSING  AUTHORITY,
 THE  CREATION  AND  ESTABLISHMENT  OF  WHICH  WAS  VALIDATED PURSUANT TO
 SECTION FOUR HUNDRED OF THIS CHAPTER, SHALL CONTINUE TO HAVE TERRITORIAL
 JURISDICTION FOR THE FIVE COUNTIES WHICH HAD CONSTITUTED  PARTS  OF  THE
 CITY  OF  NEW  YORK  PRIOR  TO  THE  ESTABLISHMENT OF THE CITY OF STATEN
 ISLAND.
   § 7-002. Subdivision 3 of section 402 of the public  housing  law,  as
 added by chapter 96 of the laws of 2013, is amended to read as follows:
   3.  A.  The  authority shall consist of seven members appointed by the
 mayor, one of whom shall be designated by the mayor as [chairman] CHAIR-
 PERSON removable at his or her pleasure. The  term  of  office  of  each
 member  other  than  the  [chairman]  CHAIRPERSON  shall be three years,
 provided, however, that the initial  appointments  of  the  six  members
 other  than the [chairman] CHAIRPERSON shall be as follows: two shall be
 appointed for one-year terms, two shall be appointed for two-year terms,
 and two shall be appointed for three-year terms. The  mayor  shall  file
 with  the  commissioner  of  housing a certificate of appointment of the
 [chairman] CHAIRPERSON and of each member. Any  member  other  than  the
 [chairman]  CHAIRPERSON  may  be removed by the mayor upon filing in the
 office of the commissioner of citywide administrative services and serv-
 ing upon the member the reasons therefor. Such  document  setting  forth
 the  reasons  shall be made available to the general public, which shall
 include but not be limited to publishing the reasons  on  the  New  York
 city  housing  authority's  website.  Three  of  such members shall be a
 tenant of record or an authorized member of  the  tenant  household,  in
 good standing, residing in one of the federal projects owned or operated
 by  the  authority, provided, however, that for the initial appointments
 of the three such members, one shall  be  among  the  members  initially
 appointed  for  one-year terms, one shall be among the members initially
 appointed for two-year  terms,  and  one  shall  be  among  the  members
 initially  appointed  for three-year terms. A vacancy in the office of a
 member other than the [chairman] CHAIRPERSON occurring otherwise than by
 expiration of term shall be filled for the unexpired term. Further,  any
 vacancy  in  the  office  of a tenant member shall only be filled by the
 appointment of an eligible tenant member, and such appointment shall  be
 made within ninety days of such vacancy.
   B.  NOTWITHSTANDING  PARAGRAPH  A OF THIS SUBDIVISION, UPON THE ESTAB-
 LISHMENT OF A CITY OF STATEN ISLAND AND FOR SO LONG AS THE NEW YORK CITY
 HOUSING AUTHORITY SHALL HAVE TERRITORIAL JURISDICTION  IN  THE  CITY  OF
 STATEN ISLAND, SUCH AUTHORITY SHALL CONSIST OF EIGHT MEMBERS, THE EIGHTH
 OF WHOM SHALL BE APPOINTED BY THE MAYOR OF STATEN ISLAND AND SHALL SERVE
 S. 8474                            86
 
 FOR A FIVE-YEAR TERM.  THE MAYOR OF THE CITY OF STATEN ISLAND SHALL FILE
 WITH  THE  COMMISSIONER  OF  HOUSING AND THE CHAIRPERSON OF THE NEW YORK
 CITY HOUSING AUTHORITY A CERTIFICATE OF APPOINTMENT OF SUCH MEMBER. SUCH
 MEMBER  MAY  BE  REMOVED BY THE MAYOR OF STATEN ISLAND FOR CAUSE AFTER A
 PUBLIC HEARING. SUCH MEMBER MAY BE OF ANY POLITICAL PARTY. A VACANCY  IN
 THE  OFFICE  OF SUCH MEMBER OCCURRING OTHER THAN BY EXPIRATION OF A TERM
 SHALL BE FILLED FOR THE UNEXPIRED TERM.
   § 7-003. Section 455 of the education law, as amended by  chapter  724
 of the laws of 1976, is amended to read as follows:
   §  455.  Relationship  with the board of education and the city of New
 York. 1. In order most effectively to carry out its corporate  purposes,
 the  fund shall cooperate with the director of management and budget and
 the board of education of the city of New York in  matters  relating  to
 land  acquisition  and capital planning for school buildings and facili-
 ties.  During the course of construction, reconstruction, rehabilitation
 and improvement of combined occupancy structures the fund shall  consult
 with  personnel of such board as the work progresses in matters relating
 to space requirements, site plans, architectural concept,  and  substan-
 tial  changes  in  the plans and specifications therefor, and in matters
 relating to the original furnishings, equipment, machinery and apparatus
 needed to furnish and equip the school portion  of  such  buildings  and
 structures,  upon the completion of work.  The board, on its part, shall
 perform such functions and services for the fund as may be requested and
 the fund shall pay to the board, from any monies of the  fund  available
 for such purpose, the reasonable cost of such functions and services.
   2.  NOTWITHSTANDING  SUBDIVISION  ONE OF THIS SECTION, UPON THE ESTAB-
 LISHMENT OF A CITY OF STATEN ISLAND, WITH RESPECT TO ANY FUND ACTIVITIES
 TO TAKE PLACE WITHIN SUCH CITY OF STATEN ISLAND, THE FUND SHALL  COOPER-
 ATE WITH THE MAYOR AND COMPTROLLER OF SUCH CITY OF STATEN ISLAND AND THE
 BOARD  OF  EDUCATION  OF  THE CITY SCHOOL DISTRICT OF THE CITY OF STATEN
 ISLAND IN MATTERS RELATING TO LAND ACQUISITION AND CAPITAL PLANNING  FOR
 SCHOOL  BUILDINGS  AND FACILITIES TO THE SAME EXTENT AS WITH THE RESPEC-
 TIVE OFFICIALS OF THE CITY OF NEW YORK.
   § 7-004. Paragraph (c) of subdivision 1 of section 462 of  the  educa-
 tion  law,  as separately amended by chapters 724 and 729 of the laws of
 1976, is amended to read as follows:
   (c) (I) To assure the continued operation and solvency of the  capital
 reserve  fund  for the carrying out of the public purposes of this arti-
 cle, provision is made in paragraph (a)  of  this  subdivision  for  the
 accumulation in the capital reserve fund of an amount equal to the maxi-
 mum amount of principal and interest maturing and becoming due and sink-
 ing  fund  payments required to be made in any succeeding fiscal year on
 all bonds of the fund then outstanding secured by  the  capital  reserve
 fund.    In  order  further  to  assure  such maintenance of the capital
 reserve fund, the board of education shall  annually  request  from  the
 city  of  New  York and pay over to the fund, for deposit in the capital
 reserve fund, such sum, if any, as shall be certified by the  [chairman]
 CHAIRPERSON  of  the  fund  to  the board, the mayor and the director of
 management and budget of the city of New York as  necessary  to  restore
 the  capital  reserve  fund  to an amount equal to the maximum amount of
 principal and interest  maturing  and  becoming  due  and  sinking  fund
 payments  required  to be made in the next succeeding fiscal year on the
 bonds of the fund then outstanding secured by the capital reserve  fund;
 provided,  however,  that such sum shall have been first appropriated by
 the city to the board or shall otherwise have been made lawfully  avail-
 able  to  the  board for such purpose. The [chairman] CHAIRPERSON of the
 S. 8474                            87
 
 fund shall annually, not later than the fifteenth  day  of  February  in
 each  year, make and deliver to the board, the mayor and the director of
 management and budget his OR HER certificate stating the amount, if any,
 required to restore the capital reserve fund to the amount aforesaid and
 the  amount  so  stated,  if any, shall be paid to the fund by the board
 during the then current fiscal year of the fund.   In the event  of  the
 failure  or  inability of the board to pay over the stated amount to the
 fund on or before August first of the same year, the  [chairman]  CHAIR-
 PERSON  of  the fund shall forthwith make and deliver to the comptroller
 of the state of New York AND THE MAYOR AND COMPTROLLER OF  THE  CITY  OF
 STATEN  ISLAND  a  further  certificate restating the amount so required
 and, after the comptroller of the state of New  York  shall  have  given
 written  notice to the commissioner of education, the mayor and director
 of management and  budget AND THE MAYOR AND COMPTROLLER OF THE  CITY  OF
 STATEN  ISLAND,  such amount shall be paid over to the fund by the comp-
 troller of the state of New York out of the next payment  of  state  aid
 apportioned, FIRST, to the city of New York on behalf of the city school
 district  of  the  city of New York for the support of common schools or
 such other aid or assistance payable in support  of  common  schools  as
 shall  supersede  or supplement such state aid for the support of common
 schools, including federal moneys apportioned by the state to  the  city
 of  New  York  on  behalf of the city school district for the support of
 common schools AND, THEREAFTER, IF SUCH AMOUNTS ARE  INSUFFICIENT,  FROM
 SUCH  SIMILAR  AID  PAYABLE TO THE CITY OF STATEN ISLAND.  Any amount so
 paid over to the fund shall be deducted from  the  corresponding  appor-
 tionment of state education aid or other aid or assistance for education
 otherwise  credited to the board of education for its purposes and shall
 not obligate the state to make or entitle  the  city  or  the  board  of
 education  OR  CITY  OF  STATEN  ISLAND  to  receive  any  additional or
 increased apportionment or payment of state aid for school purposes.
   (II) NOTWITHSTANDING SUBPARAGRAPH (I) OF THIS PARAGRAPH, ON  OR  AFTER
 THE FIRST OF JANUARY NEXT SUCCEEDING THE DATE ON WHICH THIS SUBPARAGRAPH
 SHALL  HAVE  BECOME  A LAW, THE FUND SHALL NOT ISSUE ANY BONDS, NOTES OR
 OTHER OBLIGATIONS SECURED BY A CAPITAL RESERVE FUND INTO WHICH STATE AID
 OR OTHER AID OTHERWISE PAYABLE TO THE CITY OF STATEN  ISLAND  IS  TO  BE
 DEPOSITED  PURSUANT  TO  THIS PARAGRAPH, PROVIDED, HOWEVER, THE FUND MAY
 ISSUE REFUNDING BONDS TO PAY BONDS PREVIOUSLY  ISSUED,  WHICH  REFUNDING
 BONDS  MAY BE SO SECURED IF THE FUND GIVES REASONABLE ADEQUATE NOTICE OF
 ITS INTENTION TO ISSUE SUCH REFUNDING BONDS TO THE MAYOR OF THE CITY  OF
 STATEN  ISLAND AND THE COMPTROLLER OF THE CITY OF STATEN ISLAND AND BOTH
 SUCH OFFICIALS ARE GIVEN A REASONABLE OPPORTUNITY TO PARTICIPATE AT  THE
 MEETING OR MEETINGS OF THE BOARD OF THE FUND AT WHICH ACTION IS TAKEN TO
 ISSUE SUCH REFUNDING BONDS.
   §  7-005.  Paragraph (c) of subdivision 3 of section 462 of the educa-
 tion law, as amended by chapter 474 of the laws of 1996, is  amended  to
 read as follows:
   (c) (I) To assure the continued operation and solvency of the fund for
 the  carrying  out  of the public purposes of this article, provision is
 made in paragraph (a) of this subdivision for the accumulation in a debt
 service reserve fund of an amount equal to the debt service reserve fund
 requirement on all bonds of the fund then outstanding secured by a  debt
 service  or  debt service reserve fund.  In order further to assure such
 maintenance of a debt service reserve fund, the board of education shall
 annually request from the city of New York and  pay  over  to  the  fund
 after making the payment required by paragraph (c) of subdivision one of
 this  section  for  deposit in a debt service reserve fund, such sum, if
 S. 8474                            88
 
 any, as shall be certified by the [chairman] CHAIRPERSON of the fund  to
 the  board,  the mayor and the director of the budget of the city of New
 York as necessary to restore such debt service reserve fund to an amount
 equal  to the debt service reserve fund requirement for the bonds of the
 fund secured by such debt service reserve fund; provided, however,  that
 such  sum shall have been first appropriated by the city to the board or
 shall otherwise have been made lawfully available to the board for  such
 purpose.    The  [chairman]  CHAIRPERSON of the fund shall annually, not
 later than the fifteenth day of February in each year, make and  deliver
 to  the  board,  the  mayor  and  the  director of the budget his OR HER
 certificate stating the amount, if  any,  required  to  restore  a  debt
 service  reserve  fund  to the amount aforesaid and the amount so stated
 after making the payment required by paragraph (c) of subdivision one of
 this section if any, shall be paid to the fund by the board  during  the
 then  current  fiscal  year of the fund.  In the event of the failure or
 inability of the board to pay over the stated amount to the fund  on  or
 before  August first of the same year, the [chairman] CHAIRPERSON of the
 fund shall forthwith make and deliver to the comptroller of the state of
 New York AND THE MAYOR AND COMPTROLLER OF THE CITY OF  STATEN  ISLAND  a
 further  certificate  restating  the  amount  so required and, after the
 comptroller of the state of New York shall have given written notice  to
 the commissioner, the mayor and director of the budget AND THE MAYOR AND
 COMPTROLLER  OF  THE CITY OF STATEN ISLAND, such amount after making the
 payment required by paragraph (c) of subdivision  one  of  this  section
 shall  be  paid  over to the fund by the comptroller of the state of New
 York out of the next payment of state aid  apportioned,  FIRST,  to  the
 city  of  New  York on behalf of the city school district of the city of
 New York for the support of common schools or such other aid or  assist-
 ance  payable in support of common schools as shall supercede or supple-
 ment such state aid for the support of common schools, including federal
 moneys apportioned by the state to the city of New York on behalf of the
 city school district for the support of common schools AND,  THEREAFTER,
 IF  SUCH  AMOUNTS ARE INSUFFICIENT, FROM SUCH SIMILAR AID PAYABLE TO THE
 CITY OF STATEN ISLAND.  Any amount so paid over to the fund under  para-
 graph  (c) of subdivision one of this section shall be deducted from the
 corresponding apportionment of state  education  aid  or  other  aid  or
 assistance for education otherwise credited to the board of education OR
 THE  CITY  OF  STATEN ISLAND for its purposes and shall not obligate the
 state to make or entitle the city or the board of education OR THE  CITY
 OF STATEN ISLAND to receive any additional or increased apportionment or
 payment of state aid for school purposes.
   (II)  NOTWITHSTANDING  SUBPARAGRAPH (I) OF THIS PARAGRAPH, ON OR AFTER
 THE FIRST OF JANUARY NEXT SUCCEEDING THE DATE ON WHICH THIS SUBPARAGRAPH
 SHALL HAVE BECOME A LAW, THE FUND SHALL NOT ISSUE ANY  BONDS,  NOTES  OR
 OTHER  OBLIGATIONS  SECURED  BY  A  DEBT SERVICE RESERVE FUND INTO WHICH
 STATE AID OR OTHER AID OTHERWISE PAYABLE TO THE CITY OF STATEN ISLAND IS
 TO BE DEPOSITED PURSUANT TO THIS PARAGRAPH, PROVIDED, HOWEVER, THE  FUND
 MAY  ISSUE REFUNDING BONDS TO PAY BONDS PREVIOUSLY ISSUED, WHICH REFUND-
 ING BONDS MAY BE SO SECURED IF THE FUND GIVES REASONABLE ADEQUATE NOTICE
 OF ITS INTENTION TO ISSUE SUCH REFUNDING BONDS TO THE MAYOR OF THE  CITY
 OF  STATEN  ISLAND  AND THE COMPTROLLER OF THE CITY OF STATEN ISLAND AND
 BOTH SUCH OFFICIALS ARE GIVEN A REASONABLE OPPORTUNITY TO PARTICIPATE AT
 THE MEETING OR MEETINGS OF THE BOARD OF THE  FUND  AT  WHICH  ACTION  IS
 TAKEN TO ISSUE SUCH REFUNDING BONDS.
 S. 8474                            89
 
   §  7-006.  Subdivision  1  of section 1045-c of the public authorities
 law, as added by chapter 513 of the laws of 1984, is amended to read  as
 follows:
   1.  A  corporation  known as the New York city municipal water finance
 authority is hereby created for public purposes  and  charged  with  the
 duties and having the powers provided in this title. The authority shall
 be  a  body  corporate  and politic constituting a public benefit corpo-
 ration. It shall be administered by a board of directors  consisting  of
 [seven]  EIGHT  members  as  follows:  the commissioner of environmental
 protection of the city, the state commissioner of environmental  conser-
 vation,  the  director of management and budget of the city, the commis-
 sioner of finance of the city, two public members to be appointed by the
 mayor, ONE PUBLIC MEMBER TO BE APPOINTED BY THE MAYOR OF  STATEN  ISLAND
 and  one  public  member  to  be appointed by the governor.   One public
 member appointed by the mayor shall serve for a term of  one  year,  one
 public  member  appointed  by  the  mayor  shall serve for a term of two
 years, and the public [member] MEMBERS appointed  by  the  governor  AND
 MAYOR  OF STATEN ISLAND shall serve for a term of two years from January
 first next succeeding the date of their appointment.   Their  successors
 shall  serve  for  terms  of two years each.   Members shall continue in
 office until their successors have been appointed and  qualified.    The
 mayor,  MAYOR  OF  STATEN  ISLAND or the governor shall fill any vacancy
 which may occur by reason of death, resignation or otherwise in a manner
 consistent with the original  appointment.    A  public  member  may  be
 removed by the mayor, MAYOR OF STATEN ISLAND, or the governor, whichever
 appointed  him  OR  HER, for cause, but not without an opportunity to be
 heard in person or by counsel, in his OR HER defense, upon not less than
 ten days' notice.  The mayor shall select a [chairman] CHAIRPERSON  from
 among  the  directors  appointed  by  him OR HER who shall serve in such
 capacity at his  OR  HER  pleasure.  The  [chairman]  CHAIRPERSON  shall
 preside  over all meetings of the board of directors and shall have such
 other duties as may be prescribed by the board.
   § 7-007. Subdivision 2 of section 1045-f  of  the  public  authorities
 law,  as added by chapter 513 of the laws of 1984, is amended to read as
 follows:
   2. The water board shall consist of seven members, SIX OF WHICH  SHALL
 BE  appointed  by the mayor AND, THE SEVENTH OF WHICH SHALL BE APPOINTED
 BY THE MAYOR OF STATEN ISLAND.  THE MAYOR OF STATEN  ISLAND  SHALL  FILL
 THE  EARLIER  OF  THE  FIRST  EXPIRATION  OF A TERM OR THE FIRST VACANCY
 OCCURRING AFTER THE DATE OF ESTABLISHMENT OF THE CITY OF  STATEN  ISLAND
 AND  ANY  SUCCESSOR THERETO. Terms of office of the members shall be two
 years except that the terms of four of the board members first appointed
 shall be one year. At least one member  shall  have  experience  in  the
 science  of water resource development. No member shall be a director of
 the authority. The mayor shall appoint  a  [chairman]  CHAIRPERSON  from
 among  the  members  of  the  board.  All members shall continue to hold
 office until their successors are  appointed  and  qualified.  Vacancies
 shall be filled in the manner provided for original appointments. Vacan-
 cies, occurring otherwise than by expiration of term of office, shall be
 filled  in  the  same  manner as original appointments for the unexpired
 terms.
   § 7-008. Subdivision 5 of section 1045-f  of  the  public  authorities
 law,  as added by chapter 513 of the laws of 1984, is amended to read as
 follows:
   5. The APPOINTING  mayor  may  remove  any  member  for  inefficiency,
 neglect  of duty or misconduct in office after giving such member a copy
 S. 8474                            90
 
 of the charges against such member and an opportunity to  be  heard  and
 defended,  in person or by counsel, upon not less than ten days' notice.
 If any member shall be so removed, the APPOINTING mayor  shall  file  in
 the  office  of  the  clerk  of the city a complete statement of charges
 against such  member,  and  the  APPOINTING  mayor's  findings  thereon,
 together with a complete record of the proceedings.
   §  7-009.  Paragraphs  e  and f of subdivision 1 of section 656 of the
 private housing finance law, as amended by chapter 174 of  the  laws  of
 1992, are amended to read as follows:
   e.  (I)  To  assure the continued operation and solvency of the corpo-
 ration for the carrying out of its corporate purposes, provision is made
 in paragraph a of this subdivision for the accumulation in each  capital
 reserve  fund  of  an  amount  equal to the maximum capital reserve fund
 requirement. In order further to assure such maintenance of each capital
 reserve fund, there shall be paid by the city  to  the  corporation  for
 deposit  in  each  capital  reserve  fund  on or before the first day of
 April, in each year, such amount, if any,  needed  for  the  purpose  of
 restoring  each such capital reserve fund to the maximum capital reserve
 fund requirement for such fund, as shall be certified by the chairperson
 of the corporation to the mayor and the director of management and budg-
 et on or before the first day of December next preceding; provided  that
 any  such  amount  shall have been first appropriated by or on behalf of
 the city for such purpose or shall have been  otherwise  made  available
 from  the  proceeds  of notes or bonds of the city authorized and issued
 pursuant to the local finance law for  such  purpose,  which  is  hereby
 determined  to be a specific object or purpose having a period of proba-
 ble usefulness of five years. In the event of the failure  or  inability
 of  the  city to pay over to the corporation, in full, on or before such
 first day of April the amount so certified the chairperson of the corpo-
 ration shall forthwith certify to the comptroller of the  state  of  New
 York  the  amount  remaining  unpaid and thereupon the state comptroller
 shall pay to the corporation, out of the first moneys available for  the
 next  succeeding payments of [(i)] (A) state aid apportioned to the city
 of New York AND, TO THE EXTENT THE AMOUNTS AVAILABLE THEREFOR ARE INSUF-
 FICIENT, STATE AID APPORTIONED TO THE CITY  OF  STATEN  ISLAND,  as  per
 capita  aid  for  the  support  of  local government pursuant to section
 fifty-four of the state finance law or [(ii)]  (B)  such  other  aid  or
 assistance  payable  by  the  state  to  the  city AND TO THE EXTENT THE
 AMOUNTS AVAILABLE THEREFOR ARE  INSUFFICIENT,  SUCH  AID  OR  ASSISTANCE
 PAYABLE  BY  THE  STATE  TO  THE CITY OF STATEN ISLAND and not otherwise
 allocated as shall supersede or supplement such state  per  capita  aid,
 including  federal moneys apportioned to the city AND, TO THE EXTENT THE
 AMOUNTS AVAILABLE THEREFOR ARE INSUFFICIENT, SUCH MONEYS APPORTIONED  TO
 THE  CITY  OF  STATEN ISLAND by the state, such amount remaining unpaid,
 after giving written notice to the director of management and budget  of
 each  amount  to be paid out of such state aid, until the amount in each
 such capital reserve fund is restored to  the  maximum  capital  reserve
 fund  requirement thereof; provided, however, that prior to the issuance
 of any notes or bonds of the corporation pursuant to  this  article  the
 city  shall  have  enacted  a  local  law authorizing payments from such
 sources into such a fund so long as any notes or  bonds  of  the  corpo-
 ration  shall  be  outstanding  and  unpaid,  and  provided further that
 moneys, if any, payable to the city university construction fund  pursu-
 ant to the provisions of the city university construction fund act shall
 be  paid,  in full, to such fund, prior to any payments therefrom to the
 corporation. Any amount  so  paid  over  to  the  corporation  shall  be
 S. 8474                            91
 
 deducted  from  the corresponding apportionment of such per capita state
 aid otherwise payable to the city of New York  OR  THE  CITY  OF  STATEN
 ISLAND,  AS  APPLICABLE,  and  shall  not obligate the state to make nor
 entitle  the city OR THE CITY OF STATEN ISLAND to receive any additional
 apportionment or payment of per capita state aid. All amounts paid  over
 to the corporation as provided in this [paragraph] SUBPARAGRAPH, includ-
 ing  amounts paid by the state comptroller out of payments of such state
 aid, shall constitute and be accounted for as non-interest bearing loans
 by the city OR THE CITY OF STATEN ISLAND, AS APPLICABLE  to  the  corpo-
 ration and, subject, subordinate and junior to the rights of the holders
 of  any  notes  or  bonds  of  the corporation theretofore or thereafter
 issued, shall be repaid to the city from [(i)] (A) moneys in such  capi-
 tal  reserve fund in excess of the maximum capital reserve fund require-
 ment thereof or [(ii)] (B) any moneys of the  corporation  not  required
 for any other of its corporate purposes.
   (II)  NOTWITHSTANDING  SUBPARAGRAPH (I) OF THIS PARAGRAPH, ON OR AFTER
 THE FIRST OF JANUARY NEXT SUCCEEDING THE DATE ON WHICH THIS SUBPARAGRAPH
 SHALL HAVE BECOME A LAW, THE CORPORATION  SHALL  NOT  ISSUE  ANY  BONDS,
 NOTES  OR OTHER OBLIGATIONS SECURED BY A CAPITAL RESERVE FUND INTO WHICH
 PER CAPITA STATE AID OR OTHER AID  OTHERWISE  PAYABLE  TO  THE  CITY  OF
 STATEN  ISLAND  IS  TO  BE  DEPOSITED  PURSUANT  TO  THIS  SUBPARAGRAPH,
 PROVIDED, HOWEVER, THE CORPORATION MAY  ISSUE  REFUNDING  BONDS  TO  PAY
 BONDS  PREVIOUSLY ISSUED, WHICH REFUNDING BONDS MAY BE SO SECURED IF THE
 CORPORATION GIVES REASONABLE ADEQUATE NOTICE OF ITS INTENTION  TO  ISSUE
 SUCH  REFUNDING  BONDS TO THE MAYOR OF THE CITY OF STATEN ISLAND AND THE
 COMPTROLLER OF THE CITY OF STATEN ISLAND AND  BOTH  SUCH  OFFICIALS  ARE
 GIVEN A REASONABLE OPPORTUNITY TO PARTICIPATE AT THE MEETING OR MEETINGS
 OF  THE  BOARD OF THE CORPORATION AT WHICH ACTION IS TAKEN TO ISSUE SUCH
 REFUNDING BONDS.
   f. In the event the chairperson of the corporation  shall  certify  to
 the  mayor  and  director of management and budget or to the state comp-
 troller any amount necessary to restore a capital reserve  fund  to  the
 maximum capital reserve fund requirement thereof pursuant to subdivision
 e  of  this section, the chairperson shall simultaneously deliver to THE
 MAYOR OF THE CITY OF STATEN ISLAND AND THE COMPTROLLER OF  THE  CITY  OF
 STATEN  ISLAND AND ADDITIONALLY TO such persons a statement of the cause
 or causes of such capital reserve fund deficiency and the measures to be
 taken by the corporation or the department of housing  preservation  and
 development  to  insure  repayment  of any loans made by the city OR THE
 CITY OF STATEN ISLAND to the corporation, including amounts paid by  the
 state  comptroller  out  of  payments  of  state aid, for the purpose of
 restoring such capital reserve fund to the maximum capital reserve  fund
 requirement  thereof and to prevent the recurrence of any such deficien-
 cy.
   § 7-010. Subdivision 4 of section 1680-b  of  the  public  authorities
 law, as amended by chapter 62 of the laws of 1988, is amended to read as
 follows:
   4.  In the event that a participating municipality fails to pay to the
 authority when due all or part of the rentals and other payments payable
 pursuant to any lease, sublease or agreement  with  the  authority,  the
 chairman  or another officer of the authority shall certify at the times
 provided in this subdivision the amount of rentals  and  other  payments
 then  due  from  such  participating  municipality and unpaid. The state
 comptroller, upon receipt of such certificate, shall deduct  the  amount
 of  such  rentals  and other payments as remains unpaid to the authority
 first from the aid payable to such participating municipality  from  the
 S. 8474                            92
 
 court  facilities  incentive aid fund established by section ninety-four
 of the state finance law and, then, from the next succeeding payments of
 state aid apportioned to such  participating  municipality,  as  revenue
 sharing,    per capita aid, and any other aid pursuant to section fifty-
 four of the state finance  law  and,  then,  from  the  next  succeeding
 payments  of  state  aid for any local governmental administrative costs
 that are reimbursable to  the  participating  municipality  pursuant  to
 state law and, then, from the next succeeding payments of state aid from
 moneys  appropriated pursuant to section six hundred eight of the public
 health law and pursuant to section ten-c of the highway  law;  provided,
 however,  that  the  right of the authority to the payment of any amount
 deducted by the state comptroller pursuant  to  this  section  from  per
 capita  aid apportioned to the city of New York OR, TO THE EXTENT INSUF-
 FICIENT, THE CITY OF STATEN ISLAND shall be subject and  subordinate  to
 the  rights of the city university construction fund pursuant to section
 sixty-two hundred seventy-nine of the education law, the New  York  city
 housing  development  corporation pursuant to section six hundred fifty-
 six of the private housing finance  law,  the  trustees  of  the  police
 pension  fund  pursuant  to  paragraph e of subdivision seven of section
 fifty-four of the state finance law, and the municipal assistance corpo-
 ration for the city of New York pursuant to section three thousand thir-
 ty-six-a of this chapter and subdivision one of section ninety-two-e  of
 the  state  finance law.   In order to insure that the amount of rentals
 and other payments due and unpaid by a  participating  municipality  are
 paid,  the  authority  on or within thirty days prior to January twenty-
 fifth, April twenty-fifth, July twenty-fifth and October twenty-fifth of
 each year shall certify to the state comptroller the amount  of  rentals
 and  other  payments  then  due and unpaid by each participating munici-
 pality pursuant to any lease, sublease or other  agreement.  The  amount
 required to be deducted by the state comptroller pursuant to this subdi-
 vision  shall  be  deducted  from such aid, whether or not the state aid
 from which such deduction is to be made is then payable to  the  partic-
 ipating municipality, and thereupon paid to the authority. The amount of
 state aid payable to such participating municipality shall be reduced by
 the  amount deducted by the state comptroller notwithstanding the amount
 appropriated and apportioned by the state to such participating  munici-
 pality, and the state shall not be obligated to make and the participat-
 ing  municipality shall not be entitled to receive any additional appor-
 tionment or payment of such state aid. Nothing  shall  be  construed  to
 create  an  obligation upon the state to appropriate moneys, to preclude
 the state from reducing the amount of moneys appropriated  or  level  of
 assistance provided, or to preclude the state from altering or modifying
 the manner in which it provides for or provides assistance.
   §  7-011.  Section  1727  of  the public authorities law is amended by
 adding a new subdivision 9 to read as follows:
   9. NOTWITHSTANDING  THE  PROVISIONS  OF  THIS  SECTION  OR  ANY  OTHER
 PROVISION  OF  LAW  TO  THE  CONTRARY,  THE AUTHORITY SHALL CONTINUE ITS
 CORPORATE EXISTENCE REGARDLESS OF THE ALTERATION OF THE  COMPOSITION  OF
 THE  BOARD  OF  EDUCATION OF THE CITY SCHOOL DISTRICT OF THE CITY OF NEW
 YORK CAUSED BY THE INCORPORATION OF THE CITY OF STATEN  ISLAND  AND  THE
 ESTABLISHMENT OF THE CITY SCHOOL DISTRICT OF THE CITY OF STATEN ISLAND.
   §  8-001. Subdivision 1 of section 23 of the executive law, as amended
 by chapter 385 of the laws of 2017, is amended to read as follows:
   1. Each county, except RICHMOND COUNTY AND  those  COUNTIES  contained
 within  the  city  of  New  York, and each city with a population of one
 million or more, shall  prepare  a  comprehensive  emergency  management
 S. 8474                            93
 
 plan.  Each  city  with  a population of less than one million, town and
 village is authorized to prepare a  comprehensive  emergency  management
 plan.  The disaster preparedness commission shall provide assistance and
 advice for the development of such plans. Each city with a population of
 less  than  one million, town and village plan shall be coordinated with
 the county plan.
   § 8-002.  Subdivision 1 of section 101-b  of  the  executive  law,  as
 added  by  chapter  1214  of  the  laws  of  1971, is amended to read as
 follows:
   1. Definitions. As used in this section,
   a. "Agency" means any state  board,  bureau,  commission,  department,
 division or officer authorized by law to adopt rules.
   b.  "Rule" means the whole or part of each agency statement of general
 applicability or regulation or code  that  implements  or  applies  law,
 including the amendment, suspension or repeal thereof.
   c.  "Municipal  corporation"  means  [a] ANY county outside the [city]
 CITIES of New York AND STATEN ISLAND, a city, a town,  a  village  or  a
 school district.
   d. "Governing body" means:
   (1)  In  a county, a board of supervisors, county legislature or other
 body vested by its charter, other law  or  other  valid  enactment  with
 jurisdiction to enact local laws;
   (2)  In a city, the board of aldermen, a common council, commission or
 other body vested by its charter or other law with jurisdiction to enact
 ordinances or local laws;
   (3) In a town, the town board;
   (4) In a village, the board of trustees; and
   (5) In a school district, the board of education, board of trustees or
 sole trustee.
   § 8-003. Intentionally omitted.
   § 8-004. Subdivisions 1, 2, 3, 4 and 6 of section 246 of the executive
 law, subdivisions 1, 2 and 3 as amended by section 10 of part D of chap-
 ter 56 of the laws of 2010, subdivision 4 as amended by section  102  of
 part  WWW  of chapter 59 of the laws of 2017, and subdivision 6 as added
 by chapter 479 of the laws of 1970 and as renumbered by chapter  813  of
 the laws of 1985, are amended to read as follows:
   1.  The  program  of  state  aid to county probation services shall be
 administered by the division  of  criminal  justice  services  with  the
 advice  of the state probation commission and the director of the office
 of probation and correctional alternatives. Funds  appropriated  to  the
 division  for  distribution  as  state  aid to county probation services
 [and], to the probation services of New York city AND TO  THE  PROBATION
 SERVICES  OF THE CITY OF STATEN ISLAND shall be distributed by the divi-
 sion in accordance with rules and regulations adopted by the commission-
 er of the division of criminal justice services after consultation  with
 the  state  probation  commission  and  the  director  of  the office of
 probation and correctional alternatives.
   2. State aid shall be granted to the city of New  York,  THE  CITY  OF
 STATEN ISLAND and the respective counties outside [the city of New York]
 SUCH CITIES for expenditures to be incurred by the county or [city] SUCH
 CITIES  in maintaining and improving local probation services subject to
 amounts appropriated for this purpose. State aid  grants  shall  not  be
 used for expenditures for capital additions or improvements, or for debt
 service costs for capital improvements.
   State  aid  shall  be  granted  by the commissioner of the division of
 criminal justice services after consultation with  the  state  probation
 S. 8474                            94
 
 commission  and the director of the office of probation and correctional
 alternatives, provided the respective counties OR  THE  CITY  OF  STATEN
 ISLAND  or  the  city  of  New York conform to standards relating to the
 administration  of  probation services as adopted by the commissioner of
 the division of criminal justice services after  consultation  with  the
 state  probation  commission and the director of the office of probation
 and correctional alternatives.
   3. Applications from counties OR THE CITY OF STATEN ISLAND or the city
 of New York for state aid under this section shall  be  made  by  filing
 with the division of criminal justice services, a detailed plan, includ-
 ing  cost  estimates  covering probation services for the fiscal year or
 portion thereof for which aid is requested. Included in  such  estimates
 shall  be  clerical costs and maintenance and operation costs as well as
 salaries of probation personnel and such other pertinent information  as
 the  commissioner  of  the  division  of  criminal  justice services may
 require. Items for which state aid is requested under this section shall
 be duly designated in the estimates submitted. The commissioner  of  the
 division of criminal justice services, after consultation with the state
 probation  commission  and  the  director of the office of probation and
 correctional alternatives, shall approve such plan  if  it  conforms  to
 standards relating to the administration of probation services as speci-
 fied in the rules adopted by him or her.
   4.  An  approved  plan  and  compliance with standards relating to the
 administration of probation services promulgated by the commissioner  of
 the  division  of  criminal  justice services shall be a prerequisite to
 eligibility for state aid.
   The commissioner of the division of criminal justice services may take
 into consideration granting additional state aid from  an  appropriation
 made  for  state  aid  for county probation services for counties OR THE
 CITY OF STATEN ISLAND or the city of New York when a county OR THE  CITY
 OF  STATEN  ISLAND  or the city of New York demonstrates that additional
 probation services were dedicated to intensive supervision programs  and
 intensive programs for sex offenders. The commissioner shall grant addi-
 tional state aid from an appropriation dedicated to juvenile risk inter-
 vention  services  coordination  by  probation  departments  which shall
 include, but not be limited to, probation services performed under arti-
 cle three of the family court act. The administration of such additional
 grants shall be made according to rules and regulations  promulgated  by
 the  commissioner  of  the  division  of criminal justice services. Each
 county AND THE CITY OF STATEN ISLAND and the  city  of  New  York  shall
 certify  the  total  amount  collected  pursuant  to section two hundred
 fifty-seven-c of this chapter. The commissioner of the division of crim-
 inal justice services shall thereupon certify  to  the  comptroller  for
 payment  by  the  state  out of funds appropriated for that purpose, the
 amount to which the county OR THE CITY OF STATEN ISLAND or the  city  of
 New  York  shall be entitled under this section. The commissioner shall,
 subject to an appropriation made available for such  purpose,  establish
 and  provide  funding  to  probation  departments  for  a  continuum  of
 evidence-based intervention services for youth  alleged  or  adjudicated
 juvenile  delinquents  pursuant to article three of the family court act
 or for eligible youth before  or  sentenced  under  the  youth  part  in
 accordance  with  the  criminal procedure law. Such additional state aid
 shall be made in an amount necessary to pay one hundred percent  of  the
 expenditures   for   evidence-based  practices  and  juvenile  risk  and
 evidence-based intervention services provided to youth sixteen years  of
 age  or  older when such services would not otherwise have been provided
 S. 8474                            95
 
 absent the provisions of [a] PART WWW OF chapter FIFTY-NINE of the  laws
 of  two thousand seventeen [that increased the age of juvenile jurisdic-
 tion].
   6.  The  director, after consultation with the state probation commis-
 sion, may authorize or require the comptroller to withhold  the  payment
 of  state aid to any county, OR THE CITY OF STATEN ISLAND or the city of
 New York, in the event that such county, OR THE CITY OF STATEN ISLAND or
 the city of New York, (a) fails to conform  to  standards  of  probation
 administration  as  formulated by the director pursuant to this section,
 (b) discontinues or fails to follow an approved plan, or  (c)  fails  to
 enforce  in  a  satisfactory  manner  rules promulgated pursuant to this
 section, or laws now in effect or hereafter adopted which relate in  any
 manner to the administration of probation services.
   §  8-004-a.  The  second  undesignated  paragraph  of subdivision 4 of
 section 246 of the executive law, as amended by section 103 of part  WWW
 of chapter 59 of the laws of 2017, is amended to read as follows:
   The commissioner of the division of criminal justice services may take
 into  consideration  granting additional state aid from an appropriation
 made for state aid for county probation services  for  counties  OR  THE
 CITY  OF STATEN ISLAND or the city of New York when a county OR THE CITY
 OF STATEN ISLAND or the city of New York  demonstrates  that  additional
 probation  services were dedicated to intensive supervision programs and
 intensive programs for sex offenders. The commissioner shall grant addi-
 tional state aid from an appropriation dedicated to juvenile risk inter-
 vention services  coordination  by  probation  departments  which  shall
 include, but not be limited to, probation services performed under arti-
 cle three of the family court act. The administration of such additional
 grants  shall  be made according to rules and regulations promulgated by
 the commissioner of the division  of  criminal  justice  services.  Each
 county  AND  THE  CITY  OF  STATEN ISLAND and the city of New York shall
 certify the total amount  collected  pursuant  to  section  two  hundred
 fifty-seven-c of this chapter. The commissioner of the division of crim-
 inal  justice  services  shall  thereupon certify to the comptroller for
 payment by the state out of funds appropriated  for  that  purpose,  the
 amount  to  which the county OR THE CITY IF STATEN ISLAND or the city of
 New York shall be entitled under this section. The  commissioner  shall,
 subject  to  an appropriation made available for such purpose, establish
 and  provide  funding  to  probation  departments  for  a  continuum  of
 evidence-based  intervention  services  for youth alleged or adjudicated
 juvenile delinquents pursuant to article three of the family  court  act
 or  for  eligible  youth  before  or  sentenced  under the youth part in
 accordance with the criminal procedure law.
   § 8-005. Subdivision 1 of section 255 of the executive law,  as  added
 by chapter 603 of the laws of 1973, is amended to read as follows:
   1.  There  is  hereby created a department of probation in and for the
 city of New York to have charge of all probation work  in  the  supreme,
 family  and criminal courts in the counties of Bronx, Kings, New York[,]
 AND Queens [and Richmond].
   § 8-006. The executive law is amended by adding a new section 255-a to
 read as follows:
   § 255-A. PROBATION IN THE CITY OF STATEN ISLAND. 1.   THERE IS  HEREBY
 CREATED  A  DEPARTMENT OF PROBATION IN AND FOR THE CITY OF STATEN ISLAND
 TO HAVE CHARGE OF ALL PROBATION WORK IN THE SUPREME,  FAMILY  AND  OTHER
 CRIMINAL COURTS IN THE COUNTY OF RICHMOND.
   2.  THE  HEAD  OF  SUCH  DEPARTMENT  SHALL  BE A DIRECTOR OF PROBATION
 APPOINTED BY THE MAYOR OF THE CITY OF STATEN ISLAND TO SERVE DURING  THE
 S. 8474                            96
 
 PLEASURE  OF  THE  MAYOR. THE DIRECTOR SHALL HAVE CHARGE OF THE ADMINIS-
 TRATION OF THE DEPARTMENT AND SHALL BE RESPONSIBLE FOR CARRYING OUT  THE
 FUNCTIONS  OF  THE  DEPARTMENT  INCLUDING  INTAKE, INVESTIGATION, SUPER-
 VISION,  CONCILIATION  AND  PRE-DISPOSITION  SOCIAL  TREATMENT  IN CASES
 COMING TO THE COURTS REFERRED TO IN THIS SECTION.    THE  DIRECTOR  MAY,
 FROM TIME TO TIME, CREATE, ABOLISH, TRANSFER AND CONSOLIDATE BUREAUS AND
 OTHER  UNITS  WITHIN THE DEPARTMENT AS HE OR SHE MAY DETERMINE NECESSARY
 FOR EFFICIENT OPERATION THEREOF.  THE DIRECTOR ALSO SHALL HAVE THE POWER
 TO APPOINT AND REMOVE SUCH DEPUTY DIRECTORS, ASSISTANTS, PROBATION OFFI-
 CERS AND OTHER EMPLOYEES AS MAY BE NEEDED FOR  THE  PERFORMANCE  OF  THE
 DUTIES  OF  THE  DEPARTMENT AND MAY PRESCRIBE THEIR DUTIES AND FIX THEIR
 COMPENSATION, WITHIN APPROPRIATIONS MADE AVAILABLE THEREFOR BY THE  CITY
 OF  STATEN  ISLAND  AND SUBJECT TO ALL APPLICABLE CIVIL SERVICE LAWS AND
 RULES AND REGULATIONS.   THE DIRECTOR MAY, IN  HIS  OR  HER  DISCRETION,
 APPOINT VOLUNTEER PROBATION OFFICERS, WHEN NECESSARY, PROVIDED THEY HAVE
 THE  QUALIFICATIONS REQUIRED OF SALARIED OFFICERS, BUT NO SUCH VOLUNTEER
 PROBATION OFFICER SHALL RECEIVE PAY FROM THE PUBLIC FUNDS FOR HIS OR HER
 SERVICES.  THE CITY OF STATEN ISLAND SHALL MAKE THE NECESSARY  APPROPRI-
 ATION FOR THE SALARIES OF THE DIRECTOR AND OF ALL OFFICERS AND EMPLOYEES
 OF  THE  DEPARTMENT  AS  REFERRED TO HEREIN, AS WELL AS FOR THE EXPENSES
 ACTUALLY AND NECESSARILY INCURRED BY SUCH DIRECTOR, OFFICERS AND EMPLOY-
 EES IN THE PERFORMANCE OF THEIR DUTIES.
   3.  THE DIRECTOR SHALL DISCHARGE HIS OR HER  POWERS  AND  RESPONSIBIL-
 ITIES  IN ACCORDANCE WITH ALL LAWS AND RULES APPLICABLE TO PROBATION AND
 WITH THE GENERAL RULES REGULATING METHODS AND PROCEDURE IN THE  ADMINIS-
 TRATION  OF  PROBATION  AS ADOPTED FROM TIME TO TIME PURSUANT TO SECTION
 TWO HUNDRED FORTY-THREE OF THIS CHAPTER.  THE DIRECTOR MAY ADOPT DEPART-
 MENTAL RULES, NOT INCONSISTENT WITH LAW OR THE AFORESAID GENERAL  RULES,
 TO  REGULATE THE POLICIES, PROGRAMS, STANDARDS, AND METHODS OF PROCEDURE
 IN RELATION TO PROBATION AND THE  POWERS  AND  DUTIES  OF  OFFICERS  AND
 EMPLOYEES AS IN THE DIRECTOR'S JUDGMENT ARE DEEMED PROPER.
   4.  NOTWITHSTANDING ANY OTHER PROVISION OF LAW OR OF THE STATEN ISLAND
 CITY  CHARTER  OR  ADMINISTRATIVE  CODE,  ANY  DULY APPOINTED OFFICER OR
 EMPLOYEE OF SUCH PROBATION DEPARTMENT MAY RESIDE IN  ANY  COUNTY  WITHIN
 THE STATE.
   §  8-007.  Subdivisions 1 and 4 of section 257-c of the executive law,
 as added by chapter 55 of the laws of  1992,  are  amended  to  read  as
 follows:
   1.  Notwithstanding any other provision of law, every county, THE CITY
 OF STATEN ISLAND and the city of New York, may adopt a local law requir-
 ing  individuals currently serving or who shall be sentenced to a period
 of probation upon conviction of any crime under  article  thirty-one  of
 the  vehicle  and  traffic  law to pay to the local probation department
 with the responsibility of supervising the probationer an administrative
 fee of thirty dollars per month.  The department shall waive all or part
 of such fee where, because of the indigence of the offender, the payment
 of said surcharge would work an  unreasonable  hardship  on  the  person
 convicted,  his  or  her  immediate  family,  or any other person who is
 dependent on such person for financial support.
   4. In the event of non-payment of any fees which have not been  waived
 by the local probation department, the county, THE CITY OF STATEN ISLAND
 or  the  city  of  New  York  may  seek to enforce payment in any manner
 permitted by law for enforcement of a debt.
   § 8-008. Subdivision 3 of section 262 of the executive law, as amended
 by section 28 of part A of chapter 56 of the laws of 2010, is amended to
 read as follows:
 S. 8474                            97
 
   3. Upon approval by the board, by a majority of its members, any coun-
 ty outside the [city] CITIES  of  New  York  AND  STATEN  ISLAND  acting
 through its county executive, and upon approval of the local legislative
 body, may submit a proposed service plan to the office for approval. The
 city of New York acting through the mayor and upon approval by the board
 of  estimate  AND THE CITY OF STATEN ISLAND ACTING THROUGH THE MAYOR AND
 UPON APPROVAL BY THE COMMON COUNCIL may submit a proposed  service  plan
 to the office for approval.
   §  8-009. Subdivisions 1 and 2 of section 266 of the executive law, as
 added by chapter 338 of the  laws  of  1989,  are  amended  to  read  as
 follows:
   1.  Counties  and  the [city] CITIES of New York AND STATEN ISLAND may
 submit approved amendments for alcohol and substance abuse  programs  as
 defined  in  this article as part of or in addition to an approved plan.
 In accordance with this article, nothing  in this section shall prohibit
 the development of regional alcohol and substance abuse programs by  two
 or  more counties, THE CITY OF STATEN ISLAND or cities with a population
 of one million or more.
   2. Such approved amendments shall include a statement by the county or
 the city of New York OR  THE  CITY  OF  STATEN  ISLAND  indicating  such
 municipality's  understanding  that  funding  for  eligible  alcohol and
 substance abuse programs shall be in accordance with subdivision four of
 this section and the  municipality's  commitment  to  meet  the  funding
 requirements as set forth in such subdivision.
   § 8-010. Section 267 of the executive law, as amended by section 33 of
 part A of chapter 56 of the laws of 2010, is amended to read as follows:
   §  267. Office  reports.  The office shall submit to the governor, the
 temporary president of the senate, the  speaker  of  the  assembly,  the
 [chairman]  CHAIRPERSON of the senate crime and correction committee and
 the [chairman] CHAIRPERSON of the assembly committee on codes by October
 first of each year its evaluation and assessment  of  this  alternatives
 planning  and  programming  effort  by  the  counties. Such report shall
 include, but not be limited to, the status of the  development  of  such
 plans, the approval and implementation of such plans, the success of the
 programs,  in  terms  of  their  utilization, effect on jail population,
 results of the analyses provided counties and the [city] CITIES  of  New
 York  AND  STATEN  ISLAND on the relationship between alcohol, drugs and
 crime and the success  of  the  eligible  alcohol  and  substance  abuse
 programs and sentencing decisions together with any recommendations with
 respect to the proper operation or improvement of planning and implemen-
 tation of effective alternatives to detention and alternatives to incar-
 ceration programs in counties.
   §  8-011.  Subdivisions  1  and 7 of section 530 of the executive law,
 subdivision 1 as amended by section 4 of subpart B of part Q of  chapter
 58 of the laws of 2011, subdivision 7 as amended by section 21 of part K
 of chapter 56 of the laws of 2019, are amended to read as follows:
   1. Definitions. As used in this section, the term "municipality" shall
 mean  a  county, THE CITY OF STATEN ISLAND or a city having a population
 of one million or more.
   7. The agency administering detention for each county AND THE CITY  OF
 STATEN  ISLAND  and  the  city of New York shall submit to the office of
 children and family services, at such times and in such form and  manner
 and  containing  such  information as required by the office of children
 and family services, an annual report  on  youth  remanded  pursuant  to
 article  three  or seven of the family court act who are detained during
 each calendar year including, commencing  January  first,  two  thousand
 S. 8474                            98
 
 twelve, the risk level of each detained youth as assessed by a detention
 risk assessment instrument approved by the office of children and family
 services provided, however, that the report due January first, two thou-
 sand  twenty-one  and  thereafter  shall  not be required to contain any
 information on youth who are subject to  article  seven  of  the  family
 court  act.  The  office  may require that such data on detention use be
 submitted to the office electronically. Such report shall  include,  but
 not  be  limited to, the reason for the court's determination in accord-
 ance with section 320.5 or seven hundred thirty-nine of the family court
 act to detain the youth; the offense or offenses with which the youth is
 charged; and all other reasons  why  the  youth  remains  detained.  The
 office  shall  submit  a  compilation of all the separate reports to the
 governor and the legislature.
   § 8-012. Subdivisions 1, 2 and 4 of section 214 of the elder  law  are
 amended to read as follows:
   1.  Definitions.  As  used  in this section, the following words shall
 have the following meanings:
   (a) "Designated agency" shall mean an agency which  is  designated  by
 the  chief executive officer of the county if there be one, or otherwise
 the governing board of such county, or the chief  executive  officer  of
 the  city  of New York OR THE MAYOR OF THE CITY OF STATEN ISLAND, or the
 governing board of an Indian tribal council; which is either a  unit  of
 county  government  or the city of New York OR THE CITY OF STATEN ISLAND
 or an Indian tribal organization or a  private  non-profit  agency,  and
 which  is the area agency on aging created pursuant to the federal older
 Americans act of 1965.
   (b) "Elderly person" shall mean a person sixty years of age or older.
   (c) "County" shall mean a county, as defined in section three  of  the
 county  law,  except  that  the city of New York shall be considered one
 county.
   (d) "Base year expenditures" and "base year services" shall  mean  the
 level  of  expenditures and services in the year prior to the first year
 for which a county plan is submitted or in such  county's  two  thousand
 five fiscal year, whichever is greater.
   (e) "Community services" shall mean services for elderly persons which
 are  provided  by  a public or governmental agency or non-profit agency,
 and which are provided in the home of an elderly person or in  community
 settings  such  as  senior citizens centers, housing projects, or agency
 offices. Such services shall not include any services provided  pursuant
 to the public health law other than home care services.
   (f)   "Community  service  projects"  shall  mean  community  services
 financed pursuant to paragraph (b) of subdivision four of this section.
   (g) "County plan" shall mean a plan for community services prepared by
 a county pursuant to this section.
   (h) "Non-profit agency" shall mean a corporation organized or existing
 pursuant to the not-for-profit corporation law.
   (i) "Program year" shall mean the  period  from  April  first  through
 March thirty-first of the following calendar year.
   (j)  "First program year" for a county shall mean the initial year for
 which the county has received approval for its county plan.
   2. County plans for improving the availability of  community  services
 to  the  elderly.  (a) Counties with a designated agency are required to
 submit a county plan for a two-, three-, or four-year period  determined
 by  the  director, with an annual update containing a budget request for
 the forthcoming program year and such  other  information  as  shall  be
 required  by  the  director,  for  improving  the  delivery of community
 S. 8474                            99
 
 services for elderly persons in the format prescribed by  the  director.
 The  plan  for  the  city of New York OR THE PLAN FOR THE CITY OF STATEN
 ISLAND shall specifically address the needs of each county  within  such
 city.  Such  plan  shall be a comprehensive description of the manner in
 which the county intends to address the needs of elderly persons  living
 in  the  county  through  improved  coordination  of  existing community
 services and by the development of any new or expanded community service
 projects which will improve the delivery of  services  to  the  elderly.
 Such plan shall contain:
   (1)  a  statement  of goals and objectives for addressing the needs of
 elderly persons in the county, an assessment of  the  needs  of  elderly
 persons  residing  in  the  county,  a description of public and private
 resources that currently provide community services to  elderly  persons
 within  the county, a description of intended actions to consolidate and
 coordinate existing community services administered  by  county  govern-
 ment,  a  description  of  the intended actions to coordinate congregate
 services programs for the elderly operated within the county pursuant to
 section two  hundred  seventeen  of  this  title  with  other  community
 services for the elderly, a description of the means to coordinate other
 community services for elderly persons in the county with those adminis-
 tered  by  county  government, and a statement of the priorities for the
 provision of community services during the  program  period  covered  by
 such plan;
   (2) an identification of community service projects to be developed to
 improve  the delivery of services, a budget request for approval for the
 forthcoming year which individually identifies  each  community  service
 project  to  be  funded pursuant to paragraph (b) of subdivision four of
 this section, letters of comment from the appropriate local agencies  on
 the  relationship  and expected impact of the proposed community service
 projects,  assurances  that  community  service  projects  will  provide
 services  to those most in need, an indication of fee schedules by which
 elderly persons participating in community service projects may contrib-
 ute to the costs of such projects, and an indication of how  the  effec-
 tiveness of such community service projects will be evaluated;
   (3)  an  identification  of planning, coordination, and administrative
 activities necessary to achieve the goals and objectives  of  the  plan,
 together  with a budget request for such activities for approval for the
 forthcoming year to be funded pursuant to paragraph (a)  of  subdivision
 four  of  this section, and assurances by the county that it will comply
 with the requirements of state and federal law; and
   (4) such other components as may be required pursuant  to  regulations
 promulgated by the director.
   (b)  Such county plan for community services or annual update shall be
 prepared by the designated agency and approved by  the  chief  executive
 officer of the county, if there be one, or otherwise the governing board
 of  the  county,  or  the chief executive of the city of New York OR THE
 MAYOR OF THE CITY OF STATEN ISLAND and  submitted  to  the  director  no
 later  than  ninety  days  prior  to the beginning of the program period
 covered by such plan or annual update.  Prior to a submission of a coun-
 ty plan or annual update to the director for  approval,  the  designated
 agency  shall  conduct  such public hearings as may be required by regu-
 lations of the director, provided that there shall be at least one  such
 hearing, and one in each county contained within the city of New York OR
 THE CITY OF STATEN ISLAND.
   (c)  The  director  shall  review  such county plan and may approve or
 disapprove such plan, or any part, program, or project within such plan,
 S. 8474                            100
 
 and shall propose such modifications and conditions as are deemed appro-
 priate and necessary. Compliance with paragraphs (a)  and  (b)  of  this
 subdivision shall be the basis for approval of a county plan. The direc-
 tor shall establish by regulation the dates for notifying the designated
 agency  of  approval  or  disapproval of a county plan. In the event the
 director shall disapprove the proposed county plan, the  county  submit-
 ting  such application shall be afforded an opportunity for an adjudica-
 tory hearing, as prescribed by article three of the state administrative
 procedure act.
   (d) Notwithstanding any provision of this section,  nothing  contained
 in  this  section  shall  give  the  director or a designated agency any
 administrative, fiscal, supervisory, or other authority whatsoever  over
 any  plans, programs or expenditures authorized pursuant to titles eigh-
 teen, nineteen and twenty of the federal social security  act,  or  over
 any unit of state or local government.
   (e)  Counties  with  a  designated agency may submit to the director a
 letter of intent, in the form and by the date prescribed by the director
 with the approval of the director of the budget, evidencing the  commit-
 ment  of  the county to develop a county home care plan for functionally
 impaired elderly.
   (f) Within the amounts appropriated therefor, counties  submitting  an
 approved  letter of intent pursuant to paragraph (e) of this subdivision
 shall be eligible for  reimbursement  of  one  hundred  percent  of  the
 approved  expenditures  for  preparing a county home care plan for func-
 tionally impaired elderly. Such a grant-in-aid shall be available  to  a
 county  only  once and shall be limited to one-half the amount available
 to such county pursuant to subparagraph one of paragraph (a) of subdivi-
 sion four of this section; provided however that in either  of  the  two
 years immediately following its first submission of a home care plan for
 functionally impaired elderly, a county which does not receive state aid
 during such year for expanded non-medical in-home services, non-institu-
 tional   respite  services,  case  management  services,  and  ancillary
 services pursuant to paragraph (j) of subdivision four of this  section,
 may  apply  for  reimbursement  of  one  hundred percent of the approved
 expenditures for revising such home care plan,  limited  to  one-quarter
 the  amount  available  to  such  county pursuant to subparagraph one of
 paragraph (a) of subdivision four of this section.
   (g) County home care plans for functionally impaired elderly  prepared
 pursuant  to  this subdivision shall include a comprehensive description
 of all aspects of home care, non-institutional respite, case management,
 and ancillary services available to elderly persons  in  the  county;  a
 description of intended actions to coordinate such home care, non-insti-
 tutional  respite,  case  management,  and  ancillary  services to func-
 tionally impaired elderly persons in their county  provided  under  this
 section  with other services to elderly persons; a proposal for expanded
 non-medical in-home services, non-institutional respite  services,  case
 management  services,  and  ancillary services for functionally impaired
 elderly persons with unmet needs  to  support  such  persons'  continued
 residence  in  their homes; and such other components as may be required
 pursuant to regulations promulgated by the director, including  how  the
 proposed   expanded   non-medical  in-home  services,  non-institutional
 respite services, case management services, and ancillary services  will
 be delivered to unserved or underserved populations.
   (h) Such county home care plan for functionally impaired elderly shall
 be  prepared by the designated agency after consultation with the social
 services district and the local  public  health  agency,  and  shall  be
 S. 8474                            101
 
 approved  by the chief executive officer of the county, if there be one,
 or otherwise the governing board of the county, or the  chief  executive
 of  the  city of New York OR THE MAYOR OF THE CITY OF STATEN ISLAND, and
 submitted  to the director for approval by such date as may be specified
 by regulation. The director shall not approve such county home care plan
 for functionally impaired elderly unless it complies with the  standards
 and regulations issued pursuant to this section.
   4.  State  aid.  (a)  County  plans  for improving the availability of
 community services to the elderly:
   (1)  within  the  amounts  appropriated  therefor,  counties  with  an
 approved  county plan shall be eligible for reimbursement of one hundred
 percent of the annual approved  expenditures  for  the  preparation  and
 revision  of  such  county plan, evaluation of projects contained within
 such county plan, execution of interagency agreements necessary to carry
 out the plan, actions to  consolidate,  combine  or  collocate  services
 within  the county, and such other costs of the designated agency neces-
 sary to implement such county  plan,  provided  that  the  total  annual
 amount  payable  to  a  county  pursuant  to this subparagraph shall not
 exceed the sum of one dollar for each elderly  person  residing  in  the
 county, or seventy-five thousand dollars, whichever is less, and further
 provided that for the city of New York OR THE CITY OF STATEN ISLAND such
 amount  shall  not exceed one dollar for each elderly person residing in
 [the] SUCH city or three hundred seventy-five thousand dollars, whichev-
 er is less. Notwithstanding the foregoing limitations, counties  with  a
 population  of less than twenty thousand elderly persons shall be eligi-
 ble for reimbursement of one hundred percent  of  such  annual  approved
 expenditures provided that the total annual amount of such reimbursement
 per county shall not exceed twenty thousand dollars.
   (2)  within  the amounts appropriated therefor, a county may receive a
 grant-in-aid of up to twenty-five per centum of the total annual  amount
 that  such county is eligible to receive pursuant to subparagraph one of
 this paragraph for the cost of  preparing  an  initial  county  plan  in
 accordance  with this section. Such a grant-in-aid shall be available to
 a county only once  and  shall  be  in  addition  to  the  reimbursement
 received  by  the  county pursuant to subparagraph one of this paragraph
 for the first program year. A request for such a grant-in-aid  shall  be
 accompanied by a letter of intent in the form prescribed by the director
 evidencing  the  commitment  of  the county to develop a county plan for
 community services and shall be submitted to the director at  least  six
 months prior to the beginning of the first program year.
   (b) Community service projects:
   (1)  within  the  amounts  appropriated  therefor,  counties having an
 approved county plan shall be eligible for reimbursement  by  the  state
 for  expenditures  for  approved  community service projects pursuant to
 this section. Such state reimbursement  shall  not  exceed  thirty-three
 thousand  six  hundred  dollars  or  four  dollars twenty cents for each
 elderly person residing in the county, whichever is greater. The  annual
 state  reimbursement  eligibility  shall  be  at  a rate of seventy-five
 percent of the total annual expenditures for such approved programs.
   (2) the director shall provide by regulation that  certain  non-county
 moneys  and in-kind equivalents may be used to comprise the county share
 of such total annual approved expenditures, provided  that  such  county
 share  shall  not  include  cost-sharing  received  from elderly persons
 receiving  expanded  non-medical  in-home  services,   non-institutional
 respite  services,  case  management  services,  and  ancillary services
 pursuant to paragraph (k) of this subdivision or  moneys  received  from
 S. 8474                            102
 
 the  federal  government  for  services for the elderly allocated to the
 states or local governments according to population or other  such  non-
 competitive basis.
   (3)  the director shall provide by regulation the requirements for any
 participant contributions and fee schedules used for  community  service
 projects and the manner for the accounting and use of any such revenue.
   (c)  Reimbursement pursuant to this section shall not be available for
 expenditures for base year services otherwise provided without cost,  or
 to  replace  base  year  expenditures  made  by  the county or any other
 service provider irrespective of the source of funds for such services.
   (d)  Reimbursement  shall  not  be  available  to  community  services
 projects  funded  pursuant  to  paragraph  (b) of this subdivision or to
 expanded  non-medical  in-home   services,   non-institutional   respite
 services, case management services, and ancillary services funded pursu-
 ant to paragraph (j) of this subdivision for services provided to elder-
 ly  persons who are eligible for or are receiving services to meet their
 needs pursuant to titles eighteen, nineteen or  twenty  of  the  federal
 social  security  act or any other governmental programs or for services
 provided to residents in adult residential  care  facilities  which  had
 previously been provided by the facility or which are required by law to
 be provided by such facility.
   (e)  For  the purpose of determining the amount of state reimbursement
 for which a county is  eligible  pursuant  to  this  section,  the  last
 preceding  federal  census  or  other  census data approved by the comp-
 troller shall be used. Funds appropriated by the state for  the  purpose
 of  reimbursement  for community services pursuant to this section shall
 be apportioned among the counties pursuant to the formula set  forth  in
 paragraph (b) of this subdivision by the director. Funds appropriated by
 the  state  for  the  purpose  of reimbursement for expanded non-medical
 in-home services, non-institutional respite  services,  case  management
 services,  and  ancillary  services  pursuant  to  this section shall be
 apportioned among the counties by the director pursuant to  the  formula
 set forth in paragraph (j) of this subdivision.
   (f) The comptroller may withhold the payment of state aid to any coun-
 ty  in  the event that such county alters or discontinues the operations
 approved by the director pursuant to this section or otherwise fails  to
 comply with the regulations or requirements of the director.
   (g)  Counties  shall  submit claims for reimbursement after the end of
 each month or each quarter as required by and in accordance with  proce-
 dures  prescribed  by the director. Reimbursement shall be available for
 approved expenditures incurred in accordance  with  an  approved  county
 plan for community services.
   (h)  Reimbursement  pursuant  to  subparagraph one of paragraph (b) or
 paragraph (j) of this subdivision shall not be  available  for  expendi-
 tures for community or expanded non-medical in-home services, non-insti-
 tutional  respite  services,  case  management  services,  and ancillary
 services to elderly persons in the city of New York AND IN THE  CITY  OF
 STATEN  ISLAND unless expenditures for such services are apportioned for
 services in each of the counties contained within such city in a  manner
 which  the  director has determined by regulation substantially reflects
 the proportion that the number of elderly persons in that  county  bears
 to the total number of elderly persons in [the] SUCH city as a whole. In
 determining whether reimbursement shall be available under paragraph (g)
 of  this  subdivision,  the director shall ensure that expenditures were
 apportioned in accordance with the provisions of this paragraph.
 S. 8474                            103
 
   (i) The director, within the amounts appropriated  therefor  and  with
 the approval of the director of the budget, may authorize a county which
 has  an  approved  home  care  plan for functionally impaired elderly to
 provide expanded non-medical in-home services, non-institutional respite
 services,  case  management services, and ancillary services pursuant to
 such plan. Such services shall be limited to those services necessary to
 meet otherwise unmet needs  and  which  support  such  elderly  persons'
 continued residence in their homes. Needs will be determined pursuant to
 a  standardized evaluation of functional impairment, available resources
 and such  other  relevant  factors  specified  pursuant  to  regulations
 promulgated  by  the director. No expanded non-medical in-home services,
 non-institutional respite  services,  or  ancillary  services  shall  be
 provided to any individual pursuant to this section unless such expanded
 non-medical  in-home  services,  non-institutional  respite services, or
 ancillary services are accompanied by ongoing case  management  services
 in accordance with regulations promulgated by the director.
   (j)  Within  the amounts appropriated therefor, counties authorized to
 provide expanded non-medical in-home services, non-institutional respite
 services, case management services, and ancillary services  pursuant  to
 paragraph (i) of this subdivision shall be eligible for reimbursement by
 the  state  of  up to seventy-five percent of allowable expenditures for
 approved services pursuant to this section up to the level authorized by
 the director.  The  director  shall  not  authorize  a  level  of  state
 reimbursement  pursuant to this paragraph which exceeds the sum of nine-
 ty-one thousand two hundred fifty dollars or seven dollars thirty  cents
 for  each  elderly  person residing in the county, whichever is greater,
 and shall proportionately reduce such sum for each county in  any  years
 for  which  appropriations  are  not  sufficient  to fully fund approved
 expanded  non-medical  in-home   services,   non-institutional   respite
 services,  case  management  services,  and ancillary services for func-
 tionally impaired elderly in all counties with approved home care plans;
 provided however that in state fiscal years beginning on  or  after  the
 first  day  of April, two thousand five, the director, with the approval
 of the director of the budget,  may  authorize  state  reimbursement  in
 excess of these levels to the extent appropriations are available there-
 for.
   (k)  The  director,  with  the approval of the director of the budget,
 shall provide by regulation the extent of cost-sharing to be required of
 elderly persons receiving expanded non-medical in-home services, non-in-
 stitutional respite services, case management  services,  and  ancillary
 services  pursuant to this section, which shall reflect such recipients'
 means to pay for such services and which will not affect  their  ability
 to  remain  in their homes; provided however that the director shall not
 authorize or direct the withholding of state aid pursuant  to  paragraph
 (f)  of  this  subdivision prior to the first day of April, two thousand
 five, based on any county's failure or inability to  comply  with  regu-
 lations promulgated pursuant to this paragraph. The full amount of cost-
 sharing  actually  received by any county from elderly persons receiving
 expanded  non-medical  in-home   services,   non-institutional   respite
 services, case management services, and ancillary services shall be used
 by  such  county  to  expand  either  such county's program of community
 services or  such  county's  program  of  expanded  non-medical  in-home
 services,  non-institutional respite services, case management services,
 and ancillary services pursuant to this section.
   (l) Reimbursement pursuant to paragraph (j) of this subdivision  shall
 not  be  available  for  expenditures  for  base year services otherwise
 S. 8474                            104

 provided without cost, or to replace base year expenditures made by  the
 county  or  any  other  service  provider  irrespective of the source of
 funds, or to replace community services expenditures pursuant  to  para-
 graph (b) of this subdivision.
   (m)  Counties  shall  submit  claims  for  reimbursement  for expanded
 in-home services, non-institutional respite  services,  case  management
 services,  and  ancillary  services  to functionally impaired elderly as
 required by and in accordance with procedures prescribed by  the  direc-
 tor.    Reimbursement  shall  be  available  for  approved  expenditures
 incurred in accordance with an approved county home care plan for  func-
 tionally  impaired  elderly  to  the  extent the director has authorized
 state aid for such services pursuant to paragraph (i) of  this  subdivi-
 sion.
   (n)  The  director shall provide by regulation that certain non-county
 moneys and in-kind equivalents may be used in part to compose the county
 share of total allowable expenditures pursuant to paragraph (j) of  this
 subdivision,  provided  that  such  county share shall not include cost-
 sharing received from elderly  persons  receiving  expanded  non-medical
 in-home  services,  non-institutional  respite services, case management
 services, and ancillary services  pursuant  to  paragraph  (k)  of  this
 subdivision  or moneys received from the federal government for services
 for the elderly allocated to the states or local  governments  according
 to population or other such non-competitive basis.
   § 8-013. Subdivision 9 of section 140 of the executive law, as amended
 by chapter 861 of the laws of 1960, is amended to read as follows:
   9.    The  clerks of the counties of New York, Kings, Queens, Richmond
 and Bronx shall each keep a book or card index file in  which  shall  be
 registered  the  signature  of  the commissioners so filing such certif-
 icates; and the county clerk of any county in the city  with  whom  such
 commissioner  has  filed a certificate of appointment shall, upon demand
 and upon payment of the sum of fifty cents, authenticate  a  certificate
 of  acknowledgment  or  proof  of oath taken before such commissioner of
 deeds, without regard to the county in the city in which such [acknowlg-
 ment] ACKNOWLEDGMENT  or  proof  was  taken  or  oath  administered,  by
 subjoining or attaching to the original certificate of acknowledgment or
 proof  or oath a certificate under his hand and official seal specifying
 that at the time of taking the acknowledgment or proof or oath the offi-
 cer taking it was duly authorized to take the same; that  the  authenti-
 cating  officer  is  acquainted  with  the  former's handwriting, or has
 compared the signature on the certificate of  acknowledgment,  proof  or
 oath  with the autograph signature deposited in his office by such offi-
 cer, and that he verily believes the signature is genuine.
   § 8-014. Any person who resides in or maintains  an  office  or  other
 place  of  business  in the city of Staten Island and who resides in the
 county of Richmond on the date of establishment of the  city  of  Staten
 Island  who  holds  an  appointment  as a commissioner of deeds from the
 preceding municipality shall  be  deemed  to  hold  the  appointment  as
 commissioner  of  deeds  from  the  common council of the city of Staten
 Island in accordance with the provisions of section 139 of the executive
 law. Such person shall continue to hold such office until  his  original
 appointment expires or is revoked pursuant to law.
   §  8-015. Section 56 of the social services law, as amended by chapter
 863 of the laws of 1977, is amended to read as follows:
   § 56.  City social services districts.   The city of New York AND  THE
 CITY  OF  STATEN ISLAND shall have all the powers and duties of a social
 services district insofar as  consistent  with  the  provisions  of  the
 S. 8474                            105
 
 special  and  local  laws  relating to such [city] CITIES.  The officers
 thereof charged with the administration of public  assistance  and  care
 shall  have  additional  powers  and  duties of a commissioner of social
 services not inconsistent with the laws relating to said [city] CITIES.
   §  8-016. Section 57 of the social services law, as amended by chapter
 863 of the laws of 1977, is amended to read as follows:
   § 57.  Cities in county social services districts.   Each city,  other
 than the city of New York AND THE CITY OF STATEN ISLAND, shall form part
 of  the  county  social  services  district of the county in which it is
 situated and shall not assume any powers and  responsibilities  for  the
 administration  or expense of public assistance and care, in addition to
 those specified in subdivision two of section sixty-nine, except  pursu-
 ant  to  the  provisions  of sections seventy-four and seventy-four-a of
 this chapter.
   § 8-017. Section 61 of the social services law is amended by adding  a
 new subdivision 1-a to read as follows:
   1-A.    THE  CITY OF STATEN ISLAND IS HEREBY CONSTITUTED A CITY SOCIAL
 SERVICES DISTRICT.
   § 8-018. Subdivision 1 of section 74 of the social  services  law,  as
 added by chapter 863 of the laws of 1977, is amended to read as follows:
   1.   Each city, other than the city of New York AND THE CITY OF STATEN
 ISLAND, which is responsible for one or more types of public  assistance
 and care on the date this section becomes effective shall function under
 section seventy-four-a of this chapter.
   §  8-019. Section 86-a of the social services law, as amended by chap-
 ter 655 of the laws of 1978, is amended to read as follows:
   § 86-a.   City public welfare funds.   The  taxes  levied  for  public
 assistance  and  care  in  a city, or in a city public welfare district,
 shall be paid to the city treasurer, [or] the commissioner of finance in
 the city of New York OR THE COMPTROLLER IN THE CITY  OF  STATEN  ISLAND,
 and  disbursed in accordance with the provisions of law relating to such
 city for the payment of bills and claims, provided  such  provisions  of
 law are not inconsistent with the provisions of this chapter.
   § 8-020. Intentionally omitted.
   §  8-021.  Subdivision 2 of section 209 of the social services law, as
 amended by chapter 71 of the laws of 1983,  paragraphs  (a),  (b),  (c),
 (d),  (e) and (f) as amended by section 2 of part Z of chapter 56 of the
 laws of 2023, is amended to read as follows:
   2. The following amounts shall be the standard  of  monthly  need  for
 determining eligibility for and the amount of additional state payments,
 depending  on  the type of living arrangement and the geographic area in
 which the eligible individual or the eligible couple resides:
    (a) On and after January first, two  thousand  twenty-three,  for  an
 eligible  individual living alone, $1,001.00; and for an eligible couple
 living alone, $1,475.00.
    (b) On and after January first, two  thousand  twenty-three,  for  an
 eligible  individual  living with others with or without in-kind income,
 $937.00; and for an eligible couple living with others with  or  without
 in-kind income, $1,417.00.
    (c) On and after January first, two thousand twenty-three, (i) for an
 eligible  individual  receiving  family  care, $1,180.48 if he or she is
 receiving such care in the city of New York, THE CITY OF  STATEN  ISLAND
 or  the county of Nassau, Suffolk, Westchester or Rockland; and (ii) for
 an eligible couple receiving family care in the city of  New  York,  THE
 CITY  OF  STATEN ISLAND or the county of Nassau, Suffolk, Westchester or
 Rockland, two times the amount set forth in  subparagraph  (i)  of  this
 S. 8474                            106
 
 paragraph;  or  (iii)  for an eligible individual receiving such care in
 any other county in the state,  $1,142.48;  and  (iv)  for  an  eligible
 couple  receiving  such care in any other county in the state, two times
 the amount set forth in subparagraph (iii) of this paragraph.
    (d) On and after January first, two thousand twenty-three, (i) for an
 eligible  individual  receiving residential care, $1,349.00 if he or she
 is receiving such care in the city of  New  York,  THE  CITY  OF  STATEN
 ISLAND  or  the  county of Nassau, Suffolk, Westchester or Rockland; and
 (ii) for an eligible couple receiving residential care in  the  city  of
 New  York,  THE  CITY OF STATEN ISLAND or the county of Nassau, Suffolk,
 Westchester or Rockland, two times the amount set forth in  subparagraph
 (i)  of  this  paragraph;  or (iii) for an eligible individual receiving
 such care in any other county in the state, $1,319.00; and (iv)  for  an
 eligible  couple  receiving  such care in any other county in the state,
 two times the amount set forth in subparagraph (iii) of this paragraph.
    (e) On and after January first, two thousand twenty-three, (i) for an
 eligible individual receiving enhanced residential care, $1,608.00;  and
 (ii)  for  an  eligible  couple receiving enhanced residential care, two
 times the amount set forth in subparagraph (i) of this paragraph.
    (f) The amounts set forth in  paragraphs  (a)  through  (e)  of  this
 subdivision  shall  be  increased  to  reflect  any increases in federal
 supplemental security income benefits for individuals or  couples  which
 become effective on or after January first, two thousand twenty-four but
 prior to June thirtieth, two thousand twenty-four.
   § 8-022. Subdivision 1 of section 368-e of the social services law, as
 amended  by  section  55 of part B of chapter 58 of the laws of 2009, is
 amended to read as follows:
   1. The department of health shall review claims for expenditures  made
 by  counties,  THE  CITY  OF  STATEN ISLAND and the city of New York for
 medical care, services and supplies which  are  furnished  to  preschool
 children   with  handicapping  conditions  or  such  preschool  children
 suspected of  having  handicapping  conditions,  as  such  children  are
 defined in the education law. If approved by the department, payment for
 such  medical  care, services and supplies which would otherwise qualify
 for reimbursement under this title and which are furnished in accordance
 with this title and the regulations of the department to such  children,
 shall  be  made  in  accordance  with  the department's approved medical
 assistance fee schedules by payment to  such  county  or  [city]  CITIES
 which  furnished  the  care,  services or supplies either directly or by
 contract.  Notwithstanding any provisions of law, rule or regulation  to
 the  contrary,  any  clinic  or diagnostic and treatment center licensed
 under article twenty-eight of the public health law, which as determined
 by the state education department, in conjunction with the department of
 health, has a less than  arms  length  relationship  with  the  provider
 approved  under  section  forty-four  hundred  ten  of the education law
 shall, subject to the approval of the department and based on  standards
 developed  by  the  department,  be  authorized  to directly submit such
 claims for medical assistance, services or supplies so furnished for any
 period beginning on or after July first, nineteen hundred  ninety-seven.
 The  actual  full  cost  of  the  individualized education program (IEP)
 related services incurred by the clinic shall be  reported  on  the  New
 York  State  Consolidated  Fiscal  Report  in  the education law section
 forty-four hundred ten program cost  center  in  which  the  student  is
 placed  and  the associated medical assistance revenue shall be reported
 in the same manner.
 S. 8474                            107
 
   § 8-023. Subdivision 13 of section 390 of the social services law,  as
 amended  by  chapter  160  of  the  laws  of 2003, is amended to read as
 follows:
   13.  Notwithstanding any other provision of law, this section[, except
 for paragraph (a-1) of subdivision two-a of  this  section,]  shall  not
 apply  to  child day care centers in the city of New York OR IN THE CITY
 OF STATEN ISLAND.
   § 9-001. Subdivision 1 of section 214 of the county law, as amended by
 chapter 967 of the laws of 1973, is amended to read as follows:
   1.   Concurrent resolutions, election notices  and  official  canvass.
 The members of the county legislative body, whether such body be denomi-
 nated  board of supervisors, county legislature or otherwise, or, in the
 [city] CITIES of New York AND STATEN ISLAND, of the council of EACH such
 city representing respectively  each  of  the  two  principal  political
 parties  into which the people of the state are divided, shall designate
 annually the newspaper  published  within  the  county  to  publish  the
 concurrent resolutions of the legislature.  Such designation shall be in
 writing  and  signed  by  a majority of the members representing each of
 said political parties.  In making such designation, consideration shall
 be given to the newspapers advocating the principles of  such  political
 party,  the support of its nominees and the extent of the circulation in
 the county.  However the fact that a newspaper is an independent newspa-
 per not advocating the principles  of  any  political  party  shall  not
 disqualify  it  from  consideration.    If  there  be  but one newspaper
 published in the county, such newspaper shall be designated.  The desig-
 nation shall be filed with the clerk of the county legislative body  or,
 in  the  [city]  CITIES of New York AND STATEN ISLAND, with the clerk of
 the council of EACH such city, who shall not later  than  January  tenth
 cause  notice of the name and address of such newspaper or newspapers to
 be forwarded to the secretary of state.  In like manner the  members  of
 the  county  legislative  body  or, in the [city] CITIES of New York AND
 STATEN ISLAND, of the council of EACH such city representing each of the
 two principal political parties into which the people of the  state  are
 divided,  shall  designate  the newspaper published within the county to
 publish the election notices issued by the secretary of  state  and  the
 newspaper to publish the official canvass.  In the event of a failure so
 to  designate in any year, or if either of such political parties has no
 representatives among the body or, in the [city] CITIES of New York  AND
 STATEN  ISLAND, council membership, the last newspaper designated by the
 members of such party shall be deemed duly designated.
   § 9-002. Section 226-a of the county law, as added by  chapter  80  of
 the laws of 1969, is amended to read as follows:
   §  226-a.  Patriotic observances.  The county legislature and/or board
 of supervisors, as the case may be, of any county or borough outside the
 city of New York OR THE CITY OF STATEN ISLAND, is hereby  authorized  to
 appropriate and set aside each year such sums it may deem proper for the
 purpose  of  providing  for  the  due and proper observance of any legal
 holiday, including Columbus day.
   § 9-003. Section 361-a of the county law, as amended by chapter 359 of
 the laws of 1989, is amended to read as follows:
   § 361-a. Expenses of boards of elections outside New York City AND THE
 CITY OF STATEN ISLAND; apportionment of. The board of elections in  each
 county,  outside  of the [city] CITIES of New York AND STATEN ISLAND, on
 or before the fifteenth day of December and not earlier than  the  first
 day of October, in each year, shall certify to the clerk of the legisla-
 tive  body of the county, the total amount of the expenses of such board
 S. 8474                            108
 
 of elections, including salaries for the preceding  year,  and,  if  the
 legislative  body  of  any county shall so direct, shall certify to such
 clerk the portions of such expenses which under provisions of law are to
 be  borne  by  any city or cities in said county and the portion thereof
 which is to be borne by the rest of such county  and  such  clerk  shall
 thereupon notify the proper local official or officials, who, in spread-
 ing  upon  the  assessment-rolls the taxes to be levied upon the taxable
 property in the city or any such cities, and in the rest of the  county,
 shall include in the amount so spread the amounts certified by the board
 of  elections  to  be borne by such city or cities, respectively, and in
 the amount spread upon the assessment-rolls of the taxable  property  in
 the  several  towns  or  other political subdivisions of the rest of the
 county the amount so certified by said board of elections to be borne by
 such towns or political subdivisions respectively.  Whenever  any  addi-
 tional expenses either for salaries or supplies in addition to the regu-
 lar county-wide primary and election expenses are incurred by a board of
 elections  incidental to any election in any city, town or village, such
 board of elections shall  certify  to  the  county  legislative  body  a
 detailed statement of such expenses and said county legislative body may
 cause the amount thereof to be levied against such city, town or village
 or may certify the amount thereof to such city, town or village and such
 city,  town or village shall upon such certification, include the amount
 so certified in the next budget and tax levy and shall pay the  same  to
 the county.
   §  9-004.  Subdivision 2 of section 390 of the county law, as added by
 chapter 1 of the laws of 1951, is amended to read as follows:
   2.  Whenever a patient admitted to said hospital has local  residence,
 as defined in the public health law, in the county in which the hospital
 is  situated,  he  shall  be a charge upon such county.  If such patient
 admitted to said hospital has local residence in some other county or in
 the city of New York OR THE CITY OF STATEN ISLAND, he shall be a  charge
 upon  such  other  county  or the city of New York OR THE CITY OF STATEN
 ISLAND, as the case may be, and the superintendent shall send a bill for
 such charge to the clerk of the board of supervisors of such other coun-
 ty or to the comptroller of the city of New  York  OR  OF  THE  CITY  OF
 STATEN  ISLAND.  Such charge shall be at a rate to be fixed by the board
 of managers, which shall not exceed the per diem per capita cost of care
 and treatment in said hospital, and if the county operating said  hospi-
 tal  is  currently  receiving  state  aid  for the care and treatment of
 tuberculosis patients pursuant to the public health law, such charge may
 be an amount for each day of  such  patient's  care  equivalent  to  the
 balance of the total per diem per capita cost of operating such hospital
 during  the preceding fiscal year, as computed and approved by the state
 commissioner of health [pursuant to subdivision three of section  fifty-
 four  of the public health law].  Such bill shall be audited and paid by
 the board of supervisors of said county, except that a bill so submitted
 to the city of New York OR THE CITY OF STATEN ISLAND shall  be  paid  by
 such  city after audit and upon warrant of the comptroller of such city.
 Any patient admitted to said hospital may pay for his care and treatment
 in whole or in part if he volunteers to do so.
   § 9-005. Section 391 of the county law, as added by chapter 1  of  the
 laws of 1951, is amended to read as follows:
   §  391.    Admission  of out of county patients.  1.  Exclusive of the
 city of New York AND THE CITY OF STATEN ISLAND, and exclusive  of  coun-
 ties  served by state tuberculosis hospitals, any person in a county not
 having a county hospital for the care and treatment of persons suffering
 S. 8474                            109

 from tuberculosis may apply in person to  the  clerk  of  the  board  of
 supervisors  of  such  county or to the state commissioner of health for
 admission to a tuberculosis hospital, providing that such person  submit
 with  such  application a statement signed by a reputable physician that
 such physician has, within the ten  days  preceding  the  date  of  such
 application,  examined such person and that, in his opinion, such person
 is suffering from tuberculosis or is suspected  of  having  tuberculosis
 and  is  in  need  of care and treatment therefor.  Upon receipt of such
 application, the clerk of the board of supervisors or the state  commis-
 sioner  of  health,  as  the  case may be, shall forward the same to the
 superintendent of any state, county or city hospital for  the  care  and
 treatment of tuberculosis.
   2.    Whenever  the superintendent of such a hospital shall receive an
 application for the admission  of  a  patient  in  accordance  with  the
 provisions  of  subdivision  one of this section, if it appear from such
 application that the person therein referred to is suffering from tuber-
 culosis or is suspected of having tuberculosis and is in  need  of  care
 and  treatment  therefor, the superintendent shall notify said person to
 appear in person at the hospital, provided there be a  vacancy  in  such
 hospital  and  there  be no pending application from a patient living in
 the county in which the hospital is located.  If, upon personal examina-
 tion of the patient, the superintendent is satisfied that  such  patient
 is in need of care and treatment for tuberculosis, he shall admit him to
 the  hospital.   Every patient so admitted shall be a charge against the
 county in which he was living immediately prior to such admission.  Such
 charge shall be at a rate to be fixed by the board  of  managers,  which
 shall not exceed the per diem per capita cost of maintenance therein and
 any  cost  of transportation to or from the hospital, except that if the
 county operating said hospital is currently receiving state aid for  the
 care  and  treatment  of  tuberculosis  patients  pursuant to the public
 health law, such charge  shall  be  an  amount  for  each  day  of  such
 patient's care equivalent to the balance of the total per diem per capi-
 ta  cost of operating such hospital during the preceding fiscal year, as
 computed and approved by the state commissioner of health  [pursuant  to
 subdivision  three  of section fifty-four of the public health law]; and
 the bill therefor shall be audited and paid by the board of  supervisors
 of  the  said county.   However, if such patient has local residence, as
 defined in the public health law, in some county other than the  one  in
 which  he  was living immediately prior to such admission or in the city
 of New York OR THE CITY OF STATEN ISLAND, he shall be a charge upon such
 other county or the city of New York OR THE CITY OF  STATEN  ISLAND,  as
 the case may be, and in this event any amounts for the cost of such care
 and treatment which shall have been paid by the county from which he was
 admitted  shall  be  charged  back  and reimbursed to such county by the
 aforesaid other county or the city of New York OR  THE  CITY  OF  STATEN
 ISLAND   in which the patient has local residence.  Any patient admitted
 to a hospital in accordance with the provisions of  subdivision  one  of
 this  section  may pay for his care and treatment in whole or in part if
 he volunteers to do so.
   § 9-006. Section 901 of the county law is  amended  by  adding  a  new
 subdivision 1-a to read as follows:
   1-A.    THE  COMMISSIONER  OF CORRECTIONS OF THE CITY OF STATEN ISLAND
 SHALL HAVE CUSTODY OF THE CIVIL JAILS AND PERSONS LAWFULLY COMMITTED  TO
 HIS  OR  HER  CUSTODY  AND SUCH JAILS SHALL BE KEPT BY HIM OR HER, OR BY
 KEEPERS APPOINTED BY HIM OR HER, FOR WHOSE  ACTS  HE  OR  SHE  SHALL  BE
 RESPONSIBLE.
 S. 8474                            110
 
   § 9-007. Subdivision 1 of section 902 of the county law, as amended by
 chapter 950 of the laws of 1956, is amended to read as follows:
   1.    The offices of the county clerk in the counties constituting the
 city of New York AND THE OFFICE  OF  THE  RICHMOND  COUNTY  CLERK  shall
 remain  open  for  the  transaction of business from nine o'clock in the
 forenoon to four o'clock in the afternoon every  day  except  Saturdays,
 Sundays  and  holidays  and except in the months of July and August when
 said offices shall remain open for the transaction of business from nine
 o'clock in the forenoon to two o'clock in the  afternoon  except  Satur-
 days, Sundays and holidays.
   §  9-008.  Section 904 of the county law, as amended by chapter 655 of
 the laws of 1978, is amended to read as follows:
   § 904.  Court and trust fund register and liability of officers.   The
 county  clerks  of  the counties comprising the city of New York AND THE
 RICHMOND COUNTY CLERK shall perform the same duties and shall be subject
 to the same penalties imposed by the provisions  of  this  chapter  upon
 other  county  clerks of the state with relation to court and trust fund
 registers and the delivery of property or moneys to the commissioner  of
 finance  in  pursuance  of  any  judgment, decree or order of a court of
 record of this state.
   § 9-009. The county law is amended by adding a new  section  905-a  to
 read as follows:
   §  905-A.  LIABILITY  FOR LOSS OF COURT AND TRUST FUNDS IN THE CITY OF
 STATEN ISLAND. THE OFFICER RESPONSIBLE FOR COLLECTION AND MANAGEMENT  OF
 PUBLIC  FUNDS FOR THE CITY OF STATEN ISLAND AND SUCH OFFICER'S SURETY OR
 SURETIES SHALL BE LIABLE IN THE SAME MANNER  AS  COUNTY  TREASURERS  ARE
 MADE  LIABLE  UNDER THE PROVISIONS OF THIS CHAPTER FOR THE LOSS OF COURT
 AND TRUST FUNDS.
   § 9-010. The county law is amended by adding a new  section  906-a  to
 read as follows:
   §  906-A.    LIABILITY  OF CITY OF STATEN ISLAND FOR LOSS OF COURT AND
 TRUST FUNDS.  THE CITY OF STATEN ISLAND SHALL  BE  RESPONSIBLE  FOR  ALL
 PROPERTY OR MONEYS DEPOSITED WITH THE OFFICER RESPONSIBLE FOR COLLECTION
 AND  MANAGEMENT  OF PUBLIC FUNDS FOR THE CITY OF STATEN ISLAND BY VIRTUE
 OF ANY JUDGMENT, DECREE OR ORDER OF A COURT  OF  RECORD  IN  THIS  STATE
 PROVIDED,  HOWEVER,  THAT THE CITY SHALL NOT BE HELD LIABLE FOR ANY LOSS
 DUE TO THE DEPRECIATED VALUE OF AN INVESTMENT LEGAL AT THE TIME  OF  ITS
 PURCHASE  AND WHICH CONTINUED TO BE A LEGAL INVESTMENT DURING THE PERIOD
 OF THE TRUST.  AN ACTION TO RECOVER ANY LOSS TO OR OF SUCH FUND  MAY  BE
 BROUGHT  AGAINST  THE  CITY BY ANY PARTY AGGRIEVED OR BY THE STATE COMP-
 TROLLER IN A COURT OF COMPETENT JURISDICTION.
   § 9-011. The county law is amended by adding a new  section  931-a  to
 read as follows:
   §  931-A.    EMPLOYEES OF THE DISTRICT ATTORNEY OF THE COUNTY OF RICH-
 MOND. THE DISTRICT ATTORNEY OF RICHMOND COUNTY IS VESTED WITH THE  POWER
 TO  APPOINT  ANY PERSON TO ANY POSITION FOR WHICH THERE IS NOW PROVISION
 BY APPROPRIATION OR WHICH SHALL HEREAFTER BE ESTABLISHED.  ALL POSITIONS
 IN THE DISTRICT ATTORNEY'S OFFICE OF RICHMOND COUNTY FOR WHICH THERE  IS
 NOW PROVISION BY APPROPRIATION SHALL BE CONTINUED, EXCEPT THAT THE MAYOR
 OF THE CITY OF STATEN ISLAND MAY WITH THE CONSENT OF THE DISTRICT ATTOR-
 NEY  INCREASE  OR  DECREASE THE NUMBER OF POSITIONS AND THE TERM, GRADE,
 SALARY AND COMPENSATION OF ANY POSITION.
   § 9-012. The county law is amended by adding a new section 944 to read
 as follows:
   § 944. APPLICABILITY OF ARTICLE TO THE COUNTY  OF  RICHMOND.  FOR  THE
 PURPOSES  OF  CONTINUING THE APPLICATION OF THIS ARTICLE WITHIN THE CITY
 S. 8474                            111
 
 OF STATEN ISLAND ON AND AFTER THE DATE OF ESTABLISHMENT OF THE  CITY  OF
 STATEN  ISLAND,  THE COUNTY OF RICHMOND SHALL BE DEEMED TO CONTINUE AS A
 COUNTY WITHIN THE CITY OF NEW YORK FOR THE PURPOSES OF EXERCISING  THOSE
 POWERS AND DUTIES DEVOLVED UPON SAID COUNTY OF RICHMOND PURSUANT TO THIS
 ARTICLE.
   §  9-013. Subdivision 2 and paragraphs (a) and (c) of subdivision 3 of
 section 9-124 of the election law, subdivision 2 as amended  by  chapter
 437  of  the  laws  of  2019, paragraphs (a) and (c) of subdivision 3 as
 amended by chapter 481 of the laws of  2023,  are  amended  to  read  as
 follows:
   2.  Each box, envelope, or container containing the ballots and stubs,
 if any, and all items described in subdivision one of this section shall
 be deposited by an inspector designated for that purpose with the  offi-
 cer  or board from whom or which the board of inspectors received it. In
 the city of New York AND THE CITY OF  STATEN  ISLAND,  every  such  box,
 envelope, or container shall be delivered at the polling place to police
 or  peace  officers designated by the police commissioner of such [city]
 CITIES, who shall deposit them with the APPROPRIATE board of elections.
   (a) Except in the city of New York OR THE CITY OF STATEN  ISLAND,  the
 registration  poll records or computer generated registration lists, the
 returns of canvass with results tapes and tally sheets, if any, annexed,
 the voted ballots, stubs, opened packages of unused ballots  and  ballot
 envelopes,  any  early  mail,  absentee,  military,  special federal, or
 special presidential ballots which may have been delivered to  the  poll
 site  during  election  day,  the challenge report records, keys and the
 package of protested and void ballots shall be filed with the  APPROPRI-
 ATE board of elections.
   (c)  In  the city of New York AND THE CITY OF STATEN ISLAND, the board
 of inspectors shall deliver to police or peace  officers  designated  by
 the  police commissioner of such [city] CITIES, at the polling place the
 registration poll records  or  computer  generated  registration  lists,
 challenge  report, records, keys, other election supplies, including two
 copies of the returns of the canvass and any early mail, absentee, mili-
 tary, special federal, or special presidential ballots  which  may  have
 been  delivered  to  the  poll  site during election day, voted ballots,
 stubs, open packages of unused ballots and ballot envelopes. Such police
 or peace officers shall file  the  returns,  the  package  of  void  and
 protested  ballots,  if  any,  and  the  early mail, absentee, military,
 special federal, or special presidential ballots  which  may  have  been
 delivered  to  the poll site during election day; and emergency ballots,
 stubs and ballot envelopes, if any, within twenty-four hours  after  the
 close  of the polls, in the office of the APPROPRIATE board of elections
 or its branch office within the borough, as the case may be.
   § 9-014. Subdivision 3 of section 9-124 of the election law is amended
 by adding a new paragraph (d) to read as follows:
   (D) IN THE CITY OF STATEN ISLAND THE BOARD OF INSPECTORS, SHALL DELIV-
 ER TO THE POLICE OR PEACE OFFICER AT THE POLLING PLACE THE  REGISTRATION
 POLL RECORDS OR COMPUTER GENERATED REGISTRATION LISTS, CHALLENGE REPORT,
 RECORDS,  KEYS,  THE  FLAG,  OTHER ELECTION SUPPLIES, THE RETURNS OF THE
 CANVASS AND THE ABSENTEE AND MILITARY, SPECIAL FEDERAL,  SPECIAL  PRESI-
 DENTIAL  AND  EMERGENCY BALLOTS, STUBS AND BALLOT ENVELOPES.  THE POLICE
 OR PEACE OFFICER SHALL FILE THE RETURNS, THE PACKAGE OF VOID,  PROTESTED
 AND WHOLLY BLANK BALLOTS, IF ANY, AND THE ABSENTEE AND MILITARY, SPECIAL
 FEDERAL,  SPECIAL  PRESIDENTIAL  AND EMERGENCY BALLOTS, STUBS AND BALLOT
 ENVELOPES, IF ANY, WITHIN TWENTY-FOUR  HOURS  AFTER  THE  CLOSE  OF  THE
 POLLS, IN THE OFFICE OF THE BOARD OF ELECTIONS.
 S. 8474                            112
 
   § 9-015. Section 88-b of the state finance law, as added by chapter 13
 of  the  laws  of 1987, subdivisions 2 and 6 as amended by chapter 65 of
 the laws of 1988, is amended to read as follows:
   §  88-b.  Suburban transportation fund. 1. There is hereby established
 in the joint custody of the commissioner of taxation and finance and the
 comptroller a fund to be known as the "suburban transportation fund".
   2. The suburban transportation fund shall consist of moneys  from  the
 commuter  railroad  account of the metropolitan transportation authority
 special assistance fund required to be paid by  such  authority  to  the
 suburban  transportation  fund  pursuant to subdivision three of section
 twelve hundred seventy-a of the public authorities law  and  any  moneys
 from  the  metropolitan  transportation  authority  Dutchess, Orange and
 Rockland fund transferred pursuant to subdivision four of section twelve
 hundred seventy-a of the public authorities law.
   3. Moneys in the suburban transportation fund shall be  kept  separate
 from and shall not be commingled with any other moneys in the custody of
 the commissioner of taxation and finance and the comptroller. All depos-
 its  of  such money shall, if required by the comptroller, be secured by
 obligations of the United States or of the state of market  value  equal
 at all times to the amount of the deposit and all banks and trust compa-
 nies are authorized to give such securities for such deposits.
   4. Moneys of the fund shall be made available for financing any of the
 following  types  of capital projects within the counties comprising the
 metropolitan commuter transportation  district,  except  those  counties
 comprising  the  city of New York OR THE CITY OF STATEN ISLAND, but only
 to the extent that such projects are on an adopted  transportation  plan
 and  approved  by a designated transportation coordinating committee, if
 one exists, or by the  metropolitan  planning  organization  as  created
 pursuant to section fifteen-a of the transportation law if no designated
 transportation  coordinating committee exists:  capacity and infrastruc-
 ture improvements to state, county, town, city, village roads, highways,
 parkways and bridges; or state,  county,  town,  city  or  village  mass
 transportation  projects;  provided, however, that in Nassau and Suffolk
 counties such moneys shall be available only for  capacity  improvements
 to  state  roads,  highways,  parkways  and bridges. The amount of state
 funds historically appropriated statewide, other than  bond  funds,  for
 transportation  capital purposes from other sources shall not be reduced
 because of the availability of such moneys made  available  pursuant  to
 this  chapter, nor shall such moneys be used to match federal aid. Prior
 to the allocation of state advance funds appropriated pursuant  to  this
 section,  the  municipality responsible for the project shall certify to
 the commissioner of transportation that the amount of funds appropriated
 for transportation capital purposes by that municipality  shall  not  be
 reduced  because  of  the  availability of such state advance funds, and
 that such moneys shall not be used to match federal aid.
   The designated transportation coordinating committee, if  one  exists,
 or  the  metropolitan planning organization if no designated transporta-
 tion coordinating committee  exists,  shall  notify  the  municipalities
 within its jurisdiction of which projects it has approved.
   5. In the event that any county withdraws from the metropolitan commu-
 ter  transportation  district,  the  withdrawing county shall pay to the
 state comptroller any amount that is required so that the state is fully
 reimbursed for funds advanced in anticipation of reimbursement from  the
 suburban  transportation  fund. In the event that any withdrawing county
 shall fail to make a payment pursuant to  this  subdivision,  the  state
 comptroller  shall  withhold  and  pay  to  the capital projects fund an
 S. 8474                            113
 
 amount equal to the amount owed from the next general or specific  state
 aid payment and scheduled to be paid to that county.
   6. Moneys in the suburban transportation fund  transferred pursuant to
 section  twelve hundred seventy-a of the public authorities law shall be
 made available to the state department  of  transportation  for  capital
 projects in the counties of Nassau, Suffolk, Westchester, Putnam, Dutch-
 ess,  Orange and Rockland on the basis of each county's average pro rata
 share of the mortgage recording tax receipts  raised  in  such  counties
 pursuant  to subdivision one of section two hundred sixty-one of the tax
 law during  the  period  January  first,  nineteen  hundred  eighty-four
 through  December thirty-first, nineteen hundred eighty-six as certified
 by the metropolitan transportation authority. Moneys transferred to  the
 suburban transportation fund at the request of Dutchess, Orange or Rock-
 land  county  pursuant  to  subdivision  three of section twelve hundred
 seventy-b of the public authorities law  shall  be  used  by  the  state
 department of transportation to increase the proportionate share of such
 capital  projects  in  such  county.  Such projects shall be financed by
 means of a state advance to be reimbursed by the New York state  thruway
 authority, or its successor agency, through the issuance of its bonds or
 notes  in  the manner set forth in subdivision seven of this section, or
 by means of a state advance to be reimbursed directly from the  suburban
 transportation fund.
   7.  (a)  For  projects funded by the suburban transportation fund, the
 state department of transportation may enter into an agreement with  the
 New  York  state  thruway  authority,  or  its successor agency, for the
 purpose of having the thruway authority, or its successor agency,  issue
 bonds  or notes to pay the capital costs of such project. Such agreement
 shall be subject to approval by the director  of  the  division  of  the
 budget.
   (b)  For  projects  funded  pursuant to this subdivision, the affected
 municipality shall enter into an agreement with the department of trans-
 portation for the conveyance of all  affected  real  property  including
 highways,  roads  and bridges to the thruway authority, or its successor
 agency, for the term of the bonds or notes issued by the thruway author-
 ity, or its successor agency, for such project or for such lesser period
 that such bonds or notes are outstanding.  During  the  period  of  such
 conveyance  to  the  thruway  authority,  or  its  successor agency, the
 department of transportation or the municipality shall agree to maintain
 the facility in a state of good repair,  the  responsibility  for  which
 shall  be  with  the state, or municipality, which had jurisdiction over
 said facility prior to such agreement.
   (c) Upon the final retirement of all bonds and  notes  issued  by  the
 thruway authority, or its successor agency, for such purpose, such prop-
 erty shall automatically revert to the conveying entity.
   8.  Payments to the thruway authority, or its successor agency, pursu-
 ant to this section shall be subject to appropriation from the  suburban
 transportation  fund.  The  thruway  authority, or its successor agency,
 shall utilize such moneys to pay the debt service on such bonds or notes
 and to meet administrative costs in connection therewith.
   § 9-016. Section 2302 of  the  surrogate's  court  procedure  act,  as
 amended  by  chapter  460  of  the  laws  of 1999, is amended to read as
 follows:
 § 2302. Award of costs and allowances
   1.  Upon a motion the court may award  costs  to  any  party  in  such
 amount as it determines not exceeding $20 to each party, except in coun-
 S. 8474                            114
 
 ties within the City of New York AND IN THE CITY OF STATEN ISLAND, where
 such amount shall not exceed $40.
   2.    Upon rendering a decree or in granting or denying an application
 to vacate a decree the court may award as costs such  sum  as  it  deems
 reasonable to the petitioner and to any other party who has succeeded in
 whole  or  in  part  in a contest or whose attorney, in the absence of a
 contest, has rendered services of substantial benefit to him, her or it,
 or to the estate, not exceeding
   (a)  in counties within the City of New York AND IN THE CITY OF STATEN
 ISLAND:
   (i) $100 where there has not been a contest, or
   (ii) $300 where there has been a contest and $300 for each  day,  less
 one,  necessarily  occupied in the trial or hearing and in addition $100
 for each day necessarily occupied in preparing therefore and $100  addi-
 tional if a motion for a new trial is granted.
   (b) in all other counties:
   (i) $50 where there has not been a contest, or
   (ii)  $150  where there has been a contest and $150 for each day, less
 one, necessarily occupied in the trial or hearing and  in  addition  $50
 for  each  day necessarily occupied in preparing therefore and $50 addi-
 tional if a motion for a new trial is granted.
   3.  In a contested probate proceeding:
   (a) Costs payable out of the estate or otherwise may be awarded (1) to
 an unsuccessful contestant only if he, she or it be a guardian ad  litem
 or  guardian, committee or conservator of a person under disability; (2)
 to an  unsuccessful  proponent  named  as  executor  in  the  will  when
 propounded by him, her or it in good faith as the last will of the dece-
 dent;  and  (3) to a person named as executor in a prior will on file in
 the court that is not admitted to probate when such person  participates
 in  the  proceeding in good faith.  Such nominated executor, guardian ad
 litem, guardian, committee or conservator, whether successful or not may
 be awarded costs and an allowance in such sum as the court deems reason-
 able for his, her or its counsel fees and other expenses incurred in the
 contest or attempt to sustain the will.  The court may direct that  such
 costs  and  allowances in whole or in part be payable by an unsuccessful
 contestant except that an award of the successful proponent's  counsel's
 fees  may  only  be  allowed  where the court finds that the contest was
 brought in bad faith or was frivolous.
   (b)  Either before or after the decree granting probate the court  may
 order  that a copy of the minutes of the trial be furnished to a contes-
 tant for the purposes of appeal and charge the expense thereof initially
 to the estate if satisfied that the contest is in good faith.    If  the
 contestant  be unsuccessful upon the appeal and he, she or it is not the
 guardian of an infant, the committee of an incompetent, the  conservator
 of  a  conservatee  or a guardian ad litem he, she or it shall refund to
 the estate any amount so paid by the estate for the minutes.
   4.  In a proceeding for probate of a will when the public  administra-
 tor  or county treasurer has been directed to probate a will or continue
 the proceedings for the probate thereof, the court may award  to  either
 of them such sum as it deems reasonable for his, her or its counsel fees
 and other expenses necessarily incurred therein.
   5.  After appeal, pursuant to the direction of the appellate court the
 court  may award a fiduciary such sum as it deems reasonable for counsel
 fees and other expenses necessarily incurred on the appeal.
   6.  In a proceeding to construe a will  or  after  appeal  in  such  a
 proceeding,  pursuant  to the direction of the appellate court the court
 S. 8474                            115
 
 may award to a fiduciary or any party to the proceeding such sum  as  it
 deems  reasonable  for  his,  her or its counsel fees and other expenses
 necessarily incurred in the proceeding or on the appeal.
   7.    Upon a final or intermediate judicial settlement a fiduciary may
 be awarded for his, her or its expenses and counsel fees such sum as the
 court deems reasonable not exceeding:
   (a) within the counties of the City of New York AND  IN  THE  CITY  OF
 STATEN  ISLAND:  $100 for each day necessarily occupied in preparing the
 account and in drawing, entering and executing the decree.   Any sum  so
 awarded  may  be  in  addition  to  any costs, allowances or commissions
 otherwise authorized and awarded by the court.
   (b) in all other counties: $ 50 for each day necessarily  occupied  in
 preparing the account and in drawing, entering and executing the decree.
 Any  sum  so  awarded  may  be  in  addition to any costs, allowances or
 commissions otherwise authorized and awarded by the court.
   8.  In a proceeding for disposition of real property a  fiduciary  may
 be  awarded  out of the proceeds of sale his, her or its commissions and
 such sum as the court deems reasonable for  counsel  fees  and  expenses
 necessarily incurred in the proceeding.
   §  9-017. The general municipal law is amended by adding a new section
 929 to read as follows:
   § 929. CITY OF STATEN  ISLAND  INDUSTRIAL  DEVELOPMENT  AGENCY.    (A)
 LEGISLATIVE  INTENT.   IT IS THE POLICY AND INTENT OF THE CITY OF STATEN
 ISLAND TO PROMOTE THE ECONOMIC WELFARE OF ITS INHABITANTS AND TO ACTIVE-
 LY PROMOTE, ATTRACT, ENCOURAGE AND DEVELOP ECONOMICALLY  SOUND  COMMERCE
 AND  INDUSTRY  THROUGH GOVERNMENTAL ACTION FOR THE PURPOSE OF PREVENTING
 UNEMPLOYMENT AND ECONOMIC DETERIORATION BY THE CREATION  OF  A  CITY  OF
 STATEN  ISLAND INDUSTRIAL DEVELOPMENT AGENCY.  IT IS RECOGNIZED THAT THE
 VIABILITY AND INTEGRITY OF THE RESIDENTIAL COMMUNITIES IN  THE  CITY  OF
 STATEN  ISLAND  SHOULD  BE PROTECTED AND MAINTAINED SO THAT NO PERSON BE
 DEPRIVED OF HIS OR HER  PLACE  OF  RESIDENCE  BY  ANY  CONDEMNATION  FOR
 ECONOMIC OR INDUSTRIAL DEVELOPMENT UNDERTAKEN PURSUANT TO THIS ARTICLE.
   (B)    FOR THE PURPOSE OF THIS SECTION "CITY" MEANS THE CITY OF STATEN
 ISLAND.
   (C)  FOR THE BENEFIT OF THE CITY AND THE INHABITANTS THEREOF AN INDUS-
 TRIAL DEVELOPMENT AGENCY, TO BE KNOWN  AS  THE  CITY  OF  STATEN  ISLAND
 INDUSTRIAL DEVELOPMENT AGENCY, IS HEREBY ESTABLISHED FOR THE ACCOMPLISH-
 MENT  OF ANY OR ALL OF THE PURPOSES SPECIFIED IN TITLE ONE OF THIS ARTI-
 CLE, EXCEPT THAT IT SHALL NOT HAVE THE POWER TO CONSTRUCT  OR  REHABILI-
 TATE  ANY  RESIDENTIAL  FACILITY  OR  HOUSING  OF  ANY  NATURE  AND KIND
 WHATSOEVER,  NOR  SHALL  IT  USE  ANY  OF  ITS  FUNDS  TO  FURTHER   THE
 CONSTRUCTION OR REHABILITATION OF ANY RESIDENTIAL FACILITY OR HOUSING OF
 ANY  NATURE  AND KIND WHATSOEVER.   IT SHALL CONSTITUTE A BODY CORPORATE
 AND POLITIC, AND BE PERPETUAL IN DURATION.    IT  SHALL  ONLY  HAVE  THE
 POWERS AND DUTIES CONFERRED BY TITLE ONE OF THIS ARTICLE UPON INDUSTRIAL
 DEVELOPMENT AGENCIES AS OF JANUARY FIRST, NINETEEN HUNDRED SEVENTY-THREE
 EXCEPT  IT SHALL NOT HAVE THE POWER OF CONDEMNATION.  IN THE EXERCISE OF
 THE POWERS CONFERRED UPON SUCH AGENCY WITH RESPECT TO THE ACQUISITION OF
 REAL PROPERTY BY THIS ARTICLE  SUCH  AGENCY  SHALL  BE  LIMITED  TO  THE
 GEOGRAPHICAL JURISDICTIONAL LIMITS OF THE CITY.
   (D)  IT SHALL BE ORGANIZED IN A MANNER PRESCRIBED BY AND BE SUBJECT TO
 THE PROVISIONS OF TITLE ONE OF THIS ARTICLE, EXCEPT THAT ITS BOARD SHALL
 CONSIST  OF  TEN MEMBERS.   AMONG ITS MEMBERSHIP SHALL BE THE CITY COMP-
 TROLLER, THE CITY COMMISSIONER OF ECONOMIC DEVELOPMENT, THE  CORPORATION
 COUNSEL OF SUCH CITY AND THE DIRECTOR OF THE CITY PLANNING COMMISSION OF
 SUCH  CITY,  EACH OF WHOM SHALL HAVE THE POWER TO DESIGNATE AN ALTERNATE
 S. 8474                            116
 
 TO REPRESENT THEM AT BOARD MEETINGS WITH  ALL  THE  RIGHTS  AND  POWERS,
 INCLUDING  THE  RIGHT  TO  VOTE, RESERVED TO ALL BOARD MEMBERS, PROVIDED
 THAT SUCH DESIGNATION BE IN WRITING TO THE  CHAIRPERSON  OF  THE  BOARD.
 THE REMAINING SIX MEMBERS SHALL BE APPOINTED BY THE MAYOR OF SUCH CITY.
   (E)  THE MAYOR SHALL DESIGNATE THE CHAIRPERSON OF THE BOARD, WHO SHALL
 SERVE AT THE PLEASURE OF THE MAYOR.
   (F)    THE  TERMS OF THE DIRECTORS FIRST APPOINTED BY THE MAYOR, OTHER
 THAN THE CHAIRPERSON OF THE BOARD SHALL BE AS FOLLOWS:
   (1) TWO SHALL SERVE FOR TERMS OF ONE YEAR EACH;
   (2) TWO SHALL SERVE FOR TERMS OF TWO YEARS EACH;
   (3) TWO SHALL SERVE FOR TERMS OF  THREE  YEARS  EACH,  THEREAFTER  THE
 SUCCESSORS  OF  ALL  SUCH DIRECTORS SHALL SERVE FOR TERMS OF THREE YEARS
 EACH.  THE MAYOR SHALL FILL ANY VACANCY WHICH MAY  OCCUR  BY  REASON  OF
 DEATH,  RESIGNATION,  OR  OTHERWISE  IN  A  MANNER  CONSISTENT  WITH THE
 ORIGINAL APPOINTMENT.  MEMBERS MAY BE REMOVED BY  THE  MAYOR  FOR  CAUSE
 AFTER  A  HEARING  UPON  TEN  DAYS' WRITTEN NOTICE.   SUCH MEMBERS SHALL
 RECEIVE NO COMPENSATION FOR THEIR SERVICES BUT SHALL BE ENTITLED TO  THE
 NECESSARY  EXPENSES,  INCLUDING  TRAVELING  EXPENSES,  INCURRED  IN  THE
 DISCHARGE OF THEIR DUTIES.
   (G)  THE CHIEF EXECUTIVE OFFICER OF THE AGENCY SHALL BE APPOINTED BY A
 TWO-THIRDS VOTE OF THE BOARD OF DIRECTORS.
   (H)   THE AGENCY, ITS  MEMBERS,  OFFICERS,  AND  EMPLOYEES,  SHALL  BE
 SUBJECT  TO  ARTICLE  FOURTEEN OF THE CIVIL SERVICE LAW AND FOR ALL SUCH
 PURPOSES THE AGENCY SHALL  BE  DEEMED  THE  "PUBLIC  EMPLOYER"  AND  ITS
 MEMBERS, OFFICERS AND EMPLOYEES SHALL BE DEEMED "PUBLIC EMPLOYEES".
   (I)  THE CITY SHALL HAVE THE POWER TO MAKE, OR CONTRACT TO MAKE GRANTS
 OR  LOANS INCLUDING, BUT NOT LIMITED TO GRANTS OR LOANS OF MONEY, TO THE
 AGENCY IN SUCH AMOUNTS, UPON SUCH TERMS  AND  CONDITIONS  AND  FOR  SUCH
 PERIOD  OR PERIODS OF TIME AS IN THE JUDGMENT OF THE CITY AND THE AGENCY
 ARE NECESSARY OR APPROPRIATE  FOR  THE  ACCOMPLISHMENT  OF  ANY  OF  THE
 PURPOSES OF THE AGENCY.
   (J)  THE CITY SHALL HAVE THE POWER TO CONDEMN PROPERTY FOR TRANSFER TO
 THE  CITY OF STATEN ISLAND INDUSTRIAL DEVELOPMENT AGENCY UNDER TITLE ONE
 OF THIS ARTICLE UPON THE REQUEST OF TWO-THIRDS OF  THE  MEMBERS  OF  THE
 BOARD  OF  DIRECTORS OF THE CITY OF STATEN ISLAND INDUSTRIAL DEVELOPMENT
 AGENCY.  NO PROPERTY SHALL BE CONDEMNED ON BEHALF OF THE AGENCY WHICH IS
 ZONED "RESIDENTIAL" AS DEFINED IN THE ZONING RESOLUTION OF THE CITY,  IF
 ANY,  OR  WHICH  IS  OCCUPIED IN WHOLE OR IN PART AS A DWELLING OR RESI-
 DENCE.
   (K)  FOR THE PURPOSE OF THIS SECTION "GOVERNING BODY" AS USED IN TITLE
 ONE OF THIS ARTICLE SHALL MEAN THE MAYOR OF THE CITY.  EXCEPT AS  OTHER-
 WISE  PROVIDED  IN  THIS  SECTION, THE AGENCY, ITS MEMBERS, OFFICERS AND
 EMPLOYEES, AND ITS OPERATIONS AND ACTIVITIES SHALL BE  GOVERNED  BY  THE
 PROVISIONS OF TITLE ONE OF THIS ARTICLE.
   (L)    THE  CITY  SHALL  SAVE HARMLESS AND INDEMNIFY ANY PERSON WHO IS
 SERVING OR HAS SERVED AS A DIRECTOR OR OFFICER OR  AS  EMPLOYEE  OF  THE
 CITY  OF  STATEN ISLAND INDUSTRIAL DEVELOPMENT AGENCY AGAINST ANY FINAN-
 CIAL LOSS ARISING OUT OF OR IN CONNECTION WITH ANY CLAIM,  DEMAND,  SUIT
 OR JUDGMENT, BASED ON A CAUSE OF ACTION INVOLVING ALLEGATIONS THAT PECU-
 NIARY  HARM  WAS SUSTAINED BY ANY PERSON AS A RESULT OF ANY TRANSACTION,
 ACT OR OMISSION TO ACT OF THE CITY OF STATEN ISLAND INDUSTRIAL  DEVELOP-
 MENT  AGENCY OR OF ANY ACTION OR INACTION OR VOTE OF ANY DIRECTOR, OFFI-
 CER OR EMPLOYEE OF SUCH AGENCY UNLESS SUCH  INDIVIDUAL  IS  FOUND  BY  A
 FINAL  JUDICIAL  DETERMINATION  NOT  TO  HAVE  ACTED IN GOOD FAITH FOR A
 PURPOSE SUCH INDIVIDUAL REASONABLY BELIEVED TO BE IN THE BEST  INTERESTS
 OF  THE  AGENCY OR NOT TO HAVE HAD REASONABLE CAUSE TO BELIEVE THAT SUCH
 S. 8474                            117
 
 CONDUCT WAS LAWFUL.  PROVIDED, HOWEVER, THAT SUCH INDIVIDUAL MUST TRANS-
 MIT TO THE CORPORATION COUNSEL OF THE CITY OF STATEN ISLAND  ANY  NOTICE
 OF  CLAIM,  SUMMONS OR COMPLAINT OR OTHER ANALOGOUS PAPER SERVED ON SUCH
 INDIVIDUAL WITHIN TEN DAYS OF ITS RECEIPT UNLESS PREVENTED FROM DOING SO
 BY  COMPELLING  CIRCUMSTANCES.    THE CORPORATION COUNSEL SHALL, WITHOUT
 CHARGE, REPRESENT ANY SUCH INDIVIDUAL UNLESS UNABLE TO DO SO  BY  REASON
 OF  CONFLICT  OF INTEREST.  IN THE EVENT THAT THE CORPORATION COUNSEL IS
 UNABLE TO GIVE SUCH REPRESENTATION, THE  CITY  OF  STATEN  ISLAND  SHALL
 INDEMNIFY  THE INDIVIDUAL FOR ANY REASONABLE LITIGATION EXPENSE INCURRED
 BY SUCH INDIVIDUAL.
   § 10-001. Legislative findings.  It is the intention of  the  legisla-
 ture that the incorporation of the city of Staten Island shall not alter
 the existing landlord-tenant relationships within such city and that the
 state  and  local  laws regulating landlord-tenant relationships such as
 legal regulated rents, maximum rents and tenancy issues  shall  continue
 to provide such regulation until superseded by state law or local law of
 the  city of Staten Island and in accordance with such intent, such laws
 and regulations are hereby continued. It is further  provided  that  all
 real  property tax exemptions provided under article 4 of the real prop-
 erty tax law shall be continued as shall all rent regulations and  other
 regulations  and  duties  imposed  on  the  owners of property receiving
 exemptions pursuant to such article until superseded  by  state  law  or
 local law of the city of Staten Island.
   §  10-002.   Section 1 of chapter 21 of the laws of 1962, constituting
 the local emergency housing rent control act, is amended by adding a new
 subdivision 2-a to read as follows:
   2-A. APPLICABILITY.  FOR THE PURPOSES OF THIS ACT,  A  CITY  WHICH  IS
 INCORPORATED  ON  OR AFTER THE FIRST OF JANUARY NEXT SUCCEEDING THE DATE
 ON WHICH THIS SUBDIVISION SHALL HAVE BECOME A LAW AND WHICH IS COMPRISED
 OF A GEOGRAPHICAL AREA WITH RESPECT TO WHICH PROVISIONS OF THIS ACT WERE
 IN EFFECT ON THE DATE IMMEDIATELY PRIOR TO SUCH INCORPORATION AND  WHICH
 CITY  HAD  BEEN  WHOLLY CONTAINED WITHIN A CITY WITH A POPULATION OF ONE
 MILLION OR MORE SHALL CONTINUE TO BE TREATED AS A CITY WITH A POPULATION
 OF ONE MILLION OR MORE.
   § 10-003. Section 4 of section 4 of chapter 576 of the laws  of  1974,
 constituting  the  emergency  tenant protection act of nineteen seventy-
 four, is amended by adding a new subdivision f to read as follows:
   F. IN THE CITY OF STATEN ISLAND, THE RENT GUIDELINES  BOARD  SHALL  BE
 THE  RENT GUIDELINES BOARD ESTABLISHED PURSUANT TO THE LOCAL LAW ENACTED
 AS A SUCCESSOR TO THE NEW YORK CITY RENT STABILIZATION LAW  OF  NINETEEN
 HUNDRED SIXTY-NINE AND PROVIDED WITH SUCH POWERS UNDER SUCH LOCAL LAW.
   §  10-004.  Subdivision b of section 14 of section 4 of chapter 576 of
 the laws of 1974, constituting the emergency tenant  protection  act  of
 nineteen seventy-four, is relettered subdivision c and a new subdivision
 b is added to read as follows:
   B.    IN  THE CITY OF STATEN ISLAND; PROVIDED THAT FOR THE PURPOSES OF
 THIS ACT, THE CITY OF STATEN ISLAND SHALL CONTINUE TO BE  TREATED  AS  A
 CITY  WITH  A POPULATION OF ONE MILLION OR MORE AND THE REFERENCE TO ANY
 LOCAL LAW APPLICABLE TO THE GEOGRAPHICAL AREA OF SUCH CITY PRIOR TO  ITS
 INCORPORATION  SHALL  REFER  TO  THE  APPROPRIATE  SUCCESSOR LEGISLATION
 ENACTED BY THE CITY OF STATEN ISLAND; AND
   § 10-005. The section heading and subdivision 8 of section 352-eeee of
 the general business law, as amended  by section 1 of part N of  chapter
 36 of the laws of 2019, are amended to read as follows:
   Conversions to cooperative or condominium ownership in the city of New
 York OR IN THE CITY OF STATEN ISLAND.
 S. 8474                            118
 
   8. The provisions of this section shall only be applicable in the city
 of New York AND THE CITY OF STATEN ISLAND.
   §  10-006.  Section  467-b  of the real property tax law is amended by
 adding a new subdivision 14 to read as follows:
   14. FOR THE PURPOSES OF THIS SECTION, THE CITY OF STATEN ISLAND  SHALL
 CONTINUE  TO  BE  TREATED  AS A CITY WITH A POPULATION OF ONE MILLION OR
 MORE AND ANY REFERENCE TO A LOCAL LAW  ENACTED  PURSUANT  TO  THE  LOCAL
 EMERGENCY  HOUSING  RENT  CONTROL  ACT SHALL ALSO REFER TO THE SUCCESSOR
 LOCAL LAW ENACTED BY THE CITY OF STATEN ISLAND.
   § 10-007. The real property tax law is amended by adding a new section
 498 to read as follows:
   § 498. CITY OF STATEN ISLAND. FOR THE PURPOSES OF  THIS  ARTICLE,  THE
 CITY  OF  STATEN  ISLAND  SHALL  CONTINUE TO BE TREATED AS A CITY WITH A
 POPULATION OF ONE MILLION OR MORE AND THE REFERENCE  TO  ANY  LOCAL  LAW
 APPLICABLE  TO  THE GEOGRAPHICAL AREA OF SUCH CITY PRIOR TO ITS INCORPO-
 RATION SHALL BE DEEMED TO REFER TO THE APPROPRIATE SUCCESSOR LEGISLATION
 ENACTED BY THE CITY OF STATEN ISLAND.
   § 10-008. Applicability.  It is the intention of the legislature  that
 the  state  and local laws regulating landlord-tenant relationships such
 as legal regulated rents, maximum rents and tenancy issues shall contin-
 ue to provide  such  regulation;  provided,  however,  that  within  one
 hundred  twenty  days  after  the  date  of establishment of the city of
 Staten Island, the common council of such city must make a determination
 of whether or not a public emergency exists requiring  the  continuation
 of such regulations.
   §  11-001.  Legislative  findings. The legislature recognizes that the
 formation of the city of Staten  Island  was  not  contemplated  in  the
 establishment  of  the  constitutional real property tax limitations. To
 the greatest extent practicable, the establishment of the city of Staten
 Island is formulated to preserve existing local  laws,  regulations  and
 instrumentalities of government to preserve the status quo and prevent a
 disruption of government injurious to the public good.
   The  unique factor which determined the establishment of the constitu-
 tional real property tax limits for the city of New York was the  inclu-
 sion  of  counties  wholly  within  the  city with the city assuming the
 responsibilities and expenditures for functions  normally  exercised  by
 the  counties  in areas outside the city of New York. Staten Island will
 now share this unique factor with New York city, as the county of  Rich-
 mond is wholly contained within the city of Staten Island.
   Real  property  located  in  cities  outside  the  city of New York is
 subject to a real property tax limit  of  four  percent,  of  which  two
 percent is city tax and two percent is county tax. Real property located
 within  New York city is subject to a more restrictive real property tax
 limit of two and one-half percent, all of which is city tax. County real
 property tax is not permitted within the city of New York.
   The people of the city of Staten Island and county of Richmond and the
 New York state legislature have adopted a charter for the city of Staten
 Island which continues the New York  city  form  of  government  placing
 governmental  responsibility  on  the  city  rather than the county. The
 county of Richmond has not assumed new  responsibilities  justifying  an
 interpretation  of  the  constitutional  real  property tax limits which
 would permit the county of Richmond to impose a real property tax. Like-
 wise the maintenance of the New York city form of  government  with  the
 usual  county  responsibilities being a function of city government when
 combined with the prohibition of a county real property tax, requires an
 S. 8474                            119
 
 interpretation providing a city real property tax limit of two and  one-
 half percent for the city of Staten Island.
   Therefore  the  legislature  finds and declares that the existing more
 restrictive real property tax limits for real  property  located  within
 the  county of Richmond remain in effect, providing a city real property
 tax limit of two and one-half percent for the city of Staten Island  and
 prohibiting the imposition of a real property tax by the county of Rich-
 mond.
   §  12-001.  Subdivision (a) of section 1107 of the tax law, as amended
 by section 1 of part C of chapter 407 of the laws of 1999, is amended to
 read as follows:
   (a) General. On the first day of the first month following  the  month
 in which a municipal assistance corporation is created under article ten
 of  the  public  authorities  law  for a city of one million or more, in
 addition to the taxes imposed by sections eleven hundred five and eleven
 hundred ten, there is hereby imposed on such date, within  the  territo-
 rial  limits  of  such  city  (INCLUDING,  IN  THE CASE OF THE MUNICIPAL
 ASSISTANCE CORPORATION FOR THE CITY OF NEW  YORK,  THE  CITY  OF  STATEN
 ISLAND),  and there shall be paid, additional taxes, at the rate of four
 percent, which except as provided in subdivision (b)  of  this  section,
 shall  be identical to the taxes imposed by sections eleven hundred five
 and eleven hundred ten. Such sections and the  other  sections  of  this
 article,  including the definition and exemption provisions, shall apply
 for purposes of the taxes imposed by this section in the same manner and
 with the same force and effect as if the language of those sections  had
 been  incorporated  in full into this section and had expressly referred
 to the taxes imposed by this section.
   § 12-002. Subdivision (c) of section 1107 of the tax law,  as  amended
 by chapter 588 of the laws of 2000, is amended to read as follows:
   (c)  Tax  on  sale of service of parking, garaging or storing of motor
 vehicles. On the first day of the first month  following  the  month  in
 which a municipal assistance corporation is created under article ten of
 the  public  authorities law for a city of one million or more, in addi-
 tion to the taxes  imposed  by  sections  eleven  hundred  five,  eleven
 hundred ten and subdivision (a) of this section, there is hereby imposed
 on  such date, within the territorial limits of such city (INCLUDING, IN
 THE CASE OF THE MUNICIPAL ASSISTANCE CORPORATION FOR  THE  CITY  OF  NEW
 YORK,  THE  CITY  OF STATEN ISLAND), and there shall be paid, additional
 taxes at the rate of six percent on receipts  from  every  sale  of  the
 service  of providing parking, garaging or storing for motor vehicles by
 persons operating a garage (other than a garage which is part  of  prem-
 ises  occupied  solely as a private one or two family dwelling), parking
 lot or other place of business engaged in providing parking, garaging or
 storing of motor vehicles provided, however, that this subdivision shall
 not apply to such facilities owned and operated by such city or an agen-
 cy or instrumentality of such city or a public corporation the  majority
 of  whose  members  are appointed by the chief executive officer of such
 city or the legislative body of such city or  both  of  them;  provided,
 however,  that  receipts for such services paid to a homeowner's associ-
 ation by its members or receipts paid by members of a homeowner's  asso-
 ciation  to  a  person leasing the parking facility from the homeowner's
 association shall not be subject to the tax imposed by this subdivision.
 For purposes of this subdivision, a homeowner's association is an  asso-
 ciation  (including  a cooperative housing or apartment corporation) (i)
 the membership of which is comprised exclusively of owners or  residents
 of  residential dwelling units, including owners of units in a condomin-
 S. 8474                            120
 
 ium, and including shareholders in a cooperative  housing  or  apartment
 corporation, where such units are located in a defined geographical area
 such  as  a  housing  development or subdivision; and (ii) which owns or
 operates  a  garage,  parking  lot or other place of business engaged in
 providing parking, garaging or storing for  motor  vehicles  located  in
 such  area  for  use  (whether or not exclusive) by such owners or resi-
 dents. All provisions set forth in this article applicable to the  taxes
 imposed  under section eleven hundred five, including the definition and
 exemption provisions of this article, shall apply with respect to a  tax
 imposed  under  this subdivision, except as to rate and except as other-
 wise provided herein. The transitional provisions contained  in  section
 eleven hundred six shall not apply to the taxes imposed by this section.
   § 12-003. Intentionally omitted.
   §  12-004.  Section  1210  of the tax law is amended by adding two new
 subdivisions (k) and (l) to read as follows:
   (K) IN THE CASE OF THE MUNICIPAL ASSISTANCE CORPORATION FOR  THE  CITY
 OF  NEW  YORK  THE POWER OF THE CITY OF STATEN ISLAND TO ADOPT AND AMEND
 LOCAL LAWS, ORDINANCES OR RESOLUTIONS IMPOSING  TAXES  PURSUANT  TO  THE
 AUTHORITY OF SUCH SECTION SHALL, NOTWITHSTANDING ANY PROVISIONS OF ARTI-
 CLE  TWENTY-NINE OF THIS CHAPTER TO THE CONTRARY, BE SUSPENDED UNTIL ALL
 THE NOTES AND BONDS OF SUCH MUNICIPAL ASSISTANCE CORPORATION SHALL  HAVE
 BEEN FULLY PAID AND DISCHARGED TOGETHER WITH INTEREST ON UNPAID INSTALL-
 MENTS OF INTEREST.
   (L) NOTWITHSTANDING THE PROVISIONS OF SUBDIVISION (K) OF THIS SECTION,
 THE  CITY  OF  STATEN ISLAND IS HEREBY AUTHORIZED AND EMPOWERED TO ADOPT
 AND AMEND LOCAL LAWS, IMPOSING TAXES,  AT  A  RATE  NOT  TO  EXCEED  TWO
 PERCENT  ON  THE RECEIPTS OF SALES FROM THE SERVICES OF LAUNDERING, DRY-
 CLEANING, TAILORING, WEAVING, PRESSING, SHOE REPAIRING AND SHOE SHINING,
 AND CHARGES TO A PATRON FOR ADMISSION TO,  OR  USE  OF,  FACILITIES  FOR
 SPORTING  ACTIVITIES  IN WHICH THE PATRON IS TO BE A PARTICIPANT SUCH AS
 BOWLING ALLEYS AND SWIMMING POOLS. SUCH  TAXES  SHALL  BE  ADMINISTERED,
 COLLECTED  AND  DISTRIBUTED  BY  THE STATE TAX COMMISSION AS PROVIDED IN
 SUBPART B OF PART THREE AND IN PART FOUR OF THIS ARTICLE.
   § 12-005. Subdivisions 3 and 4 of section 92-d of  the  state  finance
 law,  subdivision  3  as amended by section 4 of part A of chapter 88 of
 the laws of 2000 and subdivision 4 as amended by section 11 of part  SS1
 of chapter 57 of the laws of 2008, are amended to read as follows:
   3.  The  taxes,  interest  and penalties imposed, pursuant to sections
 eleven hundred seven or eleven hundred eight (as the case may be) of the
 tax law within the territorial limits of a city in aid of which a munic-
 ipal assistance corporation has been created (INCLUDING, IN THE CASE  OF
 THE  MUNICIPAL ASSISTANCE CORPORATION FOR THE CITY OF NEW YORK, THE CITY
 OF STATEN ISLAND), and received by  the  commissioner  of  taxation  and
 finance,  after  deducting the amount which the commissioner of taxation
 and finance shall determine to be necessary for reasonable costs of  the
 commissioner  of  taxation  and finance in administering, collecting and
 distributing such taxes, shall be  appropriated  (i)  to  the  municipal
 assistance  corporation  which  has  been created in aid of such city in
 order to enable such corporation to fulfill the terms of any  agreements
 made with the holders of its notes and bonds and to carry out its corpo-
 rate  purposes,  including  the maintenance of the capital reserve fund,
 and (ii) the balance, if any, to the city in aid of  which  such  corpo-
 ration has been created, or to a public benefit corporation to which the
 tax  may  be otherwise payable pursuant to law, as hereinafter provided.
 NOTWITHSTANDING THE PROVISIONS OF THIS SUBDIVISION, IN THE CASE  OF  THE
 MUNICIPAL ASSISTANCE CORPORATION FOR THE CITY OF NEW YORK, SUCH BALANCE,
 S. 8474                            121
 
 IF  ANY,  SHALL  BE DIVIDED BETWEEN THE CITY OF NEW YORK AND THE CITY OF
 STATEN ISLAND AND PAID, AS HEREINAFTER PROVIDED.
   4.  On  or  before  the twelfth day of each month, the commissioner of
 taxation and finance shall certify to the comptroller the amount of  all
 revenues  so  received  during the prior month as a result of the taxes,
 interest and penalties so imposed and in addition on or before the  last
 day  of  June the commissioner shall certify the amount of such revenues
 received during and including the first twenty-five days of  June.    IN
 THE  CASE  OF  THE  MUNICIPAL ASSISTANCE CORPORATION FOR THE CITY OF NEW
 YORK, THE COMMISSIONER OF TAXATION AND FINANCE SHALL CERTIFY  SEPARATELY
 THE AMOUNTS OF SUCH REVENUES RECEIVED FROM WITHIN THE TERRITORIAL LIMITS
 OF THE CITY OF NEW YORK AND THE TERRITORIAL LIMITS OF THE CITY OF STATEN
 ISLAND.  The  amount  of revenues so certified shall be deposited by the
 comptroller in the municipal assistance tax fund and the amount  attrib-
 utable  to the taxes, interest and penalties imposed within the territo-
 rial limits of a city in aid of which a municipal assistance corporation
 has been created INCLUDING, IN THE  CASE  OF  THE  MUNICIPAL  ASSISTANCE
 CORPORATION FOR THE CITY OF NEW YORK, THE CITY OF STATEN ISLAND shall be
 credited  to  a special account established in such fund for such corpo-
 ration. Notwithstanding the foregoing provisions,  the  commissioner  of
 taxation  and  finance  may prorate revenue attributable to the first or
 last quarterly return period during which the taxes imposed  by  section
 eleven hundred seven or eleven hundred eight (as the case may be) of the
 tax  law  apply  so  as  to separate from the revenue collected for that
 quarter pursuant to such taxes the revenue collected pursuant  to  local
 legislation  adopted by a city pursuant to section twelve hundred ten or
 twelve hundred twelve-A of the tax law. Such a proration by the  commis-
 sioner  of  taxation and finance shall be made on the basis of the ratio
 of the number of months during which such taxes were imposed during such
 quarterly return period to the total number of months in such  quarterly
 return  period  when such proration is reasonably necessary to ascertain
 the amount of such money which must be deposited by the  comptroller  in
 such special account and the amount of such money which must be deposit-
 ed  pursuant  to  section  twelve  hundred sixty-one of the tax law. The
 commissioner of taxation and finance shall not be held  liable  for  any
 inaccuracy in any certification under this subdivision.
   §  12-006.  Subdivision 6 of section 92-d of the state finance law, as
 amended by section 4 of part A of chapter 88 of the  laws  of  2000,  is
 amended to read as follows:
   6.  Upon  receipt  by the comptroller of a certificate or certificates
 from the [chairman] CHAIRPERSON of a  municipal  assistance  corporation
 that  such corporation requires a payment or payments in order to comply
 with any agreement with the holders of its notes and bonds and to  carry
 out  its  corporate  purposes,  including the maintenance of the capital
 reserve fund, from the special account established for such corporation,
 each of  which  certificates  shall  specify  the  required  payment  or
 payments  and  the  date  when  the payment or payments is required, the
 comptroller shall pay from such special account on or before the  speci-
 fied  date or within thirty days after such receipt, whichever is later,
 to such corporation, as the [chairman] CHAIRPERSON thereof may direct in
 any such certificate, the amount or amounts so certified.   IN THE  CASE
 OF  THE  MUNICIPAL ASSISTANCE CORPORATION FOR THE CITY OF NEW YORK, EACH
 AMOUNT SO PAID SHALL BE COMPRISED OF REVENUES ATTRIBUTABLE  TO  RECEIPTS
 FROM BOTH THE CITY OF NEW YORK AND THE CITY OF STATEN ISLAND IN THE SAME
 PROPORTION THAT SUCH REVENUES WERE RECEIVED DURING THE PERIOD COVERED BY
 EACH  SUCH CERTIFICATION. The [chairman] CHAIRPERSON of such corporation
 S. 8474                            122
 
 shall furnish the commissioner of taxation and finance  with  copies  of
 such  certificates.   The comptroller shall from time to time, but in no
 event later than the fifteenth day of October, January and April and the
 last  day  of  June  of each fiscal year, pay over and distribute to the
 chief fiscal officer of the city in aid of which such municipal  assist-
 ance  corporation  has been created to be paid into the treasury of such
 city to the credit of the general fund, or pay over and distribute to  a
 public  benefit  corporation  to  which the tax may otherwise be payable
 pursuant to law, all revenues in the  special  account  established  for
 such corporation in the municipal assistance tax fund, if any, in excess
 of  the aggregate amount which the [chairman] CHAIRPERSON of such corpo-
 ration has certified to the comptroller and which  has  been  previously
 appropriated  and  paid  to  such corporation as hereinabove authorized.
 NOTWITHSTANDING THE PROVISIONS OF THIS SUBDIVISION, IN THE CASE  OF  THE
 MUNICIPAL  ASSISTANCE  CORPORATION  FOR  THE CITY OF NEW YORK, THE COMP-
 TROLLER SHALL FROM TIME  TO  TIME,  BUT  IN  NO  EVENT  LATER  THAN  THE
 FIFTEENTH  OF  OCTOBER,  JANUARY,  AND APRIL AND THE LAST DAY OF JUNE OF
 EACH FISCAL YEAR, (A) APPORTION BETWEEN THE CITY OF  NEW  YORK  AND  THE
 CITY  OF  STATEN  ISLAND  THE  REVENUES,  IF ANY, IN THE SPECIAL ACCOUNT
 ESTABLISHED FOR SUCH CORPORATION IN THE MUNICIPAL ASSISTANCE TAX FUND ON
 THE BASIS OF THE LOCUS OF THEIR RECEIPT AND (B) PAY OVER AND  DISTRIBUTE
 TO THE CHIEF FISCAL OFFICERS OF SUCH CITIES TO PAY INTO THEIR RESPECTIVE
 TREASURIES  TO THE CREDIT OF THE GENERAL FUND ALL SUCH RESPECTIVE REVEN-
 UES IN EXCESS OF THE AGGREGATE AMOUNT  WHICH  THE  CHAIRPERSON  OF  SUCH
 CORPORATION  HAS  CERTIFIED TO THE COMPTROLLER AND WHICH HAS BEEN PREVI-
 OUSLY APPROPRIATED AND PAID TO SUCH CORPORATION AS  HEREINABOVE  AUTHOR-
 IZED.  In  no  event  shall  the comptroller pay over and distribute any
 revenues (other than  the  amount  to  be  deducted  for  administering,
 collecting  and  distributing  such sales and compensating use taxes) to
 any person other than the municipal assistance  corporation  unless  and
 until  the  aggregate  of  all  payments certified to the comptroller as
 required by such corporation as of such date in order to comply with its
 agreements with the holders of its notes and bonds and to carry out  its
 corporate  purposes,  including  the  maintenance of the capital reserve
 fund, which remain unappropriated or unpaid to  such  corporation  shall
 have  been  appropriated to such corporation and shall have been paid in
 full; provided, however, that no person, including such  corporation  or
 the  holders  of its notes or bonds shall have any lien on such revenues
 and such agreement shall be executory only to the extent of such  reven-
 ues available to the state in such special account.  On the day on which
 the comptroller pays over and distributes to the chief fiscal officer of
 such  city  OR CITIES any revenues from such special account the commis-
 sioner of taxation and finance shall  certify  to  the  comptroller  the
 amount to be deducted for administering, collecting and distributing the
 tax  imposed  pursuant to section eleven hundred seven or eleven hundred
 eight (as the case may be) of the tax law within the territorial  limits
 of  such  city  OR CITIES since he OR SHE last certified such amount and
 the comptroller shall pay such amount into the general fund of the state
 treasury to the credit of the state purposes fund therein.
   § 12-007. Subdivision 3 of section 92-e of the state finance  law,  as
 amended  by  chapter  187  of  the  laws  of 1995, is amended to read as
 follows:
   3. Such amounts, including per capita aid apportioned to a city in aid
 of which a municipal assistance corporation has been created (INCLUDING,
 IN THE CASE OF THE MUNICIPAL ASSISTANCE CORPORATION FOR THE CITY OF  NEW
 YORK,  THE CITY OF STATEN ISLAND), shall be deposited by the comptroller
 S. 8474                            123
 
 to the credit of the  special  account  established  for  the  municipal
 assistance  corporation  which  has  been created in aid of such city in
 order to enable such corporation to fulfill the terms of any  agreements
 made with the holders of its notes and bonds and to carry out its corpo-
 rate  purposes,  including  the  maintenance of the capital reserve fund
 securing such bonds and notes, and, subject to the provisions of section
 fifty-four of this chapter, and subdivisions five  and  five-a  of  this
 section,  the balance, if any, shall be paid to the chief fiscal officer
 of the city in aid of which such corporation has been created as herein-
 after provided.  NOTWITHSTANDING THE PROVISIONS OF THIS SUBDIVISION,  IN
 THE  CASE  OF  THE  MUNICIPAL ASSISTANCE CORPORATION FOR THE CITY OF NEW
 YORK, SUCH BALANCE, IF ANY, SHALL BE DIVIDED BETWEEN  THE  CITY  OF  NEW
 YORK AND THE CITY OF STATEN ISLAND AND PAID, AS HEREINAFTER PROVIDED.
   §  12-008.  Subdivision 5 of section 92-e of the state finance law, as
 amended by chapter 55 of the  laws  of  1992,  is  amended  to  read  as
 follows:
   5.  Upon  receipt  by the comptroller of a certificate or certificates
 from the [chairman] CHAIRPERSON of a  municipal  assistance  corporation
 that  such corporation requires a payment or payments in order to comply
 with any agreement with the holders of its notes and bonds and to  carry
 out  its  corporate  purposes,  including the maintenance of the capital
 reserve fund securing such bonds, from the appropriate  special  account
 established for such corporation, each of which certificates shall spec-
 ify  the  required  payment or payments and the date when the payment or
 payments is required,  the  comptroller  shall  pay  from  such  special
 account  on  or  before  the  specified date or within thirty days after
 receipt of such certificate or certificates, whichever is later, to such
 corporation, as the [chairman] CHAIRPERSON thereof  may  direct  in  any
 such  certificate,  the  amount or amounts so certified.  IN THE CASE OF
 THE MUNICIPAL ASSISTANCE CORPORATION FOR THE  CITY  OF  NEW  YORK,  EACH
 AMOUNT  SO  PAID SHALL BE COMPRISED OF PER CAPITA AID APPORTIONED TO THE
 CITY OF NEW YORK AND THE CITY OF STATEN ISLAND IN  THE  SAME  PROPORTION
 THAT  SUCH AMOUNTS WERE SO APPORTIONED DURING THE PERIOD COVERED BY EACH
 SUCH CERTIFICATION. The comptroller shall from time to time, but  in  no
 event later than the fifteenth day of October, January and April and the
 last  day  of  June  of each fiscal year, pay over and distribute to the
 chief fiscal officer of the city in aid of which such municipal  assist-
 ance  corporation  has been created to be paid into the treasury of such
 city to the credit of the general  fund  all  revenues  in  the  special
 account  established  for  such  corporation in the municipal assistance
 state aid fund, if any, in excess of (i) the aggregate amount which  the
 [chairman]  CHAIRPERSON  of  such corporation has certified to the comp-
 troller and which has been previously paid to such corporation as herein
 above authorized, and (ii) amounts to be refunded to the general fund of
 the state of New York pursuant to subdivision five-a  of  this  section.
 NOTWITHSTANDING  THE  PROVISIONS OF THIS SUBDIVISION, IN THE CASE OF THE
 MUNICIPAL ASSISTANCE CORPORATION FOR THE CITY OF  NEW  YORK,  THE  COMP-
 TROLLER  SHALL  FROM  TIME  TO  TIME,  BUT  IN  NO  EVENT LATER THAN THE
 FIFTEENTH OF OCTOBER, JANUARY AND APRIL AND THE LAST DAY OF JUNE OF EACH
 FISCAL YEAR, (A) APPORTION BETWEEN THE CITY OF NEW YORK AND THE CITY  OF
 STATEN  ISLAND  THE REVENUES, IF ANY, IN THE SPECIAL ACCOUNT ESTABLISHED
 FOR SUCH CORPORATION IN THE MUNICIPAL ASSISTANCE STATE AID FUND  ON  THE
 BASIS  OF  THE AMOUNTS APPORTIONED TO EACH SUCH CITY PURSUANT TO SECTION
 FIFTY-FOUR OF THIS CHAPTER AND (B) PAY OVER AND DISTRIBUTE TO THE  CHIEF
 FISCAL  OFFICERS  OF SUCH CITIES TO BE PAID INTO THEIR RESPECTIVE TREAS-
 URIES TO THE CREDIT OF THE GENERAL FUND ALL SUCH RESPECTIVE REVENUES  IN
 S. 8474                            124
 
 EXCESS OF THE AGGREGATE AMOUNT WHICH THE CHAIRPERSON OF SUCH CORPORATION
 HAS  CERTIFIED  TO THE COMPTROLLER AND WHICH HAS BEEN PREVIOUSLY PAID TO
 SUCH CORPORATION AS HEREINABOVE AUTHORIZED. In no event shall the  comp-
 troller  pay  over  and distribute any revenues to any person other than
 the municipal assistance corporation unless and until the  aggregate  of
 all  payments  certified  to  the comptroller as required by such corpo-
 ration as of such date in order to comply with its agreements  with  the
 holders  of its notes and bonds and to carry out its corporate purposes,
 including the maintenance of the  capital  reserve  fund  securing  such
 bonds,  which  remain unpaid to such corporation shall have been paid in
 full to such corporation; provided, however, that no  person,  including
 such  corporation  or  the  holders of its notes or bonds shall have any
 lien on such revenues and such agreement shall be executory only to  the
 extent of such revenues available to the state in such special account.
   §  12-009.    Paragraph  c of subdivision 6 of section 54 of the state
 finance law, as added by chapter 430 of the laws of 1997, is amended  to
 read as follows:
   c. Upon such certification of the amounts payable to counties, cities,
 villages and towns for town-wide and town outside village purposes, such
 per capita aid shall be apportioned and paid to the chief fiscal officer
 of  each  such locality pursuant to this section on audit and warrant of
 the state comptroller out of moneys appropriated by the legislature  for
 such purpose to the credit of the local assistance account in the gener-
 al  fund  of the state treasury; provided however that upon such certif-
 ication of amounts payable to the city of  New  York  OR,  THE  CITY  OF
 STATEN  ISLAND,  IF APPLICABLE, such per capita aid shall be apportioned
 and paid as follows: (i) any amounts required to be  paid  to  the  city
 university   construction   fund   pursuant   to   the  city  university
 construction fund act, (ii) any amounts required to be paid to  the  New
 York  city housing development corporation pursuant to the New York city
 housing development corporation act, (iii) any amounts  required  to  be
 paid  by the city to the New York city transit authority pursuant to the
 provisions of chapter seven of the laws of nineteen hundred seventy-two,
 (iv) any amounts required to be paid by the city to the state  to  repay
 an  advance  made in nineteen hundred seventy-four to subsidize the fare
 of the New York  city  transit  authority,  (v)  five  hundred  thousand
 dollars  to the chief fiscal officer of the city of New York for payment
 to the trustees of the police pension fund of such city pursuant to  the
 provisions  of  paragraph  e  of  this  subdivision, (vi) eighty million
 dollars to the special account for the municipal assistance  corporation
 for  the  city  of New York in the municipal assistance tax fund created
 pursuant to section ninety-two-d of this chapter to the extent that such
 amount has been included by the municipal assistance corporation for the
 city of New York in any computation for the issuance of bonds on a pari-
 ty with outstanding bonds pursuant to a contract  with  the  holders  of
 such  bonds prior to the issuance of any other bonds secured by payments
 from the municipal assistance state aid fund created pursuant to section
 ninety-two-e of this chapter, (vii) the balance to the  special  account
 for the municipal assistance corporation for the city of New York in the
 municipal  assistance state aid fund created pursuant to section ninety-
 two-e of this chapter, and (viii) any amounts  to  be  refunded  to  the
 general  fund  of the state of New York pursuant to the annual appropri-
 ation enacted for the municipal assistance state aid fund. Notwithstand-
 ing any existing law, no payments of per capita aid payable to the  city
 of  New  York shall be paid to the state of New York municipal bond bank
 agency, the New York state sports authority or the transit  construction
 S. 8474                            125
 
 fund  so  long  as  amounts of such aid are required to be paid into the
 municipal assistance state aid fund, and thereafter,  after  payment  of
 the  amounts described in subparagraphs (i) through (viii) of this para-
 graph  the  balance  shall  be paid (A) to the state in repayment of the
 appropriation of two hundred fifty million  dollars  made  to  the  city
 pursuant  to  chapter  two  hundred  fifty-seven of the laws of nineteen
 hundred seventy-five providing emergency  financial  assistance  to  the
 city  of  New  York  at  the extraordinary session held in such year, as
 amended, (B) to the state of New York municipal bond bank agency to  the
 extent  provided by section twenty-four hundred thirty-six of the public
 authorities law, (C) to the New  York  state  sports  authority  to  the
 extent provided by section twenty-four hundred sixty-three of the public
 authorities  law,  (D)  to  the  transit construction fund to the extent
 provided by section twelve hundred twenty-five-i of the public  authori-
 ties law, and thereafter (E) to the city OF NEW YORK.
   §  12-010.  Subparagraphs  1  and 2 of paragraph d of subdivision 6 of
 section 54 of the state finance law, as added by chapter 430 of the laws
 of 1997, are amended to read as follows:
   (1)  to the city of New York AND THE CITY OF  STATEN  ISLAND,  on  the
 twenty-fifth days of April, June, October and February;
   (2)    to  every county, city, village or town, other than the city of
 New York AND THE CITY OF STATEN ISLAND, whose fiscal year  commences  on
 the  first  day of June or July, on the twenty-fifth days of April, May,
 September and December;
   § 12-011. Subdivisions 1 and 2 of section 3034 of the public  authori-
 ties  law,  as  added by chapter 169 of the laws of 1975, are amended to
 read as follows:
   1.  The corporation shall be administered by  a  board  of  directors,
 consisting  of nine directors, none of whom shall be officers or employ-
 ees of the federal government or of the state or political  subdivisions
 thereof.    All of the directors shall be appointed by the governor with
 the advice and consent of the senate, provided that four of such  direc-
 tors  shall  be  appointed upon written recommendation of the mayor.  Of
 the directors initially appointed upon the written recommendation of the
 mayor, one shall serve for a term ending December thirty-first, nineteen
 hundred seventy-six; one shall serve for a term ending December  thirty-
 first, nineteen hundred seventy-seven; one shall serve for a term ending
 December  thirty-first,  nineteen  hundred  seventy-eight; and one shall
 serve for a term ending December thirty-first, nineteen  hundred  seven-
 ty-nine.    THE  PROVISIONS  OF THIS SUBDIVISION NOTWITHSTANDING, OF THE
 DIRECTORS APPOINTED UPON THE RECOMMENDATION OF THE MAYOR,  THE  DIRECTOR
 WHOSE  TERM  EXPIRES  ON  THE  DECEMBER  THIRTY-FIRST NEXT PRECEDING THE
 ESTABLISHMENT OF A CITY OF STATEN ISLAND,  AND  ANY  SUCCESSOR  THERETO,
 SHALL  BE APPOINTED ONLY UPON THE WRITTEN RECOMMENDATION OF THE MAYOR OF
 THE  CITY  OF  STATEN  ISLAND.  Of  the  remaining  directors  initially
 appointed  by  the  governor, one shall serve for a term ending December
 thirty-first, nineteen hundred seventy-six; one shall serve for  a  term
 ending  December thirty-first, nineteen hundred seventy-seven; one shall
 serve for a term ending December thirty-first, nineteen  hundred  seven-
 ty-eight;  and  two shall serve for a term ending December thirty-first,
 nineteen hundred seventy-nine.  Each director shall  hold  office  until
 his  OR  HER successor has been appointed and qualified. Thereafter each
 director appointed by the governor shall serve a  term  of  four  years,
 except  that  any  director appointed to fill a vacancy shall serve only
 until the expiration of his predecessor's term.
 S. 8474                            126

   2.  The speaker and the minority leader of the assembly, the president
 pro-tem and the minority leader of the senate, the city board  of  esti-
 mate acting by majority vote, [and] the [vice-chairman] VICE-CHAIRPERSON
 of  the  city  council, THE COMPTROLLER OF THE CITY OF STATEN ISLAND AND
 THE  COMMON  COUNCIL OF THE CITY OF STATEN ISLAND shall each be entitled
 to appoint a representative to   the board  of  directors.    Each  such
 representative  shall be entitled to receive notice of and to attend all
 meetings of the board of directors but shall not be  entitled  to  vote.
 No  representative shall be an employee or officer of the federal, state
 or city governments.  Each representative shall serve at the pleasure of
 the appointing official or body, shall be  eligible  for  reappointment,
 and shall hold office until his OR HER successor has been appointed.
   § 12-012. Subdivision 1 of section 3036 of the public authorities law,
 as  amended  by  chapter  201 of the laws of 1978, is amended to read as
 follows:
   1.  Not less than one hundred twenty days before the beginning of each
 fiscal year of the corporation (but not later than July 1, 1975 for  the
 fiscal  year  ending  June  30, 1976), the [chairman] CHAIRPERSON of the
 board of directors of the corporation shall certify to the  state  comp-
 troller  and to the mayor a schedule setting forth the cash requirements
 of the corporation for such fiscal year and the time or times when  such
 cash  is  required.    The  total amount so certified by such [chairman]
 CHAIRPERSON for such fiscal year shall be  equal  to:  (i)  the  amounts
 which  are  required to be deposited in the capital reserve fund author-
 ized to be created and established pursuant to subdivision three of this
 section during such fiscal  year  in  order  to  maintain  such  capital
 reserve fund of the corporation at the level required in accordance with
 subdivision five of this section; (ii) the amounts required to be depos-
 ited in the debt service fund of the corporation to pay all interest and
 all  payments  of principal and redemption premium, if any, on notes and
 bonds secured by such debt service fund maturing or otherwise coming due
 during such fiscal year; and (iii) the amounts required to be  deposited
 in  the  operating  fund of the corporation, as determined by the corpo-
 ration, to meet the operating requirements and  other  expenses  of  the
 corporation during such fiscal year.  If any increase shall occur in the
 cash requirements specified above, or if payments are required at a time
 or  times earlier than previously certified or if the city shall for any
 reason fail to make timely payment of the principal and accrued interest
 due on any obligation issued by the city to the corporation and maturing
 within the same fiscal year, such [chairman] CHAIRPERSON shall certify a
 revised schedule of cash requirements for such fiscal year to the  state
 comptroller  and  to the mayor.   The schedule accompanying each certif-
 ication (or revision thereof) shall provide for such  payment  dates  as
 the  corporation  deems appropriate to assure that sufficient funds will
 be available from the sources identified below to enable it to meet  its
 current  obligations  as  they  come due.   Upon receipt of such certif-
 ication, or any revision thereof, the state comptroller shall  pay  such
 amount  to  the  corporation  for  deposit  in the appropriate funds, in
 accordance with such certification from the special account  established
 for  the corporation in the municipal assistance tax fund, in accordance
 with subdivision one of section ninety-two-d of the state  finance  law,
 including  any  amount  transferred to the municipal assistance tax fund
 from the stock transfer tax fund pursuant to subdivision four of section
 [92-b] NINETY-TWO-B of the state finance law.   Any such  payment  shall
 be  made  within  thirty  days of receipt of the certification or at the
 time specified in the certification, whichever is later;  provided  that
 S. 8474                            127
 
 any  such  amounts  shall  have been first appropriated by the state for
 such purpose or shall have been otherwise made available.  Any amount so
 paid to the corporation shall be  deducted  from  the  amount  otherwise
 payable  to  the  city OR THE CITY OF STATEN ISLAND, AS THE CASE MAY BE,
 from the municipal assistance tax fund established  by  section  ninety-
 two-d of the state finance law and shall not obligate the state to make,
 nor  entitle  the city OR THE CITY OF STATEN ISLAND, AS THE CASE MAY BE,
 to receive, any additional payments.
   § 12-013. Subdivision 1 of section 3036-a of  the  public  authorities
 law, as amended by chapter 55 of the laws of 1992, is amended to read as
 follows:
   1. In addition to the total amount certified by such [chairman] CHAIR-
 PERSON  for  such  fiscal year, all as referred to in subdivision one of
 section three thousand thirty-six, the [chairman] CHAIRPERSON  shall  at
 the same time certify to the state comptroller and to the mayor a sched-
 ule  setting forth additional cash requirements of the corporation which
 shall be equal to: (i) the amounts which are required to be deposited in
 the capital reserve fund authorized to be created and established pursu-
 ant to subdivision two of this section (in this section called the capi-
 tal reserve fund) during such fiscal year in order to maintain the capi-
 tal reserve fund at the level required in  accordance  with  subdivision
 four  of  this section; (ii) the amounts required to be deposited in the
 bond service fund of  the  corporation  to  pay  all  interest  and  all
 payments of principal and redemption premium, if any, on notes and bonds
 payable  from  the  sources  hereinafter  identified in this section and
 maturing or otherwise coming due during such fiscal year; and (iii)  the
 amounts  required  to  be  deposited in the operating fund of the corpo-
 ration heretofore established, as determined by the corporation, to meet
 the operating requirements and other expenses of the corporation  during
 such  fiscal  year.  If any increase shall occur in such additional cash
 requirements specified above, or if payments are required at a  time  or
 times  earlier  than  previously  certified or if the city shall for any
 reason fail to make timely payment of the principal and accrued interest
 due on any obligation issued by the city to the corporation and maturing
 within the same fiscal year, such [chairman] CHAIRPERSON shall certify a
 revised schedule of such additional cash requirements  for  such  fiscal
 year  to the state comptroller and to the mayor. The schedule accompany-
 ing each certification (or revision  thereof)  shall  provide  for  such
 payment dates as the corporation deems appropriate to assure that suffi-
 cient  funds  will  be  available  from  the sources identified below to
 enable it to meet its current obligations under  this  section  as  they
 come  due.  Upon receipt of such certification, or any revision thereof,
 the state comptroller shall pay  such  amount  to  the  corporation  for
 deposit in the appropriate funds referred to in this section, in accord-
 ance  with  such  certification from the special account established for
 the corporation in the municipal assistance state aid fund in    accord-
 ance   with subdivision one of section ninety-two-e of the state finance
 law and, subject to agreements with outstanding bond and note holders of
 the corporation, from the special account  established  for  the  corpo-
 ration in the municipal assistance tax fund, in accordance with subdivi-
 sion one of section ninety-two-d of the state finance law, including any
 amount  transferred  to the municipal assistance tax fund from the stock
 transfer tax fund pursuant to subdivision four of  section  ninety-two-b
 of  the  state finance law. Any such payment shall be made within thirty
 days of receipt of the certification or at the time specified   in   the
 certification,  whichever is later; provided that any such amounts shall
 S. 8474                            128
 
 have been first appropriated by the state for such purpose or shall have
 been otherwise made  available.  Any amount paid to the corporation from
 such municipal assistance state aid fund  shall  be  deducted  from  the
 amount  otherwise  payable  to the city OR THE CITY OF STATEN ISLAND, AS
 THE CASE MAY BE, as per capita aid pursuant to sections  fifty-four  and
 ninety-two-e  of  the state finance law and shall not obligate the state
 to make, nor entitle the city OR THE CITY OF STATEN ISLAND, to  receive,
 any  additional  payments  of per capita aid.  Any amount so paid to the
 corporation from the municipal assistance tax fund shall, in addition to
 the amount deducted pursuant to subdivision one of section  three  thou-
 sand  thirty-six,  be  deducted from the amount otherwise payable to the
 city OR THE CITY OF STATEN ISLAND, AS THE CASE MAY BE, from the  munici-
 pal  assistance  tax  fund and shall not obligate the state to make, nor
 entitle the city OR THE CITY OF STATEN ISLAND to receive, any additional
 payments from such municipal assistance tax fund.
   § 12-014. Subdivision 1 of section 3036-b of  the  public  authorities
 law, as amended by chapter 55 of the laws of 1992, is amended to read as
 follows:
   1. In addition to the total amount certified by such [chairman] CHAIR-
 PERSON  for  such  fiscal year, all as referred to in subdivision one of
 each of sections three thousand thirty-six and  three  thousand  thirty-
 six-a  of  this title, the [chairman] CHAIRPERSON shall at the same time
 certify to the state comptroller and to the  mayor  a  schedule  setting
 forth  additional  cash  requirements  of the corporation which shall be
 equal to: (i) the amounts required to be deposited in the  bond  payment
 fund  of the corporation to pay all interest and all payments of princi-
 pal and redemption premium, if any, on bonds and notes payable from  the
 sources hereinafter identified in this section and maturing or otherwise
 coming  due  during  such  fiscal  year; (ii) the amounts required to be
 deposited in the operating fund of  the  corporation  heretofore  estab-
 lished, as determined by the corporation, to meet the operating require-
 ments  and  other expenses of the corporation during such fiscal year to
 the extent not otherwise provided for; and (iii) the amounts required to
 be deposited in the bond reserve fund created and  established  pursuant
 to  the agreements of the corporation made with the holders of its bonds
 or notes issued pursuant to subdivision two-b of section three  thousand
 thirty-three  of this title during such fiscal year in order to maintain
 the bond reserve fund at the  level  required  in  accordance  with  the
 agreements  of  the  corporation  made  with the holders of its bonds or
 notes issued pursuant to subdivision two-b  of  section  three  thousand
 thirty-three  of  this  title. If any increase shall occur in such addi-
 tional cash requirements specified above, or if payments are required at
 a time or times earlier than previously certified or if the city  shall,
 for any reason, fail to make timely payment of the principal and accrued
 interest due on any obligation issued by the city to the corporation and
 maturing  within the same fiscal year, such [chairman] CHAIRPERSON shall
 certify a revised schedule of such additional cash requirements for such
 fiscal year to the state comptroller and  to  the  mayor.  The  schedule
 accompanying  each certification, or revision thereof, shall provide for
 such payment dates as the corporation deems appropriate to  assure  that
 sufficient  funds will be available from the sources identified below to
 enable it to meet its current obligations under  this  section  as  they
 come  due.  Upon receipt of such certification, or any revision thereof,
 the state comptroller shall pay  such  amount  to  the  corporation  for
 deposit in the appropriate funds referred to in this section, in accord-
 ance  with  such certification and subject to agreements with holders of
 S. 8474                            129
 
 outstanding bonds and notes of the corporation, from the special account
 established for the corporation in the municipal  assistance  state  aid
 fund  in  accordance with subdivision one of section ninety-two-e of the
 state  finance  law  and  from  the  special account established for the
 corporation in the municipal assistance  tax  fund  in  accordance  with
 subdivision  one  of  section  ninety-two-d  of  the  state finance law,
 including any amount transferred to the municipal  assistance  tax  fund
 from the stock transfer tax fund pursuant to subdivision four of section
 ninety-two-b  of  the  state finance law. Any such payment shall be made
 within thirty days of receipt of the certification or at the time speci-
 fied in the certification, whichever is later; provided  that  any  such
 amounts shall have been first appropriated by the state for such purpose
 or  shall  have  been  otherwise  made available. Any amount paid to the
 corporation from such municipal assistance state aid fund,  in  addition
 to  the  amount  deducted  pursuant  to subdivision one of section three
 thousand thirty-six-a of this title, shall be deducted from  the  amount
 otherwise  payable to the city OR THE CITY OF STATEN ISLAND, AS THE CASE
 MAY BE, as per capita aid pursuant to sections  fifty-four  and  ninety-
 two-e of the state finance law and shall not obligate the state to make,
 nor  entitle the city OR THE CITY OF STATEN ISLAND to receive, any addi-
 tional payments of per capita aid. Any amount so paid to the corporation
 from the municipal assistance  tax  fund,  in  addition  to  the  amount
 deducted  pursuant  to subdivision one of each of section three thousand
 thirty-six or three  thousand  thirty-six-a  of  this  title,  shall  be
 deducted  from  the  amount otherwise payable to the city OR THE CITY OF
 STATEN ISLAND, AS THE CASE MAY BE, from  the  municipal  assistance  tax
 fund  and  shall not obligate the state to make, nor entitle the city OR
 THE CITY OF STATEN ISLAND to receive, any additional payments from  such
 municipal assistance tax fund.
   §  12-015.  Section 6 of section 2 of chapter 868 of the laws of 1975,
 constituting the New York state financial emergency act for the city  of
 New  York,  subdivision 1 as amended by chapter 777 of the laws of 1978,
 subdivision 3 as amended by chapter 869 of the laws of 1975 and subdivi-
 sion 4 as amended by chapter 201 of the laws of 1978, is amended to read
 as follows:
   § 6.  Administration of the board.  1.   The membership of  the  board
 shall  be  the  governor,  the state comptroller (pursuant to [his] SUCH
 OFFICIAL'S authority to supervise the accounts of any political subdivi-
 sion of the state), the mayor, the city comptroller, THE  MAYOR  OF  THE
 CITY OF STATEN ISLAND, THE COMPTROLLER OF THE CITY OF STATEN ISLAND, and
 three  members  appointed by the governor with the advice and consent of
 the senate.  At least two of the appointed members shall be residents of
 the city or have their principal place of business in  the  city.    THE
 MAYOR  OF  THE  CITY  OF STATEN ISLAND MAY RECOMMEND TO THE GOVERNOR THE
 APPOINTMENT OF ONE SUCH APPOINTED MEMBER.  Such appointed members  shall
 serve at the pleasure of the governor. The governor shall be the [chair-
 man]  CHAIRPERSON  of the board and the governor or [his] THE GOVERNOR'S
 representative shall preside over all meetings of the board.  The  board
 shall  act  by  majority vote of the entire board, PROVIDED, HOWEVER, ON
 MATTERS AFFECTING ONLY THE CITY, AS  DETERMINED  BY  THE  GOVERNOR,  THE
 STATE  COMPTROLLER  AND  THE APPOINTED MEMBERS, THE MAYOR OF THE CITY OF
 STATEN ISLAND AND THE COMPTROLLER OF THE CITY OF STATEN ISLAND SHALL NOT
 VOTE, AND ON MATTERS AFFECTING ONLY THE CITY OF STATEN ISLAND, AS DETER-
 MINED BY THE GOVERNOR, THE STATE COMPTROLLER AND THE APPOINTED  MEMBERS,
 THE  MAYOR  AND  THE CITY COMPTROLLER SHALL NOT VOTE. SUCH OFFICIALS NOT
 VOTING SHALL NOT BE CONSIDERED MEMBERS OF THE BOARD  FOR  DETERMINING  A
 S. 8474                            130
 
 MAJORITY.   The board shall maintain a record of its proceedings in such
 form as it may determine, but such record shall indicate attendance  and
 all votes cast by each member.  Every member of the board, who is other-
 wise  an  elected  official  of  the state or city, shall be entitled to
 designate a representative to attend, in [his]  SUCH  OFFICIAL'S  place,
 meetings  of  the board and to vote or otherwise act in [his] SUCH OFFI-
 CIAL'S behalf.  Written notice of such designation shall be furnished to
 the board by the designating member prior to  any  meeting  attended  by
 [his]  SUCH  OFFICIAL'S  representative.   Any such representative shall
 serve at the pleasure of the designating member.  No such representative
 shall be authorized to  delegate  any  of  [his]  SUCH  REPRESENTATIVE'S
 duties  or  functions  to  any  other person.   The lieutenant governor,
 temporary president of the senate, the minority leader  of  the  senate,
 speaker  and minority leader of the assembly, the president of the coun-
 cil of the city of New York, the city board of estimate acting by major-
 ity vote, THE SPEAKER AND THE MINORITY LEADER OF THE COMMON  COUNCIL  OF
 THE  CITY  OF STATEN ISLAND and the [vice-chairman] VICE-CHAIRPERSON and
 the minority leader of the council of the city of New York,  shall  each
 be  entitled to appoint a representative to the board.  Each such repre-
 sentative shall be entitled to receive notice of and to attend all meet-
 ings of the board but shall not be entitled to vote.  No  representative
 shall  be  an  employee or officer of the federal, state or city govern-
 ments.  Each representative shall serve at the pleasure of the  appoint-
 ing  official  or  body,  shall be eligible for reappointment, and shall
 hold  office  until  [his]  SUCH  REPRESENTATIVE'S  successor  has  been
 appointed.
   2.    Notwithstanding  any  inconsistent  provisions  of law, general,
 special or local, no officer or employee  of  the  state,  or  political
 subdivision  of  the state, any governmental entity operating any public
 school or college or other public agency or instrumentality or  unit  of
 government  which  exercises  governmental  powers under the laws of the
 state, shall forfeit [his] SUCH PERSON'S office or employment by  reason
 of  [his] SUCH PERSON'S acceptance or appointment as a member, represen-
 tative, officer, employee or agent of the board  nor  shall  service  as
 such  member, representative, officer, employee or agent of the board be
 deemed incompatible or in conflict with such office or employment.
   3.  The members of the board appointed by the governor and all  repre-
 sentatives designated by members of the board shall serve without salary
 or  per diem allowance but shall be entitled to reimbursement for actual
 and necessary expenses incurred in the performance  of  official  duties
 under  this  act, provided however that such members and representatives
 are not, at the time such expenses are incurred, public employees other-
 wise entitled to such reimbursement.
   4.  The governor and the mayor, jointly, shall  appoint  an  executive
 director  of  the board who shall serve at the pleasure of the board and
 may be removed by the board.   The board may delegate to  the  executive
 director  or  to one or more of its other officers, employees or agents,
 such powers and duties as the board may deem proper, except  any  duties
 inconsistent  with  the  duties  and  functions  prescribed by any other
 office or position any such person may hold.
   § 12-016. Section 7 of section 2 of chapter 868 of the laws  of  1975,
 constituting  the New York state financial emergency act for the city of
 New York, paragraphs a, b, c, e, f and g of  subdivision  1,  paragraphs
 (b)  and  (f)  of  subdivision 3 and subdivisions 4 and 6 as amended and
 subdivision 7 as added by chapter 777 of the laws of 1978,  paragraph  h
 of  subdivision  1  as amended by chapter 870 of the laws of 1975, para-
 S. 8474                            131
 
 graphs d and i of subdivision 1 as amended by chapter 830 of the laws of
 1987, subdivisions 3 and 5 as added by chapter 201 of the laws of  1978,
 and paragraph (i) of subdivision 3 as amended by chapter 285 of the laws
 of 1985, is amended to read as follows:
   §  7.  Functions of the board. 1. In carrying out the purposes of this
 act, the board shall perform the following functions:
   a. In accordance with the provisions of section eight of this act, the
 board shall (i) consult with the city and the covered organizations  AND
 TO  THE  EXTENT  IT  DEEMS IT NECESSARY OR APPROPRIATE TO ACCOMPLISH THE
 PURPOSES OF THIS ACT, THE CITY OF STATEN ISLAND, in the  preparation  of
 the  financial  plan,  and  certify  to  the  city the revenue estimates
 approved therein, (ii) prescribe the form of the financial plan and  the
 supporting information required in connection therewith, and (iii) exer-
 cise  the  rights of approval, disapproval and modification with respect
 to the financial plan, including but not limited to  the  revenue  esti-
 mates contained therein.
   b.    The board, to the extent it deems it necessary or appropriate in
 order to accomplish the purposes of this act, shall establish and  adopt
 procedures with respect to the (i) proper maintenance of the board fund,
 (ii)  the  deposit  and  investment  of  revenues in such fund and (iii)
 disbursement of monies from such fund.
   c. The board shall, from time to time  and  to  the  extent  it  deems
 necessary  or  appropriate  in  order to accomplish the purposes of this
 act, (i) review the operations, management, efficiency and  productivity
 of such city operations and of such covered organizations OR OF THE CITY
 OF  STATEN  ISLAND  or  portions thereof as the board may determine, and
 make reports thereon; (ii) audit compliance with the financial  plan  in
 such  areas as the board may determine; (iii) recommend to the city, THE
 CITY OF STATEN ISLAND and the covered organizations such measures relat-
 ing to their operations, management, efficiency and productivity  as  it
 deems  appropriate to reduce costs and improve services so as to advance
 the purposes of this act; and (iv) obtain information of  the  financial
 condition  and  needs  of  the  city,  THE CITY OF STATEN ISLAND and the
 covered organizations. Nothing herein shall diminish the powers  of  the
 comptroller  otherwise  provided  by  law  and the board may request the
 assistance of the comptroller in performing the above functions.
   d. The board (i) shall receive from the city and review the reports to
 be prepared by or on behalf of the city  pursuant  to  section  seven-a;
 (ii)  shall  receive  from  the  city, THE CITY OF STATEN ISLAND and the
 covered organizations and from the deputy comptroller, and shall  review
 such  financial  statements and projections, budgetary data and informa-
 tion, and management reports and materials as the board deems  necessary
 or  desirable  to  accomplish  the purposes of this act; and (iii) shall
 inspect, copy and audit such books and records of the city, THE CITY  OF
 STATEN ISLAND and the covered organizations as the board deems necessary
 or desirable to accomplish the purposes of this act.
   e.  All contracts entered into by the city or any covered organization
 AND, TO THE EXTENT THE BOARD DEEMS NECESSARY OR DESIRABLE TO  ACCOMPLISH
 THE  PURPOSES OF THIS ACT, BY THE CITY OF STATEN ISLAND must be consist-
 ent with the provisions of this act and must comply  with  the  require-
 ments  of  the  financial plan as approved by the board. With respect to
 all contracts or other obligations to be entered into by the city or any
 covered organization after October fifteenth, nineteen hundred  seventy-
 five,  requiring  the  payment of funds or the incurring of costs by the
 city or any covered organization:
 S. 8474                            132
 
   (i) Within twenty days from the effective date of this act  the  mayor
 shall  present  to the board proposed regulations respecting the catego-
 ries and types  of  contracts  and  other  obligations  required  to  be
 reviewed  by  the  board pursuant to this subdivision [e]. Within thirty
 days  from  the  effective  date of this act, the board shall approve or
 modify and approve such proposed regulations or promulgate  its  own  in
 the  event that such proposed regulations are not submitted to it within
 the twenty days as provided for herein. Such regulations may  thereafter
 be  modified by the board from time to time on not less than thirty days
 notice to the mayor and the mayor may from time to time propose  modifi-
 cations  to  the  board. Unless expressly disapproved or modified by the
 board within thirty days from the date of submission by the  mayor,  any
 such  proposed  regulations or modifications shall be deemed approved by
 the board;
   (ii) Prior to entering into any contract or other obligations  subject
 to  review  of  the board under its regulations, the city or any covered
 organization AND, TO THE EXTENT THE BOARD DEEMS NECESSARY  OR  DESIRABLE
 TO  ACCOMPLISH THE PURPOSES OF THIS ACT, THE CITY OF STATEN ISLAND shall
 submit a copy of such contract or other obligation to the board accompa-
 nied by an analysis of the projected costs of  such  contract  or  other
 obligation  and  a  certification  that  performance  thereof will be in
 accordance with the financial plan, all in such form and with such addi-
 tional information as the board may prescribe. The board shall  promptly
 review the terms of such contract or other obligation and the supporting
 information in order to determine compliance with the financial plan;
   (iii)  During  a  control period the board shall, by order, disapprove
 any contract or other obligation reviewed by it  only  upon  a  determi-
 nation  that, in its judgment, the performance of such contract or other
 obligation would be inconsistent with the financial plan and  the  city,
 THE  CITY  OF STATEN ISLAND or covered organization shall not enter into
 such contract or other obligation;
   (iv) During a control period if the board  approves  the  terms  of  a
 reviewed  contract or other obligation, the city or covered organization
 AND, TO THE EXTENT THE BOARD DEEMS NECESSARY OR DESIRABLE TO  ACCOMPLISH
 THE  PURPOSES OF THIS ACT, THE CITY OF STATEN ISLAND may enter into such
 contract or other obligation upon the  terms  submitted  to  the  board.
 Failure  of  the  board to notify the city, THE CITY OF STATEN ISLAND or
 covered organization within thirty days (or  such  additional  time  not
 exceeding  thirty  days  as  the  board  shall have notified the city or
 covered organization, that it requires to complete its review and analy-
 sis) after submission to it of a contract or other obligation that  such
 contract  or  other  obligation  has been disapproved shall be deemed to
 constitute board approval thereof.
   f. Upon submission thereof by the city, the  board  shall  review  the
 terms  of  each  proposed long-term and short-term borrowing by the city
 and any covered organization to be effected during a control period  but
 after  October  fifteenth,  nineteen  hundred  seventy-five, and no such
 borrowing shall be made unless approved by the board.  TO THE EXTENT THE
 BOARD DEEMS NECESSARY OR DESIRABLE TO ACCOMPLISH THE  PURPOSES  OF  THIS
 ACT, DURING A CONTROL PERIOD, THE CITY OF STATEN ISLAND SHALL SUBMIT AND
 THE  BOARD  SHALL REVIEW THE TERMS OF EACH PROPOSED LONG-TERM AND SHORT-
 TERM BORROWING BY THE CITY OF STATEN ISLAND AND NO SUCH BORROWING  SHALL
 BE  MADE UNLESS APPROVED BY THE BOARD. Each such proposed borrowing by a
 covered organization shall be submitted  to  the  city  by  the  covered
 organization  before  it  may  be considered by the board. Not more than
 thirty days after any such submission by a covered organization the city
 S. 8474                            133
 
 shall transmit any such proposed terms of borrowing to the board togeth-
 er with the certification of the city as to whether such proposed  terms
 of  borrowing are in accordance with the financial plan and are consist-
 ent  with  the objectives and purposes of this act.  Any such submission
 to the city shall be accompanied  by  a  certification  of  the  covered
 organization that the terms thereof are in accordance with the financial
 plan and are consistent with the objectives or purposes of this act. The
 transmittal  by  the city to the board shall include a recommendation by
 the city for the approval or  disapproval  of  such  proposed  terms  of
 borrowing  pursuant  to  the  terms of this paragraph.  In the event the
 city does not make such transmittal within such thirty day period,  such
 covered  organization may submit such proposed borrowing directly to the
 board. The board shall disapprove any borrowing if  it  determines  that
 such borrowing is inconsistent with the financial plan or the objectives
 or purposes of this act. The board shall consult and coordinate with the
 municipal  assistance  corporation for the city of New York with respect
 to borrowings of the city and any covered organization and shall receive
 reports from the [muncipal] MUNICIPAL  assistance  corporation  for  the
 city  of  New  York  on its review of borrowings by the city. No covered
 organizations shall be prohibited from issuing bonds  or  notes  to  pay
 outstanding bonds or notes.
   g.  The board and the comptroller shall receive quarterly reports from
 the city comptroller setting forth the debt service requirements on  all
 bonds  and  notes  of  the  city  and  the covered organizations for the
 following quarter, which reports shall be in such form and contain  such
 information  as  the board shall determine. Such reports shall be issued
 no later than sixty days prior to the start of the quarter to which they
 pertain and shall be updated immediately upon each issuance of bonds  or
 notes  after  the  date  of  such  report  to reflect any change in debt
 service requirements as a result of such issuance. The board also  shall
 receive  from  the  city  monthly and quarterly financial reports, which
 reports shall be in such form and contain such information as the  board
 shall  determine  and shall be made available by the city to the public.
 In order to avoid duplicative reports and reporting requirements, to the
 extent that the city is required to submit monthly or  quarterly  finan-
 cial reports to the department of the treasury pursuant to any agreement
 or  arrangement  made  in connection with federal guarantees of notes or
 boards issued by the city or a state financing agency,  copies  of  such
 reports  shall  be submitted to the board in satisfaction of the monthly
 and quarterly reporting requirements set forth above, together with such
 additional information as the board may require. Each monthly and  quar-
 terly  report herein required to be submitted to the board must indicate
 any variance between actual and budgeted revenues, expenses or cash  for
 the  period  covered  by  such report.   DURING A CONTROL PERIOD, TO THE
 EXTENT THE BOARD DEEMS NECESSARY OR DESIRABLE TO ACCOMPLISH THE PURPOSES
 OF THIS ACT, THE CITY OF STATEN ISLAND SHALL  BE  SUBJECT  TO  THE  SAME
 REPORTING REQUIREMENTS AS THE CITY.
   h.  The  board  shall issue, to the appropriate officials of the city,
 THE CITY OF STATEN ISLAND and the covered organizations, such orders  as
 it deems necessary to accomplish the purposes of this act, including but
 not  limited  to  timely  and satisfactory implementation of an approved
 financial plan. Any order so issued shall be binding upon  the  official
 to  whom  it  was  issued  and  failure  to comply with such order shall
 subject the official to the penalties described  in  section  eleven  of
 this act.
 S. 8474                            134
 
   i.  The  board  shall  coordinate with the municipal assistance corpo-
 ration for the city of New York and the deputy comptroller with  respect
 to  the  performance  of  its  review and monitoring of the revenues and
 expenditures of the city and the covered organizations.
   2. In the event of any default by the city on its outstanding bonds or
 notes,  and  so long as such default has not been cured BY THE CITY, the
 board may, any provisions of this act notwithstanding, take  any  action
 that  it is authorized to take pursuant to title six-A of article two of
 the local finance law, and may direct the city to take any  action  that
 the city is authorized to take under such law.
   3.  (a)  Notwithstanding any provision of the New York City Collective
 Bargaining Law, codified as chapter [fifty-four] THREE OF  TITLE  TWELVE
 of  the New York city administrative code, or any general or special law
 to the contrary, any  report  or  recommendation  of  an  impasse  panel
 constituted  pursuant  to such chapter which provides for an increase in
 wages or fringe benefits of any employee of the city or  covered  organ-
 ization,  in  addition to considering any standard or factor required to
 be considered by applicable law, including the standards  enumerated  in
 section [1173-7.0] 12-311(c)(3)(b) of such chapter, shall also take into
 consideration  and accord substantial weight to the financial ability of
 the city and or covered organization to pay the cost of such increase in
 wages or fringe benefits.
   (b) The board of collective bargaining constituted  pursuant  to  such
 chapter,  when reviewing such report or recommendation before proceeding
 to other issues, shall make a threshold determination as to whether such
 report or recommendation for an increase in wages or fringe benefits  is
 within  the  city's  and  or covered organization's financial ability to
 pay. If the threshold determination is in the negative, the matter shall
 be remitted to the impasse  panel  for  further  consideration.  If  the
 threshold determination is in the affirmative, the further review of the
 report  or  recommendation  with  respect to other issues, if any, shall
 proceed as provided by law. Unless the parties stipulate otherwise,  the
 threshold   determination   shall  be  made  within  thirty  days  after
 submission of the report or recommendation to the  board  of  collective
 bargaining.
   (c)  Any  determination  pursuant to article eight of the labor law or
 any agreement or stipulation entered into in lieu thereof which provides
 for an increase in wages or fringe benefits of any employee of the  city
 or  covered  organization shall, in addition to considering any standard
 or factor required to be considered by applicable law,  also  take  into
 consideration  and accord substantial weight to the financial ability of
 the city and or covered organization to pay the cost of such increase.
   (d) Any report or recommendation of a fact  finding  or  similar  type
 panel  or  any interest arbitration award which provides for an increase
 in wages or fringe benefits of any  employee  of  the  city  or  covered
 organization  not subject to the provisions of the New York City Collec-
 tive Bargaining Law, codified as chapter  [fifty-four]  THREE  OF  TITLE
 TWELVE  of  the New York city administrative code, shall, in addition to
 considering any standard or factor required to be considered by applica-
 ble law, also take into consideration and accord substantial  weight  to
 the financial ability of the city and or covered organization to pay the
 cost of such increase.
   (e)  Any party to a proceeding before the board of collective bargain-
 ing as described in paragraph (b) or other body as  described  in  para-
 graphs  (c)  or  (d) [hereof] OF THIS SUBDIVISION may commence a special
 proceeding in the appellate division, first department,  supreme  court,
 S. 8474                            135
 
 state  of New York, to review the threshold determination as to the city
 and/or covered organization's financial ability to pay. Such  proceeding
 shall  be  commenced not later than thirty days after the final determi-
 nation  has  been made by the board of collective bargaining in the case
 of paragraph (b) or other body in the case of paragraphs (c) or  (d)  OF
 THIS  SUBDIVISION.  Such proceeding shall have preference over all other
 causes in such appellate division, other than  causes  relating  to  the
 election law.
   (f) The court shall make a de novo review of the record solely for the
 purpose  of  determining  whether  an  award  of an increase in wages or
 fringe benefits was within the  city's  and  or  covered  organization's
 financial ability to pay. The court's findings as to such issue shall be
 based  upon a preponderance of all the evidence set forth in the record.
 Unless the parties stipulate otherwise, arguments or submission shall be
 had within fifteen days after commencement of the special proceeding and
 the court shall render its decision within fifteen days thereafter.  All
 questions,  other  than  the question relating to the threshold determi-
 nation, shall be reviewed by the appellate division in the same proceed-
 ing in the manner provided by articles seventy-five or seventy-eight  of
 the  civil practice law and rules as may be appropriate, notwithstanding
 that the issue  would  otherwise  have  been  cognizable  in  the  first
 instance  before  a  special  or  trial term of the supreme court. If an
 appeal shall otherwise lie from  such  determination  of  the  appellate
 division  to  the court of appeals, notice of such appeal shall be filed
 within thirty days after the entry of the final order or judgment of the
 appellate division if such appeal is of right or within ten  days  after
 entry  of  an  order granting leave to appeal and such appeal shall have
 preference over all other appeals other than  appeals  relating  to  the
 election law.
   (g) At any stage of any proceeding under paragraphs (a), (b), (c), (d)
 and  (e)  hereof  or any appeal from an order or judgment therefrom, the
 board may intervene as a party on the issue of the financial ability  of
 the  city  and or covered organization to pay the cost of an increase in
 wages or fringe benefits.
   (h) For the purposes of this subdivision,  financial  ability  to  pay
 shall mean the financial ability of the city and or covered organization
 to  pay  the  cost  of  any increase in wages or fringe benefits without
 requiring an increase in the level of city taxes existing at the time of
 the commencement of a proceeding under paragraph (a), (c) or (d) hereof.
   [(i) The provisions of this subdivision shall terminate on June  thir-
 tieth, nineteen hundred eighty-six.]
   4.  During  a  control  period,  except  upon approval by the board in
 accordance with the provisions of paragraph e or f of subdivision one of
 this section, as the board shall  determine,  neither  the  city  nor  a
 covered  organization  NOR,  TO  THE EXTENT THE BOARD DEEMS NECESSARY OR
 DESIRABLE TO ACCOMPLISH THE PURPOSES OF THIS ACT,  THE  CITY  OF  STATEN
 ISLAND shall enter any agreement or other arrangement, whether or not it
 creates  a  debt  of  the  city,  THE CITY OF STATEN ISLAND or a covered
 organization, pursuant to which the revenues or credit of  the  city  OR
 THE  CITY OF STATEN ISLAND may be directly or indirectly pledged, encum-
 bered, committed or promised, contingently or otherwise, for the payment
 of obligations of a public benefit corporation. Nothing in this subdivi-
 sion shall limit the right of the city to comply with the provisions  of
 any  existing  agreement  or  other  arrangement in respect of the obli-
 gations of a public benefit corporation.
 S. 8474                            136
 
   5. The board may employ such consultants as it may deem  necessary  to
 assist it in performing its functions required under this act.
   6.  The  board shall have the authority to make and execute agreements
 and all other instruments which the board deems necessary for the  exer-
 cise  of  its  powers  and  functions  including, in connection with any
 agreement by the federal government or  any  agency  or  instrumentality
 thereof  to  guarantee  the  payment  of the principal of or interest on
 bonds or notes issued by the city or by a  state  financing  agency,  to
 enter  into  one  or  more  agreements  containing  terms and conditions
 required by the secretary of the treasury pursuant to the New York  City
 Loan  Guarantee  Act of l978, Public Law 95-339 with the federal govern-
 ment or any agency or instrumentality thereof with respect to such guar-
 antee or any matters related thereto and to comply with such  terms  and
 conditions.
   7.  The  board  may  appoint  qualified  individuals to participate as
 members of such audit, productivity or similar committees or councils as
 the city may from time to time establish in consultation with the board.
 Such individuals, however, shall not be deemed to be officers, employees
 or agents of the board. The board shall review and report on,  not  less
 than annually, the development and implementation of methods for enhanc-
 ing  the  productivity  of  the  city's labor force proposed by any such
 committee or council.
   § 12-017. Section 8 of section 2 of chapter 868 of the laws  of  1975,
 constituting  the New York state financial emergency act for the city of
 New York, subdivisions 1, 2, 4, 5 and 6 as amended by chapter 201 of the
 laws of 1978, the opening paragraph and paragraph c  of  subdivision  1,
 subdivisions  2-a  and  3 as amended by chapter 777 of the laws of 1978,
 paragraph a of subdivision 1 as amended by chapter 118 of  the  laws  of
 2020, is amended to read as follows:
   §  8.   Development of the financial plan.  1.  Pursuant to the proce-
 dures contained in subdivision three of this section,    each  year  the
 city  AND TO THE EXTENT THE BOARD DEEMS NECESSARY OR DESIRABLE TO ACCOM-
 PLISH THE PURPOSES OF THIS ACT, THE CITY OF STATEN ISLAND shall develop,
 and may from time to time modify, with the approval of the board  during
 a  control  period, a four year financial plan covering the city and the
 covered organizations OR THE CITY OF STATEN ISLAND, AS APPLICABLE.
   Each such  financial plan and financial plan modification shall comply
 with the requirements of subdivision four of  this  section  and  shall,
 except  as  otherwise  provided  pursuant  to  subdivision two-a of this
 section, conform to the following standards:
   a. For its fiscal years ending June thirtieth, nineteen hundred seven-
 ty-nine through June thirtieth, nineteen hundred eighty-one, the  city's
 budget  covering  all  expenditures  other  than  capital items shall be
 prepared and balanced so that the results thereof would not show a defi-
 cit when reported in accordance with the accounting principles set forth
 in the state  comptroller's  uniform  system  of  accounts  for  munici-
 palities,  as  the same may be modified by the comptroller, in consulta-
 tion with the city comptroller, for application to the city; subject  to
 the provision of subdivision four of section three thousand thirty-eight
 of  the public authorities law with respect to contributions by the city
 or other public employer to any retirement system or  pension  fund  and
 subject to the provision of paragraph (c) of subdivision five of section
 three  thousand  thirty-eight of the public authorities law with respect
 to expense items included in the capital budget of  the  city.  For  the
 fiscal  year ending June thirtieth, nineteen hundred eighty-two, and for
 each fiscal year thereafter, the city's budget covering all expenditures
 S. 8474                            137
 
 other than capital items shall be prepared  and  balanced  so  that  the
 results  thereof  would  not  show a deficit when reported in accordance
 with generally accepted accounting principles and would  permit  compar-
 ison  of the budget with the report of actual financial results prepared
 in  accordance  with  generally  accepted  accounting  principles.  With
 respect  to  financial  plans  that include the fiscal years ending June
 thirtieth, nineteen hundred seventy-nine through June  thirtieth,  nine-
 teen  hundred  eighty-one,  the  city's budget covering all expenditures
 other than capital items shall be prepared in accordance with  generally
 accepted  accounting  principles and there shall be substantial progress
 in each such fiscal year towards achieving a city  budget  covering  all
 expenditures  other  than  capital  items the results of which would not
 show a deficit when  reported  in  accordance  with  generally  accepted
 accounting  principles.  The city shall eliminate expense items from its
 capital budget not later than the commencement of the fiscal year ending
 June thirtieth, nineteen hundred eighty-two. For the fiscal year  ending
 June  thirtieth,  nineteen hundred eighty-nine, and for each fiscal year
 thereafter, the budgets covering all  expenditures  other  than  capital
 items  of  each  of  the  covered  organizations  shall  be prepared and
 balanced so that the results thereof  would  not  show  a  deficit  when
 reported  in  accordance  with generally accepted accounting principles;
 and for each fiscal year  prior  thereto,  there  shall  be  substantial
 progress  towards  such  goal.  Notwithstanding  the  foregoing  and the
 provisions of any general or special state  law  or  local  law  to  the
 contrary,  including  but not limited to the New York city charter:  (i)
 all costs that would be  capital  costs  in  accordance  with  generally
 accepted  accounting principles, but for the application of governmental
 accounting standards board statement number forty-nine, shall be  deemed
 to  be capital costs for purposes of this act and any other provision of
 state or local law, including but not limited to the New York city char-
 ter, relevant to the treatment of such costs; and (ii) the determination
 as to the existence of a deficit pursuant to  this  act  and  any  other
 provision  of  state  or local law, including but not limited to the New
 York city charter, shall be made without regard to changes in restricted
 fund balances, as  defined  by  the  governmental  accounting  standards
 board,  where restrictions in relation to such fund balances are imposed
 by state or federal law  or  regulation,  or  otherwise  by  private  or
 governmental parties other than the city of New York, and without regard
 to  funds  held  in  the  health stabilization fund, the school crossing
 guards health insurance fund, any revenue stabilization fund established
 pursuant to section fifteen hundred twenty-eight of the  New  York  city
 charter  and the management benefits fund established by the city of New
 York. Deposits into any such revenue stabilization fund shall be  deemed
 to  be  expenses  of such city in the fiscal year in which such deposits
 are made, and withdrawals from such fund shall be deemed to be  revenues
 of  such  city  in the year in which such withdrawals are made; provided
 however, that surpluses of such city, whether  accumulated  from  fiscal
 years  ending  prior to the effective date of the chapter of the laws of
 two thousand twenty that amended this paragraph or existing at the close
 of any fiscal year ending after such effective date, shall be  deposited
 into  such  revenue  stabilization fund as soon as practicable, and such
 deposits shall not be deemed expenses of the city in the fiscal year  in
 which such deposits are made.
   b.  The limitations on its outstanding short-term obligations required
 by subdivision nine of section three thousand thirty-eight of the public
 S. 8474                            138
 
 authorities law and by section nine-b of this act shall be  observed  at
 all times, as each is amended from time to time.
   c.    Provision  shall  be  made  for  the payment in full of the debt
 service on all bonds and notes of the city and the covered organizations
 (other than notes held by the municipal assistance corporation  for  the
 city  of  New York to the extent that such corporation has evidenced its
 intention not to present such notes for payment during the  fiscal  year
 in which the determination is made provided that such notes were held by
 such  corporation  on  June thirtieth, nineteen hundred seventy-eight or
 were issued in exchange for or in refunding or renewal of notes held  by
 such  corporation on such date) AND TO THE EXTENT THE BOARD DEEMS NECES-
 SARY OR DESIRABLE TO ACCOMPLISH THE PURPOSES OF THIS ACT,  THE  CITY  OF
 STATEN  ISLAND,  for  the  adequate funding of programs of the city, THE
 CITY OF STATEN ISLAND, IF APPLICABLE and the covered organizations which
 are mandated by state or federal law and for which obligations are going
 to be incurred during the fiscal year and for payment of a guarantee fee
 or any other amounts required by the United States  of  America  or  any
 agency  or  instrumentality  thereof in connection with the guarantee of
 the payment of the principal of or interest on bonds or notes issued  by
 the city.
   d.  All projections of revenues and expenditures contained in a finan-
 cial  plan  shall be based on reasonable and appropriate assumptions and
 methods of estimation.  All cash flow projections shall  be  based  upon
 reasonable  and  appropriate  assumptions as to sources and uses of cash
 (including but not limited to the timing thereof), and shall provide for
 operations of the city, THE CITY OF STATEN  ISLAND,  IF  APPLICABLE  and
 covered  organizations  to  be  conducted  within  the cash resources so
 projected.
   e.  The city shall provide a general reserve for each fiscal  year  to
 cover potential reductions in its projected revenues or increases in its
 projected  expenditures  during  each  such  fiscal  year.    The amount
 provided for such general reserve shall be  estimated  by  the  city  in
 accordance  with  paragraph d of this subdivision, but in no event shall
 it be less than one hundred million dollars  at  the  beginning  of  any
 fiscal year.
   f.    For  financial  plans beginning with the fiscal year ending June
 thirtieth, nineteen hundred eighty-three or any succeeding fiscal  year,
 the  first  fiscal  year  included  in  any  financial  plan  shall make
 provision for the repayment of any deficit incurred by the  city  during
 the preceding fiscal year.
   2.   In developing the financial plan the city shall seek to achieve a
 stabilized work force for the city and, to the extent a reduction in the
 work force is required, primary recourse shall be had to  the  attrition
 process to accomplish such reduction.
   2-a.    The  city  and the board shall confer concerning the projected
 effect on the budgets of the city and the covered organizations  of  any
 change  in  generally  accepted  accounting principles, or change in the
 application of generally accepted accounting principles to the city  and
 the  covered  organizations,  made after the effective date of this act.
 If the board determines that immediate compliance with such change  will
 have  a  material effect on such budgets over a time period insufficient
 to accommodate the effect without a substantial adverse  impact  on  the
 delivery  of  essential  services, the board may authorize and approve a
 method of phasing the requirements of such change into such budgets over
 such reasonably expeditious time period as the board deems appropriate.
 S. 8474                            139

   3.  The financial plan shall be developed and, during a control  peri-
 od, shall be approved, and may from time to time be modified, in accord-
 ance with the following procedures:
   a.    The  city  shall, by June first, nineteen hundred seventy-eight,
 prepare and submit a financial plan to the board covering the four  year
 period which begins with the fiscal year ending June thirtieth, nineteen
 hundred  seventy-nine.   Thereafter,  at  least  fifty days prior to the
 beginning of each fiscal year or on such other date  as  the  board  may
 approve  upon  the  request of the city OR THE CITY OF STATEN ISLAND, IF
 APPLICABLE, the city, AND, DURING A CONTROL PERIOD, TO  THE  EXTENT  THE
 BOARD  DEEMS  NECESSARY  OR DESIRABLE TO ACCOMPLISH THE PURPOSES OF THIS
 ACT, THE CITY OF STATEN ISLAND shall prepare and submit a financial plan
 to the board covering the four year period beginning  with  such  fiscal
 year.  On such dates the mayor shall also submit to the board the city's
 executive  expense,  revenue  and capital budgets for the ensuing fiscal
 year and a certificate of  the  mayor  stating  that  such  budgets  are
 consistent with the financial plan submitted therewith, that projections
 contained  in  the  budgets and financial plan are based upon reasonable
 and appropriate assumptions and methods of estimation, and  that  opera-
 tion within the budgets is feasible.
   b.   (i)  During a control period the board shall promptly review each
 financial plan and financial plan modification submitted by the city OR,
 THE CITY OF STATEN ISLAND, IF APPLICABLE.  Not more than forty-five days
 after submission of a financial plan or  more  than  thirty  days  after
 submission  of  a  financial plan modification the board shall determine
 whether the financial plan or financial plan  modification  is  complete
 and  complies  with  the  standards set forth in subdivision one of this
 section and shall approve or disapprove the financial plan or  financial
 plan modification in accordance with the provisions of this section.  If
 the board determines that the financial plan or financial plan modifica-
 tion  is  complete and complies with the standards set forth in subdivi-
 sion one of this section, the board shall approve the financial plan  or
 financial  plan modification.   Upon making such determination the board
 shall make a certification to the city OR, THE CITY OF STATEN ISLAND, IF
 APPLICABLE, setting forth revenue estimates approved  by  the  board  in
 accordance with such determination.
   (ii)   At all times other than during a control period the board shall
 promptly review each financial  plan  and  financial  plan  modification
 submitted  by  the city.  If the board determines after such review that
 the financial plan or financial plan modification submitted by the  city
 is  not in accordance with the standards set forth in subdivision one of
 this section, the board shall promptly so notify the city and  may  take
 such other action under this act as it deems appropriate.
   c.    The  board  shall  disapprove a financial plan or financial plan
 modification if during a control period it determines that the financial
 plan or financial plan modification is incomplete  or  fails  to  comply
 with the provisions of subdivision one of this section.  In disapproving
 a  financial  plan  or a financial plan modification the board may order
 that one or more of the following actions be taken:
   (i)  expenditures  or  reserves  to  assure  availability  of  amounts
 required  for  debt  service  requirements on all bonds and notes of the
 city, THE CITY OF STATEN ISLAND, IF APPLICABLE and the covered organiza-
 tions or expenditures required for adequate funding of programs  of  the
 city, THE CITY OF STATEN ISLAND, IF APPLICABLE and the covered organiza-
 tions  mandated  by  state  or federal law and for which obligations are
 S. 8474                            140
 
 going to be incurred during the fiscal year, be increased to the  levels
 required to provide for their payment in full;
   (ii)  the  revenue projections (or any item thereof) during any period
 be adjusted to comply with the standards set forth in subdivision one of
 this section; and
   (iii) the aggregate expenditures projected for any period  be  reduced
 to  conform  to  revenue  estimates  certified  by the board in order to
 comply with the standards set forth in subdivision one of this section.
   d.  During a control period in the event that the city OR THE CITY  OF
 STATEN  ISLAND,  IF  APPLICABLE  shall, for any reason, fail to submit a
 financial plan prior to the beginning of a fiscal year, as  required  by
 paragraph a of this subdivision, or in the event that the board has not,
 for  any  reason  permitted  under  this  act, approved a financial plan
 submitted by the city OR THE CITY OF STATEN ISLAND, IF APPLICABLE  prior
 to the beginning of a fiscal year, the board shall formulate and adopt a
 financial plan to be effective until the board approves a financial plan
 submitted  by the city OR THE CITY OF STATEN ISLAND, IF APPLICABLE.  Any
 financial plan so formulated by the board shall comply with  the  stand-
 ards  set  forth  in  subdivision one of this section.   The budgets and
 operations of the city OR THE CITY OF STATEN ISLAND, IF  APPLICABLE  and
 the  covered  organizations  at  all  times  shall be in conformance and
 compliance with the RESPECTIVE financial plan then in effect.
   e.  After the initial adoption by the city, or  the  approval  by  the
 board  during  a  control  period,  OR,  DURING A CONTROL PERIOD, TO THE
 EXTENT THE BOARD DEEMS NECESSARY OR DESIRABLE TO ACCOMPLISH THE PURPOSES
 OF THIS ACT, THE INITIAL ADOPTION BY THE CITY OF  STATEN  ISLAND,  of  a
 financial plan, projections of revenues and expenditures and other esti-
 mates  contained  in the financial plan shall be reexamined by the board
 at least quarterly in consultation with the city and the covered  organ-
 izations,  and  during  a  control period the city OR THE CITY OF STATEN
 ISLAND, AS APPLICABLE shall prepare and submit to  the  board  financial
 plan  modifications  at  such times, in such detail and within such time
 periods as the board may require  in  order  to  modify  the  RESPECTIVE
 financial  plan to conform to the standards set forth in subdivision one
 of this section.  During a control period in the event the board  deter-
 mines  that (i) revenue estimates (or any item thereof) must be adjusted
 to ensure compliance with the standards set forth in subdivision one  of
 this  section,  or  (ii)  that the city or a covered organization OR THE
 CITY OF STATEN ISLAND, AS APPLICABLE is expending funds at a  rate  that
 would  cause expenditures to exceed the aggregate expenditure limitation
 for the city or covered organization OR THE CITY OF  STATEN  ISLAND,  AS
 APPLICABLE  provided  for in the financial plan then in effect, prior to
 the expiration of the fiscal year,  the  city  OR  THE  CITY  OF  STATEN
 ISLAND,  AS  APPLICABLE  shall  submit  a financial plan modification to
 effect such adjustments in revenue estimates  and  reductions  in  total
 expenditures  as may be necessary to conform to such standards or aggre-
 gate expenditure limitations.  If during a control period the city fails
 to submit such modification after such determination as  to  adjustments
 in  revenue estimates or such determination as to rates of expenditures,
 or to submit a financial plan modification in the detail or  within  the
 time  period  specified  by the board, or if such modification is disap-
 proved by the board as not conforming to  the  standards  set  forth  in
 subdivision  one of this section, the board may formulate and adopt such
 financial plan modification as it deems appropriate to ensure  that  the
 financial plan WITH RESPECT TO SUCH ENTITY continues to meet such stand-
 ards.    Such  modification  shall  become  effective  on  its adoption.
 S. 8474                            141
 
 Notwithstanding the provisions of this section, in the event the city OR
 THE CITY OF STATEN ISLAND, AS APPLICABLE shall determine  that,  due  to
 unforeseen  events  during  a fiscal year, compliance with the standards
 set forth in paragraph a of subdivision one of this section would result
 in  a  material  adverse impact upon the delivery of essential services,
 the city OR THE CITY OF STATEN ISLAND, AS APPLICABLE  shall  notify  the
 board of such determination, together with such information, projections
 or  analyses relating thereto as the board may require, and shall submit
 a modification to the  financial  plan  reflecting  such  determination.
 During a control period the board shall disapprove any such modification
 unless it finds that (i) [the city's] SUCH determination is supported by
 information, projections and analyses which the board deems substantial-
 ly  accurate in all material respects and (ii) such events, in its judg-
 ment, warrant such modification to the  financial  plan  to  avoid  such
 adverse impact on the delivery of essential services.
   f.    The  city  OR  THE CITY OF STATEN ISLAND may, from time to time,
 submit financial plan modifications TO  EACH  PLAN  for  review  by  the
 board.    During a control period the board shall approve such modifica-
 tions unless it determines that   such  modifications  would  constitute
 grounds for disapproval of the financial plan pursuant to paragraph c of
 this  subdivision,  or  if  applicable,  pursuant to paragraph e of this
 subdivision.
   g.  Anything contained in this act to  the  contrary  notwithstanding,
 during  a  control  period the board may at any time disapprove or after
 consultation with the city OR THE CITY OF STATEN ISLAND, AS APPROPRIATE,
 revise the revenue estimates (or any item thereof) prepared by the  city
 OR  THE  CITY  OF STATEN ISLAND in connection with the preparation  of a
 financial plan or any modification thereto and determined by  the  board
 not  to  be  based  on  assumptions  and methods of estimation which are
 reasonable and appropriate under the circumstances and in  view  of  the
 objectives  and  purposes  of the act.  The board may after consultation
 with the city OR THE CITY OF STATEN ISLAND,  AS  APPROPRIATE,  determine
 the  estimated  revenues  of  the  city OR THE CITY OF STATEN ISLAND, AS
 APPROPRIATE, and the covered organizations provided, however,  that  any
 revenues  estimated by the board shall be based on reasonable and appro-
 priate assumptions and methods of estimation.
   4.  Each financial plan shall be in such form and shall  contain  such
 information  for  each year during which the financial plan is in effect
 as the board may specify,  and shall, in such detail as  the  board  may
 from  time  to  time  prescribe,  include  projections  of all revenues,
 expenditures and cash flows (including  but  not  limited  to  projected
 capital  expenditures  and  debt  issuances) and a schedule of projected
 capital commitments of the city OR THE CITY OF STATEN ISLAND, AS  APPRO-
 PRIATE,  and  except in such instances as the board may deem appropriate
 each of the covered organizations.  In addition, each financial plan and
 financial plan modification shall include a statement of the significant
 assumptions and methods of estimation used in arriving  at  the  projec-
 tions  contained  therein,  set forth in such form and in such detail as
 the board may from time to time prescribe.
   5.  The city and the covered organizations AND DURING A CONTROL PERIOD
 TO THE EXTENT THE BOARD DEEMS NECESSARY OR DESIRABLE TO  ACCOMPLISH  THE
 PURPOSES  OF  THIS ACT, THE CITY OF STATEN ISLAND shall promptly furnish
 the board with any information which the board may  request  to  satisfy
 itself  that  (i)  projected  employment  levels,  collective bargaining
 agreements  and  other  action  relating  to  employee  costs,   capital
 construction  and  such  other  matters  as  the  board may specify, are
 S. 8474                            142
 
 consistent with the provisions made for  such  costs  in  the  financial
 plan,  (ii) the city and the covered organizations OR THE CITY OF STATEN
 ISLAND,  AS  APPROPRIATE  are  taking  whatever action is necessary with
 respect  to  programs  mandated  by state and federal law to ensure that
 expenditures for such programs are limited to and covered by the expend-
 itures stated in the financial plan, and  (iii)  adequate  reserves  are
 provided  to maintain programs mandated by state and federal law and for
 which obligations are going to be incurred in the fiscal year and  other
 essential  programs  in  the  event  revenues have been overestimated or
 expenditures underestimated for any period.
   6. For each financial plan  and  financial  plan  modification  to  be
 prepared  and  submitted  by  the  city  to  the  board  pursuant to the
 provisions of this section, the covered organizations  shall  submit  to
 the city  such information with respect to their projected expenditures,
 revenues,  cash  flows  and  a schedule of projected capital commitments
 for each year covered by such financial plan or modification as the city
 shall determine.   Notwithstanding any other provision of  law  limiting
 the  authority of the city with respect to any covered organization, the
 city, in the preparation  and  submission  of  the  financial  plan  and
 modifications  thereof,  shall  (except  for  debt  service or for other
 expenditures to the extent that such expenditures are required  by  law)
 have  the  power to determine the aggregate expenditures to be allocated
 to any covered organization in the financial plan and any  modifications
 thereto.
   §  12-018.  Section 9 of section 2 of chapter 868 of the laws of 1975,
 constituting the New York state financial emergency act for the city  of
 New  York, as amended by chapter 201 of the laws of 1978 and the section
 heading and subdivisions 1 and 4 as amended by chapter 777 of  the  laws
 of 1978, is amended to read as follows:
   §  9.   Establishment and application of the board fund.  1.  There is
 hereby established a fund designated the   board fund.    Commencing  on
 October  twentieth,  nineteen hundred seventy-five, and for the duration
 of a control period, all revenues received or to be received by the city
 or any covered organization AND TO THE EXTENT THE BOARD DEEMS  NECESSARY
 OR  DESIRABLE TO ACCOMPLISH THE PURPOSES OF THIS ACT, THE CITY OF STATEN
 ISLAND shall, unless exempted by order of the board, be revenues of  the
 board  fund and shall be for the account of the city, THE CITY OF STATEN
 ISLAND or the appropriate  covered  organizations,  except  (i)  to  the
 extent  expressly  prohibited by federal law, (ii) where revenues of the
 city are deposited in the  general  debt  service  fund,  the  TAN  debt
 service  account  or  the RAN debt service account, or (iii)  where such
 revenues are pledged to the payment of any outstanding bonds,  notes  or
 other  obligations  of covered organizations or state public authorities
 as defined in section  two  hundred  one  of  the  civil  service  law.
 Disbursement  from  the board fund shall be made by the board in accord-
 ance with the approved financial plan except as provided in  subdivision
 five  of  this section nine.   Commencing on October twentieth, nineteen
 hundred seventy-five, and for the duration  of  a  control  period,  all
 funds  and  accounts  established or thereafter established by the city,
 THE CITY OF STATEN ISLAND or the  covered  organizations  shall,  unless
 exempted  by order of the board, thereafter be funds and accounts of the
 board fund except to the extent expressly prohibited by federal  law  or
 to  the  extent  pledged  by  covenants  or  agreements  relating to any
 outstanding bonds, notes or other obligations of  covered  organizations
 or public authorities as defined in section two hundred one of the civil
 service  law;  and  no  monies or funds held in the general debt service
 S. 8474                            143
 
 fund, the TAN debt service account or the RAN debt service account shall
 be part of the board fund.  All such accounts of the  board  shall  have
 such  captions  and entries as the board shall determine to be necessary
 to  credit  the  foregoing revenues and receipts to the board fund.  The
 monies of the fund shall not be deemed to be money of the state or money
 under its control.
   2.  The deposit of revenues into the board fund and the investment  or
 deposit  of monies therein shall be made in accordance with and pursuant
 to procedures established by the board.
   3.  In order to assure compliance with the financial plan,  the  board
 shall from time to time adopt procedures controlling the disbursement of
 monies  from  the board fund.  The board shall authorize the city OR, IF
 APPLICABLE, THE CITY OF STATEN  ISLAND  to  make  all  disbursements  of
 [city]  SUCH  ENTITY'S revenues from the board fund, which disbursements
 shall be made in accordance with the approved financial plan;  provided,
 that the board may withdraw such authorization if it determines that (a)
 any  disbursements made or to be made by the city OR, IF APPLICABLE, THE
 CITY OF STATEN ISLAND have not been or are likely not to be  in  compli-
 ance  with  the approved financial plan, (b) the city OR, IF APPLICABLE,
 THE CITY OF STATEN ISLAND has violated any other provisions of this act,
 or (c) the city has violated an agreement with any holder  or  guarantor
 of bonds or notes issued by the city or a state financing agency.
   4.    Within  the  board  fund  there  is hereby established a special
 account designated the debt service repayment account.  The board  shall
 from  time  to time direct, in accordance with procedures adopted by the
 board, the deposit in the debt service repayment account of such amounts
 as the board shall, in its discretion, determine  to  be  sufficient  to
 meet the debt service requirements of the covered organizations on their
 bonds  and  notes  (other  than bonds and notes of covered organizations
 payable from revenues not included in the board  fund)  as  they  become
 due.    Amounts  in  the debt service repayment account shall be used to
 meet such debt service requirements of the covered organizations.
   5.  If at any time the board determines that the amount then  held  in
 the  board  fund  or the amount estimated by the board to be held in the
 board fund is or will be insufficient to meet the  expenditures  in  the
 amounts and at the times required by the financial plan, the board shall
 require  disbursements  from  the board fund to be made in the following
 order or priority unless otherwise required by law of the United  States
 of  America:  (i) the payment of amounts from the APPROPRIATE ACCOUNT OF
 THE board fund to the debt service repayment account, the  general  debt
 service  fund,  the  TAN  debt  service account and the RAN debt service
 account, to maintain therein the amount required, to meet  debt  service
 requirements  of the city, THE CITY OF STATEN ISLAND, IF APPROPRIATE and
 the covered organizations on their bonds and notes as  they  may  become
 due,  (ii) the payment of other liabilities having statutory or contrac-
 tual priority over remaining liabilities of  the  city  ,  THE  CITY  OF
 STATEN ISLAND, IF APPROPRIATE and the covered organizations whose monies
 are  included  in  the  board fund, and (iii) the payment of other obli-
 gations on an allocated basis as specified by the city OR, THE  CITY  OF
 STATEN  ISLAND,  IF APPROPRIATE, for expenditures in accordance with the
 financial plan provided that, in the event that the city OR, THE CITY OF
 STATEN ISLAND, IF APPROPRIATE, fails to so specify, the board may  with-
 hold  payment  of  any  of  such  other  obligations or may direct their
 payment pro rata.
 S. 8474                            144
 
   6.  The board shall cause to be performed such pre-audit and  post-au-
 dit  reviews  of  the  board funds and disbursements therefrom as it may
 determine.
   § 12-019. Section 9-a of section 2 of chapter 868 of the laws of 1975,
 constituting  the New York state financial emergency act for the city of
 New York, as added by chapter 201 of the laws of 1978,  subdivisions  1,
 2,  3, 4, 6, 7, 8, 9 and 11 as amended, subdivision 10 as renumbered and
 amended and subdivision 12 as added by chapter 777 of the laws of  1978,
 is amended to read as follows:
   §  9-a.  Establishment and application of a general debt service fund.
 1.  Commencing on the first day of the first full fiscal quarter  subse-
 quent  to  the first sale of a federally guaranteed city obligation, the
 city shall establish a general debt service  fund  for  the  purpose  of
 paying  debt service due or becoming due in the then current fiscal year
 and in subsequent fiscal years UNTIL THE LATER OF  (I)  THE  TERMINATION
 DATE  OF  THIS ACT OR (II) THE DATE WHEN ALL GENERAL OBLIGATION BONDS OF
 THE CITY OUTSTANDING AS OF THE  ESTABLISHMENT  OF  THE  CITY  OF  STATEN
 ISLAND  HAVE  BEEN  PAID  OR  PAYMENT  THEREFOR HAS BEEN PROVIDED FOR IN
 ACCORDANCE WITH THEIR TERMS.  All monies in the fund shall  be  held  by
 the  comptroller,  who shall administer and maintain the fund in accord-
 ance with the provisions of this section.
   2.  All payments of or on account of real estate taxes or  assessments
 DUE TO THE CITY OR THE CITY OF STATEN ISLAND, other than the proceeds of
 tax  anticipation  notes, shall be immediately upon receipt deposited in
 AN ACCOUNT DESIGNATED FOR THE MUNICIPALITY  TO  WHICH  PAYMENT  WAS  DUE
 ESTABLISHED  IN  such fund.   The comptroller shall retain, disburse and
 apply monies in the fund during each month as follows:
   a.  During the first month of each  fiscal  quarter,  there  shall  be
 retained  in the fund, subject to the provisions of subdivision three of
 this section, all real estate tax payments deposited in the  fund  until
 there  shall  have  been  retained  from monies so deposited during such
 month IN THE APPLICABLE ACCOUNT an amount equal  to  the  total  monthly
 debt  service, computed as of the date of any disbursement of money from
 the fund, for the second  and  third  months  of  such  fiscal  quarter;
 provided  that  such  amount  shall  be reduced by any amount already on
 deposit in the fund which may be used to pay the  monthly  debt  service
 for such months.
   AMOUNTS  TO  BE  ON  DEPOSIT  IN  SUCH ACCOUNTS SHALL BE DETERMINED AS
 FOLLOWS: (I) WITH RESPECT TO THE ACCOUNT OF THE CITY, DEBT SERVICE SHALL
 INCLUDE PAYMENTS WITH RESPECT TO (A) ALL BONDS AND  NOTES  OF  THE  CITY
 ISSUED  ON  OR  AFTER  THE  DATE  OF ESTABLISHMENT OF THE CITY OF STATEN
 ISLAND AND (B) ALL BONDS OR NOTES OF THE CITY PRIOR  THERETO  MULTIPLIED
 BY A FRACTION, THE NUMERATOR OF WHICH IS THE TOTAL ASSESSED VALUATION OF
 ALL  TAXABLE  REAL  PROPERTY  LOCATED IN THE CITY AS OF THE DATE OF SUCH
 ESTABLISHMENT AND THE DENOMINATOR OF WHICH IS THE TOTAL  ASSESSED  VALU-
 ATION  OF  ALL TAXABLE REAL PROPERTY LOCATED IN THE CITY AND THE CITY OF
 STATEN ISLAND COMBINED AS OF THE DATE OF  SUCH  ESTABLISHMENT  AND  (II)
 WITH  RESPECT  TO THE ACCOUNT OF THE CITY OF STATEN ISLAND, DEBT SERVICE
 SHALL INCLUDE PAYMENTS WITH RESPECT TO (A) ALL BONDS  OR  NOTES  OF  THE
 CITY  OF  STATEN  ISLAND  AND  (B) ALL BONDS OR NOTES OF THE CITY ISSUED
 PRIOR TO THE ESTABLISHMENT OF THE CITY OF STATEN ISLAND MULTIPLIED BY  A
 FRACTION,  THE NUMERATOR OF WHICH IS THE TOTAL ASSESSED VALUATION OF ALL
 TAXABLE REAL PROPERTY LOCATED IN THE CITY OF STATEN  ISLAND  AS  OF  THE
 DATE  OF  SUCH ESTABLISHMENT AND THE DENOMINATOR OF WHICH IS THE SAME AS
 IN CLAUSE (B) OF SUBPARAGRAPH (I)  OF  THIS  PARAGRAPH.  TO  THE  EXTENT
 EITHER  ACCOUNT  CONTAINS  INSUFFICIENT  AMOUNTS TO MAKE PAYMENTS ON THE
 S. 8474                            145
 
 RESPECTIVE ALLOCABLE PORTION OF CITY BONDS OR NOTES ISSUED PRIOR TO  THE
 ESTABLISHMENT  OF  THE CITY OF STATEN ISLAND AND SUCH MUNICIPALITIES OWN
 BONDS OR NOTES ISSUED SUBSEQUENT THERETO,  AMOUNTS  ON  DEPOSIT  IN  THE
 ACCOUNT  OF  THE OTHER MUNICIPALITY IN EXCESS OF THE AMOUNTS REQUIRED TO
 PROVIDE FOR PAYMENT OF SUCH LATTER MUNICIPALITY'S  OWN  BONDS  OR  NOTES
 ISSUED  SUBSEQUENT  TO  SUCH ESTABLISHMENT AND ALLOCABLE PORTION OF CITY
 BONDS OR NOTES ISSUED PRIOR THERETO, SHALL BE RETAINED IN  SUCH  ACCOUNT
 AND APPLIED TO THE PAYMENT OF BONDS OR NOTES OF THE CITY ISSUED PRIOR TO
 SUCH ESTABLISHMENT TO THE EXTENT OF ANY INSUFFICIENCY IN SUCH ACCOUNTS.
   For  purposes  of  this  section, fiscal quarter shall mean the three-
 month period beginning July first, October first, January first or April
 first, and monthly debt service shall mean, as of any date  of  computa-
 tion,  the  amount  of monies equal to the aggregate of (i) all interest
 payable during such month on bonds and notes of the city OR THE CITY  OF
 STATEN ISLAND, AS APPLICABLE, plus (ii) the amount of principal (includ-
 ing payments into sinking funds) maturing or otherwise coming due during
 such  month  on  all  bonds of the city OR THE CITY OF STATEN ISLAND, AS
 APPLICABLE,  (excluding  principal  payments  made  from  sinking  funds
 required  by  the terms of certain city OR THE CITY OF STATEN ISLAND, AS
 APPLICABLE, bonds), plus (iii) the amount of principal  to  be  paid  on
 notes  of  the  city OR THE CITY OF STATEN ISLAND, AS APPLICABLE, during
 such month from sources other than the  proceeds  of  bonds  or  renewal
 notes  (exclusive  of  revenue  anticipation  notes and tax anticipation
 notes or renewals thereof issued less than two years prior to  the  date
 of computation).
   b.    During the second and third months of each fiscal quarter, there
 shall be retained in the fund, subject to the provisions of  subdivision
 three  of  this  section,  all real estate tax payments deposited in the
 fund until there shall have  been  retained  from  monies  so  deposited
 during  such  month  an  amount equal to the total monthly debt service,
 computed as of the date of any disbursement of monies from the fund, for
 the first month of the next succeeding  fiscal  quarter;  provided  that
 such  amount  shall  be  reduced by any amount already on deposit in the
 fund which may be used to pay the monthly debt service for such month.
   c.   During any month  of  a  fiscal  quarter,  after  the  retentions
 required  by  paragraphs  a and b of this subdivision have been made for
 such month, the comptroller shall deposit any remaining balance of  real
 estate taxes received during such month, first into the TAN debt service
 account  to  the  extent required under subdivision six of this section,
 and second into the board fund to be applied in accordance  with  proce-
 dures of the board.
   d.   The city may at any time pay into the fund any monies required by
 law to be used to pay monthly debt service and any other  monies  avail-
 able for such purpose.
   3.  The board may approve, subject to agreements made with the holders
 or guarantors of outstanding notes or bonds issued by or for the benefit
 of the city after the effective date of this act, criteria for calculat-
 ing  a proportion of real estate tax receipts to be retained in the fund
 in order to provide  for  the  retention  of  amounts  required  by  the
 provisions  of  subdivision two of this section in lieu of the retention
 of all initial receipts as required by such subdivision; provided,  that
 if the board at any time determines that retentions in the fund pursuant
 to  the  provisions of such subdivision are or are likely to be insuffi-
 cient to provide for the payment of monthly debt service  when  due,  in
 order  to  ensure that the amounts on deposit in the fund will be suffi-
 cient to pay monthly debt service when due, the board shall require  (i)
 S. 8474                            146
 
 that real estate tax receipts be retained in the fund in greater amounts
 or  at earlier dates than the provisions of such subdivision require, or
 (ii) that other revenues or cash resources of the city be paid into  the
 fund.    The  board  shall  consider  the  impact  of  earlier or larger
 retention of real estate tax receipts on the city's  seasonal  borrowing
 requirements  when  determining whether it shall require such additional
 retention or that other revenues or cash resources of the city  be  paid
 into the fund.  Prior to the issuance by the city of any bonds or notes,
 the  board  shall review any criteria then in effect which determine the
 proportion of real estate tax receipts to be retained  in  the  fund  to
 determine  whether  the proposed debt service schedule for such bonds or
 notes is consistent with the monies which will be available therefor  or
 whether  such  criteria should be revised.  The board shall from time to
 time take such action as it determines is  necessary,  including  disap-
 proval of a proposed issue pursuant to paragraph f of subdivision one of
 section  seven, so that the monies in the fund shall be adequate to meet
 debt service requirements.
   4.  Commencing on the first day of the second month of the first  full
 fiscal  quarter  subsequent  to the first sale of a federally guaranteed
 city obligation, the payment of monthly  debt  service  shall  be  made,
 first,  from amounts retained in the fund.  Amounts retained in the fund
 shall be used only to pay debt service of the city.
   5.  Upon the issuance of any  tax  anticipation  notes  following  the
 effective date of this act, the comptroller shall establish and, so long
 as any tax anticipation notes shall be outstanding, shall maintain a tax
 anticipation  note  debt service account within the fund for the purpose
 of paying the principal of tax anticipation notes.
   6.  The city shall determine the date on which the principal due or to
 become due on an outstanding issue of tax anticipation notes shall equal
 ninety percent of the available tax levy with respect to such issue, and
 upon reasonable notice thereof the comptroller shall  commence  on  such
 date  to  pay into the TAN debt service account from collections of such
 taxes and assessments, after retaining amounts required to be  deposited
 in  the  fund, amounts sufficient to pay when due, the principal of such
 issue of tax anticipation notes.  The payments of the principal  of  tax
 anticipation  notes  shall  be made, first, from amounts retained in the
 TAN debt service account.
   7.  Upon the issuance of any revenue anticipation notes following  the
 effective date of this act, the comptroller shall establish and, so long
 as any revenue anticipation notes shall be outstanding, shall maintain a
 revenue  anticipation  note debt service account within the fund for the
 purpose of paying the principal of revenue  anticipation  notes.    Each
 specific  type of revenue in anticipation of which such notes are issued
 and available for such purpose shall be deposited in such account  imme-
 diately  upon receipt by the city.  Where such revenue consists of state
 aid or other revenue to be paid to the city by the comptroller,  on  the
 date  such revenue is payable to the city, the comptroller shall deposit
 such revenue directly into such account in lieu of payment to the  city.
 All  revenues  deposited  in  the RAN debt service account shall be paid
 immediately into the board fund except as otherwise provided in subdivi-
 sion eight of this section.
   8.  The city shall determine the date on which the principal due or to
 become due on an outstanding issue of revenue anticipation  notes  shall
 equal  ninety  percent of the total amount of revenue against which such
 notes were issued remaining to be paid to the  city  on  or  before  the
 fifth  day prior to the maturity date of such notes  and upon reasonable
 S. 8474                            147
 
 notice thereof the comptroller shall commence on such date to retain  in
 the  RAN  debt service account from amounts deposited or to be deposited
 therein of each specific type of revenue in anticipation of which reven-
 ue  such  anticipation  notes  were issued, an amount sufficient to pay,
 when due, the principal of such  revenue  anticipation  notes.    Monies
 retained  in  such  account shall vest immediately in the comptroller in
 trust for the benefit of the holders of the revenue  anticipation  notes
 in  anticipation  of which such notes were issued.  No person having any
 claim of any kind in tort, contract or otherwise against such city shall
 have any right to or claim against any monies of the state  appropriated
 by  the  state and in anticipation of which such notes have been issued,
 other than a claim for payment by the holders of such  notes,  and  such
 monies  shall  not  be  subject to any order, judgment, lien, execution,
 attachment, setoff or counter-claim by any such person; provided, howev-
 er, that nothing contained in  this  paragraph  shall  be  construed  to
 limit,  impair,  impede  or otherwise adversely affect in any manner the
 rights or remedies of the purchasers and holders and owners of any bonds
 or notes of the state or any  agency,  instrumentality,  public  benefit
 corporation  or political subdivision thereof, including the city of New
 York, under which such purchasers and holders and owners have any  right
 of  payment  of  such  bonds  or notes by recourse to state aid or local
 assistance monies held by the state or for the payment of which bonds or
 notes state aid or local assistance monies are a designated source.  The
 payment of the principal of revenue anticipation  notes  shall  be  made
 first from amounts retained in the RAN debt service account.
   9.    Whenever the amount contained in the TAN debt service account or
 the RAN debt service account exceeds the amount required to be  retained
 in such account such excess monies, including earnings on investments of
 monies  in  the fund, shall be withdrawn from such account and paid into
 the board fund.
   10.   Subject  to  agreements  made  with  holders  or  guarantors  of
 outstanding  notes  or  bonds  issued  by or for the benefit of the city
 after the effective date of this act, the comptroller shall  invest  the
 monies retained in the fund in accordance with law.
   11.  The limitations imposed upon the city by this section shall be in
 addition  to any limitations imposed upon the city OR THE CITY OF STATEN
 ISLAND under the local finance law.  In the event any provisions of  the
 local  finance  law  shall  be  inconsistent with the provisions of this
 section, the provisions of this section shall prevail.  The requirements
 of this section shall not apply to any note of  the  city  held  by  the
 municipal  assistance corporation for the city of New York to the extent
 that such corporation has evidenced its intention not  to  present  such
 notes  for  payment during the fiscal year in which the determination is
 made provided that such notes were held  by  such  corporation  on  June
 thirtieth, nineteen hundred seventy-eight or were issued in exchange for
 or  in  refunding  or  renewal of notes held by such corporation on such
 date.
   12.  Notwithstanding any other provision of this section, the city AND
 THE CITY OF STATEN ISLAND, IF APPLICABLE, may, at any time,  subject  to
 approval  by  the  comptroller, designate a trust company or bank having
 its principal place of business in the state of New York and having  the
 powers  of  a  trust company in the state of New York to hold all or any
 part of the monies in the fund and to administer and maintain the monies
 so held in accordance with the applicable provisions of this section and
 any agreements made pursuant thereto.
 S. 8474                            148

   § 12-020. Section 11 of section 2 of chapter 868 of the laws of  1975,
 constituting  the New York state financial emergency act for the city of
 New York, subdivisions 1 and 3 as amended by chapter 777 of the laws  of
 1978, is amended to read as follows:
   §  11.   Prohibitions; penalties.  1.  During a control period, (i) no
 officer or employee of the city or of any of the  covered  organizations
 OR  TO  THE  EXTENT THE BOARD DEEMS NECESSARY OR DESIRABLE TO ACCOMPLISH
 THE PURPOSES OF THIS ACT, THE  CITY  OF  STATEN  ISLAND  shall  make  or
 authorize  an  obligation  or  other  liability  in excess of the amount
 available therefor under the financial plan as then in effect;  (ii)  no
 officer  or  employee of the city or of any of the covered organizations
 OR THE CITY OF STATEN ISLAND shall involve the city, THE CITY OF  STATEN
 ISLAND,  IF  APPLICABLE  or  any  of  the  covered  organizations in any
 contract or other obligation or liability for the payment of  money  for
 any  purpose  required to be approved by the board unless such contract,
 obligation or liability has been so approved or deemed to be approved as
 provided in paragraphs e and f of subdivision one of section  seven  and
 unless  such  contract  or obligation or liability is in compliance with
 the financial plan as then in effect.
   2.  No officer or employee of the city or any of the covered organiza-
 tions, OR, THE CITY OF STATEN ISLAND,  IF  APPLICABLE,  shall  take  any
 action  in  violation  of  any valid order of the board or shall fail or
 refuse to take any action required by any such order or  shall  prepare,
 present  or  certify any information (including any projections or esti-
 mates) or report for the board or any of its agents  that  is  false  or
 misleading,  or,  upon  learning  that  any such information is false or
 misleading, shall fail promptly to advise the board or its agents there-
 of.
   3.  In addition to any penalty or liability under other law, any offi-
 cer or employee of the city or any of the covered organizations, OR, THE
 CITY OF STATEN ISLAND, IF APPLICABLE, who shall knowingly and  willfully
 violate  subdivision  one  or  two  of  this section shall be subject to
 appropriate administrative  discipline,  including,  when  circumstances
 warrant,  suspension  from  duty  without  pay or removal from office by
 order of either the governor or the mayor OR THE MAYOR OF  THE  CITY  OF
 STATEN ISLAND, IF APPLICABLE, and shall, upon conviction, be guilty of a
 misdemeanor.
   4.    In  the  case  of  a violation of subdivision one or two of this
 section by an officer or employee of the city, OR, THE  CITY  OF  STATEN
 ISLAND, IF APPLICABLE, or any of the covered organizations, the mayor OR
 THE  MAYOR  OF  THE  CITY  OF STATEN ISLAND, IF APPLICABLE, or the chief
 executive officer of such covered organization shall immediately  report
 to the board all pertinent facts together with a statement of the action
 taken thereon.
   §  13-001. Section 25-a of the general city law is amended by adding a
 new undesignated paragraph to read as follows:
   FOR THE PURPOSES OF THIS ARTICLE, A CITY WHICH IS INCORPORATED  ON  OR
 AFTER  THE FIRST OF JANUARY NEXT SUCCEEDING THE DATE ON WHICH THIS PARA-
 GRAPH SHALL HAVE BECOME A LAW AND WHICH IS COMPRISED OF  A  GEOGRAPHICAL
 AREA  WHICH ON THE DATE IMMEDIATELY PRIOR TO SUCH INCORPORATION HAD BEEN
 WHOLLY CONTAINED WITHIN A CITY WITH A POPULATION OF ONE MILLION OR  MORE
 SHALL  CONTINUE TO BE TREATED AS A CITY WITH A POPULATION OF ONE MILLION
 OR MORE.
   § 13-002.  Section 25-w of the general city law is amended by adding a
 new subdivision (g) to read as follows:
 S. 8474                            149
 
   (G) FOR THE PURPOSES OF THIS ARTICLE, A CITY WHICH IS INCORPORATED  ON
 OR  AFTER  THE  FIRST  OF JANUARY NEXT SUCCEEDING THE DATE ON WHICH THIS
 SUBDIVISION SHALL HAVE  BECOME  A  LAW  AND  WHICH  IS  COMPRISED  OF  A
 GEOGRAPHICAL  AREA  WHICH ON THE DATE IMMEDIATELY PRIOR TO SUCH INCORPO-
 RATION  HAD BEEN WHOLLY CONTAINED WITHIN A CITY WITH A POPULATION OF ONE
 MILLION OR MORE SHALL CONTINUE TO BE TREATED AS A CITY WITH A POPULATION
 OF ONE MILLION OR MORE.
   § 13-003. Section 1 of chapter 772 of the laws  of  1966  relating  to
 imposition  of  a  city business tax is amended by adding a new undesig-
 nated paragraph to read as follows:
   FOR THE PURPOSES OF THIS SECTION, A CITY WHICH IS INCORPORATED  ON  OR
 AFTER  THE FIRST OF JANUARY NEXT SUCCEEDING THE DATE ON WHICH THIS PARA-
 GRAPH SHALL HAVE BECOME A LAW AND WHICH IS COMPRISED OF  A  GEOGRAPHICAL
 AREA  WHICH ON THE DATE IMMEDIATELY PRIOR TO SUCH INCORPORATION HAD BEEN
 WHOLLY CONTAINED WITHIN A CITY WITH A POPULATION OF ONE MILLION OR  MORE
 SHALL  CONTINUE TO BE TREATED AS A CITY WITH A POPULATION OF ONE MILLION
 OR MORE.
   § 13-004. Section 2 of chapter 772 of the laws  of  1966  relating  to
 imposition  of  a  city business tax is amended by adding a new undesig-
 nated paragraph to read as follows:
   FOR THE PURPOSES OF THIS SECTION, A CITY WHICH IS INCORPORATED  ON  OR
 AFTER  THE FIRST OF JANUARY NEXT SUCCEEDING THE DATE ON WHICH THIS PARA-
 GRAPH SHALL HAVE BECOME A LAW AND WHICH IS COMPRISED OF  A  GEOGRAPHICAL
 AREA  WHICH ON THE DATE IMMEDIATELY PRIOR TO SUCH INCORPORATION HAD BEEN
 WHOLLY CONTAINED WITHIN A CITY WITH A POPULATION OF ONE MILLION OR  MORE
 SHALL  CONTINUE TO BE TREATED AS A CITY WITH A POPULATION OF ONE MILLION
 OR MORE.
   § 13-005. Section 1301 of the tax law  is  amended  by  adding  a  new
 subsection (f) to read as follows:
   (F)  FOR THE PURPOSES OF THIS ARTICLE, A CITY WHICH IS INCORPORATED ON
 OR AFTER THE FIRST OF JANUARY NEXT SUCCEEDING THE  DATE  ON  WHICH  THIS
 SUBSECTION SHALL HAVE BECOME A LAW AND WHICH IS COMPRISED OF A GEOGRAPH-
 ICAL  AREA WHICH ON THE DATE IMMEDIATELY PRIOR TO SUCH INCORPORATION HAD
 BEEN WHOLLY CONTAINED WITHIN A CITY WITH A POPULATION OF ONE MILLION  OR
 MORE  SHALL  CONTINUE  TO  BE TREATED AS A CITY WITH A POPULATION OF ONE
 MILLION OR MORE.
   § 14-001. The administrative code of the  city  of  Staten  Island  is
 enacted to read as follows:
                 Title 6 - General Services and Contracting
   § 6-101 Definitions. As used in this title:
   1.  "Commissioner"  shall  mean  the commissioner of the department of
 general services and contracting.
   2. "Department" shall mean the  department  of  general  services  and
 contracting.
   §  6-102 Commissioner. The head of the department shall be the commis-
 sioner.
   § 6-103 Powers and duties. The commissioner shall have the  power  and
 it  shall be his or her duty to perform all the functions and operations
 of the city of Staten Island relating to the  construction,  maintenance
 and  care  of  public buildings and facilities; the procurement of goods
 and other personal property; the disposition of  surplus  property;  the
 providing to city agencies of services other than personal services; the
 acquisition,  disposition  and  management  by the city of real property
 other than housing; the providing of automotive,  communication,  energy
 and data processing services including without limitation:
 S. 8474                            150
 
   1.  Procurement  of goods, other personal property and services.  With
 respect to the procurement and disposal  of  goods  and  other  personal
 property  and  the procurement of services other than personal services,
 the commissioner shall have the following power and duties:
   (a)  to  purchase,  inspect, store and distribute all goods, supplies,
 materials, equipment and other personal property required  by  any  city
 agency,  except  as  otherwise  provided by law, or by any office of any
 county wholly included in the city  for  which  supplies,  materials  or
 equipment  are  required, payment for which is made from the city treas-
 ury;
   (b) to establish and maintain one or more city storehouses,  operating
 therein  a  modern  system  of  stores  control  to supply the estimated
 current needs of the agencies for which the commissioner  is  authorized
 to  purchase.    All  purchases  other than such purchases for stock for
 estimated needs and all deliveries from such stock shall be upon  justi-
 fied  requisitions.   The commissioner shall also oversee the establish-
 ment of efficient and economical systems of stores control in other city
 agencies and review the operations of such storehouses to  assure  their
 efficient and economical management;
   (c) to receive all surplus and obsolete personal property not required
 by any agency for which the commissioner has the power to make purchases
 and  all such agencies shall surrender such property to the commissioner
 who shall dispose thereof pursuant to rules promulgated by  him  or  her
 governing its redistribution, exchange, transfer, sale or other disposi-
 tion;
   (d)  to  procure,  supply  and  manage contractual services other than
 personal or professional services for the use of city agencies;
   (e) to promulgate rules governing the purchase, payment, storage,  and
 delivery  of goods, supplies, materials and equipment by agencies of the
 city and the disposal of surplus and obsolete materials, and  to  super-
 vise their enforcement; and
   (f) to classify all goods, supplies, materials and equipment.
   2. Energy; gas and electricity. The commissioner shall have charge and
 control  of  furnishing  the  city  or  any part thereof, by contract or
 otherwise, with gas, electricity,  steam,  hot  water  or  other  energy
 source,  except  such  functions  as are exercised by the public utility
 service of the city.
   3. Data processing services; information technology  and  telecommuni-
 cations.  (a) For purposes of this title "telecommunications" shall mean
 transmission of writings,  signals,  pictures,  numbers  and  sounds  or
 intelligence  of all kinds by and of wire, cable,  optical fiber, radio,
 satellite, electromagnetic wave,  microwave  or  other  like  connection
 between  points  of origin and reception of such transmission, including
 all instrumentalities, facilities, apparatus and services incidental  to
 such transmission.
   (b)  The  commissioner shall provide data processing support, program-
 ming, and computer systems analysis  services  for  city  agencies  when
 necessary  or desirable, in accordance with executive orders promulgated
 by the mayor.
   (c) In addition,  the  commissioner  shall  have  further  powers  and
 duties:
   (i)  to plan, formulate, coordinate and advance information technology
 and telecommunications policy for the city;
   (ii) to develop, maintain and  implement  a  long  range  telecommuni-
 cations strategy;
 S. 8474                            151
 
   (iii)  to  administer,  subject  to  the approval of the council where
 applicable, all franchises and revocable consents relating to telecommu-
 nications including without  limitation,  proposing  authorizing  resol-
 utions   for  telecommunications,  franchises,  developing  and  issuing
 requests  for proposals or other solicitations of proposals for telecom-
 munications franchises, selecting telecommunications franchises, review-
 ing and approving petitions for revocable consents relating to  telecom-
 munications,  negotiating  the  terms  of  contracts or other agreements
 relating  to  telecommunications  franchises  and  revocable   consents,
 enforcing the terms and conditions of such agreements;
   (iv)  to  develop  municipal  uses  of cable television and coordinate
 interagency uses of cable television and other telecommunications;
   (v) to ensure that priority is given on at least one municipal channel
 to the cable casting of the public proceedings of the  council  and  its
 committees,  the city planning commission and other state and city agen-
 cies;
   (vi) to provide to city agencies such land-based and  wireless  voice,
 data,  video or other communication facilities, and technical assistance
 or other assistance with respect to such facilities, as they may require
 for the effective discharge of their responsibilities;
   (vii) to participate in developing,  maintaining  and  implementing  a
 long-range  computer  system  and  data  communications strategy for the
 city;
   (viii) to assist in  providing  interagency  coordination  on  matters
 related to data communications activities and interfacing of computers;
   (ix)  to  provide appropriate, reliable, cost-effective and responsive
 computer and data communications services to agencies that require  such
 services by purchasing and maintaining hardware, software and such other
 goods  and  services  as  may  be necessary to effectively discharge the
 powers and duties of the department;
   (x) to provide assistance to agencies in meeting their data processing
 and data communications objectives;
   (xi) to provide agencies using or proposing to  use  the  services  of
 this department with technical assistance in determining feasibility and
 resource requirements;
   (xii)  to  simplify access to shared information, reduce communication
 costs and provide access to  multiple  computer  systems  by  connecting
 computers  and  terminals  of various city agencies, and of other public
 entities requesting such connection where such provision to  such  other
 entities  would  in  the  judgment  of the commissioner be in the city's
 interests;
   (xiii) to plan and provide telecommunications coordination in  support
 of disaster recovery;
   (xiv)  to  ensure  security  for data and other information handled by
 this department;
   (xv) to institute procedures  to  assure  restrictions  of  access  to
 information  to the appropriate individuals, where such restrictions are
 required by law; and
   (xvi) to perform such other responsibilities with respect to  informa-
 tion  technology  and telecommunications matters, including responsibil-
 ities delegated elsewhere by the code, as the mayor shall direct.
   4. Automotive services.  The commissioner shall acquire  by  purchase,
 lease  or otherwise, vehicles and other automotive equipment for the use
 of city agencies; manage, maintain, store and operate a fleet  of  motor
 vehicles;  assign fleets to agencies in accordance with the direction of
 the mayor and ensure  the  effective  operation  of  all  shops,  yards,
 S. 8474                            152
 
 garages,  fuel  depots and other facilities required for the maintenance
 of fleets operated by agencies; and ensure the  maintenance  of  records
 for all city owned vehicles.
   5.  Right  of entry.   The commissioner, officers and employees of the
 department may, in accordance with law, enter  upon  public  or  private
 property  for  the  purpose of making surveys, borings or other investi-
 gations necessary for the exercise of powers or the performance  of  the
 duties  of  the commissioner and the department.  Refusal to permit such
 entry shall be a misdemeanor punishable by not  more  than  thirty  days
 imprisonment or by a fine of not more than $50.00, or both.
   §  6-104  Emergency  communications  systems  of  other agencies. With
 respect to emergency communications systems and emergency communications
 facilities administered by another agency or another  municipality,  the
 department  shall exercise its powers and duties only as the mayor shall
 direct or at the request of such agency.
   § 6-105 Records and information services. Within the department  there
 shall  be  a  division  of  records and information services which shall
 include, but not be limited to, municipal archives, a  municipal  refer-
 ence and research center and a municipal records management division.
   1.  The  division  shall be responsible for the maintenance, access to
 and preservation of records of the city. In addition, the division shall
 develop and promulgate standards and procedures to  effectively  perform
 those duties.
   The  division  shall provide appropriate information and assistance to
 the mayor and to members of the council. It shall also  provide,  within
 reasonable  limits, access to the public to records, books and documents
 within its care and control.
   2. The division is authorized  to  arrange  for  the  exchange,  sale,
 purchase  and  loan  of  information materials from and with legislative
 research services, libraries and institutions in  other  municipalities,
 governmental bodies and public authorities.
   3. The division shall:
   (a)  provide  for  the distribution of publications of the city, where
 such authority is not vested in another city agency, and issue at  regu-
 lar intervals, no less than quarterly, a bulletin describing its facili-
 ties and resources;
   (b)  institute  actions  in  replevin to recover any historical and/or
 other documents properly owned by, or originating from,  the  county  of
 Richmond prior to the creation of the preceding municipality;
   (c)  report  annually  by the thirtieth of September to the mayor, and
 council on the powers and duties  herein-mentioned  including,  but  not
 limited  to,  the cost of savings effectuated by the division during the
 preceding fiscal year.
   § 6-106 Departmental libraries. The  commissioner  shall  analyze  the
 needs  of  each  city agency, except the law department, with respect to
 the establishment and maintenance of any library  or  research  facility
 therein,  and  make  such  recommendations  as may be appropriate in the
 circumstances. Any  libraries  or  research  facilities  so  established
 shall,  among  any  of  its other duties, be responsible for the mainte-
 nance, access to  and  preservation  of  records  within  its  care  and
 control.
                           Title 7 - Legal Affairs
   §  7-102  Department;  corporation  counsel.  1.  There shall be a law
 department the head of which shall be the corporation counsel.
   2.  The first assistant corporation counsel, appointed by  the  corpo-
 ration  counsel, during absence, disability or the vacancy of the office
 S. 8474                            153
 
 of the corporation counsel, shall assume  all  powers  and  perform  all
 duties  of  the corporation counsel and shall act as corporation counsel
 until a new appointment is made.
   3.    The  corporation counsel may empower, by written authority filed
 and remaining on record in the department,  any  of  the  assistants  to
 perform certain duties of the corporation counsel.
   § 7-103 Powers and duties. The corporation counsel shall:
   1.  be  attorney and counsel for the city and every agency thereof and
 shall have charge of and conduct all the law business of  the  city  and
 its agencies;
   2. have charge of and conduct the legal proceedings necessary in open-
 ing, widening, altering and closing streets and in acquiring real estate
 or in city condemnation proceedings;
   3.  have  charge  of and conduct the preparation of all leases, deeds,
 contracts, bonds and all other legal papers for the  city  or  connected
 agency or officer thereof; and the corporation counsel shall approve the
 form of all such deeds, bonds, contracts, leases and legal papers;
   4.  have  the right to institute actions in law or equity to maintain,
 defend and establish the rights, interests, revenues,  property,  privi-
 leges,  franchises  or demands of the city or the people thereof, and to
 collect any money, debts, fines or penalties or enforce the laws;
   5. not be empowered  to  compromise,  settle  or  adjust  any  rights,
 claims,  demands or causes of action in favor of or against the city, to
 offer or confess judgment against the city or accept any offer of  judg-
 ment in favor of the city without the approval of the comptroller; and
   6.  have the authority to assign one or more assistants to any agency;
 and the head of each agency may employ staff counsel to assist in  legal
 affairs of the agency.
   §  7-104  Legal  authority.  1.    All actions and proceedings for the
 recovery of penalties for the violation of any law shall be  brought  in
 the name of the city and not in that of any agency.
   2.  The  mayor may delegate to any agency, after consultation with the
 corporation counsel and head  of  the  agency,  responsibility  for  the
 conduct of routine legal affairs of the agency.
   3.  The mayor may assign or transfer attorneys from the law department
 of the agency to assist in such delegated functions.
   4. The corporation counsel shall monitor and  evaluate  on  a  regular
 basis the exercise of authority delegated.
   5.  The  mayor,  upon  recommendation  of the corporation counsel, may
 suspend or withdraw any delegated authority whenever in his or her judg-
 ment the interests of the city justify such action.
   § 7-105 City sheriff; powers and duties. 1.  There  shall  be  a  city
 sheriff who shall be appointed by the mayor.
   2.  Except  as  otherwise  provided  by law, the functions, powers and
 duties formerly exercised by the sheriff of the  preceding  municipality
 as  of  the  date  of  establishment  of the city of Staten Island shall
 remain with the city sheriff.
   § 7-106 City clerk; powers and duties. The city clerk shall:
   1. be the chief archivist of the city and shall advise the  mayor  and
 council  on  those  matters  concerning  the  preservation of the city's
 historical documentation;
   2. act as the chief reference and research librarian for the mayor and
 council and shall ensure that all significant  materials  pertaining  to
 operations of the city be preserved and readily available for use;
   3.  act  as the chief public records officer for the mayor and council
 and shall, except as otherwise provided by law, establish standards  for
 S. 8474                            154
 
 the proper records management in any agency or government instrumentali-
 ty funded in whole or in part from local tax levy monies; and
   4.  have the power formerly exercised or delegate any of the functions
 and duties vested in such city clerk by law  of  the  preceding  munici-
 pality as it existed on the date of establishment.
                             Title 8 - Reserved
 
                        Title 9 - Criminal Justice
 
 Chapter 1
 
 Department of Corrections
 
   § 9-101 Definitions. As used in this title:
   1.  "Commissioner"  shall  mean  the commissioner of the department of
 corrections.
   2. "Department" shall mean the department of corrections.
   3. "Division" shall mean the division of juvenile justice.
   § 9-102 Commissioner. The head of the department shall be the  commis-
 sioner of corrections.
   §  9-103  Powers and duties of commissioner. 1. The commissioner shall
 have:
   a. charge and management of all institutions of  the  city  (including
 all  hospital  wards) for the care and custody of felons; misdemeanants;
 all prisoners under arrest and waiting arraignment (including those  who
 require  hospital  care  and/or  psychiatric  observation or treatment);
 violators of ordinances or local laws  and  for  the  detention  of  any
 witnesses  who  are  unable  to furnish security for their appearance in
 criminal proceedings;
   b. sole power and authority concerning the care, custody  and  control
 of all court pens for the detention of prisoners while in custody of the
 state  of New York within the city of Staten Island, the family court of
 the state of New York, the supreme court in the county of  Richmond  and
 of  all  vehicles  employed  in the transportation of prisoners who have
 been sentenced, are awaiting trial or being held for other cause;
   c. charge and management of persons or any other  institution  of  the
 city placed under his or her jurisdiction;
   d. all authority concerning the care and custody of felons, misdemean-
 ants  or  violators  of local laws held in institutions under his or her
 jurisdiction;
   e. all authority in relation to  the  custody  and  transportation  of
 persons  held  for  any criminal proceedings, all prisoners under arrest
 and waiting arraignment (including those requiring hospital care  and/or
 psychiatric treatment) in the city; and
   f.  supervision and responsibility for the planning and implementation
 of re-training, counseling,  and  rehabilitative  programs  for  felons,
 misdemeanants  and  violators of local laws who are held in institutions
 under his or her charge.
   2. The commissioner shall maintain and operate  buildings  and  struc-
 tures under his or her jurisdiction and may construct additions and make
 repairs  to  such  buildings by use of the labor of persons under his or
 her care and custody.
   § 9-104 Labor of prisoners. 1. Every inmate of  an  institution  under
 the  authority  of  the  commissioner  shall be employed in some form of
 industry, farming operations or other employment and any products there-
 S. 8474                            155
 
 of shall be utilized in the institutions under the commissioner's juris-
 diction.
   2.  Any  persons  held for trial may be employed in the same manner as
 sentenced prisoners; however, such sentenced prisoners must  give  their
 consent in writing.
   3.  Inmates  and/or  prisoners  held  for trial may be detailed by the
 commissioner to perform work or service on the grounds, buildings, or on
 any public improvement under the charge of any other agency.
 
                                 Chapter 2
 
                       Division of Juvenile Justice
 
   § 9-201 The division of juvenile justice; director. 1. There shall  be
 within the department of corrections a division of juvenile justice.
   2. The head of the division shall be the director of juvenile justice.
   § 9-202 Powers and duties of director. The director shall:
   1.  establish, initiate, control, maintain and operate secure and non-
 secure facilities for the temporary care  and  maintenance  of  children
 alleged to be or adjudicated as juvenile delinquents.
   2.  have  the power to contract with other public and private agencies
 for services in order to ensure adequate, suitable and accessible accom-
 modations and that proper care  will  be  available  when  required  for
 detention.
   3.  establish  regulations  for the operation of secure and non-secure
 detention facilities and shall provide or  secure  the  availability  of
 accessible  and  adequate  non-secure detention facilities  certified by
 the state division of youth.
   4. develop, implement and  maintain  systems  to  collect,  store  and
 disseminate  information concerning juvenile delinquency, juvenile crime
 and the juvenile justice system.
   5. participate with other city agencies in development, implementation
 and maintenance of juvenile justice information.
                             Title 10 - Reserved
                                 TITLE 11
                           TAXATION AND FINANCE
                                 CHAPTER 1
                           DEPARTMENT OF FINANCE
   § 11-001 Definitions and applicability. Any terms in this title refer-
 ring to a governmental entity of the  preceding  municipality  shall  be
 deemed  to  refer  to  such  entity of the preceding municipality or its
 successor entity under the city of Staten Island. Any  action  taken  in
 compliance  with the provisions of this title prior to the incorporation
 of the city of Staten Island shall be deemed to comply with the require-
 ments of this title. For the purposes of this title, the term  preceding
 municipality shall mean the city government for the geographical area of
 the  city of Staten Island which existed immediately prior to the incor-
 poration of the city of Staten Island.
   § 11-101  Power of department of finance to adopt a seal. The  depart-
 ment of finance is authorized to adopt a seal.
   §  11-102    Finance  department; records; copies when in evidence.  A
 copy of any paper, record, book, document or map, filed in  the  depart-
 ment  of finance, or the minutes, records or proceedings, or any portion
 thereof, of any  board  or  commission  of  which  the  commissioner  of
 finance,  is  or may become a member, when certified by the commissioner
 of finance, or a deputy commissioner of finance, to be a correct copy of
 S. 8474                            156

 the original, shall be admissible in evidence  in  any  trial,  investi-
 gation,  hearing or proceeding in any court, or before any commissioner,
 board or tribunal, with the same  force  and  effect  as  the  original.
 Whenever  a  subpoena is served upon the commissioner of finance, or any
 member of a board or commission of which the commissioner of finance  is
 a  member, or upon any officer or employee of the department of finance,
 or upon any officer or employee of such boards or commissions, requiring
 the production upon any trial or hearing of an original paper, document,
 book, map, record, minutes or proceedings, the commissioner of  finance,
 in  his  or  her  discretion,  may  furnish  a  copy certified as herein
 provided, unless the subpoena be accompanied by an order of the court or
 other tribunal before which  trial  or  hearing  is  had  requiring  the
 production of such original.
   §  11-102.1  Authorization  to  require  identifying  numbers.  a. The
 commissioner of finance in the proper discharge of his or her duties  in
 the  administration  and  collection  of  taxes, assessments, arrears or
 other charges payable to the city may require any person to furnish such
 identifying number as the commissioner may prescribe for securing proper
 identification of such person including, but not limited  to,  a  social
 security account number or federal employer identification number.
   b. Any person who fails to supply such identifying number within thir-
 ty days after written demand therefor shall be liable for a civil penal-
 ty  of  not  more than one thousand dollars. Upon application in writing
 and for good cause shown, the commissioner of  finance  may  extend  the
 time for compliance with such written demand.
   c.  The civil penalty prescribed by this section shall be recovered by
 the corporation counsel in an action  or  proceeding  in  any  court  of
 competent  jurisdiction. In addition, the corporation counsel may insti-
 tute any other action or proceeding in any court of competent  jurisdic-
 tion  that  may  be  appropriate or necessary for the enforcement of the
 provisions of this section.
   § 11-103   Bond  of  commissioner  of  finance.  The  commissioner  of
 finance,  within  ten days after receiving notice of his or her appoint-
 ment and before such commissioner enters upon his or her  office,  shall
 give  a  bond  to the city and to the people of the state of New York in
 the sum of three hundred thousand  dollars,  with  not  less  than  four
 sufficient  sureties to be approved by the comptroller, conditioned that
 he or she will faithfully discharge the  duties  of  the  commissioner's
 office  and  all  trusts  imposed  on him or her by law in virtue of the
 commissioner's office, including all duties in connection with  the  tax
 on  mortgages as prescribed by article eleven of the tax law.  Such bond
 shall be deemed to extend to the faithful execution of the duties of the
 office until a new appointment shall be  made  and  confirmed,  and  the
 person  so  appointed  enters upon the performance of the commissioner's
 duties. In case of any official misconduct or default  on  the  part  of
 such commissioner of finance, or his or her subordinates, an action upon
 such  bond  may  be begun and prosecuted to judgment by the city, which,
 after first paying therefrom the expenses of the litigation, shall cause
 the proceeds of such judgment to be distributed as shall be  lawful  and
 equitable  among  the  persons  and objects injured or defrauded by such
 official misconduct or default of the commissioner of finance or any  of
 his or her subordinates.
   § 11-104  Commissioner of finance to keep accounts. a. The commission-
 er  of  finance shall keep books showing the receipts of moneys from all
 sources, and designating the sources  of  same,  and  also  showing  the
 S. 8474                            157
 
 amounts paid from time to time on account of the several appropriations,
 the forms of which shall be prescribed by the comptroller.
   b.  The  city  collector  or  the deputy collector in receiving moneys
 payable to the city, from whatever source derived,  shall  not  issue  a
 receipt  to the payor for a payment made by personal, business or corpo-
 rate check unless specifically requested.
   § 11-105 Agreements with financing agencies or card  issuers;  payment
 of  fines,  civil  penalties, taxes, fees, rates, rent, charges or other
 amounts by credit card. 1. As used in this section, the following  terms
 shall have the following meanings:
   a. "Card issuer" shall mean an issuer of a credit card, charge card or
 other value transfer device.
   b.  "Credit  card"  means  any credit card, credit plate, charge card,
 charge plate, courtesy card, debit card or other identification card  or
 device  issued by a person to another person which may be used to obtain
 a cash advance or a loan or credit, or to purchase or lease property  or
 services on the credit of the person issuing the credit card or a person
 who  has  agreed with the issuer to pay obligations arising from the use
 of a credit card issued another person.
   c. "Financing agency" means a person engaged, in whole or in part,  in
 the  business of purchasing retail installment contracts, obligations or
 credit agreements or indebtedness of buyers under credit agreements from
 one or more retail sellers  or  entering  into  credit  agreements  with
 retail  buyers  but shall not include a retail seller. The term includes
 but is not limited to a bank, trust company, private banker,  industrial
 bank  or  investment  company,  if  so  engaged, but shall not include a
 retail seller.
   d. "Person" means an individual, partnership, corporation or any other
 legal or commercial entity.
   2. The city may enter into agreements with one or more financing agen-
 cies or card issuers to provide for the acceptance by the city of credit
 cards as an alternate means of payment of fines, civil penalties, taxes,
 fees, rent, rates, charges or other amounts owed  by  a  person  to  the
 city.  Any  such  agreement  shall  govern the terms and conditions upon
 which a credit card proffered as a means of payment  of  a  fine,  civil
 penalty,  tax, fee, rent, rate, charge or other amount shall be accepted
 or declined and the manner in and conditions upon  which  the  financing
 agency  or  card issuer shall pay to the city the amount of fines, civil
 penalties, taxes, fees, rent, rates, charges or other  amounts  paid  by
 means of credit cards pursuant to such agreement. Any such agreement may
 provide  for  the  payment  by the city to such financing agency or card
 issuer of fees for the services rendered by  such  financing  agency  or
 card  issuer  pursuant  to  such  agreement, which fees may consist of a
 discount deducted from or payable in respect of the amount of each  such
 fine,  civil  penalty,  tax,  fee, rent, rate, charge or other amount or
 otherwise as the agreement may provide.
   3. Notwithstanding any other provision of law  to  the  contrary,  any
 agency or department of the city which, pursuant to an agreement entered
 into  under  this section, accepts credit cards as a means of payment of
 fines, civil penalties, taxes,  fees,  rent,  rates,  charges  or  other
 amounts  owed  by a person to the city shall be authorized to charge and
 collect from any person offering a credit card as a means of payment  of
 a  fine  a  reasonable  and uniform fee as a condition of accepting such
 credit card in payment of a fine, civil penalty, tax, fee,  rent,  rate,
 charge  or  other amount. Such fee shall not exceed the cost incurred by
 the agency or department in connection  with  such  credit  card  trans-
 S. 8474                            158
 
 action,  which  cost  shall  include  any fee payable by the city to the
 financing agency.
   § 11-106  Weekly reports by commissioner of finance to mayor and comp-
 troller.  The  commissioner of finance shall report weekly in writing to
 the mayor and to the comptroller all moneys received by the  commission-
 er,  the amount of all warrants paid by him or her since the commission-
 er's last report, and the amount remaining to the credit of the city.
   § 11-107  Report to comptroller. The  commissioner  of  finance,  when
 required  by  the comptroller, shall furnish to him or her such informa-
 tion as the comptroller may demand in relation to the  finances  of  the
 city, within such reasonable time as the commissioner may direct.
   §  11-108    Rules in signing warrants.  No warrant shall be signed by
 the comptroller or countersigned by the commissioner of finance,  except
 upon  vouchers  for  the  expenditures of the amount named therein, duly
 prepared and audited according to the methods prescribed  by  the  comp-
 troller,  and  filed  with  the comptroller, except in the case of judg-
 ments, in which case a transcript thereof shall be filed.
   § 11-109  Commissioner of finance to exhibit bank  book.  The  commis-
 sioner  of finance shall exhibit his or her bank book to the comptroller
 on the first Tuesday of every month and more often when required.
   § 11-110  When commissioner of finance to close accounts. The accounts
 of the commissioner of finance shall be annually closed on the last  day
 of June.
   §  11-111   Withdrawal of moneys by heads of agencies. Notwithstanding
 any provision of the charter, any city treasury or sinking  fund  moneys
 which have been duly withdrawn from any bank or trust company upon prop-
 er  warrant and check to the order of the head or heads of any agency or
 agencies may be redeposited by such head or  heads  of  such  agency  or
 agencies in a properly designated deposit bank and thereafter such rede-
 posited  moneys may be withdrawn upon check signed by him or her or them
 without additional warrant.
   § 11-112  Authorization of subordinates to sign checks  and  warrants.
 Notwithstanding any provision of the charter, the comptroller or commis-
 sioner  of  finance  may designate and authorize any deputies, assistant
 deputies, or employees to sign, each in his or her own name and in place
 of and for the comptroller or commissioner of finance, respectively, any
 or all checks  or warrants, including those issued against sinking  fund
 and  trust fund bank accounts.  A warrant or check so signed shall be of
 the same force and effect as if signed by the comptroller or commission-
 er of finance, respectively.  The designation or designations  of  depu-
 ties  shall  be made in writing in the manner set forth in section nine-
 ty-four of the charter of  the  preceding  municipality  as  it  existed
 January  first, nineteen hundred ninety-four.  The designation or desig-
 nations of assistant deputies or employees shall be in  writing,  signed
 in  duplicate by the comptroller or the commissioner of finance, respec-
 tively, and shall be duly filed and remain of record in  the  office  of
 the  comptroller  and  the department of finance.   The period for which
 each such designation of  deputies,  assistant  deputies  and  employees
 shall continue in force shall be specified therein and may be terminated
 by the comptroller or commissioner of finance, respectively, at any time
 by  filing  in  the  same office or offices in which the designation has
 been filed a written notice of such  termination  signed  by  the  comp-
 troller or commissioner of finance, respectively.
   §  11-113  Acceptance of facsimile signatures by banks or trust compa-
 nies. Notwithstanding any provision of the charter,  checks  drawn  upon
 any  bank  or trust company for payment of payrolls or disbursements for
 S. 8474                            159
 
 relief, required to be signed by the head of an agency  or  his  or  her
 authorized  designee, may be signed by the facsimile signature or signa-
 tures of the person or persons authorized to sign such  checks,  if  the
 head  of such agency so authorizes by an instrument in writing signed by
 the head of such agency and filed with the  comptroller;  and,  in  such
 event, any bank or trust company shall, acting in good faith and without
 notice  of  any  defect  or  invalidity,  be  authorized  to  pay and be
 protected in paying any checks bearing or purporting to bear the facsim-
 ile signature or signatures of the person or persons duly authorized  to
 sign such checks, regardless of the person by whom or the means by which
 the  actual  or  purported facsimile signature or signatures thereon may
 have been affixed thereto, if such  facsimile  signature  or  signatures
 closely  resemble  the  facsimile specimens from time to time filed with
 such banks or trust companies by the head of  the  agency  in  question;
 provided, however, that nothing herein contained shall release such bank
 or trust company from any liability arising from any cause or fact other
 than  the  fact that such facsimile signature is not a genuine facsimile
 signature affixed with appropriate authority.
   § 11-115  City collector; appointment; bond.  The mayor shall  appoint
 the city collector.  The city collector, before entering upon the duties
 of  his  or  her  office,  shall enter into a bond to the city of Staten
 Island to be approved by the commissioner of finance and comptroller  in
 the  penal  sum  of  twenty-five  thousand  dollars, which bond shall be
 conditioned for the faithful performance of the duties of the office  by
 the officer giving such bond.  Such bond shall be a lien on all the real
 estate  held by the collector executing the same, or any surety thereto,
 in the city at the time of the filing thereof, unless there be named and
 described in or on any such bond, real estate  in  such  city  equal  in
 value  to  the amount of such bond and owned by a surety,  in which case
 the bond shall be a lien on such real estate so described and  upon  all
 the real estate of such city collector, and no other, and shall continue
 to be such lien until the condition, together with all costs and charges
 which  may  accrue by the prosecution thereof, shall be fully satisfied,
 or until such lien be released, not to exceed, however,  the  period  of
 ten  years after the time when the officer who has given such bond shall
 have ceased to hold his or her office, unless an action thereon has been
 commenced and shall then be pending.
   § 11-116  Deputies to give bond; duties.   The  city  collector  shall
 take  from  each deputy a bond, in such penal sum and with such sureties
 as may be approved by the city collector  and  by  the  comptroller  and
 commissioner of finance, which bond shall run to the city collector, the
 city and to whom it may concern, and shall be conditioned for the faith-
 ful  performance  of  the  duties  of  such deputy.   Each bond taken in
 pursuance of the provisions of this section  shall  be  filed  with  the
 comptroller.    Each  deputy  collector shall have all the powers and be
 subject to all the duties of  the  city  collector  in  respect  to  the
 collection and receipt of taxes, assessments, water rents and arrears.
   §  11-117    Renewal of bond. If at any time during the continuance in
 office of the city collector or deputy  collectors  the  comptroller  or
 commissioner  of  finance  shall  deem any surety of them to be insuffi-
 cient, he or she may require the city collector or deputy collectors  to
 enter  into  a  new  bond to be approved in like manner as prescribed in
 section 11-115 of this chapter, within such time as the comptroller  may
 direct, not being less than ten days after requiring such new bond to be
 given.  In case of the neglect or refusal of any such officer to furnish
 S. 8474                            160
 
 such  bond  within the time so directed, the comptroller or commissioner
 of finance may declare his or her office vacant.
   § 11-118  Bureau of city collections; duties. The duties of the bureau
 of  city  collections  shall also include the collection of water rents,
 charges, fines and  penalties  in  connection  with  the  water  supply,
 including  arrears,  sewer  rents,  sewer surcharges, charges, fines and
 penalties in connection with the sewer system  as  defined  in  sections
 24-514  and  24-523 of the code of the preceding municipality, including
 arrears, interest on bonds and mortgages and revenue  arising  from  the
 sale of property belonging to or managed by the city.
   §  11-119    City  collector; absence; suspension of.   a.  In case of
 inability of the city collector to perform the  duties  of  his  or  her
 office  by  reason of sickness or absence from the city, the mayor shall
 designate some suitable person to perform the duties of the city collec-
 tor's office during such inability or absence, and shall, if  the  comp-
 troller so requires, take from such person a bond, with sufficient sure-
 ties, in the manner hereinafter prescribed.
   b. If the city collector or any deputy collector shall on any day omit
 or  neglect  to  furnish  to the commissioner of finance or to the comp-
 troller, respectively, the statements and vouchers required  in  section
 11-121  of  this  chapter,  or to make the prescribed daily payments, it
 shall be the duty of the commissioner of finance  forthwith  to  suspend
 him or her from office.  In case of such suspension, the commissioner of
 finance  shall  appoint  a  suitable person to perform the duties of the
 officer so suspended, who shall continue to act as  such  officer  until
 the person suspended shall be restored or another person shall have been
 appointed.    On  making such temporary appointment, the commissioner of
 finance shall be required to take from the person so appointed  a  bond,
 with  two  sufficient  sureties,  to  be approved by the comptroller and
 filed with the comptroller, in such penal sum  as  the  comptroller  may
 deem just, conditioned for the faithful performance of the duties of the
 office  during  the continuance of the person appointed therein; and all
 the provisions of law prescribing the duties of the city  collector  and
 deputy collectors shall apply to the person or persons so appointed.
   §  11-120   Bond of city collector to be filed.  The bond given by the
 city collector shall be filed and remain in  the  office  of  the  comp-
 troller, and true copies thereof, certified by the comptroller, shall be
 filed  in the office of the clerk, and shall be public records.  In case
 a certificate of the adjustment of the accounts of the city collector be
 made, a true copy thereof, certified by the comptroller, shall be  filed
 in each of the offices in which a copy of the bond of the city collector
 shall have been filed.
   §  11-121  City collector; daily statements and accounts. a.  The city
 collector or the deputy collector shall enter upon accounts, to be main-
 tained in each such office for each parcel of property, the  payment  of
 taxes,  assessments,  sewer  rents  or  water  rents thereon, the amount
 therefor, and the date when paid.  The city collector shall daily  enter
 into  suitable  books  to be kept for the purpose of such accounts, such
 payments and the respective parcels on account of which  the  same  were
 paid.
   b.  At close of office hours each day, the city collector shall render
 to  the commissioner of finance a statement of the sums so received, and
 at the same time pay over to such commissioner of  finance,  the  amount
 received  on  such day.  The city collector shall thereupon receive from
 such commissioner of finance a voucher for  the  payment  of  such  sums
 S. 8474                            161
 
 which he or she shall exhibit to the comptroller not later than the next
 succeeding business day.
   c.    At  the close of office hours each day, the city collector shall
 also furnish a statement to the comptroller who shall file the  same  in
 his or her office.  Such statement shall indicate in detail such sums so
 received  and  the  respective parcels on account of which the same were
 paid.  The comptroller shall, on each day, immediately  after  receiving
 such statement, compare it with a voucher furnished to him or her by the
 commissioner of finance indicating the sums which have been paid on such
 day  to the commissioner of finance and if the aggregate amounts thereof
 shall correspond, shall credit the city collector in his  or  her  books
 with such amount.
   §  11-122  Exemption  from  taxes granted to REMICs. An entity that is
 treated for federal income  tax  purposes  as  a  real  estate  mortgage
 investment  conduit, hereinafter referred to as a REMIC, as such term is
 defined in section 860D of the internal revenue code,  shall  be  exempt
 from  all  taxation  under  chapters five and six of this title. A REMIC
 shall not be treated as a corporation, partnership or trust for purposes
 of chapter six of this title.  The  assets  of  a  REMIC  shall  not  be
 included in the calculation of any tax liability under chapter six. This
 provision  does not exempt the holders of regular or residual interests,
 as defined in section 860G of the internal revenue code, in a REMIC from
 tax on or measured by such regular or residual interests, or  on  income
 from such interests.
   § 11-123 Interest compounded daily.
   In  computing  the  amount  of  any interest required to be paid under
 section 11-224 (except subdivision j thereof), 11-224.1, 11-264, 11-306,
 11-307, 11-312, 11-313, 17-151, 19-152, 24-317, 24-512, 24-605,  26-128,
 26-517.1,  27-2144  or  27-4029.1  of  the  code, such interest shall be
 compounded daily.
   § 11-124 Conciliation conferences. a. The commissioner of finance  may
 establish   a  procedure  for  providing  conciliation  conferences  for
 purposes of settling contested determinations of  taxes  or  charges  or
 denials  of  refunds or credits with respect to taxes or charges imposed
 under chapter five, six, seven, eight, nine, eleven,  twelve,  thirteen,
 fourteen,  fifteen,  twenty-one, twenty-two, twenty-four, twenty-five or
 twenty-seven of this title, or for  the  purpose  of  settling  disputes
 arising from the notification of the refusal to grant, the suspension or
 the  revocation of a license issued pursuant to chapter thirteen of this
 title. If such a procedure is  established,  a  conciliation  conference
 shall  be  provided  at  the  option of any taxpayer or any other person
 subject to the provisions of any of such chapters. For purposes of  this
 subdivision, if the commissioner of finance fails to act with respect to
 a  refund  application  before  the  expiration of the time period after
 which the taxpayer may file a petition for refund with the  tax  appeals
 tribunal  established  by section one hundred sixty-eight of the charter
 of the preceding municipality as  it  existed  January  first,  nineteen
 hundred  ninety-four  pursuant  to  subdivision (c) of section 11-529 or
 subdivision three of section 11-680 of the code, such failure  shall  be
 deemed to be the denial of a refund.
   b. A request for a conciliation conference shall be made in the manner
 set  forth  in  rules  promulgated  by  the commissioner of finance and,
 notwithstanding any provision of law to the contrary, shall suspend  the
 running  of  the period of limitations for the filing of a petition with
 such tax appeals tribunal under chapter five, six, seven,  eight,  nine,
 eleven,  twelve,  thirteen,  fourteen,  fifteen, twenty-one, twenty-two,
 S. 8474                            162
 
 twenty-four, twenty-five or twenty-seven of this title until  such  time
 as  a  conciliation decision is rendered by the commissioner of finance,
 or until the person who requested the conciliation  conference  makes  a
 written  request  to  discontinue  or  withdraw  from  the  conciliation
 proceeding.
   c. Nothing contained herein shall prevent any taxpayer  or  any  other
 person  who has received a notice of determination, notice of deficiency
 or notice of denial of a claim for refund from filing  a  petition  with
 such tax appeals tribunal if the time for filing such a petition has not
 elapsed.
   d.  The  commissioner  of finance is authorized and empowered to make,
 adopt and amend rules appropriate to the carrying out  of  this  section
 and the purposes thereof.
   §  11-126 Definitions. When used in this title, the term "partnership"
 shall mean an entity classified as a partnership for federal income  tax
 purposes,  including  a  subchapter K limited liability company, and the
 term "partner" or the term "member" when used in relation to a  partner-
 ship shall include a member of a subchapter K limited liability company,
 unless  the  context  requires otherwise. The term "subchapter K limited
 liability company" shall mean a limited liability company classified  as
 a partnership for federal income tax purposes. The term "limited liabil-
 ity  company"  means  a  domestic limited liability company or a foreign
 limited liability company, as defined in section one hundred two of  the
 state  limited  liability  company  law,  a limited liability investment
 company formed pursuant to section five hundred  seven  of  the  banking
 law, or a limited liability trust company formed pursuant to section one
 hundred  two-a  of  the banking law.  Notwithstanding anything herein to
 the contrary, this section shall  not  apply  for  purposes  of  chapter
 seventeen or nineteen of this title.
   §  11-128 Payment of real property taxes by electronic funds transfer.
 a.  Definition. "Electronic funds transfer" shall mean any  transfer  of
 funds,  other  than  a transaction originated by check, draft or similar
 paper instrument, which is initiated  through  an  electronic  terminal,
 telephonic  instrument  or  computer  or  magnetic  tape so as to order,
 instruct or authorize a financial institution  to  debit  or  credit  an
 account.
   b.  Authority.  Notwithstanding  any provision of law to the contrary,
 the department of finance may accept and, as authorized by this section,
 require payment of real property taxes by electronic funds transfer, and
 may authorize a designee to accept  such  payments.  The  department  of
 finance, or its designee, may take all actions necessary to complete and
 administer  such  transactions,  including but not limited to requesting
 and collecting necessary  information  and  the  debiting  of  specified
 accounts as provided for by this section.
   c.  Participation. Notwithstanding any provision of law to the contra-
 ry, the commissioner may require the payment of real property  taxes  by
 electronic  funds  transfer for properties with annual real property tax
 liability equal to or greater than three hundred thousand  dollars.  The
 owner  of  any such real property, or the person or entity authorized by
 such owner to pay real property taxes on such real  property,  shall  be
 required  to  enroll  in  an  electronic  payment  program  to make such
 payments, including any arrears in real  property  taxes  on  such  real
 property,  by  electronic funds transfer, either by payment initiated by
 the taxpayer as described in paragraph one  of  subdivision  d  of  this
 section  or  by authorizing the department of finance to debit the rele-
 S. 8474                            163
 
 vant account as described in paragraph two  of  subdivision  d  of  this
 section.
   1.  Notwithstanding  any  other  provision  of  this  section, where a
 taxpayer pays real property taxes for more than one property by a single
 payment, and the total annual real property tax liability for such prop-
 erties is equal to or greater than three hundred thousand  dollars,  the
 total  annual  real  property tax liability for such properties shall be
 used to determine whether the taxes for a property must be paid by elec-
 tronic funds transfer.
   2. (i) Where real property taxes are paid for more than  one  taxpayer
 by  a  single bill or paid by a single entity, including but not limited
 to a mortgage escrow agent as defined in subparagraph (ii) of this para-
 graph, if the total amount paid  is  equal  to  or  greater  than  three
 hundred  thousand  dollars annually, such amount shall be used to deter-
 mine whether the taxpayer or entity is required  to  participate  in  an
 electronic funds transfer program.
   (ii)  For purposes of this paragraph, the term "mortgage escrow agent"
 shall include every banking organization, federal savings bank,  federal
 savings and loan association, federal credit union, bank, trust company,
 licensed  mortgage  banker,  savings bank, savings and loan association,
 credit union, insurance corporation organized  under  the  laws  of  any
 state  other  than New York, or any other person, entity or organization
 which, in the regular course of its  business,  requires,  maintains  or
 services  escrow  accounts in connection with mortgages on real property
 located in the city.
   d. Electronic payment program. The owner of real  property,  or  other
 person  or entity authorized by such owner to pay real property taxes on
 real property for which payment must be made by electronic funds  trans-
 fer  under  this section, may choose between participating in a taxpayer
 initiated payment program or an automatic debit program, as set forth in
 this subdivision and described in rules promulgated by the  commissioner
 of finance.
   1.  Taxpayer  initiated program. In such a program, taxpayers initiate
 payment by electric funds transfer, including payment by fedwire.
   2. Automatic debit program. In such a program, taxpayers authorize the
 department of finance, or the department's designee as determined by the
 commissioner of finance, to debit the taxpayer's account for the amounts
 due.
   e. Notification of participation requirements. For taxpayers or  enti-
 ties  subject  to  this  section,  the  department of finance shall mail
 notice of such requirement to the property owner or other party who  has
 been  designated to receive real property tax bills on an owner's regis-
 tration card filed by such owner. Such notice shall include the date  by
 which  the  owner  or  other  party designated by such owner to pay real
 property taxes on the property must enroll  in  the  electronic  payment
 program.
   f.  Authorization. To administer the payment of real property taxes by
 electronic funds transfer by automatic debit as described  in  paragraph
 two  of  subdivision  d  of  this section, the department of finance may
 require that the party responsible for  the  payment  of  real  property
 taxes:
   1.  execute an electronic funds transfer agreement with the department
 of finance or its designee, on a form  approved  by  the  department  of
 finance.  Such  form  may be in a format designated by the commissioner,
 including an electronic format. The agreement  shall  require  that  the
 taxpayer  authorize  the  department of finance or its designee to debit
 S. 8474                            164
 
 such account on the last date by which the real property  taxes  may  be
 paid  without the accrual of interest in accordance with applicable law;
 and
   2.  furnish the department of finance or its designee with information
 to enable the department of finance to  complete  the  electronic  funds
 transfer transaction. Such information shall include, but not be limited
 to,  the  name  and  address  of the bank from which an electronic funds
 transfer shall be authorized, the account number from which the  payment
 shall  be  authorized,  the  American  Bankers Association (ABA) routing
 number of the bank where the  taxpayer  maintains  an  account  and  the
 borough,  block and lot of the real property for which such payments are
 authorized.
   g. Timely payment. Notwithstanding any provision of law to the contra-
 ry, where real property taxes are required  to  be  made  by  electronic
 funds  transfer  pursuant  to  subdivision c of this section, payment of
 real property tax by electronic funds transfer shall  be  deemed  timely
 and not subject to interest charges if:
   1.  for taxpayers enrolled in a taxpayer initiated program pursuant to
 paragraph one of subdivision d of this section, (i) the taxpayer proper-
 ly initiates payment on the last date by which the real  property  taxes
 may  be paid without the accrual of interest in accordance with applica-
 ble law; and (ii) on the last date by which the real property taxes  may
 be  paid  without  the accrual of interest in accordance with applicable
 law, such account contains sufficient funds  to  enable  the  successful
 completion of the electronic funds transfer; or
   2.  for  taxpayers  enrolled in an automatic debit program pursuant to
 paragraph two of subdivision d of this section, (i)  the  department  of
 finance  or  its  designee  has  been authorized to debit the taxpayer's
 account on the last date by which the real property taxes  may  be  paid
 without  the accrual of interest in accordance with applicable law; (ii)
 such account is properly identified; and (iii) on the date such  payment
 is  due, such account contains sufficient funds to enable the successful
 completion of the electronic funds transfer.
   h. Charge on returned payments. Where the department of finance or its
 designee attempts to debit a taxpayer's  account  pursuant  to  a  valid
 electronic  funds  transfer  agreement  and  is  unable  to successfully
 complete the electronic funds transfer  due  to  insufficient  funds  or
 other  cause not attributable to the department of finance or its desig-
 nee, in addition to any interest accruing from the late payment of taxes
 in accordance with applicable law, the same fee that is  imposed  for  a
 dishonored  check pursuant to section eighty-five of the general munici-
 pal law shall be imposed on the affected real property, and such fee may
 be collected in the manner provided in such section.
   i. Hardship. If a taxpayer is  unable  to  enroll  in  the  electronic
 payment  program required by subdivision c of this section or subsequent
 to enrollment becomes unable to make payments by electronic funds trans-
 fer as required by this section, the taxpayer may seek a waiver by writ-
 ten application to the department of finance that sets forth the  reason
 for  such inability. Such waiver may be granted in the discretion of the
 commissioner of finance, who may consider such criteria as:
   1. the hardship, whether financial or practical,  created  by  partic-
 ipation  in the electronic funds transfer program for the taxpayer seek-
 ing the waiver;
   2. the length of time for which the waiver is requested; and
   3. any other factors that the commissioner may deem relevant.
 S. 8474                            165
 
   The commissioner shall issue a determination, in writing,  within  ten
 days of the department of finance's receipt of a waiver request pursuant
 to  this subdivision, but no waiver shall be granted with respect to the
 payment of any installment of real property taxes  that  is  due  within
 thirty days of the date of the request for a waiver.
   j.  Confidentiality. The department of finance shall assure the confi-
 dentiality of information supplied by taxpayers in effecting  electronic
 funds  transfers  in  accordance  with applicable provisions of law. The
 provisions of article six of the public officers law shall not apply  to
 any  such information furnished by taxpayers subject to the requirements
 of this section.
   k. Failure to pay by electronic funds transfer. 1. With respect to any
 real property as to which real property taxes are required to be paid by
 electronic funds transfer under this section, but for which an  install-
 ment of real property taxes is not paid by electronic funds transfer and
 is  paid  instead  by  any other method, including payment by check, (i)
 with respect to the first installment that is paid by any other  method,
 including payment by check, the department of finance shall mail a warn-
 ing notice to the taxpayer setting forth the requirement to make payment
 by electronic funds transfer and the penalties for failure to do so; and
 (ii)  with respect to each and every subsequent installment that is paid
 by any other method, including  payment  by  check,  the  department  of
 finance  shall  impose  a penalty charge in the amount of one percent of
 the amount of the tax installment that was required under  this  section
 to be paid by electronic funds transfer.
   2.  Any  penalty charge imposed under this subdivision shall be a lien
 against the real property for  which  the  taxpayer  failed  to  make  a
 payment  in the manner required by this section, and shall accrue inter-
 est at the same rate as is imposed on a delinquent tax on real property,
 to be calculated to the date of payment from the  date  of  entry.  Such
 lien  shall  be  a  tax  lien  within the meaning of sections 11-319 and
 11-401 and may be sold, enforced or foreclosed in the manner provided in
 chapters three and four of this title.
   l. Rules. The commissioner may promulgate rules necessary to implement
 this section.
                                 CHAPTER 2
              REAL PROPERTY ASSESSMENT, TAXATION AND CHARGES
 
                               SUBCHAPTER 1
                        ASSESSMENT ON REAL PROPERTY
   § 11-201   Assessments on real property;  general  powers  of  finance
 department.  The commissioner of finance shall be charged generally with
 the duty and responsibility of assessing all real  property  subject  to
 taxation within the city.
   §  11-202    Maps  and  records; surveyor. The commissioner of finance
 shall appoint a surveyor  who  shall  make  the  necessary  surveys  and
 corrections  of  the  block or ward maps, and also make all new tax maps
 which may be required.
   § 11-203  Maps and records; tax maps. a.  As used in  the  charter  of
 the  city  of Staten Island  and in this code, the term "tax maps" shall
 mean and include the block map of taxes and assessments  to  the  extent
 that  the  territory  within  the  city  of Staten Island is or shall be
 embraced in such map, such ward or land maps as embrace the remainder of
 such city, and also such maps as may be prepared under and  pursuant  to
 subdivision d of this section.
 S. 8474                            166
 
   b.  Each separately assessed parcel shall be indicated on the tax maps
 by a parcel number or by an identification number.  A separate identifi-
 cation  number  shall  be  entered  upon  the tax maps in such manner as
 clearly to indicate each separately assessed parcel of real property not
 indicated  by  parcel  numbering.    Real property indicated by a single
 identification number shall  be  deemed  to  be  a  separately  assessed
 parcel.
   In  the  case  of a newly created parcel with any building thereon, no
 tax lot number or identification number shall be assigned to such parcel
 unless the commissioner of the department  of  buildings  has  certified
 that the newly created parcel complies with all applicable zoning laws.
   c.   Parcel numbers shall designate each parcel by the use of three or
 more numbers, of which one shall be a section or ward number, another  a
 block,  district  or plat number, and another a lot number.  The depart-
 ment of finance may from time to time change the form of the section and
 blocks, and also the numbers thereof, on  the  tax  maps  filed  in  its
 office  whenever such change of form has been caused pursuant to section
 one hundred ninety-nine of the charter of the preceding municipality  as
 it  existed  on  the  first  of  January in the year next succeeding the
 effective date of this section and there shall thereafter be  delineated
 and  entered  upon such maps such new additional sections and blocks and
 their numbers as necessity may require.  Such   administration may  from
 time to time change the form of the lots or parcels comprised within any
 block,  and also the numbers thereof, and cause to be shown on such maps
 the separate lots or parcels of land contained in any  new  block  added
 thereto  and also the lot numbers thereof, according to the general plan
 employed in the making of such maps.
   d.  Each separately assessed parcel  indicated  by  an  identification
 number shall be shown by a description, or by inscription of such number
 on  the  block  map  of  taxes  and  assessments,  or  by  other map and
 description.  Such numbers may be altered in the same manner as provided
 in subdivision c of this section for the alteration of parcel numbers.
   e.  New tax maps shall be certified by the department of  finance  and
 filed  in  its  main office. All changes and alterations made in the tax
 maps shall be transmitted within thirty days after such change or alter-
 ation to such office.
   § 11-204 Tax maps; block references; alterations and corrections.  The
 word  "block",  as  used  in this section designates a plot or parcel of
 land such as is commonly so designated  in  the  city,  wholly  embraced
 within  the continuous lines of streets, or streets and waterfront taken
 together where water forms one of the boundaries of a  block,  and  such
 other  parcels  of  land  or land under water as may be indicated by the
 department of finance upon such tax maps by block numbers as  constitut-
 ing blocks.
   § 11-205 Maps and records; public inspection; evidential value. a. The
 books,  maps,  assessment-rolls,  files and records of the department of
 finance shall be kept in such  of  the  offices  of  the  department  of
 finance as may be most convenient to the taxpayers of the city and suit-
 able  to  the  proper  discharge  of  the  business of the department of
 finance. They shall be public records and shall at all reasonable  times
 be open to public inspection.
   b.  Copies  of  all such records and transcripts thereof, certified by
 the commissioner of finance or an assessor or by an officer or  employee
 of  the department of finance designated by the commissioner of finance,
 and under the seal of the department of finance, shall be admissible  in
 evidence  in  all  courts and places in the same manner and for the same
 S. 8474                            167
 
 purposes as books, papers or documents similarly  authenticated  by  the
 clerk of a county.
   §  11-206  Power of the commissioner of finance to correct errors. The
 commissioner of finance may correct any assessment or tax which is erro-
 neous due to a clerical error or to an error of description contained in
 the several books of annual record of assessed  valuations,  or  in  the
 assessments-rolls.    If the taxes computed on such erroneous assessment
 have been paid, the commissioner of finance is authorized to  refund  or
 credit  the  difference  between the taxes computed on the erroneous and
 corrected assessments.
   § 11-207 Duties of assessors in assessing property. a.  In  performing
 their  assessment  duties,  the  assessors shall personally examine each
 parcel of taxable real estate during at  least  every  third  assessment
 cycle,  and  shall personally examine each parcel of real estate that is
 not taxable during at least every fifth assessment  cycle,  as  measured
 from  the  last  preceding assessment cycle during which such parcel was
 personally examined, provided, however,  the  assessors  shall  revalue,
 reassess  or update the assessment of each parcel of taxable or nontaxa-
 ble real estate during each assessment cycle,  irrespective  of  whether
 such parcel was personally examined during each assessment cycle.
   b. The persons having charge of the assessment office shall furnish to
 the  commissioner  of  finance,  under oath, a detailed statement of all
 taxable real estate in the city.    Such  statement  shall  contain  the
 street, the section or ward, the block and lot and map or identification
 numbers  of  such  real  estate  embraced  within such city; the sum for
 which, in their judgment, each separately assessed parcel of real estate
 would sell under ordinary circumstances if  it  were  wholly  unimproved
 and,  separately  stated,  the  sum for which the same parcel would sell
 under ordinary circumstances with the  improvements,  if  any,  thereon,
 such  sums  to be determined with regard to the limitations contained in
 the state real property tax law.   Such  statement  shall  include  such
 other information as the commissioner of finance may, from time to time,
 require.
   §  11-208   Special right of entry; certificate of the commissioner of
 finance. A right of entry upon real  property  and  into  buildings  and
 structures  at  all  reasonable  times to ascertain the character of the
 property shall not be allowed to any person  acting  in  behalf  of  the
 department  of  finance,  other than the officials mentioned in sections
 one hundred fifty-six and one thousand five hundred  twenty-one  of  the
 charter  of  the  preceding  municipality  as it existed on the first of
 January in the year next succeeding the effective date of this  section,
 unless  a  certificate  therefor,  executed in writing and signed by the
 commissioner of finance, is presented  by  such  person  to  the  owner,
 lessee,  or  occupant  of  the premises or his or her agent before entry
 thereon is made.
   § 11-208.1 Income and expense statements. a. Where  real  property  is
 income-producing property, the owner shall be required to submit annual-
 ly  to  the department not later than the first of September a statement
 of all income derived from and all expenses attributable to  the  opera-
 tion of such property as follows:
   (1)  Where  the  owner's books and records reflecting the operation of
 the property are maintained on a  calendar  year  basis,  the  statement
 shall be for the calendar year preceding the date the statement shall be
 filed.
   (2)  Where  the  owner's books and records reflecting the operation of
 the property are maintained on a fiscal year basis  for  federal  income
 S. 8474                            168
 
 tax  purposes, the statement shall be for the last fiscal year concluded
 as of the first of August preceding the  date  the  statement  shall  be
 filed.
   (3)  Notwithstanding  the provisions of paragraphs one and two of this
 subdivision, where the owner of the property has not operated the  prop-
 erty  and  is without knowledge of the income and expenses of the opera-
 tion of the property for a consecutive twelve month period concluded  as
 of  the  first  of  August  preceding the date of the statement shall be
 filed, then the statement shall be for the period of ownership.
   (4) The commissioner may for good cause  shown  extend  the  time  for
 filing  an income and expense statement by a period not to exceed thirty
 days.
   b. Such statements shall contain the following declaration: "I certify
 that all information contained in this statement is true and correct  to
 the  best  of  my  knowledge  and  belief. I understand that the willful
 making of any false statement of material fact herein will subject me to
 the provisions of law relevant to the making and filing of false instru-
 ments and will render this statement null and void."
   c. The form on which  such  statement  shall  be  submitted  shall  be
 prepared  by  the  commissioner  and  copies  of such form shall be made
 available at the offices of the department in the county  in  which  the
 property  is located. The commissioner may, by rule, require such state-
 ment to be submitted electronically in such form and such manner as  the
 commissioner  may  determine. For good cause, the commissioner may waive
 any rule requiring electronic filing and may permit a  statement  to  be
 filed in such other manner as the commissioner may designate.
   d.  (1)  In the event that an owner of income-producing property fails
 to file an income and expense statement within the  time  prescribed  in
 subdivision  a  of this section (determined with regard to any extension
 of time for filing), such owner shall be subject  to  a  penalty  in  an
 amount  not  to  exceed  three  percent  of  the  assessed value of such
 income-producing property determined for  the  current  fiscal  year  in
 accordance  with  section  fifteen  hundred  six  of  the charter of the
 preceding municipality as it existed on the first of January in the year
 next succeeding the effective date of this  section  provided,  however,
 that if such statement is not filed by the thirty-first of December, the
 penalty  shall  be  in  an  amount  not  to  exceed four percent of such
 assessed value. If, in the year immediately following the year in  which
 an  owner fails to file by the thirty-first of December, the owner again
 fails to file an income and expense statement within the time prescribed
 in subdivision a of this section (determined with regard to  any  exten-
 sion of time for filing), such owner shall be subject to a penalty in an
 amount not to exceed five percent of the assessed value of such property
 determined for the current fiscal year. Such owner shall also be subject
 to  a  penalty of up to five percent of such assessed  value in any year
 immediately succeeding a year in which a penalty of up to  five  percent
 could  have  been imposed, if in such succeeding year the owner fails to
 file an income and expense  statement  within  the  time  prescribed  in
 subdivision  a  of this section (determined with regard to any extension
 of time for filing). The penalties prescribed in this paragraph shall be
 determined by the commissioner after notice and  an  opportunity  to  be
 heard.
   (2)  The  tax  commission shall deny a hearing on any objection to the
 assessment of property for which an  income  and  expense  statement  is
 required and has not been timely filed.
 S. 8474                            169
 
   (3)   Where  an  income  and  expense  statement  required  under  the
 provisions of this section has not been timely filed,  the  commissioner
 may  compel  by  subpoena the production of the books and records of the
 owner relevant to the income and expenses of the property, and may  also
 make  application  to  any  court of competent jurisdiction for an order
 compelling the owner to furnish the required income and  expense  state-
 ment.
   e. As used in this section, the term "income-producing property" means
 property  owned  for the purpose of securing an income from the property
 itself, but shall not include property with an assessed value  of  forty
 thousand  dollars  or  less,  or  residential property containing ten or
 fewer dwelling units or property classified  in  class  one  or  two  as
 defined  in article eighteen of the real property tax law containing six
 or fewer dwelling units and one retail store.
   f. Except in accordance with proper judicial  order  or  as  otherwise
 provided  by law, it shall be unlawful for the commissioner, any officer
 or employee of the  department,  the  president  or  a  commissioner  or
 employee  of  the  tax commission, any person engaged or retained by the
 department or the tax commission on an independent  contract  basis,  or
 any  person,  who, pursuant to this section, is permitted to inspect any
 income and expense statement or to whom a copy, an abstract or a portion
 of any such statement is furnished, to divulge  or  make  known  in  any
 manner  except  as  provided  in  this subdivision, the amount of income
 and/or expense or any particulars set forth or  disclosed  in  any  such
 statement  required  under this section. The commissioner, the president
 of the tax commission, or any commissioner or officer or employee of the
 department or the tax commission charged with the custody of such state-
 ments shall not be required to produce any income and expense  statement
 or evidence of anything contained in them in any action or proceeding in
 any  court,  except  on  behalf of the department or the tax commission.
 Nothing herein shall be construed to prohibit the delivery to  an  owner
 or  his or her duly authorized representative of a certified copy of any
 statement filed by such owner pursuant to this section  or  to  prohibit
 the  publication of statistics so classified as to prevent the identifi-
 cation of particular statements and the items thereof, or  making  known
 aggregate income and expense information disclosed with respect to prop-
 erty classified as class four as defined in article eighteen of the real
 property  tax law without identifying information about individual leas-
 es, or making known a range as determined  by  the  commissioner  within
 which  the  income  and  expenses  of a property classified as class two
 falls, or the inspection by the legal representatives of the  department
 or  of  the tax commission of the statement of any owner who shall bring
 an action to correct the assessment. Any violation of the provisions  of
 this  subdivision shall be punished by a fine not exceeding one thousand
 dollars or by imprisonment not exceeding  one  year,  or  both,  at  the
 discretion  of  the court, and if the offender be an officer or employee
 of the department or the tax commission, the offender shall be dismissed
 from office.
   g. The commissioner shall be authorized to promulgate rules and  regu-
 lations necessary to effectuate the purposes of this section.
   h.  Subdivision  f of this section shall be deemed a state statute for
 purposes of paragraph (a) of subdivision two of section eighty-seven  of
 the public officers law.
   §  11-209  Taxable status of building in course of construction. a.  A
 building in the course of construction, commenced  since  the  preceding
 fifth  day  of  January  and not ready for occupancy on the fifth day of
 S. 8474                            170
 
 January following, shall not be assessed unless it shall  be  ready  for
 occupancy  or a part thereof shall be occupied prior to the fifteenth of
 April.
   b.  (1) A commercial building in the course of construction, commenced
 since the fifth day of January one year  preceding  the  taxable  status
 date  and  not  ready for occupancy or partially occupied on the taxable
 status date, shall not be assessed unless it shall be ready for occupan-
 cy or a part thereof shall be occupied prior to  the  fifteenth  day  of
 April following the taxable status date.
   (2)  A  commercial  building  in the course of construction, commenced
 since the fifth day of January two years preceding  the  taxable  status
 date  and  not  ready for occupancy or partially occupied on the taxable
 status date, shall not be assessed unless it shall be ready for occupan-
 cy or a part thereof shall be occupied prior to  the  fifteenth  day  of
 April following the taxable status date.
   (3)  A  commercial  building  in the course of construction, commenced
 since the fifth day of January three years preceding the taxable  status
 date  and  not  ready for occupancy or partially occupied on the taxable
 status date, shall not be assessed unless it shall be ready for occupan-
 cy or a part thereof shall be occupied prior to  the  fifteenth  day  of
 April following the taxable status date.
   c.  For purposes of this section, a "commercial building" shall mean a
 building that is intended to be  used,  and  upon  completion  is  used,
 exclusively   for  buying,  selling  or  otherwise  providing  goods  or
 services, or for other  lawful  business,  commercial  or  manufacturing
 activities,  excluding hotel services, except that a commercial building
 may contain a residential component other than  a  hotel,  provided  (i)
 that  such  residential component is receiving or has applied for and is
 eligible to receive a partial exemption from real property taxes  pursu-
 ant  to  section four hundred twenty-one-a of the real property tax law,
 or (ii) that such residential component in its entirety, both  land  and
 building,  is  receiving or has applied for and is eligible to receive a
 full exemption from real property taxes, provided, however,  a  "commer-
 cial  building"  shall  not  include any building that is constructed on
 block 1049, lot 29 as shown on the tax map of the city of New  York  for
 the  borough  of  Manhattan as such map was in effect for the assessment
 roll published in calendar year two thousand.
   d. Subdivision b of this section shall not apply to  a  tax  lot  that
 constitutes  a  part of a building unless the building viewed as a whole
 is a commercial building as defined in subdivision c of this section.
   e. Any building that receives the benefit conferred pursuant to subdi-
 vision b of this section that is subsequently  determined  not  to  have
 been  a  commercial building as defined in subdivision c of this section
 for any year in which it received such benefit shall have its assessment
 corrected for any such year. Taxes shall be imposed in the  amount  that
 would  have applied had the corrected taxable assessed value appeared on
 the final assessment roll.
   § 11-210  Books of annual record of assessed valuation of real  estate
 indicated  by  parcel numbers; form and contents. a. There shall be kept
 in the office of the department of finance, books of the  annual  record
 of the assessed valuation of real estate to be called "the annual record
 of  the assessed valuation of real estate indicated by parcel numbers in
 the Staten Island", in which shall be entered  in  detail  the  assessed
 valuation  of  each  separately  assessed  parcel  indicated by a parcel
 number within the limits of Staten Island.
 S. 8474                            171
 
   b. The assessed valuation of each such parcel shall  be  set  down  in
 such  books  in two columns.  In the first column shall be stated, oppo-
 site each such parcel, the sum for which such parcel  would  sell  under
 ordinary  circumstances  if wholly unimproved; and in the second column,
 the  sum  for  which such parcel would sell under ordinary circumstances
 with the improvements, if any thereon.
   c. Such books shall be prepared in such manner that the assessed valu-
 ations entered therein shall be under sections and block headings as may
 be most convenient for use in connection with the tax maps described  in
 section 11-203 of this chapter.
   §  11-211  Books of annual record of assessed valuation of real estate
 indicated by identification numbers. a. The assessed  valuation  of  all
 taxable  real  property  indicated  by  identification  numbers shall be
 entered in the office of the department of finance.
   b. The assessors in the city shall  furnish  to  the  commissioner  of
 finance at the office of the department of finance, a detailed statement
 under  oath  of the assessable real property indicated by an identifica-
 tion number in such city.
   c. There shall be kept in the office of  the  department  of  finance,
 books  of  the annual record of the assessed valuation of real estate to
 be known as "the annual record of the assessed valuation of real  estate
 indicated  by  identification  numbers",  in  which shall be entered the
 assessed valuations of the real property mentioned in this section.
   § 11-212 Power of the commissioner of finance to equalize  assessments
 before  opening  books.  a.  Before  opening the several books of annual
 record of assessed valuation for public inspection, the commissioner  of
 finance shall fix the valuations of property for the purpose of taxation
 throughout  the  city  at such sums as will, in the commissioner's judg-
 ment, establish a just and equal  relation  between  the  valuations  of
 property throughout the entire city.
   b.  To  this end the assessors are required to transmit to the commis-
 sioner of finance in each year a report of  the  assessed  valuation  of
 real  property  at  such  time prior to the fifteenth of January as such
 commissioner may prescribe.
   § 11-213 Errors in annual records or  assessment-rolls.  The  omission
 from  the  several books of annual record of assessed valuations or from
 the assessment-rolls in respect to the entry therein of the name of  the
 rightful  owner  or owners of real estate, whether individuals or corpo-
 rations, shall not invalidate any  tax  or  assessment.  In  such  case,
 however,  no  tax  shall  be  collected  except  from the real estate so
 assessed.
   § 11-214 Procedure on apportionment of assessment. a. The commissioner
 of finance may apportion any assessment in such  manner  as  he  or  she
 shall deem just and equitable, and forthwith cause such assessment to be
 cancelled  and  new assessments, equal in the aggregate to the cancelled
 assessment, to be made on the proper books and rolls. Within  five  days
 thereafter the commissioner of finance shall cause written notice of the
 new  assessments to be mailed to the owners of record of the real estate
 so assessed at their last known residence or business  address,  and  an
 affidavit of the mailing of such notice to be filed in the office of the
 department of finance.
   b.  When such notice is mailed after the first of February such owners
 may apply for correction of such assessments within  twenty  days  after
 the  mailing  of  such  notice with the same force and effect as if such
 application were made on or before the first of March in such year.
 S. 8474                            172
 
   § 11-215 Entry of corrections made by tax commission.  Upon  receiving
 notice  of a correction of an assessment made by the tax commission, the
 commissioner of finance shall cause the  amount  of  the  assessment  as
 corrected  to  be entered upon the proper books of annual record and the
 assessment-rolls for the year for which such correction is made.
   §  11-216  Reduction  in  assessments;  publication. a. There shall be
 published annually in the City Record a list of all reductions  in  real
 property  assessments granted by the tax commission identifying the name
 of the property owner, the address and the amount of reduction.
   b. No reduction shall be  granted  for  an  income-producing  property
 unless  there  is  submitted to the tax commission a statement of income
 and expenses in the form prescribed by  the  tax  commission  and  which
 shall  be, in the case of property valued at one million dollars or more
 certified by a certified public accountant.   The commissioner  granting
 such reduction in assessment shall state in a short memorandum the basis
 upon which the reduction is granted.
   c. In all cases where the reduction in assessment for the current year
 is  for fifty thousand dollars or more, the concurrence of the president
 of the tax commission shall be required.
   § 11-217 Assessment-rolls; form and contents.  Assessment-rolls  shall
 be  so arranged with respect to number of columns and shall contain such
 entries as the commissioner of finance shall  prescribe,  sufficient  to
 identify the property assessed and to show its total assessed valuation.
 Real  estate  shall  be  described  therein by the numbers by which such
 property is designated on the tax maps and in the several books  of  the
 annual record of the assessed valuation of real estate, and such numbers
 shall   import  into  the  assessment-rolls  any  necessary  identifying
 description shown by the tax maps.
   § 11-218 Assessment-rolls; delivery to council or city clerk.  a.  The
 council  shall  meet at noon, on the day of delivery of the rolls, other
 than a Saturday, Sunday, or legal holiday, at the  city  hall  or  usual
 place  of  meeting for the purpose of receiving the assessment-rolls and
 performing such other duties in relation thereto as  are  prescribed  by
 law.
   b.  If the council fails to meet as herein prescribed, the rolls shall
 be delivered to the city clerk with the same effect as if  delivered  to
 the council.
   §  11-219 Books of annual record; delivery for publication. Within two
 weeks after the delivery of the assessment-rolls  to  the  council,  the
 commissioner of finance shall furnish to the director of the City Record
 a  copy  of the several books of the annual record of the assessed valu-
 ation of real estate, omitting, however, the two columns headed  respec-
 tively "size of house" and "houses on lot."
   §  11-220  Council; date of meeting to fix tax rate. The council shall
 meet on a day other than a Saturday, Sunday or legal holiday, to fix the
 annual tax rate.
   § 11-221 Extension of tax on assessment-rolls or upon  assessment-roll
 cards.  The respective sums to be paid as taxes on the valuation of real
 property, may be set down in the assessment-rolls, or  upon  assessment-
 roll cards.
   § 11-222 Tax account of the commissioner of finance. Upon notification
 from  the  public  advocate  of  the  amount  of taxes mentioned in such
 assessment-rolls and tax warrants, the comptroller shall cause the prop-
 er sum to be charged to the commissioner of finance for collection.
   § 11-223 Apportionment of taxes. a. If a sum of  money  in  gross  has
 been or shall be taxed upon any lands or premises, any person or persons
 S. 8474                            173
 
 claiming  any  dividend  or  undivided part thereof may pay such part of
 such sum so taxed and of any interest and charges due or charged  there-
 on, as the commissioner of finance may deem to be just and equitable.
   b.  The commissioner of finance shall apportion the assessed valuation
 of such lands or premises.
   c. The remainder of the sum of money so taxed  and  the  interest  and
 charges  shall be a lien upon the residue of the land and premises only,
 and the tax lien upon such residue may be  sold  to  satisfy  such  tax,
 interest or charges thereon, in the same manner as though the residue of
 said  tax had been imposed only upon such residue of such lands or prem-
 ises.
   § 11-224 Interest on unpaid taxes. a. If any tax on real estate  which
 shall  have  become  due  and  payable  prior to January first, nineteen
 hundred thirty-four, is unpaid in whole or in part, the commissioner  of
 finance  shall  charge,  receive and collect interest upon the amount of
 such tax or such part thereof, to be calculated to the date  of  payment
 at the rate of seven per centum per annum from the date when such tax or
 such  part  thereof  became  due  and payable to January first, nineteen
 hundred thirty-four, at the rate of ten per centum per annum from  Janu-
 ary  first,  nineteen hundred thirty-four to May first, nineteen hundred
 thirty-seven, or at the rate of seven per  centum  per  annum  for  such
 period  if  the  comptroller  and  the commissioner of finance, in their
 discretion, both determine that the payment of any tax arrears  at  such
 reduced  rate  of  interest  may operate to save the property upon which
 such taxes are in arrears from foreclosure or encourage its  development
 or  is otherwise in the public interest, at the rate of seven per centum
 per annum from May first, nineteen hundred thirty-seven to August first,
 nineteen hundred sixty-nine, and from  August  first,  nineteen  hundred
 sixty-nine  to  December  thirty-first, nineteen hundred seventy-six, at
 the rate of seven per centum per annum if the annual tax on a parcel  is
 two  thousand  dollars  or  less,  and at the rate of one per centum per
 month if the annual tax on a parcel is more than  two  thousand  dollars
 or,  irrespective  of  the annual tax, if a parcel consists of vacant or
 unimproved land, and from January first, nineteen hundred  seventy-seven
 at  the rate of seven per centum per annum if the annual tax on a parcel
 is two thousand dollars or less, and at the rate of fifteen  per  centum
 per  annum  if  the  annual  tax  on  a parcel is more than two thousand
 dollars or, irrespective of the annual tax,  if  a  parcel  consists  of
 vacant or unimproved land.
   b.  If  any tax on real estate which shall have become due and payable
 after January first, nineteen hundred thirty-four  and  prior  to  April
 first, nineteen hundred thirty-seven, is unpaid in whole or in part, the
 commissioner  of finance shall charge, receive and collect interest upon
 the amount of such tax or such part thereof, to  be  calculated  to  the
 date of payment at the rate of ten per centum per annum from the date on
 which such tax or such part thereof became due and payable to May first,
 nineteen  hundred  thirty-seven,  or at the rate of seven per centum per
 annum for such  period  if  the  comptroller  and  the  commissioner  of
 finance, in their discretion, both determine that the payment of any tax
 arrears at such reduced rate of interest may operate to save the proper-
 ty  upon  which  such taxes are in arrears from foreclosure or encourage
 its development or is otherwise in the public interest, at the  rate  of
 seven per centum per annum from May first, nineteen hundred thirty-seven
 to  August  first, nineteen hundred sixty-nine, from August first, nine-
 teen hundred  sixty-nine  to  December  thirty-first,  nineteen  hundred
 seventy-six, at the rate of seven per centum per annum if the annual tax
 S. 8474                            174
 
 on  a parcel is two thousand dollars or less, and at the rate of one per
 centum per month if the annual tax on a parcel is more than two thousand
 dollars or, irrespective of the annual tax,  if  a  parcel  consists  of
 vacant  or  unimproved  land,  and  from January first, nineteen hundred
 seventy-seven, at the rate of seven per centum per annum if  the  annual
 tax  on  a  parcel  is  two thousand dollars or less, and at the rate of
 fifteen per centum per annum if the annual tax on a parcel is more  than
 two  thousand  dollars  or,  irrespective of the annual tax, if a parcel
 consists of vacant or unimproved land.
   c. If any tax on real estate which shall have become due  and  payable
 on  or  after  April  first,  nineteen hundred thirty-seven and prior to
 August first, nineteen hundred sixty-nine is unpaid in whole or in part,
 the commissioner of finance shall charge, receive and  collect  interest
 upon  the  amount  of such tax or such part thereof, to be calculated to
 the date of payment at the rate of seven per centum per annum  from  the
 day  on  which  such  tax or such part thereof became due and payable to
 August first, nineteen hundred sixty-nine, from August  first,  nineteen
 hundred  sixty-nine  to December thirty-first, nineteen hundred seventy-
 six, at the rate of seven per centum per annum if the annual  tax  on  a
 parcel  is  two  thousand  dollars  or  less, and at the rate of one per
 centum per month if the annual tax on a parcel is more than two thousand
 dollars or, irrespective of the annual tax,  if  a  parcel  consists  of
 vacant  or  unimproved  land,  and  from January first, nineteen hundred
 seventy-seven at the rate of seven per centum per annum  if  the  annual
 tax  on  a  parcel  is  two thousand dollars or less, and at the rate of
 fifteen per centum per annum if the annual tax on a parcel is more  than
 two  thousand  dollars  or,  irrespective of the annual tax, if a parcel
 consists of vacant or unimproved land.
   d. If any tax on real estate which shall have become due  and  payable
 on  or  after  August  first,  nineteen  hundred sixty-nine and prior to
 December thirty-first, nineteen hundred seventy-six, is unpaid in  whole
 or  in  part,  the  commissioner  of  finance  shall charge, receive and
 collect interest upon the amount of such tax or such part thereof, to be
 calculated from the date on which such tax or such part  thereof  became
 due  and payable to December thirty-first, nineteen hundred seventy-six,
 at the rate of seven per centum per annum if the annual tax on a  parcel
 is  two  thousand dollars or less, and at the rate of one per centum per
 month if the annual tax on a parcel is more than  two  thousand  dollars
 or,  irrespective  of  the annual tax, if a parcel consists of vacant or
 unimproved land, and from January first, nineteen hundred  seventy-seven
 at  the rate of seven per centum per annum if the annual tax on a parcel
 is two thousand dollars or less, and at the rate of fifteen  per  centum
 per  annum  if  the  annual  tax  on  a parcel is more than two thousand
 dollars or, irrespective of the annual tax,  if  a  parcel  consists  of
 vacant or unimproved land.
   e. If any tax on real estate which shall become due and payable at any
 time  on  or  after January first, nineteen hundred seventy-seven, shall
 remain unpaid in whole or in part on the  fifteenth  day  following  the
 date on which the same shall become due and payable, the commissioner of
 finance  shall  charge,  receive and collect interest upon the amount of
 such tax or such part thereof remaining  unpaid  on  that  date,  to  be
 calculated  from  the  day on which such tax or such part thereof became
 due and payable to the date of payment at the rate of seven  per  centum
 per annum if the annual tax on a parcel is two thousand dollars or less,
 and  at  the rate of fifteen per centum per annum if the annual tax on a
 S. 8474                            175
 
 parcel is more than two thousand dollars or, irrespective of the  annual
 tax, if a parcel consists of vacant or unimproved land.
   f. If any tax on real estate which shall become due and payable at any
 time on or after July first, nineteen hundred seventy-nine, shall remain
 unpaid  in  whole  or in part on the fifteenth day following the date on
 which the same shall become due and payable,  or  if  any  tax  on  real
 estate  which  became  due  and  payable  prior  to July first, nineteen
 hundred seventy-nine shall remain unpaid on that date, the  commissioner
 of finance shall charge, receive and collect interest upon the amount of
 such tax or such part thereof remaining unpaid, to be calculated, in the
 case  of  any  tax  which  shall become due and payable on or after July
 first, nineteen hundred seventy-nine, from the day on which such tax  or
 such  part  thereof  became  due and payable, and in the case of any tax
 which became due and payable  prior  to  July  first,  nineteen  hundred
 seventy-nine,  from  July  first,  nineteen hundred seventy-nine, to the
 date of payment at the rate of seven per centum per annum if the  annual
 tax on a parcel is two thousand seven hundred fifty dollars or less, and
 at  the  rate  of  fifteen  per  centum per annum if the annual tax on a
 parcel is more than two thousand seven hundred fifty dollars  or,  irre-
 spective of the annual tax, if a parcel consists of vacant or unimproved
 land.  Any interest accrued prior to July first, nineteen hundred seven-
 ty-nine, pursuant to subdivisions a through e of this section  shall  be
 unaffected by the provisions of this subdivision.
   g. No later than the twenty-fifth day of May of each year, the banking
 commission  shall  transmit a written recommendation to the council of a
 proposed interest rate to be charged for nonpayment  of  taxes  on  real
 estate  in those cases where the annual tax on a parcel is more than two
 thousand seven hundred fifty dollars or where, irrespective of the annu-
 al tax, a parcel consists of vacant or unimproved land. In  making  such
 recommendations  the  commission  shall consider the prevailing interest
 rates charged for  commercial  loans  extended  to  prime  borrowers  by
 commercial  banks  operating  in the city and shall propose a rate of at
 least six per centum per annum greater than such rates. The council  may
 by  resolution  adopt an interest rate to be applicable to the aforemen-
 tioned parcels and may specify in such resolution the date on which such
 interest rate is to take effect.
   h. Notwithstanding anything to the contrary contained in the recommen-
 dation transmitted by the banking commission to the council relative  to
 the  proposed  rate  of interest to be charged during the fiscal year of
 the city commencing July first, nineteen  hundred  seventy-nine  in  the
 case  of nonpayment of real estate taxes, or contained in the resolution
 adopted by the council in accordance with such recommendation, the coun-
 cil hereby sets the interest rate to be charged during the  fiscal  year
 of  the  city  commencing  July first, nineteen hundred seventy-nine for
 nonpayment of real estate taxes at eighteen per centum per  annum  where
 the annual tax on a parcel is more than two thousand seven hundred fifty
 dollars or where the parcel consists of vacant or unimproved land.
   i.  The interest mentioned in subdivisions a through h of this section
 shall be paid over and accounted for from time to time by  such  commis-
 sioner of finance as a part of the tax collected by him or her.
   j. When an installment agreement has been entered into pursuant to any
 of  the  provisions  of  chapter  four  of this title, during the period
 beginning on the date this subdivision takes  effect  and  ending  April
 thirtieth,  nineteen  hundred  eighty-two,  the  commissioner of finance
 shall, notwithstanding any higher rate of interest  prescribed  pursuant
 to  applicable law, and unless a lower rate of interest is applicable to
 S. 8474                            176
 
 a parcel covered by such  an  agreement,  charge,  collect  and  receive
 interest  on  the  arrears  due  and payable under such agreement, to be
 calculated at the rate of ten percent per annum from May first, nineteen
 hundred  eighty-two  to  the  date  of  payment of each installment. Any
 interest accrued or accruing prior to May first, nineteen hundred eight-
 y-two shall not be affected by the provisions of  this  subdivision  but
 shall  be charged, collected and received in the manner and at the rates
 prescribed pursuant to applicable law.  Such ten percent rate of  inter-
 est  shall  be  applicable  only  if,  as of May first, nineteen hundred
 eighty-two, (i) there has been no default in such  agreement,  and  (ii)
 all  current  taxes, assessments or other legal charges are paid as they
 become due or within the period of  grace  provided  by  law.  Where  an
 installment agreement has been entered into prior to May fifth, nineteen
 hundred  eighty-two pursuant to the provisions of either paragraph three
 of subdivision a of section 11-413 of chapter four of this  title  prior
 to  March  fourteenth, nineteen hundred seventy-nine or of subdivision a
 of section 11-405 or subdivision h of section 11-409 of chapter four  of
 this title and said agreement is current as to both installment payments
 and current taxes, assessments and other legal charges, the commissioner
 of finance, on application of the party who entered into such agreement,
 may  cancel said agreement and enter into a new agreement containing the
 terms provided on May fifth, nineteen hundred eighty-two.  If  any  such
 prior  agreement  is  not cancelled as herein provided, any installments
 due and payable under such agreement on or  after  May  first,  nineteen
 hundred  eighty-two  shall  be subject to interest at the rate and under
 the conditions set forth above. In the event of any  subsequent  default
 or  failure to make timely payment of any installment payment or current
 tax, assessment or other legal charge, the ten percent rate of  interest
 specified in this subdivision shall thereupon cease to be applicable and
 the commissioner of finance shall thereafter charge, collect and receive
 interest  in the manner and at the rates prescribed pursuant to applica-
 ble law.
   k. 1. Notwithstanding any other  provision  of  this  section  to  the
 contrary,  but  subject  to  the exception contained in paragraph two of
 this subdivision, in the case of an installment of tax on real  property
 described  in paragraph b of subdivision four of section fifteen hundred
 nineteen of the city charter of the preceding municipality as it existed
 on the first of January in the year next succeeding the  effective  date
 of  this  section,  interest shall be charged, received and collected at
 the rate established pursuant to this section if such installment  shall
 remain  unpaid  in whole or in part on the date on which it shall become
 due and payable.
   2. If the tax rate for any fiscal year of the city has not been set by
 the fifteenth of June preceding the start of such fiscal year,  interest
 shall  not  be charged, received and collected with respect to the first
 installment of tax which is due and payable on the first of July in such
 fiscal year if such installment  is  paid  on  or  before  the  extended
 payment  date.  For this purpose, the term "extended payment date" means
 the date which falls the same number of days after the first of July  in
 such  fiscal  year  as  the number of days the date such tax rate is set
 falls after such fifteenth of June.
   l. No later than the fifth day following the effective  date  of  this
 subdivision  and no later than May twenty-fifth of each succeeding year,
 the banking commission shall transmit a written  recommendation  to  the
 council of proposed interest rates to be charged for nonpayment of taxes
 on  real  property  in  those cases in which the annual tax on a parcel,
 S. 8474                            177
 
 other than a parcel which consists of vacant or unimproved land, is  not
 more  than  two  thousand  seven  hundred  fifty dollars. In making such
 recommendations, the banking commission shall  consider  the  prevailing
 interest  rates charged for commercial loans extended to prime borrowers
 by commercial banks operating in the city.  In  the  case  of  any  such
 parcel  with respect to which the real property taxes are held in escrow
 and paid to the commissioner of finance by a "mortgage escrow agent," as
 that term is defined in section fifteen hundred  nineteen  of  the  city
 charter  of  the  preceding  municipality  as it existed on the first of
 January in the year next succeeding the effective date of this  section,
 the  proposed  rate shall be at least six percent per annum greater than
 such prevailing prime rate, and in the case of all other  such  parcels,
 the proposed rate shall be at least equal to such prevailing prime rate.
 The  council  may by resolution adopt interest rates to be applicable to
 the aforementioned parcels and may specify in such resolution the  dates
 on  which such interest rates are to take effect. In the event the coun-
 cil does not adopt interest rates as provided in this  subdivision,  the
 interest rates otherwise specified in this section shall be applicable.
   § 11-224.1 Interest on unpaid real property tax.
   (a)  For  real  property  with  an  assessed  value of eighty thousand
 dollars or less, if an installment of tax due and payable is not paid by
 July fifteenth, October fifteenth, January fifteenth or April fifteenth,
 interest shall be imposed on such unpaid amounts.
   (b) For real property with an assessed value of over  eighty  thousand
 dollars,  if  an  installment of tax due and payable is not paid by July
 first or January  first,  interest  shall  be  imposed  on  such  unpaid
 amounts.
   (c)  If  the  council does not adopt interest rates by July first, two
 thousand twenty-five, the rates shall be (i) for real property  with  an
 assessed  value  of  eighty  thousand dollars or less, seven percent per
 annum; and (ii) for real property with an assessed value of over  eighty
 thousand dollars, fifteen percent per annum.
   (d)  (i)  Any  tax or part of a tax that became due before July first,
 two thousand five and remains unpaid after June thirtieth, two  thousand
 twenty-five,  shall  continue  to accrue interest until paid at the rate
 applicable under this section.
   (ii) This section shall not apply  to  interest  accrued  before  July
 first, two thousand twenty-five.
   (e)  By  May  twenty-fifth  of each year, the banking commission shall
 send a written recommendation to the council of a proposed interest rate
 to be charged for nonpayment of taxes on real property.  The  commission
 shall  consider  the  prevailing  interest  rates charged for commercial
 loans extended to prime borrowers by commercial banks operating  in  the
 city and:
   (i)  for  real  property  with  an  assessed  value of eighty thousand
 dollars or less, shall propose a rate at least equal to such  prevailing
 prime rate;
   (ii)  for real property with an assessed value of over eighty thousand
 dollars, shall propose a rate of at least six percent per annum  greater
 than such prevailing prime rate.
   The council may by resolution adopt interest rates to be applicable to
 the  aforementioned  properties  and  may specify in such resolution the
 date that such rates will take effect.
   (f) If the tax rate for any fiscal year of the city is not set by  the
 fifteenth  of  June  preceding  the  start of such fiscal year, interest
 shall not be charged for the first installment of tax which  is  due  on
 S. 8474                            178
 
 the first day of July in such fiscal year if such installment is paid on
 or  before  the  extended  payment  date.  For  this  purpose,  the term
 "extended payment date" means the date which falls the  same  number  of
 days  after  the  first day of July in such fiscal year as the number of
 days the date such tax rate is set falls after  such  fifteenth  day  of
 June.
   (g)  For  purposes  of  this section, property held in the cooperative
 form of ownership shall not be deemed to have an assessed value of  over
 eighty  thousand dollars if the property's assessed value divided by the
 number of residential dwelling units is eighty thousand dollars or  less
 per unit.
   §  11-225  Power  of  tax commission to remit or reduce taxes. The tax
 commission shall have power to remit or reduce a tax imposed  upon  real
 property where lawful cause therefor is shown or where such tax is found
 to  be excessive or otherwise erroneous, but such remission or reduction
 shall be made only with respect to an assessment for which  an  applica-
 tion  for  correction  has  been  made  pursuant  to section one hundred
 sixty-three of the charter, and no such remission or reduction shall  be
 made  when a claim to correct the assessment or recover the tax would be
 barred by passage of time or other adequate defense,  or  when,  at  the
 time  that the determination is rendered, applications for correction or
 other proceedings are pending to review the assessment of such  property
 for  more  than  one  subsequent fiscal year, provided, however, the tax
 commission shall have no power to remit or reduce a tax pursuant to this
 section more than five years after the last day on which an  application
 for correction could have been filed to appeal the unlawful or erroneous
 assessment  upon  which  such tax was based. If such tax shall have been
 paid the commissioner of finance is authorized to refund or  credit  the
 amount  of  any  such  remission  or  reduction granted pursuant to this
 section. When the correction results from an application for  correction
 made  by the board of managers of a condominium, a refund may be paid to
 the board of managers for distribution to  the  individual  unit  owners
 with the consent of such board and on such conditions as the commission-
 er deems appropriate.
   §  11-226 Special right of entry; certificate of president. A right of
 entry upon real property  and  into  buildings  and  structures  at  all
 reasonable times to ascertain the character of the property shall not be
 allowed to any person acting in behalf of the tax commission, other than
 the  officials  mentioned  in sections one hundred fifty-six and fifteen
 hundred twenty-one of the charter of the preceding  municipality  as  it
 existed  on  the first of January in the year next succeeding the effec-
 tive date of this section, unless a certificate  therefor,  executed  in
 writing  and signed by the president of the tax commission, is presented
 by such person to the owner, lessee or occupant of the premises  or  his
 agent before entry thereon is made.
   §  11-227  Duties  of authorized employees in examining applicants. a.
 Employees of the tax commission, when authorized to  take  testimony  on
 application, shall reduce such testimony to writing.
   b.  Within  ten  days  after the evidence on any application is taken,
 they shall transmit the application and testimony so taken,  with  their
 recommendation,  to  the tax commission at its main office or such other
 office as the commission may prescribe.
   § 11-228 Testimony taken on application to constitute part of  record.
 All written testimony taken by the tax commission, by a commissioner, or
 by  an employee of the commission authorized to take testimony on appli-
 S. 8474                            179
 
 cations, shall constitute part of the record of the proceedings upon any
 assessment.
   §  11-229  Solicitation  of retainers prohibited. It shall be unlawful
 for any person or his or her or its agents or employee,  or  any  person
 acting  on  his  or  her  or  its behalf, to solicit, or procure through
 solicitation, either directly or indirectly, any retainer or agreement:
   (a) Authorizing such person, or his or her or its agent,  employee  or
 any  person  acting  on his or her or its behalf, to make application to
 the commissioner of finance or tax commission for the  correction  of  a
 tentative  or  final assessed valuation of real property on behalf of an
 owner of such property or other person claiming to be aggrieved, or
   (b) Authorizing such person, or his or her or its agent,  employee  or
 any  person  acting  on  his  or  her  or its behalf, to appear for such
 purpose or represent such owner or aggrieved person before such  commis-
 sion  or  a  commissioner or any other officer or employee authorized by
 law to act upon such application, examine  applicants,  take  testimony,
 make  or recommend the making of a correction of any such assessed valu-
 ation, or take any  other  official  action  in  relation  to  any  such
 correction. Any violation of this section shall be a misdemeanor.
   §  11-230  Issuance of final determination; limitation of time. Except
 as otherwise provided in section one hundred sixty-five of  the  charter
 of  the  preceding municipality as it existed on the first of January in
 the year next succeeding the effective date of this section,  the  final
 determination  of  the  tax  commission  upon  any  application  for the
 correction of an assessment  and  upon  the  evidence  taken  thereunder
 shall, where the evidence is taken by the commission or by a commission-
 er, be rendered within thirty days after the hearing of such application
 is closed. Where the evidence is taken by an employee of the tax commis-
 sion  authorized  to  take testimony on applications, the final determi-
 nation shall be rendered within thirty days after  the  application  and
 the  testimony  hereon  shall have been filed with the commission at its
 main office.
   Immediately upon making a correction of an assessment, the tax commis-
 sion shall notify the commissioner of finance thereof.
   § 11-231 Proceeding to review tax assessment; contents of petition. a.
 Any person or corporation claiming to be aggrieved by the assessed valu-
 ation of real property may commence a proceeding to review or correct on
 the merits a final determination of the tax commission by serving on the
 president of the tax commission, or his or her duly authorized agent,  a
 copy of a verified petition as prescribed by law. No such petition shall
 be  accepted  unless,  prior to the service thereof, an index number has
 been obtained from the county clerk. Within ten days after a  proceeding
 has been commenced as hereinbefore provided, the original verified peti-
 tion  with proof of service shall be filed in the office of the clerk of
 the court in which the proceeding is to be heard.
   b. Such review shall be allowed only on one or more of  the  following
 grounds, which must be specified in such petition:
   1.  That the assessment is illegal, and stating the particulars of the
 alleged illegality, or
   2. That the assessment is erroneous by reason of over-valuation, or
   3. That the assessment is erroneous by reason of inequality,  in  that
 it has been made at a higher proportionate valuation than the assessment
 of  other real property on the assessment rolls of the city for the same
 year, and for assessments made  after  December  thirty-first,  nineteen
 hundred eighty-one, other real property within the same class as defined
 in section eighteen hundred two of the real property tax law, specifying
 S. 8474                            180

 the  instances  in  which such inequality exists and the extent thereof,
 and stating that the petitioner is or will be injured thereby, or
   4.  That  the real property is misclassified, and stating the class in
 which it is claimed the property should be classified.
   c. The proceeding shall  be  maintained  against  the  tax  commission
 either  by naming the president and the commissioners of the tax commis-
 sion individually, or by naming the tax commission of the city of Staten
 Island generally.
   d. Such proceeding to review and all proceedings thereunder  shall  be
 brought  at a special term of the supreme court in the judicial district
 where the real property so assessed is situated.
   e. The justice or referee before whom such proceeding shall  be  heard
 may inspect the real property which is the subject of the proceeding.
   §  11-232 Comptroller; rates of interest on taxes and assessments. The
 comptroller shall not reduce the rate of  interest  upon  any  taxes  or
 assessments below the amount fixed by law.
   §  11-233  Cancellation  of  unpaid taxes. When it shall appear to the
 comptroller that the unpaid taxes or assessments, or both, together with
 the interest and penalties thereon which may have  been  levied  upon  a
 parcel of real estate subject to easements which were in existence prior
 to the levying of such taxes or assessments, equal or exceed the sum for
 which,  under  ordinary  circumstances, such parcel of real estate would
 sell subject to  such  easements,  the  comptroller,  with  the  written
 approval  of  the corporation counsel, may settle and adjust such unpaid
 taxes or assessments, or both, with the interest and penalties  thereon,
 and  when  it  shall  appear to the comptroller that such parcel of real
 estate would sell under ordinary circumstances subject to such easements
 for only a nominal sum, then the comptroller with the  written  approval
 of  the corporation counsel may cancel such unpaid taxes and assessments
 together with the interest and penalties thereon.
   § 11-235 Board of estimate; power to  cancel  taxes,  assessments  and
 water  rents. The board of estimate, upon the written certificate of the
 comptroller approving the same, with whom application for  relief  under
 this section shall be filed, in its discretion and upon such terms as it
 may  deem  proper,  by  unanimous  vote, may cancel and annul all taxes,
 assessments and water rents and sales to the city of any or all  of  the
 same  which  now  are  or  may  hereafter become a lien against any real
 estate owned by any corporation, entitled  to  exemption  of  such  real
 estate  owned by it from local taxation under the provisions of the real
 property tax law formerly contained in subdivision six of  section  four
 of  the  tax  law,  provided  that  all taxes and water rents from which
 relief is asked be apportioned as of  the  date  such  corporation  took
 title to such real estate, and that such taxes and water rents so appor-
 tioned  to the period before such date, and all assessments which became
 a lien before such date, be paid. The commissioner of finance shall mark
 the city's books and rolls of taxes,  assessments  and  water  rents  in
 accordance with the determination of the board of estimate in every case
 in which action shall be taken under the provisions of this section.
   §  11-236 Powers of board of estimate to cancel taxes, water rents and
 assessments. The council by local law may authorize the board  of  esti-
 mate,  by a unanimous vote, upon the written consent of the comptroller,
 to cancel and annul any taxes, water rents and assessments  constituting
 a  lien  against any real property owned by a corporation whose property
 is exempt from taxation under the provisions of the  real  property  tax
 law,  notwithstanding  that such taxes, water rents or assessments shall
 have become a lien against such real property while owned by a person or
 S. 8474                            181
 
 corporation not exempt under such section. The commissioner  of  finance
 shall  mark  the  city's  books  and  rolls  of taxes and assessments in
 accordance with the determination of the board of  estimate  under  such
 local law.
   §  11-237  Cancellation  of assessments, water and sewer rents on real
 property acquired by tax enforcement foreclosure proceedings.  Upon  the
 cancellation  of  unpaid  assessments, water and sewer rents by the city
 collector pursuant to section 11-353  of  this  title,  the  comptroller
 shall  charge the unpaid amounts for assessments for local improvements,
 so cancelled, to the surplus in the  appropriate  assessment  fund;  the
 unpaid amounts for water charges, meter setting and repair, meter glass-
 es  and  sewer  rents, so cancelled, shall be deducted from the accounts
 receivable of the appropriate fund.
   § 11-238 Real property tax surcharge on absentee landlords. a.   Impo-
 sition  of surcharge. A real property tax surcharge is hereby imposed on
 class one property, as defined in section eighteen hundred  two  of  the
 real  property  tax  law,  excluding  vacant  land, that provides rental
 income and is not the primary residence of the owner or owners  of  such
 class  one  property, or the primary residence of the parent or child of
 such owner or owners, in an amount equal to zero percent of the net real
 property taxes for fiscal years beginning on or after the first of  July
 in  the  second year next succeeding the effective date of this section.
 As used in this section, "net real property tax" means the real property
 tax assessed on class one property after deduction for any exemption  or
 abatement received pursuant to the real property tax law or this title.
   b.  Rental  income,  primary residence and/or relationship to owner or
 owners. The property shall be deemed to be the primary residence of  the
 owner  or  owners thereof, if such property would be eligible to receive
 the real property tax exemption pursuant to section four  hundred  twen-
 ty-five  of  the real property tax law, regardless of whether such owner
 or owners has filed an application for, or  the  property  is  currently
 receiving, such exemption. Proof of primary residence and the resident's
 or  residents'  relationship  to  the owner or owners and the absence of
 rental income shall be in the form of a certification as required by the
 rules of the commissioner.
   c. Rules. The department of finance shall have,  in  addition  to  any
 other  functions,  powers and duties which have been or may be conferred
 on it by law, the power to make and promulgate rules to  carry  out  the
 purposes  of  this section, including, but not limited to, rules related
 to the timing, form and manner  of  any  certification  required  to  be
 submitted under this section.
   d. Penalties. 1. Notwithstanding any provision of any general, special
 or  local  law  to  the contrary, an owner or owners shall be personally
 liable for any taxes owed pursuant to this section whenever  such  owner
 or  owners  fail  to  comply  with this section or the rules promulgated
 hereunder, or makes a false or misleading statement or omission and  the
 commissioner  determines  that  such act was due to the owner or owners'
 willful neglect, or that under such circumstances such act constituted a
 fraud on the department. The remedy provided herein  for  an  action  in
 person  shall  be  in  addition to any other remedy or procedure for the
 enforcement of collection  of  delinquent  taxes  provided  by  general,
 special or local law.
   2.  If  the commissioner should determine, within three years from the
 filing of an application or certification pursuant to this section, that
 there was a material misstatement on such application or  certification,
 S. 8474                            182
 
 he  or  she  shall  impose  a  penalty  tax against the property of five
 hundred dollars, in accordance with the rules promulgated hereunder.
   e. Cessation of use. In the event that a property granted an exemption
 from  taxation pursuant to this section ceases to be used as the primary
 residence of such owner or owners or his, her or their parent or  child,
 or  produces  rental  income,  such  owner or owners shall so notify the
 commissioner.
                               SUBCHAPTER 2
                  EXEMPTIONS FROM REAL PROPERTY TAXATION
                                  PART 1
                EXEMPTIONS FOR CERTAIN RESIDENTIAL PROPERTY
   § 11-241 Discrimination in tax exempt projects.    No  exemption  from
 taxation,  for any project, other than a project hitherto agreed upon or
 contracted for, shall be granted to a housing company, insurance  compa-
 ny,  redevelopment  company  or  redevelopment  corporation, which shall
 directly or indirectly, refuse, withhold from, or deny to any person any
 of the dwelling or business accommodations in such project or  property,
 or the privileges and services incident to occupancy thereof, on account
 of the race, color or creed of any such person.
   Any  exemption  from  taxation hereafter granted shall terminate sixty
 days after a finding by the supreme court of the state of New York  that
 such  discrimination  is  being or has been practiced in such project or
 property; if within sixty  days  such  discrimination  shall  have  been
 ended, then the exemption shall not terminate.
   §  11-242  Exemption  and  tax  abatement in regard to improvements of
 substandard dwellings.  a. As used in this section, the following  terms
 shall have the following meanings:  1. "Alteration" and "improvement": a
 physical  change  in  an existing dwelling other than painting, ordinary
 repairs, normal replacements or maintenance items.
   2. "Existing dwelling": a class A multiple dwelling in existence prior
 to the commencement of alterations for which tax exemption and abatement
 is claimed under the terms of this section and  for  which  a  valuation
 appears  on  the annual record of assessed valuation of the city for the
 fiscal year nineteen hundred fifty-five--nineteen hundred fifty-six.
   3. "Start" on alteration or improvement: begin any physical  operation
 undertaken  for  the purpose of making alterations or improvements to an
 existing dwelling.
   4. "Complete" an alteration or improvement: conclude or terminate  any
 physical  operation such as is referred to in subparagraph three of this
 paragraph, to an extent or degree which renders such building capable of
 use for the purpose for  which  the  improvements  or  alterations  were
 intended.
   5.  "Multiple dwelling": multiple dwellings as that term is defined in
 section four of the multiple dwelling law.
   b. Any increase in assessed valuation resulting from  alterations  and
 improvements  to  existing  dwellings  to  eliminate  presently existing
 unhealthy or dangerous conditions in any existing dwelling or to replace
 inadequate and obsolete sanitary facilities in any such dwelling, any of
 which represent fire or health hazards, or to provide central  or  other
 appropriate  and  approved  heating,  except  insofar as the gross cubic
 content of the building is increased thereby, shall be exempt from taxa-
 tion for local purposes for a period of twelve years after  the  taxable
 status  date immediately following the completion of the alterations and
 improvements, to the extent that such  increase  in  assessed  valuation
 result  from  the  reasonable cost of such alterations and improvements,
 providing that construction  is  started  after  March  first,  nineteen
 S. 8474                            183
 
 hundred  fifty-five and completed before December thirty-first, nineteen
 hundred fifty-nine.  The assessed valuation allocated to  such  dwelling
 after  such  alterations  and  improvements during such period of twelve
 years,  exclusive  of the increase in valuation which is exempted, shall
 not exceed the valuation of the previously existing  dwelling  appearing
 on  the  assessment  rolls  after  the  taxable  status date immediately
 preceding the commencement of such alterations and  improvements.    The
 assessed  valuation  of  the  land  occupied  by  such  dwelling and any
 increase in valuation resulting from alterations and improvements  other
 than  those  made pursuant to this section, shall not be affected by the
 provisions of this section.
   c. The taxes upon any such property,  including  the  land,  shall  be
 abated  and reduced by an amount equal to eight and one-third per centum
 of the reasonable cost of such alterations and  improvements  each  year
 for  a  period  of nine years commencing with the first tax bill for the
 first tax year in which the exemption herein provided is effective,  but
 such  abatement of taxes in any consecutive twelve-month period shall in
 no event exceed the amount of taxes payable in such period.
   d. The department of buildings shall determine and certify the reason-
 able cost of any such alterations and improvements and for that  purpose
 may  adopt rules and regulations, administer oaths to and take testimony
 of any person, including but not limited to the owner of such  property,
 may  issue  subpoenas  requiring  the attendance of such persons and the
 production of such books, papers or other documents  as  the  department
 shall  deem  necessary,  may  make  preliminary estimates of the maximum
 reasonable cost of such  alterations  and  improvements,  may  establish
 maximum  allowable  costs  for specified units, fixtures or work in such
 alterations or improvements, and may require the submission of plans and
 specifications of such alteration  and  improvements  before  the  start
 thereof.    Application  forms for the benefits of this section shall be
 filed with the tax commission between February first and March fifteenth
 and the tax commission shall certify to the city collector the amount of
 taxes to be abated and reduced, pursuant to  the  certification  of  the
 commissioner of buildings as herein provided.  No such application shall
 be  accepted  unless  accompanied  by copies of certificates of the city
 planning commission and the commissioner of buildings,  as  provided  in
 this subdivision and in subdivision e of this section.
   e. To the end that alterations and improvements in such property shall
 interfere  as little as practicable with urgently needed public improve-
 ments, and the clearance and rebuilding of  substandard  and  insanitary
 areas,  and  shall  be  confined  to multiple dwellings which are struc-
 turally sound,  comply  with  applicable  provisions  of  law,  and  are
 provided with adequate central or other appropriate and approved heating
 exemption  or  abatement  from taxation hereunder shall be restricted to
 dwellings which: (1) the city planning commission certify will not undu-
 ly interfere with projected public improvements  or  the  clearance  and
 rebuilding of substandard and insanitary areas which certification shall
 be evidenced by a certificate describing the property involved and shall
 be  issued  upon  application  to  such city planning commission in such
 manner and in such form as may  be  prescribed  by  such  city  planning
 commission,  and  (2) which the department of buildings shall certify to
 be structurally sound, comply with  applicable  provisions  of  law  and
 provide central or other appropriate and approved heating, which certif-
 ication  shall  be  evidenced  by  a certificate describing the property
 involved and shall be issued  upon  application  to  the  department  of
 buildings  in  such manner and in such form as may be prescribed by such
 S. 8474                            184
 
 department.  Where the improvements and alterations include  or  benefit
 that  part of a building which is occupied by stores or used for commer-
 cial purposes, the cost shall be apportioned so  that  the  benefits  of
 this  section  shall not be provided for the cost of the improvements or
 alterations made for store or commercial purposes.
   f. Notwithstanding the provisions of the multiple dwelling law, or any
 local law, ordinance, provisions of this code, rule or  regulation,  any
 dwelling to which alterations and improvements are made pursuant to this
 section  and  which  did not require a certificate of occupancy on April
 second, nineteen hundred forty-five, may be occupied lawfully after such
 date upon the completion of such alterations  and  improvements  without
 such  a  certificate being obtained, provided, however, that such alter-
 ations and improvements shall have been made in conformity with law  and
 the  applicable  provisions for fire protection required by articles six
 and seven of the multiple dwelling law.
   g. No owner of a dwelling to which the benefits of this section  shall
 be  applied  nor  any  agent, employee, manager or officer of such owner
 shall directly or indirectly deny to any person because of race,  color,
 creed,  or  religion any of the dwelling accommodations in such property
 or any of the privileges or services incident to occupancy therein.
   h. Each agency to which functions are assigned  by  this  section  may
 adopt rules and regulations for the effectuation of the purposes of this
 section,  and  a copy, for each member of the council, of such rules and
 regulations shall be filed with  the  clerk  of  the  council  prior  to
 promulgation.
   i.  Any  person who shall knowingly and wilfully make any false state-
 ment as to any material matter in any application for  the  benefits  of
 this  section  shall be guilty of an offense punishable by a fine of not
 more than five hundred dollars or imprisonment for not more than  ninety
 days, or both.
   j. The benefits of this section shall not apply to any multiple dwell-
 ing which is not subject to the provisions of the emergency housing rent
 control  law  or  its  successor  statute for the city of Staten Island,
 provided that this subdivision shall not operate to rescind any benefits
 granted by the tax commission under this section prior  to  July  first,
 nineteen  hundred fifty-eight; and further provided that where the bene-
 fits herein provided were or are granted by the  tax  commission  on  or
 after  July first, nineteen hundred fifty-eight to any multiple dwelling
 which is decontrolled subsequent to the granting of such  benefits,  the
 tax   commission  shall  withdraw  such  benefits,  effective  upon  the
 commencement of the first tax year following the tax year in which  such
 multiple dwelling is decontrolled.
   §  11-243  Reextension  of  exemption  and  tax abatement in regard to
 improvements of substandard dwellings. a. As used in this  section,  the
 following terms shall have the following meanings:
   1.  "Alteration"  and  "improvement": a physical change in an existing
 dwelling other than painting, ordinary repairs,  normal  replacement  of
 maintenance  items,  provided, however, that ordinary repairs and normal
 replacement of maintenance items, as defined by  rules  adopted  by  the
 department  of housing preservation and development pursuant to subdivi-
 sion m of this section, shall be eligible  for  tax  exemption  and  tax
 abatement  under  this  section  provided  that  repairs and maintenance
 items:
   (1) were started and completed within a twelve-month period,
   (2) were made to any common area of the dwelling premises concurrently
 with a major capital improvement thereto, as defined by rules adopted by
 S. 8474                            185
 
 the department of  housing  preservation  and  development  pursuant  to
 subdivision m of this section,
   (3)  require the issuance of a permit for at least one item thereof by
 any city agency, and
   (4) the amount of money expended thereon shall not  exceed  two  times
 the  amount  expended on the major capital improvement performed concur-
 rently therewith.
   "Alteration" and "improvement" shall also mean "an abatement" of lead-
 based paint hazards, as defined in part 745 of title forty of  the  code
 of  federal  regulations  or  any  successor regulations in any existing
 dwelling including any common areas, and shall include  an  "inspection"
 and  "risk  assessment" for lead-based paint hazards, as defined in such
 part, in a dwelling unit whether such unit is  vacant  or  occupied  but
 shall  not  include  any  work  performed  to  comply  with  a notice of
 violation issued for a violation of article fourteen of  subchapter  two
 of chapter two of title 27 of the administrative code of the city of New
 York.  For  purposes  of this paragraph, the term, "targeted area" shall
 mean the geographical area of New York city that is  determined  by  the
 department  of  health and mental hygiene to have high rates of children
 with environmental intervention blood lead  levels.  The  department  of
 housing  preservation  and  development shall establish two schedules of
 certified reasonable costs for items that are included in  an  abatement
 of  lead-based  paint  hazards,  one  covering  such  abatement  that is
 performed in an eligible dwelling unit or common  area  located  in  the
 targeted  area,  and one covering such abatement that is performed in an
 eligible dwelling unit or common area that is not located in the target-
 ed area. The first such schedules shall be promulgated by the department
 of housing preservation and development within 180 days of the effective
 date of this section and shall be used for any such abatements that  are
 commenced  on  or after August 2, 2004. Such schedules shall be reviewed
 by such  department  biennially  following  their  effective  dates  and
 amended  as  necessary.    Notwithstanding any other provision of law or
 rule, an owner who performs an abatement  of  lead-based  paint  hazards
 pursuant to this paragraph shall not be required to comply with subdivi-
 sion  y  of this section which provides for filing of a notice of intent
 form prior to the commencement of work, and no additional fee or penalty
 shall be due and owing the department at  the  time  of  issuance  of  a
 certificate  of eligibility and reasonable cost for failure to file such
 notice of intent.
   2. "Existing dwelling": except as hereinafter provided in  subdivision
 d  of this section, a class A multiple dwelling or a building consisting
 of one or two dwelling units over space used for commercial occupancy in
 existence prior  to  the  commencement  of  alterations  for  which  tax
 exemption  and  abatement is claimed under the terms of this section and
 for which a valuation appears on the annual record of assessed valuation
 of the city for the fiscal year immediately preceding  the  commencement
 of such alterations and improvements.
   3.  "Start" an alteration or improvement: begin any physical operation
 undertaken for the purpose of making alterations or improvements  to  an
 existing dwelling.
   4.  "Complete" an alteration or improvement: conclude or terminate any
 physical operation such as is referred to in  paragraph  three  of  this
 subdivision,  to an extent or degree which renders such building capable
 of use for the purpose for which the improvements  or  alterations  were
 intended.
 S. 8474                            186
 
   5.  "Multiple dwelling": multiple dwellings as that term is defined in
 section four of the multiple dwelling law.
   6. "Moderate rehabilitation": shall mean a scope of work which
   (a)  includes  a building-wide replacement of a major component of one
 of the following systems:
   (1) Elevator
   (2) Heating
   (3) Plumbing
   (4) Wiring
   (5) Window; and
   (b) has a certified reasonable  cost  of  not  less  than  twenty-five
 hundred dollars, exclusive of any certified reasonable cost for ordinary
 repairs,  for each dwelling unit in existence at the commencement of the
 rehabilitation; except that the department of housing  preservation  and
 development  may  establish  a  minimum  certified reasonable cost to be
 greater than twenty-five hundred dollars per dwelling unit  pursuant  to
 subdivision m of this section.
   7.  "Substantially occupied": shall mean an occupancy of not less than
 sixty percent of all dwelling units immediately prior and  during  reha-
 bilitation,  except  that  the  department  of  housing preservation and
 development may establish higher percentages of  occupancy  pursuant  to
 subdivision m of this section.
   8.  "Private  dwelling"  shall mean any building or structure designed
 and occupied for residential purposes by not  more  than  two  families.
 Private dwellings shall also be deemed to include a series of one-family
 or  two-family  dwelling units each of which faces or is accessible to a
 legal street or public thoroughfare,  if  each  such  dwelling  unit  is
 equipped as a separate dwelling unit with all essential services, and if
 each such unit is arranged so that it may be approved as a legal one-fa-
 mily or two-family dwelling.
   b.  Subject  to  the  limitations  provided  in  subdivision d of this
 section and the restrictions in this section on conversion of  buildings
 used  in whole or in part for single room occupancy, any increase in the
 assessed valuation of real property shall be exempt  from  taxation  for
 local  purposes  to the extent such increase results from the reasonable
 cost of: (1) the conversion of a class B multiple dwelling to a class  A
 multiple  dwelling  except  insofar  as  the gross cubic content of such
 building is increased thereby; or (2) the conversion of any  nonresiden-
 tial building or structure situated in the county of Richmond to a class
 A  multiple  dwelling  except insofar as the gross cubic content of such
 building or structure  is  increased  thereby;  or  (3)  alterations  or
 improvements to the exterior of an otherwise eligible building or struc-
 ture  visible  from  a  public street pursuant to a permit issued by the
 landmarks commission with respect to a designated historic  or  landmark
 site  or  structure;  or  (4) alterations or improvements constituting a
 moderate rehabilitation of a substantially  occupied  class  A  multiple
 dwelling  except  insofar as the gross cubic content of such building or
 structure is increased thereby; or (5) alterations or improvements to an
 otherwise eligible building or structure commenced after January  first,
 nineteen  hundred eighty designed to conserve the use of fuel, electric-
 ity or other energy sources or to reduce demand for electricity, includ-
 ing the installation of meters for purposes of measuring the  amount  of
 electricity  consumed  for each dwelling unit, and conversions of direct
 metering to a system that includes a master meter and submeters  in  any
 cooperative,  condominium, or housing development fund company organized
 under article eleven of the private housing finance law; or  (6)  alter-
 S. 8474                            187
 
 ations  or  improvements  to  existing  dwellings  to eliminate existing
 unhealthy or dangerous conditions  in  any  such  existing  dwelling  or
 replace inadequate and obsolete sanitary facilities in any such existing
 dwelling,  any  of which represents fire or health hazards, including as
 improvements asbestos abatement to the extent such asbestos abatement is
 required by federal, state or local law, except  insofar  as  the  gross
 cubic  content  of  such  existing dwelling is increased thereby; or (7)
 conversion of residential units qualified for the protection of  article
 seven-C  of  the  multiple dwelling law in buildings or portions thereof
 registered with the New York city loft board as interim multiple  dwell-
 ings  pursuant to such article to units which are in compliance with the
 standards of safety and fire protection set forth in article seven-B  of
 the  multiple dwelling law or to units which have a certificate of occu-
 pancy as class A multiple dwellings; or (8) alterations or  improvements
 commenced  on  or  after  September first, nineteen hundred eighty-seven
 constituting a substantial rehabilitation of a class A  multiple  dwell-
 ing,  or a conversion of a building or structure into a class A multiple
 dwelling, as part of a program to provide housing for low  and  moderate
 income  households  as defined by the department of housing preservation
 and development pursuant to the rules and regulations promulgated pursu-
 ant to subdivision m of this section, provided that such alterations  or
 improvements  or  conversions shall be aided by a grant, loan or subsidy
 from any federal, state or local agency or  instrumentality,  including,
 in the discretion of the department of housing preservation and develop-
 ment,  a subsidy in the form of a below market sale from the city of New
 York; or (9) alterations or improvements  to  any  private  dwelling  or
 conversion  of any private dwelling to a multiple dwelling or conversion
 of any multiple dwelling to  a  private  dwelling,  provided  that  such
 alterations,  improvements or conversions are part of a project that has
 applied for or is receiving benefits pursuant to this section and  shall
 be  aided  by  a grant, loan or subsidy from any federal, state or local
 agency or instrumentality. Such conversions, alterations or improvements
 shall be completed within thirty-six months after the date on which same
 shall be started except that such thirty-six month limitation shall  not
 apply  to conversions of residential units which are registered with the
 loft board in accordance with article seven-C of the  multiple  dwelling
 law pursuant to paragraph eight of this subdivision.  Provided, however,
 a  sixty-month  period for completion shall be available for alterations
 or improvements undertaken by a housing development fund company  organ-
 ized  pursuant  to  article  eleven  of the private housing finance law,
 which are carried out with the substantial assistance of  grants,  loans
 or  subsidies  from  any  federal, state or local governmental agency or
 instrumentality or which are carried out in a property transferred  from
 the  city  of  New  York or the city of Staten Island if alterations and
 improvements are completed within seven years after the date  of  trans-
 fer. In addition, the department of housing preservation and development
 may  grant  an  extension  of  the  period of completion for any project
 carried out with the substantial assistance of grants, loans  or  subsi-
 dies  from any federal, state or local governmental agency or instrumen-
 tality, if such alterations, improvements or conversions  are  completed
 within  sixty  months  from  commencement  of  construction.   Provided,
 further, that such conversions, alterations or improvements shall in any
 event be completed prior to the thirty-first of December  in  the  third
 year  next succeeding the effective date of this section.  Exemption for
 conversions, alterations or improvements pursuant to paragraph one, two,
 three, four, six, seven, eight or ten of this subdivision shall continue
 S. 8474                            188
 
 for a period not to exceed fourteen years and begin no sooner  than  the
 first  tax  period  immediately following the completion of such conver-
 sions,  alterations  or  improvements.  Exemption  for  alterations   or
 improvements  pursuant  to  paragraph  five  or nine of this subdivision
 shall continue for a period not to exceed thirty-four  years  and  shall
 begin  no  sooner  than  the  first tax period immediately following the
 completion of such alterations or improvements. Such exemption shall  be
 equal to the increase in the valuation, which is subject to exemption in
 full  or  proportionally under this subdivision for ten or thirty years,
 whichever is applicable. After such period of time, the amount  of  such
 exempted  assessed  valuation  of  such improvements shall be reduced by
 twenty percent in each succeeding year until the assessed value  of  the
 improvements  is  fully  taxable.   Provided, however, exemption for any
 conversions, alterations or improvements, which are aided by a  loan  or
 grant  under article eight, eight-A, eleven, twelve, fifteen, or twenty-
 two of the private housing finance law, section six hundred ninety-six-a
 or section ninety-nine-h of the general municipal law, or section  three
 hundred  twelve  of  the  housing act of nineteen hundred sixty-four (42
 U.S.C.A. 1452b), or the Cranston-Gonzalez  national  affordable  housing
 act, (42 U.S.C.A. 12701 et. seq.), or started after July first, nineteen
 hundred  eighty-three  by  a  housing development fund company organized
 pursuant to article eleven of the private housing finance law which  are
 carried  out  with the substantial assistance of grants, loans or subsi-
 dies from any federal, state or local governmental agency or  instrumen-
 tality  or which are carried out in a property transferred from the city
 of New York and where alterations and improvements are completed  within
 seven  years after the date of transfer may commence at the beginning of
 any tax period subsequent to the start of such conversions,  alterations
 or  improvements and prior to the completion of such conversions, alter-
 ations or improvements. The assessed valuation of the land  occupied  by
 such  dwelling  and  any  increase  in assessed valuation resulting from
 conversions, alterations, or improvements other than those made pursuant
 to this section shall not be affected by the provisions of this section.
   b-1. Notwithstanding the provisions of subdivision b of this  section,
 alterations,  improvements  or  conversions of any building or structure
 that are eligible for benefits pursuant to subdivision b of this section
 except insofar as the gross cubic content of such building or  structure
 is  increased thereby shall be eligible for such benefits insofar as the
 gross cubic content of such building or structure is  increased  thereby
 provided that:
   (1) for all tax lots now existing or hereafter created, at least fifty
 percent  of  the  floor  area  of  the  completed  building or structure
 consists of the pre-existing building or structure that  was  converted,
 altered  or  improved  in accordance with subdivision b of this section,
 and
   (2) for tax lots now existing or hereafter created within the  follow-
 ing  area  in the borough of Manhattan, such conversions, alterations or
 improvements are aided by a grant, loan or  subsidy  from  any  federal,
 state  or local agency or instrumentality: beginning at the intersection
 of the United States pierhead line in the Hudson river  and  the  center
 line  of Chambers street extended, thence easterly to the center line of
 Chambers street and continuing along the center line of Chambers  street
 to  the  center line of Centre street, thence southerly along the center
 line of Centre street to the center line of the Brooklyn Bridge  to  the
 intersection  of the Brooklyn Bridge and the United States pierhead line
 in the East river, thence northerly along  the  United  States  pierhead
 S. 8474                            189
 
 line in the East river to the intersection of the United States pierhead
 line  in  the East river and the center line of one hundred tenth street
 extended, thence westerly to the center line of one hundred tenth street
 and  continuing along the center line of one hundred tenth street to its
 westerly terminus, thence westerly to the  intersection  of  the  center
 line of one hundred tenth street extended and the United States pierhead
 line in the Hudson river, thence southerly along the United States pier-
 head line in the Hudson river to the point of beginning.
   (3)  For  purposes  of  this  subdivision, "floor area" shall mean the
 horizontal areas of the several floors  or  any  portion  thereof  of  a
 dwelling  or  dwellings  and accessory structures on a lot measured from
 the exterior faces of exterior walls or from the center  line  of  party
 walls.
   (4)  Nothing  in  this  subdivision  shall be construed to provide tax
 abatement benefits pursuant to subdivision c of  this  section  for  the
 costs  attributable  to the increased cubic content in any such building
 or structure.
   c. (1) Except as provided in paragraphs two, three and  four  of  this
 subdivision,  the  taxes upon any real property, including the land, may
 be abated each year for a period of not more than  twenty  years  by  an
 amount  no greater than eight and one-third per centum of the reasonable
 cost of eligible conversions, alterations or  improvements  provided  in
 paragraphs  one through eight and paragraph ten of subdivision b of this
 section provided that the abatement in taxes in any consecutive  twelve-
 month  period  shall  in  no event exceed the amount of taxes payable in
 such twelve-month period;  and  provided  further  that  alterations  or
 improvements pursuant to paragraph four of subdivision b of this section
 shall  only  receive  the  benefits  of  this  section  if  construction
 commenced after January first, nineteen hundred seventy-eight  and  that
 in  no  event  shall the aggregate abatement exceed ninety per centum of
 the reasonable cost of conversions, alterations or improvements provided
 in paragraphs one, three, four, six, seven, and ten of subdivision b  of
 this  section,  or  exceed  fifty  per  centum of the reasonable cost of
 conversions pursuant to paragraph one of subdivision b of  this  section
 if  construction commenced after January first, nineteen hundred eighty-
 two or exceed fifty per centum of the  reasonable  cost  of  conversions
 pursuant  to  paragraphs two and eight of subdivision b of this section,
 or exceed one hundred per centum of the reasonable cost  of  alterations
 or  improvements  pursuant  to  paragraph  five of subdivision b of this
 section provided that where  alterations  or  improvements  pursuant  to
 paragraphs  four  and  six  of subdivision b of this section are done in
 conjunction with a conversion pursuant to paragraph two of subdivision b
 of this section, the aggregate abatement  shall  not  exceed  fifty  per
 centum of the reasonable cost.  Notwithstanding the foregoing, the taxes
 upon real property, including the land may be abated for a period of not
 more  than twenty years at eight and one-third per centum of the reason-
 able cost of conversions where construction actually commenced  in  good
 faith prior to July first, nineteen hundred eighty pursuant to an alter-
 ation  permit issued by the department of buildings prior to July first,
 nineteen hundred eighty provided that the aggregate abatement shall  not
 exceed  ninety  per  centum  of the reasonable cost thereof and provided
 further that in no event shall the abatement in  taxes  in  any  twelve-
 month  period  exceed  the  amount of taxes payable in such twelve-month
 period. In no event, however, shall the aggregate abatement for  conver-
 sions,  alterations  or  improvements  pursuant to subdivision b of this
 section exceed such dollar limit per existing class A dwelling  unit  or
 S. 8474                            190
 
 additional  unit created by conversion to a class A multiple dwelling as
 may be established pursuant to rules and regulations promulgated by  the
 department  of housing preservation and development pursuant to subdivi-
 sion  m of this section. Only those items of work set forth in the item-
 ized cost breakdown schedule contained in rules and regulations  promul-
 gated by the department of housing preservation and development pursuant
 to  subdivision  m  of this section shall be eligible for tax abatement.
 Such abatement shall commence on  the  later  of  July  first,  nineteen
 hundred  seventy-eight or the first day of the first tax quarter follow-
 ing the completion of such construction and the filing for  benefits  as
 provided  in  subdivision  h  of this section except that such period of
 abatement may commence on the later of the first day of  the  first  tax
 quarter following commencement of any conversion, alteration or improve-
 ment or (i) July first, nineteen hundred seventy-six, if aided by a loan
 pursuant  to  article  eight  of  the  private  housing  finance law and
 completed after December thirty-first, nineteen hundred seventy-five; or
 (ii) July first, nineteen hundred seventy-seven,  if  aided  by  a  loan
 pursuant to article fifteen of the private housing finance law; or (iii)
 July  first,  nineteen  hundred  eighty,  if aided by a loan pursuant to
 article eight-A of the private housing finance law; or (iv) July  first,
 nineteen  hundred  eighty,  if aided by a loan pursuant to section three
 hundred twelve of the housing act of  nineteen  hundred  sixty-four  (42
 U.S.C.A.  §1452b);  or  (v)  July first, nineteen hundred ninety-two, if
 started after such date and aided by a loan or grant under article elev-
 en, twelve, or twenty-two of the private housing  finance  law,  section
 six hundred ninety-six-a or section ninety-nine-h of the general munici-
 pal  law,  or  the Cranston-Gonzalez national affordable housing act (42
 U.S.C.A. 12701 et  seq.); or (vi) July first, nineteen  hundred  eighty-
 eight, if started after such date by or on behalf of a company not qual-
 ified  under  any  of  the  above  provisions, which is a not-for-profit
 corporation qualified pursuant to  section  501(c)(3)  of  the  internal
 revenue  code and which has entered into a regulatory agreement with the
 local housing agency requiring operation of the property as housing  for
 low and moderate income persons and families.
   (2)  In  the case of alterations or improvements pursuant to paragraph
 five of subdivision b of this section which are  carried  out  with  the
 substantial  assistance  of grants, loans or subsidies from any federal,
 state or local agency or instrumentality or any  not-for-profit  philan-
 thropic  organization  one of whose primary purposes is providing low or
 moderate income housing or financed with mortgage insurance by  the  New
 York city residential mortgage insurance corporation or the state of New
 York mortgage agency or pursuant to a program established by the federal
 housing administration for rehabilitation of existing multiple dwellings
 in  a neighborhood strategy area as defined by the United States depart-
 ment of housing and urban development, the abatement of  taxes  on  such
 property,  including the land, shall not exceed the lesser of the actual
 cost of the alterations or improvements or one hundred fifty per  centum
 of  the certified reasonable cost of the alterations or improvements, as
 determined under regulations of the department of  housing  preservation
 and  development,  and  the  annual  abatement of taxes shall not exceed
 twelve and one-half  per  centum  of  such  certified  reasonable  cost,
 provided that such abatement shall not be effective for more than twenty
 years  and the annual abatement of taxes in any consecutive twelve-month
 period shall in no event exceed the amount  of  taxes  payable  in  such
 twelve-month period.
 S. 8474                            191
 
   (3)  In  the  case of alterations or improvements carried out with the
 substantial assistance of grants, loans or subsidies from  any  federal,
 state  or  local agency or instrumentality or any not-for-profit philan-
 thropic organization one of whose primary purposes is providing  low  or
 moderate  income housing, or financed with mortgage insurance by the New
 York city residential mortgage insurance corporation or the state of New
 York mortgage agency or pursuant to a program established by the federal
 housing administration for rehabilitation of existing multiple dwellings
 in a neighborhood strategy area as defined by the United States  depart-
 ment of housing and urban development where such alterations or improve-
 ments  are  done  on property located in census tracts in which seventy-
 five percent or more of the population live  in  households  which  earn
 fifty  percent  or  less of the median household income of the city, the
 abatement of taxes on such  property,  including  the  land,  shall  not
 exceed  the lesser of the actual cost of the alterations or improvements
 or one hundred fifty per centum of the certified reasonable cost of  the
 alterations  or  improvements,  as  determined  under regulations of the
 department of housing  preservation  and  development,  and  the  annual
 abatement  of  taxes  shall not exceed twelve and one-half per centum of
 such certified reasonable cost, provided that such abatement  shall  not
 be  effective  for  more  than  twenty years and the annual abatement of
 taxes in any consecutive twelve-month period shall in  no  event  exceed
 the amount of taxes payable in such twelve-month period.
   (4)  In  the case of alterations, improvements or conversions pursuant
 to paragraph eight of subdivision b of this section,  the  abatement  of
 taxes  on such property, including the land, shall not exceed the lesser
 of the actual cost of the alterations or  improvements  or  one  hundred
 fifty  per centum of the certified reasonable cost of the alterations or
 improvements, as determined under regulations of the department of hous-
 ing preservation and development, and  the  annual  abatement  of  taxes
 shall  not  exceed  twelve  and  one-half  per  centum of such certified
 reasonable cost, provided that such abatement shall not be effective for
 more than twenty years and the annual abatement of taxes in any  consec-
 utive  twelve-month  period shall in no event exceed the amount of taxes
 payable in such twelve-month period.
   d. The benefits of this section shall apply:
   (1) to any multiple dwelling which is altered, improved  or  increased
 in  valuation with aid of a loan provided by the city of New York or the
 city of Staten Island, the New York city housing development corporation
 or the United States department of housing and urban development for the
 elimination of conditions dangerous to  human  life  or  detrimental  to
 health,  including nuisances as defined in section three hundred nine of
 the multiple dwelling law, or other rehabilitation or improvement wheth-
 er or not all of the units thereof were in existence prior to  rehabili-
 tation  pursuant to the provisions of: (i) article two, eight or eight-A
 of the private housing finance law provided that such dwelling  is  made
 available solely to persons or families of low income as defined in said
 articles,  (ii) article twelve of the private housing finance law, (iii)
 article fifteen of the private housing finance law or (iv)  any  federal
 law where the multiple dwelling is supervised or regulated by the United
 States department of housing and urban development.
   (2) except as hereinafter provided, to any building or structure which
 is  converted to a class A multiple dwelling or to any existing dwelling
 which is substantially rehabilitated,  and  further  provided  that  the
 rents  subsequent  to conversion or substantial rehabilitation shall not
 exceed such amount as may be fixed: (i) by the United States  department
 S. 8474                            192
 
 of  housing  and urban development, (ii) pursuant to the private housing
 finance law of the state of New York, or (iii) pursuant to chapter three
 or chapter four of title twenty-six of the code of the preceding munici-
 pality,  provided that the initial legal regulated rent for the dwelling
 units shall be the rent charged and  paid  by  the  initial  tenant  and
 registered  with  the  New  York state division of housing and community
 renewal. Buildings or structures which are converted to class A multiple
 dwellings and existing dwellings which are  substantially  rehabilitated
 shall  contain  bedrooms  in a number equal to at least fifty percent of
 the apartments created where an alteration permit has been issued by the
 department of buildings prior to April first,  nineteen  hundred  eighty
 and  seventy-five  percent of the apartments created where an alteration
 permit has been issued by the department of buildings on or after  April
 first,  nineteen hundred eighty provided, however, that if a building or
 structure is converted from a non-residential use to a class A  multiple
 dwelling  and  the  units  therein  contain an average floor area of one
 thousand square feet, such requirement as  to  the  number  of  bedrooms
 shall  not  be  applicable  and if an existing dwelling is substantially
 rehabilitated, the seventy-five percent  bedroom  requirement  shall  be
 reduced  to  the extent its application would necessitate a reduction in
 the number of units which are contained in the existing  dwelling  prior
 to commencement of substantial rehabilitation.
   (3) to any multiple dwelling, building or structure otherwise eligible
 for any of the benefits of this section which:
   (i) is operated exclusively for the benefit of persons or families who
 are  or will be entitled to occupancy by reason of ownership of stock or
 membership in the corporate owner, or for the benefit of such persons or
 families and other persons  or  families  entitled  to  occupancy  under
 applicable provisions of law without ownership of stock or membership in
 the  corporate  owner, or (ii) is owned as a condominium and is occupied
 as the residence or home of three or more families living  independently
 of  each other; provided, however, that, in addition to all other condi-
 tions of eligibility for the benefits of this section, except for multi-
 ple dwellings in which units have  been  newly  created  by  substantial
 rehabilitation  of  vacant  buildings  or conversions of non-residential
 buildings, the availability of benefits  under  this  section  for  such
 multiple  dwellings, buildings or structures shall be conditioned on the
 following: (a) alterations or improvements to at least one building-wide
 system are part of  the  application  for  benefits,  and  (b)  (i)  the
 assessed  valuation  of  such multiple dwelling, building, or structure,
 including land, shall not exceed an average of thirty  thousand  dollars
 per  dwelling unit at the time of the commencement of the alterations or
 improvements, and (ii) during the three years immediately preceding  the
 commencement  of  the  alterations  or improvements the average per room
 sale price of the dwelling units or the stock allocated to such dwelling
 units shall have been no greater than thirty-five percent of the maximum
 mortgage amount for a single family home eligible for  purchase  by  the
 Federal  National  Mortgage  Association; provided that if less than ten
 percent of the dwelling units or an amount of stock less than the amount
 allocable to ten percent of such  dwelling  units  was  not  transferred
 during  such preceding three year period, eligibility for benefits shall
 be conditioned upon the multiple dwelling, building, or structure having
 an assessed valuation per dwelling unit  of  no  more  than  twenty-five
 thousand  dollars  at the time of the commencement of the alterations or
 improvements. Provided, further, that such benefits shall  be  available
 S. 8474                            193
 
 only  for  alterations or improvements commenced on or after June first,
 nineteen hundred eighty-six.
   Notwithstanding  the  foregoing, the benefits of this section shall be
 available for any alterations or  improvements  commenced  after  August
 seventh,  two  thousand  eight for such multiple dwellings, buildings or
 structures and shall be conditioned on the following: (1)  the  applica-
 tion  for  benefits may include any item of work designated in the rules
 adopted by the department of housing preservation and development  as  a
 major  capital  improvement  or  asbestos  abatement  to the extent such
 asbestos abatement is required by federal, state and local law; and  (2)
 (i) the assessed valuation of such multiple dwelling, building or struc-
 ture,  including  land,  shall  not  exceed an average of forty thousand
 dollars per dwelling unit at the time of the commencement of the  alter-
 ations  or improvements; and (ii) the average per room sale price of the
 dwelling units or the stock allocated to such dwelling units shall  have
 been  no greater than thirty-five percent of the maximum mortgage amount
 for a single family home eligible for purchase by the  Federal  National
 Mortgage  Association  during  the three years immediately preceding the
 commencement of the alterations or improvements; provided that  if  less
 than  ten  percent of the dwelling units or an amount of stock less than
 the amount allocable to ten percent  of  such  dwelling  units  was  not
 transferred  during  such  preceding  three-year period, eligibility for
 benefits shall be conditioned upon the multiple dwelling,  building,  or
 structure having an assessed valuation per dwelling unit of no more than
 forty thousand dollars at the time of the commencement of the alteration
 or  improvement.    Provided,  however, benefits shall also be available
 under this section for work completed in  any  such  multiple  dwelling,
 building  or structure within the first three years of its conversion to
 cooperative or condominium ownership, as evidenced by the date on  which
 the first closing in a condominium to a bona fide purchaser occurs or in
 the  case  of a cooperative, the date on which the shares allocable to a
 unit are conveyed to a bona fide purchaser, provided, however, that  the
 availability  of  such benefits for conversions, alterations or improve-
 ments commenced prior to June first, nineteen hundred eighty-six, except
 with respect to governmentally assisted projects  as  defined  in  regu-
 lations  issued  by  the department of housing preservation and develop-
 ment, shall be conditioned upon  the  completion  of  such  conversions,
 alterations  or  improvements  within  three  years after acceptance for
 filing of the prospectus to establish such  cooperative  or  condominium
 entity  by  the  attorney  general of the state of New York. The maximum
 amount of tax abatement which may be received in any  tax  period  under
 this  section  by  any such multiple dwelling, building or structure for
 any alterations and improvements commenced three or more years after its
 initial conversion to cooperative  or  condominium  ownership  shall  be
 limited  to an amount not in excess of two thousand five hundred dollars
 per dwelling unit of the certified reasonable cost of the alterations or
 improvements as determined under regulations of the department of  hous-
 ing preservation and development.
   (3-a)  Notwithstanding  any  contrary  provision of paragraph three of
 this subdivision, the availability of any benefits under this section to
 any multiple dwelling, building or structure owned  and  operated  by  a
 limited-profit  housing  company  established pursuant to article two of
 the private housing finance  law  shall  not  be  conditioned  upon  the
 assessed  valuation  of  such  multiple dwelling, building or structure,
 including land, as calculated as an average dollar amount  per  dwelling
 unit,  at  the  time  of the commencement of the alterations or improve-
 S. 8474                            194
 
 ments; provided, however, that such limited-profit housing  company  (i)
 is  organized  and  operating  as a mutual company, (ii) continues to be
 organized and operating as a mutual company and to own and  operate  the
 multiple  dwelling,  building  or structure receiving such benefits, and
 (iii) has entered into a binding  and  irrevocable  agreement  with  the
 commissioner  of housing of the state of New York, the supervising agen-
 cy, the New York city housing development corporation, or the  New  York
 state  housing  finance  agency prohibiting the dissolution or reconsti-
 tution of such limited-profit housing company pursuant to section  thir-
 ty-five  of  the  private  housing finance law for not less than fifteen
 years from the commencement of such benefits. For the purposes  of  this
 paragraph,  the  terms  "mutual  company" and "supervising agency" shall
 have the same meanings as set forth in section two of the private  hous-
 ing finance law.
   (4)  provided  that,  in the case of any building or structure: (i) in
 which conversion, alteration or improvement commences on or after  Janu-
 ary first, nineteen hundred eighty-two, and (ii) which is located within
 an  area  designated  herein as a minimum tax zone, the benefits of this
 section shall not be applied to abate or reduce the taxes upon the  land
 portion  of  such  real property, which shall continue to be taxed based
 upon the assessed valuation of the land and the applicable tax  rate  at
 the  time  such  taxes are levied; provided, however, that the foregoing
 limitation with respect to abatement of taxes shall not apply:
   (A) to any multiple dwelling which is eligible for benefits based upon
 moderate rehabilitation pursuant to paragraph four of subdivision  b  of
 this  section,  or  (B) to any multiple dwelling which is governmentally
 assisted as such term is defined in regulations to be promulgated by the
 department of housing preservation and development pursuant to  subdivi-
 sion m of this section.
   (5)  provided  that,  in the case of any building or structure: (i) in
 which conversion, alteration or improvement commences on or after  Janu-
 ary first, nineteen hundred eighty-two, and (ii) which is located within
 an  area  designated herein as a tax abatement exclusion zone, the bene-
 fits of this section shall not be applied to abate or reduce  the  taxes
 upon such real property, which shall continue to be taxed based upon the
 assessed  valuation  of the land and the improvements and the applicable
 tax rate at the time such taxes are levied; provided, however, that  the
 foregoing  limitation  shall not deprive such real property of any bene-
 fits of exemption from taxation of an increase in assessed valuation  to
 which  it  is entitled pursuant to this section; provided, however, that
 the foregoing limitation with respect to abatement of  taxes  shall  not
 apply:
   (A)  to  any  alteration  or improvement designated as a major capital
 improvement, by the regulations promulgated by the department of housing
 preservation and development pursuant to subdivision m of this  section,
 provided  that the maximum amount of tax abatement which may be received
 in any tax period under this section  by  any  such  multiple  dwelling,
 building  or  structure  for  any  alterations and improvements shall be
 limited to an amount not in excess of twenty-five  hundred  dollars  per
 dwelling  unit  of  the certified reasonable cost of the alterations and
 improvements as determined under regulations of the department of  hous-
 ing  preservation and development, or (B) to any multiple dwelling which
 is governmentally assisted as such term is defined by said regulations.
   (8) Limitation on benefits. (a) The provisions of this paragraph shall
 apply to  all  conversions,  alterations  and  improvements  except  the
 following:
 S. 8474                            195
 
   (i)  alterations  or improvements under paragraphs three, five and six
 of subdivision b of this section, where carried out:
   (A) with the substantial assistance of grants, loans or subsidies from
 any  federal,  state or local agency or instrumentality, or any not-for-
 profit philanthropic organization  one  of  whose  primary  purposes  is
 providing low or moderate incoming housing; or
   (B)  with mortgage insurance by the New York city residential mortgage
 insurance corporation or the state of New York mortgage agency; or
   (C) in the areas bounded and described as follows:
   AREAS IN THE COUNTY OF RICHMOND:
   PORT RICHMOND--The area bounded by the Kill Van  Kull;  Jewett  Avenue
 and its prolongation; Forest Avenue; and, the Willow Brook Expressway.
   NEW  BRIGHTON--The  area  bounded  by  the  Kill  Van Kull; Westervelt
 Avenue; Brook Street; Castleton Avenue; and, North  Randall  Avenue  and
 its prolongation.
   STAPLETON--The  area  bounded by Victory Boulevard; the Upper New York
 Bay; Vanderbilt Avenue; Van Duzer Street; Cebra Avenue; and,  St.  Pauls
 Avenue.
   FOX  HILLS--The  area bounded by Vanderbilt Avenue; the Upper New York
 Bay; the Staten Island Rapid Transit Railway  right  of  way;  and,  the
 Staten Island Expressway.
   (D)  pursuant to a program established by the federal housing adminis-
 tration, federal national mortgage association, federal home loan  mort-
 gage  corporation  or  government  national mortgage association for the
 rehabilitation of existing multiple dwellings  for  persons  of  low  or
 moderate  income,  or  a program of mortgage insurance for the rehabili-
 tation of existing multiple dwellings pursuant to  section  two  hundred
 twenty-three-f  of the national housing act, as amended, or a program of
 mortgage insurance established by the federal housing administration for
 the rehabilitation of existing multiple dwellings for persons of low  or
 moderate  income; provided that properties receiving benefits under such
 programs are located in a neighborhood strategy area, as defined, by the
 United States department of housing and urban development, or in one  of
 the areas listed in subparagraph (C) of this paragraph.
   (ii) alterations or improvements under paragraph four of subdivision b
 of this section; and
   (iii)  conversion of residential units qualified for the protection of
 article seven-C of the multiple dwelling law under  paragraph  seven  of
 subdivision b of this section.
   (b)  Abatement limitations. (i) The amount of abatement under subdivi-
 sion c of this section shall not exceed the certified reasonable cost of
 the conversion, alteration or improvement,  as  determined  under  regu-
 lations  of  the  department  of  housing  preservation and development,
 provided that the amount  of  certified  reasonable  cost  eligible  for
 abatement  under  this section shall not exceed fifteen thousand dollars
 for a dwelling unit of three and one-half rooms, as determined under the
 applicable zoning resolution, and a comparable amount for dwelling units
 of other sizes, determined under regulations of the department of  hous-
 ing  preservation  and development, and further provided that the amount
 of certified reasonable cost eligible for abatement under  this  section
 may exceed fifteen thousand dollars or such comparable amount per dwell-
 ing  unit, but not more than twenty-five percent above such amount, upon
 application of the property owner and a determination by the  department
 of housing preservation and development that:
 S. 8474                            196
 
   (A) in the case of a conversion under paragraph one or two of subdivi-
 sion  b  of this section, the increased cost is necessary to comply with
 applicable law;
   (B) in the case of an alteration or improvement under paragraph six of
 subdivision b of this section, the increased cost is necessary to elimi-
 nate the unhealthy or dangerous conditions or replace the inadequate and
 obsolete facilities in a satisfactory manner;
   (C)  in  the case of an alteration or improvement under paragraph five
 of subdivision b of this section, the increased  cost  is  necessary  to
 conserve energy in a satisfactory manner; or
   (D)  in the case of an alteration or improvement under paragraph three
 of subdivision b of this section, the increased cost, to the extent such
 cost is not offset by any and all tax credits received as  a  result  of
 the alteration or improvement, is necessary to comply with any provision
 of law regulating historic or landmark buildings or structures.
   (ii) Notwithstanding any other provisions of this subparagraph, and in
 addition to all other conditions of eligibility for the benefits of this
 section,  the  availability  of  abatements pursuant to subdivision c of
 this section for any multiple dwellings,  buildings  or  structures  not
 owned  as a condominium or cooperative, except for multiple dwellings in
 which units have been newly created  by  substantial  rehabilitation  of
 vacant  buildings  or conversions of non-residential buildings, shall be
 conditioned on the  assessed valuation of such multiple dwelling, build-
 ing or structure, including land, not exceeding  an  average  of  thirty
 thousand  dollars  per  dwelling unit at the time of commencement of the
 alterations or improvements, provided, however, that such average  shall
 not  exceed  forty  thousand  dollars  per  dwelling unit at the time of
 commencement  of  the  alteration  or  improvement  for  alterations  or
 improvements commenced after the effective date of this paragraph.
   (c)  Exemption  limitations. (i) The increase in assessed valuation of
 the real property resulting from the conversion, alteration or  improve-
 ment  under subdivision b of this section, shall be exempt from taxation
 as provided in this section, only to the extent provided in this subpar-
 agraph, provided that this subparagraph shall not apply to  any  conver-
 sions,  alterations  or  improvements  commenced on or after June first,
 nineteen hundred eighty-six.  The amount of the increased assessed valu-
 ation that is exempt from taxation shall depend on  the  amount  of  the
 total assessed value per dwelling unit calculated by dividing the amount
 of the total assessed valuation of the property, as determined under the
 real  property  tax law, by the number of dwelling units in the building
 after completion of  the  conversion,  alteration  or  improvement.  The
 amount of increased assessed valuation that will be exempt from taxation
 for  buildings  with  total assessed valuation per dwelling unit of less
 than thirty-eight thousand dollars shall be calculated pursuant  to  the
 following  formula:  (A)  any portion of total assessed valuation of the
 property attributable to the first eighteen thousand  dollars  of  total
 assessed  valuation  per  dwelling  unit,  to  the  extent it represents
 increased assessed valuation, shall be one hundred percent  exempt;  (B)
 any  portion  of  total assessed valuation attributable to the next four
 thousand dollars of total assessed valuation per dwelling unit,  to  the
 extent it represents increased assessed valuation, shall be seventy-five
 percent exempt; (C) any portion of total assessed valuation attributable
 to the next four thousand dollars of total assessed valuation per dwell-
 ing  unit,  to  the  extent  it represents increased assessed valuation,
 shall be fifty percent exempt; (D) any portion of total  assessed  valu-
 ation  attributable  to the next four thousand dollars of total assessed
 S. 8474                            197
 
 valuation per dwelling unit,  to  the  extent  it  represents  increased
 assessed  valuation,  shall  be  twenty-five percent exempt; and (E) any
 portion of total assessed valuation attributable to the next eight thou-
 sand  dollars  of  total  assessed  valuation  per dwelling unit, to the
 extent it represents increased assessed  valuation  per  dwelling  unit,
 shall  be  fully  taxable.  Property with a total assessed valuation per
 dwelling unit of thirty-eight thousand dollars  or  more  shall  not  be
 eligible for a tax exemption under this section.
   (ii)  In  calculating  the amount of increased assessed valuation that
 will be exempt from taxation pursuant to the formula in  clause  (i)  of
 this subparagraph, the full amount of total assessed valuation that does
 not  represent  increased  assessed  valuation  shall be applied in such
 formula prior to the inclusion of any amount of increased assessed valu-
 ation.
   (iii) Where the real property is  occupied  in  part  for  residential
 purposes  and  in  part for non-residential purposes, the assessed valu-
 ation of the property shall be appropriately allocated between the resi-
 dential and non-residential portions. In computing  the  total  assessed
 valuation  per dwelling unit under this subparagraph, only the amount of
 valuation so allocated to the residential portion shall be considered.
   (iv) Commencing with the assessment roll for the year nineteen hundred
 eighty-four, where there has been a change in the  level  of  assessment
 from  the  assessment  roll  of  the  prior year of properties receiving
 exemptions under this section, the department of  finance  may  petition
 the  state  board  to  certify  the  percentage  of  such change for the
 purposes of this section. In such petition, the  department  of  finance
 shall  submit such information as the state board shall require in order
 to certify the percentage of such change. The state board may also  make
 such  a  certification  on  its own motion. Upon receipt of such certif-
 ication from the state board, the department of housing preservation and
 development may modify the dollar values of total assessed valuation per
 dwelling unit in clause (i) of this subparagraph to reflect the percent-
 age change in the level of assessment as shown in such certification. As
 used in this subparagraph, the term "change in the level of  assessment"
 means  the net increase or decrease in the assessed valuation of proper-
 ties in the assessing unit that received exemptions under  this  section
 in  the current year as compared to those that received exemptions under
 this section in the prior year as a result of assessing such  properties
 at a higher or lower ratio of full value.
   (v)  (A) Notwithstanding the provisions of clause (i) of this subpara-
 graph, the department of housing preservation and development may reduce
 or remove the limitations on the exemption  from  taxation  provided  in
 such  clause with respect to a particular property undergoing alteration
 or improvement, upon application of the property owner  and  a  determi-
 nation  by  such department that the increased benefit will increase the
 number of dwelling units that will be affordable to persons of  low  and
 moderate  income, and the increased benefit is necessary to make econom-
 ically viable units or improvement in the quality of dwelling units that
 will be affordable to persons of low or moderate income.
   (B) As used in this subparagraph, the term "persons of low or moderate
 income" shall mean persons  who  would  qualify  for  housing  subsidies
 pursuant to section two hundred thirty-five of the national housing act,
 as amended, at one hundred thirty-five percent of the income limitations
 provided therein.
   (C)  Upon  receiving  an application under this subparagraph in proper
 form, the department of housing preservation and development shall imme-
 S. 8474                            198
 
 diately submit it to the community board  for  the  area  in  which  the
 project  is  located,  which may, within forty-five days of receiving it
 and after a public hearing, make recommendations to the department as to
 the  application.    The  department shall act on the application within
 sixty days of receiving it from the property owner in proper  form,  but
 not  before  expiration  of the time for the community board to make its
 recommendations, unless the board has acted sooner.
   (d) The department of housing preservation  and  development  may  set
 forth  preliminarily the terms of a determination under subparagraph (b)
 or (c) of this paragraph prior to the commencement  of  the  conversion,
 alteration  or  improvement.  Any  such  determination shall take effect
 after completion of the work in accordance with the terms of the  appli-
 cation made by the property owner.
   (e)  Any  determination  of the department of housing preservation and
 development to increase an abatement  under  subparagraph  (b)  of  this
 paragraph,  or  to  reduce  or  remove  the  exemption limitations under
 subparagraph (c) of this paragraph shall state the basis for the  deter-
 mination  and the data on which the determination was based. Such deter-
 mination shall be published in the City Record for five consecutive days
 after the determination is rendered.
   e. Notwithstanding any provision of this section or any other  section
 of  the  code to the contrary, where such dwelling is in an area where a
 plan of redevelopment,  program  of  neighborhood  improvement,  housing
 maintenance,  demonstration rehabilitation or concentrated code enforce-
 ment is being carried out, the rents subsequent  to  conversion,  alter-
 ation or improvement may exceed the maximum amount allowable pursuant to
 chapter  four  of  title twenty-six of the code of the preceding munici-
 pality where necessity for the adjustment of such rents is certified  by
 the department of housing preservation and development.
   f.  Subject  to  the  provisions of subdivision d of this section, the
 department of housing preservation and development shall  determine  and
 certify  the  reasonable  cost  of  any such conversions, alterations or
 improvements and eligibility for the benefits of this  section  and  for
 that  purpose  may  adopt rules and regulations, administer oaths to and
 take the testimony of any person, including but not limited to the owner
 of such property, may issue subpoenas requiring the attendance  of  such
 persons  and  the production of such bills, books, papers or other docu-
 ments as it shall deem necessary, may make preliminary estimates of  the
 maximum  reasonable  cost  of  such conversions, alterations or improve-
 ments,  may  establish  maximum  allowable  costs  of  specified  units,
 fixtures  or  work in such conversions, alterations or improvements, and
 may require the submission of plans and specifications of  such  conver-
 sions,  alterations  or  improvements, and may require the submission of
 plans and specifications of such conversions,  alterations  or  improve-
 ments  before  the  start  thereof. Applications for certification shall
 include all bills and other documents showing the cost  of  construction
 or  such  other  evidence  of  such cost as shall be satisfactory to the
 department of housing preservation and development,  including,  without
 limitation,  certification  of  cost by a certified public accountant in
 accordance with generally accepted accounting principles.   Applications
 for certification for a building eligible for benefits pursuant to para-
 graph  three  of  subdivision  d  of  this  section,  for alterations or
 improvements completed more than three years  after  its  conversion  to
 cooperative  or  condominium ownership, shall include such documentation
 of the sale price of dwelling units or stock allocated to such  dwelling
 units  as  may be required by the department of housing preservation and
 S. 8474                            199
 
 development, including but not limited to certification of  sales  price
 by  a  certified public accountant. In addition, such applications shall
 contain the consent of the applicant to allow the department of  housing
 preservation and development access to records, including but not limit-
 ed  to  other  tax  records,  as  the department may deem appropriate to
 enforce such conditions of eligibility.  Applications for  certification
 filed  on or after January first, nineteen hundred seventy-nine pursuant
 to paragraphs one through six and paragraph eight of  subdivision  b  of
 this  section  shall  be  made  after  completion and within forty-eight
 months following the start of construction of the conversion, alteration
 or improvement, except that applications for  certification  for  alter-
 ations  or improvements undertaken by a housing development fund company
 organized pursuant to article eleven of the private housing finance law,
 which are carried out with the substantial assistance of  grants,  loans
 or  subsidies  from  any  federal, state or local governmental agency or
 instrumentality or which are carried out in a property transferred  from
 the  city  of  New  York  or  city  of Staten Island shall be made after
 completion and within seventy-two months  following  the  start  of  the
 construction  of  the alteration or improvement.  Provided, however, the
 department of housing preservation and development is empowered to grant
 an extension of the period for application for any project  carried  out
 with  the  substantial assistance of loans, grants or subsidies from any
 federal, state or local governmental agency or instrumentality, if  such
 application  is  made  within  seventy-two  months  from commencement of
 construction. Applications for certification pursuant to paragraph seven
 of subdivision b of this section shall be filed within twelve months  of
 the date of completion as provided by such subdivision.
   g.  To  the  end that conversions, alterations or improvements in such
 property shall interfere as little as practicable  with  the  clearance,
 rehabilitation  or  rebuilding  of sub-standard and insanitary areas and
 shall be confined to buildings and  structures  which  are  structurally
 sound  and comply with applicable provisions of law, eligibility for the
 benefits of this section shall  be  restricted  to  such  buildings  and
 structures  which the department of housing preservation and development
 shall certify:
   (1) to be structurally sound and to comply with applicable  provisions
 of  law,  as  determined  by  the department of buildings, which certif-
 ication shall be evidenced by  a  certificate  describing  the  property
 involved;
   (2)  if  in  an  area for which a final plan of clearance, replanning,
 reconstruction,  rehabilitation,  or  redevelopment  has  been  approved
 pursuant  to  article  fifteen of the general municipal law, or if in an
 area for which an urban renewal plan or tests, studies or demonstrations
 have been approved pursuant to article fifteen of the general  municipal
 law,  to be improved in conformity with such replanning, reconstruction,
 rehabilitation, redevelopment, tests, studies, demonstrations  or  plan;
 and
   (3) if in an area where a program of local neighborhood improvement or
 housing  maintenance is being carried out, to be in conformity with such
 program.
   h. Application forms for the benefits of this section shall  be  filed
 with the department of finance within the time periods to be established
 by  rules and regulations promulgated by the department of housing pres-
 ervation and development pursuant to subdivision m of this section.  The
 department  of  finance  shall certify the amount of taxes to be abated,
 pursuant to the certification of the department of housing  preservation
 S. 8474                            200
 
 and  development  as  herein  provided.  No  such  application  shall be
 accepted unless accompanied by a copy of the certificate of the  depart-
 ment  of housing preservation and development both as to reasonable cost
 and as to eligibility as provided in subdivision f of this section.
   i. The benefits of this section shall not apply:
   (1) except as provided in subdivision d of this section, to any exist-
 ing  dwelling  which  is  not subject to the provisions of the emergency
 housing rent control law or to the city rent and rehabilitation  law  or
 to the city rent stabilization law or to the private housing finance law
 or  to  any  federal  law providing for supervision or regulation by the
 United States department of housing and urban development;
   (2) to any private dwelling, notwithstanding any  other  provision  of
 this  section,  unless it is in an area where a plan of redevelopment or
 program of neighborhood improvement, housing maintenance,  demonstration
 rehabilitation or concentrated code enforcement is being carried out and
 the  department  of  housing preservation and development finds that the
 conversion, alteration or improvement is in conformity with such plan of
 redevelopment, or program of neighborhood improvement,  housing  mainte-
 nance,  demonstration  rehabilitation  or concentrated code enforcement;
 provided that, however, for the purposes of  this  section,  a  class  A
 multiple  dwelling  may  be deemed to include any garden-type maisonette
 dwelling project consisting of a series of dwelling units which together
 and in their aggregate were arranged or designed  to  provide  three  or
 more apartments and are provided as a group collectively with all essen-
 tial  services  such  as, but not limited to, water supply, house sewers
 and heat, and which are in existence and operated as a unit under single
 ownership on the date upon which an application for the benefits of this
 section is received by the department of housing preservation and devel-
 opment, even though certificates of occupancy were issued  for  portions
 thereof as private dwellings;
   (3)  to any property receiving tax exemption or abatement concurrently
 for rehabilitation or new construction under any other provision of  New
 York  state,  city  of  New  York  or city of Staten Island law with the
 exception of any alteration or improvement to  property  receiving  such
 tax  exemption  or abatement under the provisions of the private housing
 finance law, provided, however, that the benefits of this section  shall
 not apply to any alterations or improvements done in connection with the
 refinancing,  pursuant  to  section 223f of the national housing act, as
 amended, of a housing project organized  pursuant  to  article  two  and
 article four of the private housing finance law;
   (4)  to any multiple dwelling for ordinary repairs and normal replace-
 ment of maintenance items, as provided in paragraph one  of  subdivision
 a,  hereof in the event that the dwelling thereof is receiving the bene-
 fits of this section for other ordinary repairs and  normal  replacement
 of  maintenance items as of the December thirty-first preceding the date
 of application;
   (5) to the conversion of any building or structure, or portion  there-
 of:
   (i)  which  is  located in the city of Staten Island where residential
 conversion as of right is not permitted by the zoning resolution;
   (ii) where such benefits are eliminated by regulations to  be  promul-
 gated by the department of housing preservation and development pursuant
 to  subdivision  m of this section, unless, in the case of a building or
 structure in Richmond county, construction actually commenced  prior  to
 October  first, nineteen hundred eighty-three, pursuant to an alteration
 permit. A copy of any proposed regulation  pursuant  to  this  paragraph
 S. 8474                            201
 
 shall  be transmitted to the city council not less than sixty days prior
 to its publication in  the  City  Record,  pursuant  to  section  eleven
 hundred  five of the charter of the preceding municipality as it existed
 on  the first of January, in the year next succeeding the effective date
 of this section; and
   (iii) provided that the provisions of this paragraph shall  not  apply
 to  conversions  pursuant  to  paragraph  seven of subdivision b of this
 section.
   (6) to any conversion of or alteration or improvement, commenced on or
 after July first, nineteen hundred eighty-two, to any class  B  multiple
 dwelling  or  class  A  multiple  dwelling  used in whole or in part for
 single room occupancy, regardless of the status or use of  the  building
 after  the conversion, alteration or improvement unless such conversion,
 alteration or improvement is carried out with the substantial assistance
 of grants, loans or subsidies from any federal, state or local agency or
 instrumentality.
   (7) to any conversion of or alteration or improvement, commenced on or
 after the effective date of this paragraph, to any  property  classified
 under  the  zoning  resolution as a non-profit institution with sleeping
 accommodations, regardless of the status or use of  the  building  after
 the conversion, alteration or improvement unless such conversion, alter-
 ation  or  improvement is carried out with the substantial assistance of
 grants, loans or subsidies from any federal, state or  local  agency  or
 instrumentality.
   j. Notwithstanding the provisions of the multiple dwelling law, or any
 local  law,  ordinance, provisions of this code, rule or regulation, any
 dwelling to which alterations and improvements are made pursuant to this
 section and which did not require a certificate of  occupancy  on  April
 second, nineteen hundred forty-five, may be occupied lawfully after such
 date  upon  the  completion of such alterations and improvements without
 such a certificate being obtained, provided, however, that  such  alter-
 ations  and improvements shall have been made in conformity with law and
 the applicable provisions for fire protection required by  articles  six
 and seven of the multiple dwelling law.
   k.  No owner of a dwelling to which the benefits of this section shall
 be applied, nor any agent, employee, manager or officer  of  such  owner
 shall  directly or indirectly deny to any person because of race, color,
 creed, national origin, gender, sexual orientation, disability,  marital
 status,  age,  religion,  alienage or citizenship status, or the use of,
 participation in, or being eligible for a governmentally funded  housing
 assistance program, including, but not limited to, the section 8 housing
 voucher program and the section 8 housing certificate program, 42 U.S.C.
 1437  et  seq.,  or  the senior citizen rent increase exemption program,
 pursuant to either chapter seven of title twenty-six of the code of  the
 preceding municipality or section 26-509 of such code, any of the dwell-
 ing accommodations in such property or any of the privileges or services
 incident  to  occupancy  therein.  The term "disability" as used in this
 subdivision shall have the meaning set forth in  section  8-102  of  the
 code  of  the preceding municipality.  Nothing in this subdivision shall
 restrict such consideration in the development of housing accommodations
 for the purpose of providing for  the  special  needs  of  a  particular
 group.
   l.  Any person who shall knowingly and willfully make any false state-
 ment as to any material matter in any application for  the  benefits  of
 this  section  shall be guilty of an offense punishable by a fine of not
 more than five hundred dollars or imprisonment for not more than  ninety
 S. 8474                            202
 
 days,  or  both. The commissioner of the department of housing preserva-
 tion and development may reduce or revoke past and future  exemption  or
 tax abatement authorized pursuant to this section if the application for
 tax  exemption  or  tax  abatement  contains  a false statement or false
 information as to a material matter or omits a material matter.
   m. Each agency or department to which functions are assigned  by  this
 section may adopt and promulgate rules and regulations for the effectua-
 tion of the purpose of this section.
   n.  The department of housing preservation and development may require
 a filing fee in an amount as  provided  by  the  rules  and  regulations
 promulgated  by  the  department of housing preservation and development
 pursuant to subdivision m of this section.
   o. Any tax abatement granted for a period of nine years to a  multiple
 dwelling aided by a loan provided by the city of New York prior to Janu-
 ary first, nineteen hundred seventy-one, shall upon application therefor
 be  adjusted to extend for a period of up to twenty years, provided that
 the total abatement before and after such adjustment  shall  not  exceed
 the  total abatement to which such property was initially entitled under
 this section.
   p. This section is enacted pursuant to the provisions of section  four
 hundred  eighty-nine of the real property tax law and subdivision two of
 section four hundred five of the private housing finance law.
   q. No application for the benefits of this section shall  be  accepted
 by  the department of finance if there are outstanding real estate taxes
 or water and sewer charges or payments in lieu of taxes which  were  due
 and  owing  as  of  the last day of the tax period preceding the date of
 such filing with the department of finance, provided that  an  applicant
 aided by article eight or article fifteen of the private housing finance
 law shall have such application accepted by the department of finance if
 there  are  no  outstanding real estate taxes or water and sewer charges
 due and owing as of the last day of the tax period  preceding  commence-
 ment of construction.
   r.  In the event that any building or structure receiving the benefits
 of this section shall become operated exclusively for commercial,  hotel
 or  transient  hotel  use,  the  tax  commission shall withdraw benefits
 granted herein prospectively.
   s. The benefits of this section shall  not  apply  to  alterations  or
 improvements  to  existing  dwellings  in  existence on December thirty-
 first, nineteen hundred  seventy-five  where  (i)  such  alterations  or
 improvements were completed on or before December thirty-first, nineteen
 hundred  seventy-five,  and  (ii)  no dwelling units thereof on December
 thirty-first, nineteen  hundred  seventy-five  had  rentals  which  were
 subject  to  control by the city rent agency pursuant to chapter four of
 title twenty-six of the code of the preceding municipality.  This subdi-
 vision shall not apply to alterations or improvements to any building or
 structure which is benefitted by mortgage insurance pursuant to  section
 two  hundred thirteen of the national housing act for applications filed
 prior to January first, nineteen hundred seventy-nine.
   t. Notwithstanding any law to the contrary, the owner of any  building
 or  structure  eligible for any of the benefits of this section which is
 converted to a class A multiple dwelling,  completed,  or  substantially
 rehabilitated  on  or  after January one, nineteen hundred seventy-four,
 shall register the initial rent for each dwelling unit in such  building
 or  structure  with the New York state division of housing and community
 renewal. After such registration, the rents of such dwelling units shall
 be fully subject to regulations under chapter four of  title  twenty-six
 S. 8474                            203
 
 of  the  code  of  the preceding municipality so long as the benefits of
 this section are in effect or for such longer period as may be  provided
 by law.
   u.  Any  tax  exemption  or  tax abatement authorized pursuant to this
 section may be revoked retroactively by the commissioner  of  department
 of  housing preservation and development or the department of finance at
 any time during the authorized term of such tax exemption or tax  abate-
 ment  if real estate taxes or water and sewer charges due to the city of
 New York or city of Staten Island remain unpaid for one year  after  the
 same  are  due  and  payable.  In no event shall revocation be effective
 prior to the date such taxes or charges were first due and payable.
   v. Where alterations, improvements, or conversions include or  benefit
 that  part of a building which is not occupied for dwelling purposes but
 is occupied by stores or  otherwise  used  for  commercial  purposes  or
 community facilities, the increase in assessed valuation and the cost of
 the  alteration  shall be apportioned so that the benefits of this title
 shall not be provided for alterations, improvements or conversions  made
 for other than dwelling purposes.
   w.  If  any provision of this section or its application to any person
 shall be held invalid, the remainder of this section and the applicabil-
 ity of its provisions to other persons or  circumstances  shall  not  be
 affected thereby.
   x.  Notwithstanding any provision of this section, no benefit pursuant
 to paragraph four of subdivision b of this section shall be granted  for
 work  commenced after January first, nineteen hundred eighty, unless the
 applicant establishes that the department of  housing  preservation  and
 development  and  tenants  of  such class A multiple dwelling were given
 notice of (i) the proposed work prior to commencement of such work, (ii)
 the identity of the  owner's  representative,  and  (iii)  the  tenants'
 rights under applicable law with respect to such work, provided that, in
 the  case of a loan program supervised by such department, notice to the
 department shall be unnecessary, and further provided that  the  depart-
 ment may itself provide the required notice to the tenants.
   y.  Applicants for benefits under the provisions of this section shall
 file with the department of finance a form supplied by  said  department
 which  (i) states an intention to file for benefits under the provisions
 of this section, (ii) describes the work for which tax benefits will  be
 claimed and (iii) estimates the cost of such work which will be eligible
 for benefits. Such form shall be filed prior to the commencement of such
 work.  If  the  scope of such work or the estimated cost thereof changes
 materially, applicant shall file a revised statement.    Applicants  who
 fail  to  comply  with  the  requirements  of  this subdivision shall be
 subject to a penalty not to exceed one hundred percent of the filing fee
 otherwise payable pursuant to subdivision n of this section.
   z. A former tenant or former subtenant of premises in  a  non-residen-
 tial  building  which is the subject of an application for an alteration
 permit for conversion to a class  A  multiple  dwelling,  prior  to  the
 application  for any tax exemption or abatement benefits for such build-
 ing pursuant to this section, and as a condition to the  grant  thereof,
 shall  be  entitled to a relocation award under the terms and conditions
 set forth below:
   (1) As used in this subdivision, the term "eligible tenant" shall mean
 any former tenant or former subtenant who:
   (i) leased and used the vacated premises to conduct  a  manufacturing,
 warehousing,  or  wholesaling business for not less than two consecutive
 years immediately prior to vacating;
 S. 8474                            204
 
   (ii) vacated such premises on or after April first,  nineteen  hundred
 eighty-one for any reason other than eviction for non-payment of rent;
   (iii)  vacated  such  premises  (a) no earlier than twenty-four months
 prior to the filing date of an application for  such  alteration  permit
 and  (b)  no later than the completion of the conversion as evidenced by
 the issuance of a permanent certificate  of  occupancy  for  a  class  A
 multiple dwelling;
   (iv)  either  purchased or leased for a term of not less than eighteen
 months other premises within the city of Staten Island with a floor area
 not less than one-third of the floor area of the vacated premises;
   (v) relocated their business to such other premises within one year of
 vacating the vacated premises; and
   (vi) paid all commercial rent or occupancy tax for the  vacated  prem-
 ises.  A  subtenant  shall  be  eligible  to  receive a relocation award
 notwithstanding any lack of eligibility of its prime tenant;
   (2) the relocation award shall not  exceed  the  greater  of  (i)  the
 aggregate  base  rent  which accrued and was paid by the eligible tenant
 during the final twenty-four months of  its  occupancy  of  the  vacated
 premises  or  (ii)  four  dollars for each square foot that the eligible
 tenant occupied in the vacated premises  during  the  final  twenty-four
 months  of its occupancy of the vacated premises. As used in this subdi-
 vision, base rent shall be calculated in the same manner as base rent is
 calculated for purposes of commercial rent or occupancy tax in the  city
 of Staten Island. However, the aggregate award payable to a prime tenant
 and/or  any  subtenants of such prime tenant shall not exceed the amount
 which would have been payable to the prime tenant had the  prime  tenant
 been eligible for an award based on the entire floor area it leased from
 the  owner; and if such limitation applies, the awards shall be prorated
 based upon the total floor area  used  and  occupied  by  each  eligible
 tenant;
   (3)  the  relocation award shall become due and payable to an eligible
 tenant at the time the eligible tenant (i) either  purchases  or  leases
 other premises in accordance with paragraph one of this subdivision, and
 (ii)  certifies  eligibility  to, and demands payment of, the award from
 the owner of the vacated building. If the relocation award is  not  paid
 within  thirty  days  of  such  certification and demand, interest shall
 accrue on the relocation award from the date of  the  certification  and
 demand at the rate of twenty-four percent per annum;
   (4)  at  any time after such certification and demand and prior to the
 date of the filing of an application for tax exemption or abatement  for
 the  vacated  building  pursuant to this section, an eligible tenant who
 has not received a relocation award shall have a right to file a  notice
 of  claim.  Such notice of claim shall be filed with the county clerk of
 the county and shall verify the claimant's  name,  its  compliance  with
 eligibility requirements, the address of the vacated premises, the floor
 area  it  occupied,  the  name  of the prime tenant if the claimant is a
 subtenant, and all the base rent that accrued and was paid by the claim-
 ant during the final twenty-four months of its occupancy;
   (5) a notice of claim, filed in accordance with paragraph four of this
 subdivision, may be discharged by the filing of an undertaking with  the
 county  clerk in an amount equal to the amount claimed and in accordance
 with the procedures set forth in subdivision four of section nineteen of
 the lien law, or by the payment into court of such amount in  accordance
 with the procedures set forth in section fifty-five of such law;
   (6)  no  tax  exemption or abatement shall be granted pursuant to this
 section unless the department of housing  preservation  and  development
 S. 8474                            205
 
 receives  an  affidavit  from the applicant for benefits of this section
 which verifies that:
   (i)  the  applicant has caused to be published a notice in a newspaper
 of general circulation within the city of Staten Island, no  later  than
 sixty days prior to filing of an application for tax exemption or abate-
 ment  pursuant to this section, which advises former tenants and subten-
 ants of their rights pursuant to this subdivision; and
   (ii) no notice of claim  has  been  filed  or  all  claims  have  been
 released  by the claimants, or secured in accordance with the provisions
 of paragraph five of this subdivision,  or  discharged  as  an  improper
 claim by court order;
   (7) the affidavit required pursuant to the provisions of paragraph six
 of  this  subdivision  shall  be  considered part of the application for
 benefits pursuant to this section;
   (8) if an eligible tenant has duly filed a notice of claim pursuant to
 paragraph four of this subdivision and  did  not  receive  a  relocation
 award  as  provided herein, it may commence an action against any appli-
 cant who filed a false affidavit  pursuant  to  paragraph  six  of  this
 subdivision  or  any security posted by such applicant pursuant to para-
 graph five of this subdivision, within three years of  such  filing.  In
 any action to enforce a claim pursuant to this subdivision, if the court
 finds  that  the  claimant  has  wilfully  exaggerated the amount of the
 claim, the claimant may be held liable in damages for an amount  not  to
 exceed  the proper relocation award. An eligible tenant in whose favor a
 judgment is entered shall be entitled to costs and reasonable legal fees
 and disbursements provided that such judgment is in excess of the amount
 which the applicant or owner offered to pay the eligible tenant; and
   (9) any lease or other rental agreement provision exempting,  waiving,
 releasing or discharging the obligation to pay a relocation award pursu-
 ant to this subdivision shall be void as against public policy and whol-
 ly unenforceable.
   aa.  Harassment.  (1)  The provisions of this subdivision apply to and
 are additional requirements for claiming or receiving:
   (a) any tax exemption under this section; or
   (b) any tax abatement under this section where the  certified  reason-
 able cost per dwelling unit of the conversion, alteration or improvement
 (including  the  cost  of  any conversion, alteration or improvement for
 which an abatement was approved within four years prior to  commencement
 of  the  conversion,  alteration  or improvement) exceeds seven thousand
 five hundred dollars.
   (2) The owner of the property shall file with the department of  hous-
 ing  preservation  and development, not less than thirty days before the
 commencement of the conversion, alteration or  improvement  (hereinafter
 referred to as the "cut-off date"), an affidavit, or, where any informa-
 tion  referred  to in paragraph one of this subdivision changes prior to
 applying for or claiming any benefit under  this  section,  an  amending
 affidavit, setting forth the following information:
   (a)  every  owner of record and owner of a substantial interest in the
 property or entity owning the property  or  sponsoring  the  conversion,
 alteration or improvement;
   (b)  a  statement that none of such persons had, within the five years
 prior to the cut-off date, been found to  have  harassed  or  unlawfully
 evicted  tenants  by  judgment  or  determination  of  a court or agency
 (including a non-governmental agency having appropriate legal  jurisdic-
 tion)  under  the  penal law, any state or local law regulating rents or
 S. 8474                            206
 
 any state or local law relating to harassment  of  tenants  or  unlawful
 eviction; and
   (c) any change in the information required to be set forth.
   (3)  No conversion, alteration or improvement subject to this subdivi-
 sion shall be eligible for tax exemption or  tax  abatement  under  this
 section where:
   (a) any affidavit required under this subdivision has not been filed;
   (b)  any  such affidavit contains a willful misrepresentation or omis-
 sion of any material fact; or
   (c) any person referred to in subparagraph (a)  of  paragraph  two  of
 this  subdivision  has been found to have harassed or unlawfully evicted
 tenants as described in that paragraph, until and unless the finding  is
 reversed  on  appeal,  provided  that any such finding after the cut-off
 date shall not apply to or affect any tax abatement or exemption for the
 conversion, alteration or improvement covered by the affidavit.
   (4) The department of housing preservation  and  development  and  the
 department  of  finance shall maintain a list of affidavits as described
 in paragraph two of this subdivision. Each agency shall review that list
 with respect to each application or claim for benefits subject  to  this
 subdivision.
   (5)  "Substantial  interest"  as used in subparagraph (a) of paragraph
 two of this subdivision shall mean ownership of an interest of  ten  per
 centum or more in the property or entity owning the property or sponsor-
 ing the conversion, alteration or improvement.
   (6)  Where  the  conversion,  alteration  or  improvement is commenced
 before August first, nineteen hundred  eighty-three,  the  cut-off  date
 shall  be  as  set  forth in this subdivision, but no affidavit shall be
 required to be filed until thirty days after the effective date of  this
 subdivision.
   bb.  Notwithstanding  any  contrary  provision  of the private housing
 finance law, the benefits of this section shall  apply  to  any  limited
 profit housing company as provided in this section. Such multiple dwell-
 ing, building or structure shall be eligible for benefits where at least
 one  building-wide  improvement or alteration is part of the application
 for benefits. Furthermore,  to  the  extent  that  such  alterations  or
 improvements  are  financed  with  grants,  loans  or subsidies from any
 federal, state, or local agency or instrumentality, such multiple dwell-
 ing, building or structure shall be eligible for benefits  only  if  the
 limited  profit  housing  company  has entered into a binding and irrev-
 ocable agreement with the commissioner of housing of the  state  of  New
 York,  the supervising agency, as such term is defined in section two of
 the private housing finance law, the New York city  housing  development
 corporation,  or  the  New York state housing finance agency prohibiting
 the dissolution or reconstitution of such limited profit housing company
 pursuant to section thirty-five of the private housing finance  law  for
 not  less  than  fifteen  years  from  the commencement of benefits. The
 abatement of taxes on such property, including the land, shall not be an
 amount greater than ninety per centum of the certified  reasonable  cost
 of  such alterations or improvements, as determined under regulations of
 the department of housing preservation and development, nor greater than
 eight and one-third percent of such certified  reasonable  cost  in  any
 twelve-month  period,  nor  be effective for more than twenty years. The
 annual abatement of taxes in any twelve-month period shall in  no  event
 exceed fifty percent of the amount of taxes payable in such twelve-month
 period  pursuant to the applicable exemption granted pursuant to article
 two of the private housing finance law or other applicable laws or fifty
 S. 8474                            207
 
 percent of payments required to be made in lieu of taxes in such twelve-
 month period. Provided, however,  the  annual  abatement  of  taxes  for
 alterations  or  improvements  commenced  prior  to June first, nineteen
 hundred  eighty-six  may  not  be  applied to reduce the amount of taxes
 payable or the amount of payments required to be made in lieu  of  taxes
 in  any twelve-month period to an amount less than the minimum amount of
 taxes required to be  paid  pursuant  to  section  thirty-three  of  the
 private housing finance law.
   cc.  The  commissioner  of  the department of housing preservation and
 development and the commissioner of  the  department  of  finance  shall
 prepare  an  annual report which shall be submitted to the Mayor and the
 council on or before the first of July next succeeding the year to which
 the report pertains, regarding the  exemptions  and  abatements  granted
 pursuant  to  this  section and shall include, but not be limited to the
 following information: (i) the amount of real property  tax  that  would
 have  been  paid in the aggregate by the owners of real property granted
 an exemption or abatement if the property were  fully  taxable  and  the
 amount  of  tax  actually paid in the aggregate by such owners, (ii) the
 geographic distribution of exemptions and abatements granted pursuant to
 this section, and (iii) a distribution by type of eligible categories as
 delineated in paragraphs one through  nine  of  subdivision  b  of  this
 section.
   dd.  Partial  waiver of rent adjustments attributable to major capital
 improvements. (1) The provisions of this subdivision apply  to  and  are
 additional  requirements  for  claiming  or  receiving any tax abatement
 under this section, except as provided in paragraphs three and  four  of
 this subdivision.
   (2)  The owner of the property shall file with the department of hous-
 ing preservation and development, on the date any application for  bene-
 fits  is  made,  a  declaration stating that in consideration of any tax
 abatement benefits which may be received pursuant  to  such  application
 for  alterations  or  improvements constituting a major capital improve-
 ment, such owner agrees to waive the collection  of  a  portion  of  the
 total  annual  amount  of any rent adjustment attributable to such major
 capital improvement which may be granted by the New York state  division
 of housing and community renewal pursuant to the rent stabilization code
 or its successor statute for the city of Staten Island equal to one-half
 of the total annual amount of the tax abatement benefits which the prop-
 erty  receives  pursuant to such application with respect to such alter-
 ations or improvements. Such waiver shall commence on the  date  of  the
 first  collection  of  such rent adjustment, provided that, in the event
 that such tax abatement benefits  were  received  prior  to  such  first
 collection, the amount waived shall be increased to account for such tax
 abatement benefits so received. Following the expiration of a tax abate-
 ment  for  alterations  or  improvements  constituting  a  major capital
 improvement for which a rent adjustment has been granted by  such  divi-
 sion,  the  owner  may  collect the full amount of annual rent permitted
 pursuant to such rent adjustment. A copy of such  declaration  shall  be
 filed  simultaneously  with  the  New York state division of housing and
 community renewal. Such declaration shall be binding  upon  such  owner,
 and his or her successors and assigns.
   (3)  The provisions of this subdivision shall not apply to substantial
 rehabilitation of buildings vacant when alterations or improvements  are
 commenced  or to buildings rehabilitated with the substantial assistance
 of city, state or federal subsidies.
 S. 8474                            208
 
   (4) The provisions of this subdivision shall apply only to alterations
 and improvements commenced after the effective date of such subdivision.
   §  11-244  Tax exemption and abatement for rehabilitated buildings. a.
 As used in this section, the following terms shall  have  the  following
 meanings:
   1. "Eligible real property" shall mean:
   (i) any class B multiple dwelling;
   (ii)  any  class  A  multiple  dwelling used for single room occupancy
 pursuant to section two hundred forty-eight of the multiple dwelling law
 which contains no more than twenty-five percent class A  dwelling  units
 which contain lawful sanitary and kitchen facilities within the dwelling
 unit,  provided  that  in the case of a multiple dwelling containing ten
 dwelling units or less, up to forty percent of the dwelling units may be
 class A units; and
   (iii) not-for-profit institutions with sleeping accommodations.
   Notwithstanding  the  foregoing,  eligible  real  property  shall  not
 include college and school dormitories, club houses, or residences whose
 occupancy is restricted to an institutional use such as housing intended
 for use primarily or exclusively by the employees of a single company or
 institution.  A  building is an eligible real property only if it quali-
 fies as such after completion of the eligible improvements, but need not
 have been an eligible real property prior to the eligible improvements.
   2. "Eligible improvements" shall be limited to the  following  catego-
 ries  of  work,  provided  further that such work shall be in conformity
 with all applicable laws:
   (i) replacement of a boiler or burner or installation of an entire new
 heating system;
   (ii) replacement or upgrading of electrical system;
   (iii) replacement or upgrading of elevators;
   (iv) installation or replacement or upgrading of the plumbing  system,
 including water main and risers;
   (v)  replacement  or  installation  of walls, ceilings, floors or trim
 where necessary;
   (vi) replacement or  upgrading  of  doors,  installation  of  security
 devices and systems;
   (vii)  installation, replacement or upgrading of smoke detectors, fire
 alarms, fire escapes or sprinkler systems;
   (viii) replacement or repair of roof, leaders and gutters;
   (ix) replacement or installation of bathroom facilities;
   (x) installation of wall and pipe insulation;
   (xi) replacement or upgrading of street connections for water or sewer
 services;
   (xii) replacement or  installation  of  windows,  or  installation  of
 window gates or guards;
   (xiii) installation or replacement of boiler smoke stack;
   (xiv) pointing, waterproofing and cleaning of entire building exterior
 surface;
   (xv) improvements designed to conserve the use of fuel, electricity or
 other energy sources;
   (xvi)  work  necessary  to  effect compliance with all applicable laws
 including, but not limited to the multiple dwelling law, the city  hous-
 ing  maintenance  code  or  its successor statute for the city of Staten
 Island and the building code; and
   (xvii) improvements unique to congregate living facilities, as defined
 by rules and regulations promulgated by the department of housing  pres-
 ervation and development.
 S. 8474                            209

   3. "Existing dwelling" shall mean any eligible real property in exist-
 ence  prior  to the commencement of eligible improvements, for which tax
 exemption and abatement is claimed under the terms of this  section  and
 for which a valuation appears on the annual record of assessed valuation
 of  the  city for the fiscal year immediately preceding the commencement
 of construction of such eligible improvements.
   4. "Commencement of eligible improvement" shall mean the beginning  of
 any  physical  operation  undertaken  for the purpose of making eligible
 improvements to eligible real property.
   5. "Completion of eligible improvement" shall mean the  conclusion  or
 termination of any physical operation referred to in the preceding para-
 graph, to an extent or degree which renders an eligible property capable
 of use for the purpose for which the improvements were intended.
   6.  "Permanent resident" shall mean a person who has resided in eligi-
 ble real property for six months or more; has a lease  or  other  rental
 agreement  for  a  term  of six or more months; or has requested a lease
 pursuant to the provisions of the rent stabilization code or its succes-
 sor statute for the city of Staten  Island  for  housing  accommodations
 located in hotels.
   b.  Any  increase  in the assessed valuation of eligible real property
 shall be exempt from taxation for local purposes for a period  of  thir-
 ty-two  years to the extent such increase results from eligible improve-
 ments, provided that:
   (i) the eligible improvements are commenced after July first, nineteen
 hundred eighty, and prior to the thirty-first of December  in  the  year
 next  succeeding  the  effective date of this section, and are completed
 within thirty-six months from commencement;
   (ii) the department of housing preservation and development determines
 and certifies the cost, qualification and eligibility of any improvement
 for benefits of this section;
   (iii) the exemption may commence no sooner than the July first follow-
 ing the filing with the department of  finance  of  a  certification  of
 eligibility  issued by the department of housing preservation and devel-
 opment for benefits of this section;  provided,  however,  that  if  the
 rehabilitation  is carried out with substantial government assistance as
 part of a program for affordable housing the exemption may  commence  no
 sooner than the July first following the commencement of construction of
 eligible improvements;
   (iv)  immediately  prior  to, and during, the construction of eligible
 improvements, not less than fifty percent of the dwelling units in  such
 eligible  real  property  are  occupied by permanent residents; provided
 that such occupancy requirement shall not apply  to  a  vacant,  govern-
 mentally owned multiple dwelling which had been vacant for not less than
 two years prior to the commencement of construction of eligible improve-
 ments, nor to a vacant multiple dwelling where the eligible improvements
 are  carried  out  with  the  substantial assistance of grants, loans or
 subsidies from any federal, state or local agency or instrumentality  or
 any  not-for-profit  philanthropic  organization  one  of  whose primary
 purposes is providing low or moderate income housing;
   (v) no  outstanding  real  estate  taxes,  water  and  sewer  charges,
 payments  in  lieu of taxes or other municipal charges are due and owing
 as of the tax quarter immediately  preceding  the  commencement  of  tax
 exemption  pursuant  to  this  section; provided that an applicant aided
 pursuant to the provisions of the private housing finance law shall have
 such application  accepted  by  the  tax  commission  if  there  are  no
 outstanding  real  estate, water and sewer taxes due and owing as of the
 S. 8474                            210
 
 last day of the tax quarter preceding commencement  of  construction  of
 eligible improvements;
   (vi)  except  in the case of eligible real property which is receiving
 or has received assistance  pursuant  to  a  governmental  rent  subsidy
 program or which is owned by a not-for-profit corporation or by a wholly
 owned  subsidiary of a not-for-profit corporation and which is receiving
 or has received assistance  pursuant  to  a  governmental  loan  subsidy
 program,  as  defined  by  the  rules and regulations promulgated by the
 department of housing preservation and development, for the construction
 of eligible improvements, the initial rent after completion of  eligible
 improvements,  for  ninety percent of the total number of dwelling units
 occupied by permanent residents in a class A or class B multiple  dwell-
 ing  other  than  apartments  shall not exceed the greater of either the
 amount of any governmental rental assistance received by an occupant  or
 seventy-five  percent  of  the rent which is permitted to be charged for
 zero-bedroom units on the moderate rehabilitation fair market rent sche-
 dule as determined by the United States department of housing and  urban
 development  for  the  housing assistance payments program under section
 eight of the national housing act;
   (vii) no person residing in eligible real property prior to or  during
 the construction of eligible improvements shall be required by the owner
 to  vacate  the  eligible  real  property solely in order to perform the
 eligible improvements or any related work.
   c. Eligible real property which qualifies for exemption from  taxation
 for  local purposes for eligible improvements shall also be eligible for
 an annual abatement of real property taxes in an amount  not  to  exceed
 twelve  and one-half percent of the reasonable cost of eligible improve-
 ments certified by the department of housing preservation  and  develop-
 ment,  which  abatement  may  commence on the first day of the first tax
 quarter following the filing with the department of finance of a certif-
 ication of eligibility issued by the department of housing  preservation
 and development for benefits of this section; provided, however, that if
 the rehabilitation is carried out with substantial government assistance
 as  part  of a program for affordable housing the abatement may commence
 no sooner than the first day of the  first  tax  quarter  following  the
 commencement  of construction of eligible improvements, provided further
 that:
   (i) the annual abatement shall not exceed the amount of  taxes  other-
 wise payable in the corresponding year;
   (ii)  the  period  during  which such abatement is effective shall not
 exceed twenty consecutive years  from  the  date  such  abatement  first
 becomes effective; and
   (iii)  the  total abatement shall not exceed the lesser of one hundred
 fifty percent of the certified reasonable costs of eligible improvements
 or the actual costs as determined by the department of housing preserva-
 tion and development pursuant to its rules and regulations.
   d. During the period of tax exemption or abatement  pursuant  to  this
 section,  each  of  the  following shall be a condition precedent to the
 continuation of the exemption and/or abatement:
   (i) compliance with all applicable provisions of law,  including,  but
 not  limited  to  the  multiple  dwelling law, the building code and the
 housing maintenance code of the preceding municipality;
   (ii) all dwelling units, except owner occupied units, shall be subject
 to the emergency housing rent control law  or  the  local  housing  rent
 control  act  or  the tenant protection act of nineteen hundred seventy-
 four, or any local laws enacted pursuant thereto or the rent  stabiliza-
 S. 8474                            211

 tion  law of nineteen hundred sixty-nine or their successor statutes for
 the city of Staten Island; provided, however,  that  the  department  of
 housing  preservation  and  development may exempt from this requirement
 dwelling  units  that  are  not occupied by permanent residents in those
 buildings owned by a not-for-profit corporation and which  are  improved
 with  the  aid  of  a  rehabilitation loan from any government agency or
 instrumentality or operated pursuant to a contract with  a  governmental
 entity.
   (iii)  eligible real property receiving tax exemption or tax abatement
 benefits under this section shall  not  receive  tax  exemption  or  tax
 abatement  for  new  construction  or  rehabilitation  under  any  other
 provision of law;
   (iv) the eligible improvements shall not be used as the basis for  any
 application  for  rent increases and the owner shall file a statement to
 such effect with the department of housing preservation and  development
 and with any appropriate rent regulatory agency, provided, however, that
 rents  of  units improved with the aid of a rehabilitation loan from any
 governmental agency or instrumentality may within the limitations estab-
 lished by this section be increased pursuant  to  the  rules  and  regu-
 lations of the department of housing preservation and development; and
   (v)  a  minimum of seventy-five percent of the dwelling units shall be
 rental units occupied by permanent residents; provided, however that the
 department of housing preservation and development may exempt from  this
 requirement  those buildings improved  with  the aid of a rehabilitation
 loan from any governmental agency or instrumentality or operated  pursu-
 ant to a contract with a governmental entity.
   e.  During  the  period of tax exemption or abatement pursuant to this
 section, the owner shall submit an annual certification to  the  depart-
 ment  of  housing preservation and development in the form prescribed by
 such department. Failure to submit such certification in any given  year
 may  result  in  the  revocation  of  benefits.  The certification shall
 include the following:
   (i) the total number of dwelling units within the eligible real  prop-
 erty  and the total number of dwelling units occupied by permanent resi-
 dents;
   (ii) the number of dwelling units subject to  the  provisions  of  the
 emergency  housing rent control act, the emergency tenant protection act
 of nineteen seventy-four or any local laws enacted pursuant thereto; the
 emergency housing rent control law or  the  rent  stabilization  law  of
 nineteen  hundred  sixty-nine  or their successor statutes applicable to
 the city of Staten Island; and
   (iii) all such other information required by the department of housing
 preservation and development.
   f. Any tax exemption or tax  abatement  authorized  pursuant  to  this
 section may be revoked or reduced by the department of housing preserva-
 tion  and development or by the department of finance at any time during
 the authorized term of such tax exemption or tax abatement upon a  find-
 ing by either department that:
   (i) the application for benefits pursuant to this section or the annu-
 al  certification required hereunder contains a false statement or false
 information as to a material matter, or  omits  a  material  matter,  in
 which  case  the  revocation  or  reduction  may  be  retroactive to the
 commencement of benefits pursuant to this section;
   (ii) real estate taxes, water, sewer or other  municipal  charges,  or
 payments  in  lieu  of said taxes or charges are, and have remained, due
 and owing for more than one  year,  in  which  case  the  revocation  or
 S. 8474                            212
 
 reduction may be retroactive to the commencement of benefits pursuant to
 this  section,  provided  that in no event shall revocation be effective
 prior to the date such taxes or charges were first due and payable; or
   (iii)  the  eligible real property fails to comply with one or more of
 the provisions or requirements of this section.
   g. Application forms for the benefits of this section shall  be  filed
 with  the  tax  commission  within the time periods to be established by
 rules and regulations promulgated by the department of housing preserva-
 tion and development, pursuant to subdivision i of this section. The tax
 commission shall certify to the department  of  finance  the  amount  of
 taxes  to  be abated, pursuant to the certification of the department of
 housing preservation and development as herein provided. No such  appli-
 cation shall be accepted unless accompanied by a copy of the certificate
 of  the  department  of  housing preservation and development both as to
 reasonable cost and as to eligibility as provided in  subdivision  b  of
 this section.
   h. No owner of a dwelling to which the benefits of this section apply,
 nor any agent, employee, manager or officer of such owner shall directly
 or indirectly deny to any person because of race, color, creed, national
 origin, sex, disability, marital status, age, religion, military status,
 gender  identity or expression or sexual orientation any of the dwelling
 accommodations in such property or any of  the  privileges  or  services
 incident  to  occupancy  therein.  The term "disability" as used in this
 subdivision shall mean a physical, mental or medical impairment  result-
 ing  from  anatomical,  physiological,  or neurological conditions which
 prevents the exercise of a normal bodily function or is demonstrable  by
 medically accepted clinical or laboratory diagnostic techniques. Nothing
 in this subdivision shall restrict such consideration in the availabili-
 ty  of  housing  accommodations  for  the  purpose  of providing for the
 special needs of a particular group.
   i. The department of housing preservation and development shall deter-
 mine and certify the reasonable cost of  any  such  conversions,  alter-
 ations  or improvements and eligibility for the benefits of this section
 and for that purpose may adopt rules and regulations,  administer  oaths
 to  and  take the testimony of any person, including, but not limited to
 the owner of such property, may issue subpoenas requiring the attendance
 of such persons and the production of such bills, books, papers or other
 documents as it shall deem necessary, may make preliminary estimates  of
 the maximum reasonable cost of such conversions, alterations or improve-
 ments,  may  establish  maximum  allowable  costs  of  specified  units,
 fixtures or work in such conversions, alterations or  improvements,  and
 may  require  the submission of plans and specifications of such conver-
 sions, alterations or improvements before the  start  thereof.  Applica-
 tions  for  certification  shall  include  all bills and other documents
 showing the cost of construction or such other evidence of such cost  as
 shall  be  satisfactory  to  the  department of housing preservation and
 development, including, without limitation, certification of cost  by  a
 certified  public  accountant  in  accordance  with  generally  accepted
 accounting principles. Each additional agency  to  which  functions  are
 assigned  by this section may adopt and promulgate rules and regulations
 for the effectuation of the purposes of this section.
   j. The department of housing preservation and development may  require
 a  filing  fee  in  an  amount  as provided by the rules and regulations
 promulgated by the department of housing  preservation  and  development
 pursuant to subdivision i of this section.
 S. 8474                            213
 
   k.  Any  person who shall knowingly and wilfully make any false state-
 ments as to any material matter in any application for the  benefits  of
 this  section  shall be guilty of an offense punishable by a fine of not
 more than five hundred dollars or imprisonment for not more than  ninety
 days, or both.
   l.  If  any provision of this section or its application to any person
 shall be held invalid, the remainder of this section and the applicabil-
 ity of its provisions to other persons or  circumstances  shall  not  be
 affected thereby.
   §  11-245.1  Site  eligibility  limitations  on  benefits  pursuant to
 section four hundred twenty-one-a of the real property tax law.
   (a) Where eligibility for benefits under section four hundred  twenty-
 one-a  of  the  real  property  tax  law  is sought for any construction
 commenced on or after November twenty-ninth,  nineteen  hundred  eighty-
 five  and  before  May  twelfth,  two  thousand  on  the basis that such
 construction shall take place on land  which,  on  the  date  thirty-six
 months prior to the commencement of such construction, was improved with
 a  nonresidential  building  or  buildings  and  was under-utilized, the
 under-utilization of the land must have been such that each building  or
 buildings:
     (1)  contained  no  more  than  the permissible floor area ratio for
     nonresidential buildings in the zoning district in  question  and  a
     floor  area  ratio  which  was twenty percent or less of the maximum
     floor area ratio for residential buildings,
     (2) had an assessed valuation equal to or less than  twenty  percent
     of  the  assessed  valuation  of  the  land on which the building or
     buildings were situated, or
     (3) by reason of the configuration of the building,  or  substantial
     structural  defects  not brought about by deferred maintenance prac-
     tices or intentional conduct, could no  longer  be  functionally  or
     economically  utilized  in  the  capacity  in  which it was formerly
     utilized.
   For purposes of this subdivision and subdivisions (a-1) through  (a-4)
 of  this  section, construction shall be deemed to have commenced on the
 date immediately following the issuance by the department  of  buildings
 of  a  new building permit for an entire new building (based upon archi-
 tectural, plumbing and structural plans approved by such department)  on
 which  the excavation and the construction of initial footings and foun-
 dations commences in good faith, on  vacant  land  and  for  the  entire
 project  site,  as  certified  by  an architect or professional engineer
 licensed in the state, provided that installation of footings and  foun-
 dations  is  similarly  certified  by such architect or engineer to have
 been completed without undue delay.
   (a-1) Except as provided in subdivision (a-2) of this  section,  where
 eligibility  for benefits under section four hundred twenty-one-a of the
 real property tax law is sought for any  construction  commenced  on  or
 after  May twelfth, two thousand and before the effective date of subdi-
 visions (a-3)  and  (a-4)  of  this  section  on  the  basis  that  such
 construction  shall  take  place  on  land which, on the date thirty-six
 months prior to the commencement of such construction, was improved with
 a nonresidential building  or  buildings  and  was  under-utilized,  the
 under-utilization  of the land must have been such that each building or
 buildings:
     (1) contained no more than the  permissible  floor  area  ratio  for
     nonresidential  buildings  in  the zoning district in question and a
 S. 8474                            214
 
     floor area ratio which was seventy-five percent or less of the maxi-
     mum floor area ratio for residential buildings,
     (2)  had  an  assessed  valuation equal to or less than seventy-five
     percent of the assessed valuation of the land on which the  building
     or buildings were situated, or
     (3)  by  reason of the configuration of the building, or substantial
     structural defects not brought about by deferred  maintenance  prac-
     tices  or  intentional  conduct,  could no longer be functionally or
     economically utilized in the  capacity  in  which  it  was  formerly
     utilized.
   For purposes of this subdivision, construction shall be deemed to have
 commenced as provided in subdivision (a) of this section.
   (a-2)  Where eligibility for benefits under section four hundred twen-
 ty-one-a of the real property tax law is sought for any construction  on
 any  tax lot now existing or hereafter created which is located south of
 or adjacent to either side of one hundred tenth street in the borough of
 Manhattan which construction commenced on  or  after  May  twelfth,  two
 thousand  and  before the effective date of subdivisions (a-3) and (a-4)
 of this section on the basis that such construction shall take place  on
 land  which,  on the date thirty-six months prior to the commencement of
 such construction, was improved with a nonresidential building or build-
 ings and was under-utilized, the under-utilization of the land must have
 been such that each building or buildings:
     (1) contained no more than the  permissible  floor  area  ratio  for
     nonresidential  buildings  in  the zoning district in question and a
     floor area ratio which was fifty percent  or  less  of  the  maximum
     floor area ratio for residential buildings,
     (2) had an assessed valuation equal to or less than fifty percent of
     the  assessed  valuation of the land on which the building or build-
     ings were situated, or
     (3) by reason of the configuration of the building,  or  substantial
     structural  defects  not brought about by deferred maintenance prac-
     tices or intentional conduct, could no  longer  be  functionally  or
     economically  utilized  in  the  capacity  in  which it was formerly
     utilized.
   For purposes of this subdivision, construction shall be deemed to have
 commenced as provided in subdivision (a) of this section.
   (a-3) Except as provided in subdivision (a-4) of this  section,  where
 eligibility  for benefits under section four hundred twenty-one-a of the
 real property tax law is sought for any  construction  commenced  on  or
 after  the  effective  date  of  this subdivision on the basis that such
 construction shall take place on land  which,  on  the  date  thirty-six
 months prior to the commencement of such construction, was improved with
 a  nonresidential  building  or  buildings  and  was under-utilized, the
 under-utilization of the land must have been such that each building  or
 buildings:
     (1)  contained  no  more  than  the permissible floor area ratio for
     nonresidential buildings in the  zoning  district  in  question  and
     either  (i) had a floor area ratio which was seventy-five percent or
     less of the maximum floor area ratio for  residential  buildings  in
     such  zoning  district,  or (ii) if the land was not zoned to permit
     residential use on the date thirty-six months prior to the commence-
     ment of construction, had a floor area ratio which was  seventy-five
     percent  or less of the floor area ratio of the residential building
     which replaces such non-residential building,
 S. 8474                            215
 
     (2) had an assessed valuation equal to  or  less  than  seventy-five
     percent  of the assessed valuation of the land on which the building
     or buildings were situated, or
     (3)  by  reason of the configuration of the building, or substantial
     structural defects not brought about by deferred  maintenance  prac-
     tices  or  intentional  conduct,  could no longer be functionally or
     economically utilized in the  capacity  in  which  it  was  formerly
     utilized.
   For purposes of this subdivision, construction shall be deemed to have
 commenced as provided in subdivision (a) of this section.
   (a-4)  Where eligibility for benefits under section four hundred twen-
 ty-one-a of the real property tax law is sought for any construction  on
 any  tax lot now existing or hereafter created which is located south of
 or adjacent to either side of one hundred tenth street in the borough of
 Manhattan which construction commenced on or after the effective date of
 this subdivision on the basis that such construction shall take place on
 land which, on the date thirty-six months prior to the  commencement  of
 such construction, was improved with a nonresidential building or build-
 ings and was under-utilized, the under-utilization of the land must have
 been such that each building or buildings:
     (1)  contained  no  more  than  the permissible floor area ratio for
     nonresidential buildings in the  zoning  district  in  question  and
     either (i) had a floor area ratio which was fifty percent or less of
     the  maximum  floor  area  ratio  for  residential buildings in such
     zoning district, or (ii) if the land was not zoned to  permit  resi-
     dential  use on the date thirty-six months prior to the commencement
     of construction, had a floor area ratio which was fifty  percent  or
     less  of  the  floor  area  ratio  of the residential building which
     replaces such non-residential building,
     (2) had an assessed valuation equal to or less than fifty percent of
     the assessed valuation of the land on which the building  or  build-
     ings were situated, or
     (3)  by  reason of the configuration of the building, or substantial
     structural defects not brought about by deferred  maintenance  prac-
     tices  or  intentional  conduct,  could no longer be functionally or
     economically utilized in the  capacity  in  which  it  was  formerly
     utilized.
   For purposes of this subdivision, construction shall be deemed to have
 commenced as provided in subdivision (a) of this section.
   (b) The department of housing preservation and development may promul-
 gate  rules and regulations for the effectuation of the purposes of this
 section.
   (c) The limitations on benefits contained in this section shall be  in
 addition to those contained in any other law or regulation.
   §  11-245.1-a  Boundary  review  commission. (a) There shall be estab-
 lished a  boundary  review  commission  consisting  of  eleven  members,
 including the commissioner of finance, the commissioner of housing pres-
 ervation and development, the commissioner of buildings, the chairperson
 of  the  department  of  city  planning,  the  director of the office of
 management and budget, the executive director of the board of  standards
 and  appeals  and five members chosen by the speaker of the council. The
 appointees of the speaker of the council shall serve at the pleasure  of
 the  speaker.  The  commission  shall elect a chairperson from among its
 members.
   (b) The boundary review commission shall undertake a  biennial  review
 of  the tax benefit program established pursuant to section four hundred
 S. 8474                            216
 
 twenty-one-a of the real property tax law to determine whether the areas
 for which the tax benefits are restricted pursuant to  those  provisions
 of  the  administrative  code  which  relate  to  such program should be
 revised in any manner.
   (c)  In  conducting a review to determine whether geographic exclusion
 zones restricting benefits provided pursuant  to  section  four  hundred
 twenty-one-a of the real property tax law should be revised, the commis-
 sion  shall  review  measurers  of  housing  activity and housing market
 conditions throughout the city including (i) the amount of new  develop-
 ment;  (ii)  values  in  land sales, residential sales prices and rents;
 (iii) trends in land sales, residential sales prices and rents and other
 development trend data including land use trends, lot consolidation  and
 board  of standards and appeals actions; (iv) development potential; (v)
 relationship between volume of potential development and existing  hous-
 ing;  and (vi) financial feasibility of development with and without the
 benefits provided pursuant to section four hundred twenty-one-a  of  the
 real property tax law.
   (d)  On  or before December first of each even numbered year following
 the effective date of this  section,  such  commission  shall  submit  a
 report  to the speaker of the council and the mayor on its deliberations
 and shall include recommendations for revisions to such boundaries  that
 it deems appropriate or why no revisions were recommended, including the
 methodology  by which it applied the criteria in subdivision (c) of this
 section to arrive at its recommendations, and all data used to make such
 recommendations.  Any  recommendations  shall  be  consistent  with  the
 provisions of section four hundred twenty-one-a of the real property tax
 law.
   §  11-245.1-b Limitations on benefits pursuant to section four hundred
 twenty-one-a of the real property tax law. (a) As used in this  section,
 the following terms shall have the following meanings:
   (1)  "Residential tax lot" shall mean a tax lot that contains dwelling
 units.
   (2) "Non-residential tax lot" shall mean  a  tax  lot  that  does  not
 contain any dwelling units.
   (3)  "Annual  limit"  shall  mean  sixty-five  thousand dollars, which
 amount shall be increased by three percent, compounded annually, on each
 taxable status date following the first  anniversary  of  the  effective
 date of the local law that added this section.
   (4)  "Certificate  of  occupancy"  shall mean the first certificate of
 occupancy covering all residential areas of the building on or  contain-
 ing a tax lot.
   (5)  "Unit  count" shall mean (i) in the case of a residential tax lot
 that does not contain any commercial, community  facility  or  accessory
 use space, the number of dwelling units in such tax lot, and (ii) in the
 case of a residential tax lot that contains commercial, community facil-
 ity or accessory use space, the number of dwelling units in such tax lot
 plus one.
   (6) "Exemption cap" shall mean the unit count multiplied by the annual
 limit.
   (b)  The  provisions of this section shall apply only to projects that
 commence construction on or after the effective date of this section.
   (c) No benefits under section four hundred twenty-one-a  of  the  real
 property tax law shall be conferred for any multiple dwelling containing
 fewer than four dwelling units, as set forth in the certificate of occu-
 pancy,  unless the construction of such multiple dwelling is carried out
 with substantial assistance of  grants,  loans  or  subsidies  from  any
 S. 8474                            217
 
 federal,  state or local agency or instrumentality where such assistance
 is provided pursuant to a program  for  the  development  of  affordable
 housing.
   (d)  The  portion of the assessed valuation of any residential tax lot
 exempted from real property taxation in any  year  pursuant  to  section
 four  hundred twenty-one-a of the real property tax law shall not exceed
 the exemption cap on or after the first taxable status  date  after  the
 building on or containing such tax lot receives its certificate of occu-
 pancy unless, in accordance with a regulatory agreement with or approved
 by the department of housing preservation and development that is appli-
 cable  to such tax lot, (1) the construction of such building is carried
 out with substantial assistance of grants, loans or subsidies  from  any
 federal, state or local agency or instrumentality and such assistance is
 provided  pursuant  to a program for the development of affordable hous-
 ing, or (2) the department of housing preservation and  development  has
 imposed a requirement or has certified that twenty per cent of the units
 be  restricted  income  units.  All such restricted income units must be
 situated onsite. For the purposes of this section, "onsite"  shall  mean
 that  restricted  income  units shall be situated within the building or
 buildings for which benefits pursuant to section  four  hundred  twenty-
 one-a  of  the  real property tax law are being granted. A dwelling unit
 that is located in two or more tax lots shall be ineligible  to  receive
 any benefits under section four hundred twenty-one-a of the real proper-
 ty tax law. The portion of the assessed valuation of all non-residential
 tax  lots in the building on or containing such non-residential tax lots
 exempted from real property taxation in any  year  pursuant  to  section
 four  hundred twenty-one-a of the real property tax law shall not exceed
 a cumulative total equal to the annual limit on or after the first taxa-
 ble status date after the building on or containing such non-residential
 tax lots receives its certificate of occupancy.
   (e) A new multiple dwelling that is situated  in  (1)  a  neighborhood
 preservation  program  area  as  determined by the department of housing
 preservation and development as of June first, nineteen hundred  eighty-
 five, (2) a neighborhood preservation area as determined by the New York
 city planning commission as of June first, nineteen hundred eighty-five,
 (3)  an  area  that  was eligible for mortgage insurance provided by the
 rehabilitation mortgage insurance corporation as of May first,  nineteen
 hundred  ninety-two, or (4) an area receiving funding for a neighborhood
 preservation project pursuant to the  neighborhood  reinvestment  corpo-
 ration  act  (42  U.S.C.  §§  8101  et  seq.) as of June first, nineteen
 hundred eighty-five, shall only be eligible for the  benefits  available
 pursuant  to  subparagraph  (iii) of paragraph (a) of subdivision two of
 section four hundred twenty-one-a of the real property tax law if:
   a. the construction is carried  out  with  substantial  assistance  of
 grants,  loans  or  subsidies from any federal, state or local agency or
 instrumentality and such assistance is provided pursuant  to  a  program
 for the development of affordable housing, or
   b.  the department of housing preservation and development has imposed
 a requirement or has certified that  twenty  percent  of  the  units  be
 restricted  income units. All such restricted income units must be situ-
 ated onsite.
   (f) The department of housing preservation and development may promul-
 gate rules and regulations to effectuate the purposes of this section.
   (g) The limitations on eligibility  for  benefits  contained  in  this
 section  shall  be in addition to those contained in any other law, rule
 or regulation.
 S. 8474                            218
 
   (h) Notwithstanding anything to the  contrary  contained  herein,  the
 limitations  on eligibility for benefits contained in this section shall
 not apply to a covered project as defined in subparagraph (i)  of  para-
 graph  a  of subdivision six of section four hundred twenty-one-a of the
 real property tax law.
   §  11-245.2  Exemption for real property of certain water-works corpo-
 rations. Real property owned by a water-works corporation subject to the
 provisions of the public service law and used exclusively for the  sale,
 furnishing and distribution of water for domestic, commercial and public
 purposes, shall not be taxable.
   §  11-245.3 Exemption for persons sixty-five years of age or over.  1.
 Real property owned by one or more persons, each of whom  is  sixty-five
 years  of  age or over, or real property owned by husband and wife or by
 siblings, one of whom is sixty-five years of age or over, or real  prop-
 erty  owned  by  one  or  more  persons, some of whom qualify under this
 section and section 11-245.4 of this part shall be exempt from taxes  on
 real  estate to the extent of fifty per centum of the assessed valuation
 thereof. For the purposes of this section, siblings shall mean a brother
 or a sister, whether related through halfblood, whole blood or adoption.
   2. Exemption from taxation for school purposes shall not be granted in
 the case of real property where a child resides if such child attends  a
 public school of elementary or secondary education.
   3. No exemption shall be granted:
   (a) if the income of the owner or the combined income of the owners of
 the  property  exceeds  the sum of twenty-six thousand dollars beginning
 July first, two thousand six, twenty-seven  thousand  dollars  beginning
 July  first, two thousand seven, twenty-eight thousand dollars beginning
 July first, two thousand eight, twenty-nine thousand  dollars  beginning
 July first, two thousand nine, and fifty thousand dollars beginning July
 first,  two  thousand  seventeen  for  the  income  tax year immediately
 preceding the date of making application for exemption.  Income tax year
 shall mean the twelve-month period for which the owner or owners filed a
 federal personal income tax return, or if no such return is  filed,  the
 calendar  year. Where title is vested in either the husband or the wife,
 their combined income may not exceed such sum, except where the  husband
 or  wife,  or  ex-husband  or  ex-wife  is  absent  from the property as
 provided in subparagraph (ii) of paragraph (d) of this subdivision, then
 only the income of the spouse or  ex-spouse  residing  on  the  property
 shall  be  considered  and  may  not  exceed such sum. Such income shall
 include social security and retirement  benefits,  interest,  dividends,
 total  gain  from  the  sale or exchange of a capital asset which may be
 offset by a loss from the sale or exchange of a  capital  asset  in  the
 same  income  tax  year,  net rental income, salary or earnings, and net
 income from self-employment, but shall not include gifts,  inheritances,
 a  return  of  capital,  payments  made  to individuals because of their
 status as victims of Nazi persecution as defined in P.L. 103-286, monies
 earned through employment in the federal foster grandparent program, and
 veterans disability compensation as defined in title 38  of  the  United
 States  Code,  and  any  such  income shall be offset by all medical and
 prescription drug expenses actually paid which were  not  reimbursed  or
 paid  for  by  insurance.  In computing net rental income and net income
 from self-employment no depreciation deduction shall be allowed for  the
 exhaustion,  wear  and  tear  of  real or personal property held for the
 production of income.
   (b) unless the title of the property shall have  been  vested  in  the
 owner  or  one of the owners of the property for at least twelve consec-
 S. 8474                            219
 
 utive months prior to the date  of  making  application  for  exemption,
 provided,  however,  that in the event of the death of either husband or
 wife in whose name title of the property shall have been vested  at  the
 time  of  death and then becomes vested solely in the survivor by virtue
 of devise by or descent from the deceased husband or wife, the  time  of
 ownership  of  the  property  by  the  deceased husband or wife shall be
 deemed also a time of ownership by the survivor and such ownership shall
 be deemed continuous for the purposes of computing such period of twelve
 consecutive months, and provided further, that in the event of a  trans-
 fer  by either husband or wife to the other spouse of all or part of the
 title to the property, the time of ownership  of  the  property  by  the
 transferer spouse shall be deemed also a time of ownership by the trans-
 feree  spouse  and  such  ownership  shall  be deemed continuous for the
 purposes of computing such period  of  twelve  consecutive  months,  and
 provided  further,  that  where property of the owner or owners has been
 acquired to replace property formerly owned by such owner or owners  and
 taken  by  eminent  domain or other involuntary proceeding, except a tax
 sale, and where a residence is sold and replaced with another within one
 year and both are within the state,  the  period  of  ownership  of  the
 former  property  shall  be combined with the period of ownership of the
 property for which application is made for exemption and such periods of
 ownership shall be  deemed  to  be  consecutive  for  purposes  of  this
 section.  Where  the owner or owners transfer title to property which as
 of the date of transfer was exempt from taxation under the provisions of
 this section, the reacquisition of title by such owner or owners  within
 nine  months  of  the  date  of  transfer shall be deemed to satisfy the
 requirement of this paragraph that the title of the property shall  have
 been  vested in the owner or one of the owners for such period of twelve
 consecutive months. Where, upon or subsequent to the death of  an  owner
 or  owners,  title  to  property  which as of the date of such death was
 exempt from taxation under such provisions, becomes vested, by virtue of
 devise or descent from the deceased owner or owners, or by  transfer  by
 any  other means within nine months after such death, solely in a person
 or persons who, at the time of such death, maintained such property as a
 primary residence, the requirement of this paragraph that the  title  of
 the  property  shall  have been vested in the owner or one of the owners
 for such period of twelve consecutive months shall be deemed satisfied;
   (c) unless the property is used exclusively for residential  purposes,
 provided, however, that in the event any portion of such property is not
 so  used  exclusively  for  residential  purposes  but is used for other
 purposes, such portion shall be subject to taxation  and  the  remaining
 portion  only  shall  be  entitled  to  the  exemption  provided by this
 section;
   (d) unless the property is the legal residence of and is  occupied  in
 whole  or  in part by the owner or by all of the owners of the property;
 except where, (i) an owner is absent from the residence while  receiving
 health-related care as an inpatient of a residential health care facili-
 ty,  as defined in section twenty-eight hundred one of the public health
 law, provided that any income accruing to that person  shall  be  income
 only  to  the  extent  that  it  exceeds  the amount paid by such owner,
 spouse, or co-owner for care in the facility, and provided further, that
 during such confinement such property is not occupied by other than  the
 spouse or co-owner of such owner; or, (ii) the real property is owned by
 a husband and/or wife, or an ex-husband and/or an ex-wife, and either is
 absent  from  the residence due to divorce, legal separation or abandon-
 ment and all other provisions of this  section  are  met  provided  that
 S. 8474                            220

 where an exemption was previously granted when both resided on the prop-
 erty,  then the person remaining on the real property shall be sixty-two
 years of age or over.
   4. Application for such exemption must be made by the owner, or all of
 the owners of the property, on forms prescribed by the state board to be
 furnished by the department of finance and shall furnish the information
 and  must  be executed in the manner required or prescribed in such form
 and shall be filed in the department of finance in the borough in  which
 the  real  property  is located between the fifteenth day of January and
 the fifteenth day of March. Notwithstanding any other provision of  law,
 any  person  otherwise qualifying under this section shall not be denied
 the exemption under this section if he or she becomes  sixty-five  years
 of  age  after the taxable status date and on or before December thirty-
 first of the same year.
   5. At least sixty days prior to  the  fifteenth  day  of  January  the
 department  of  finance  shall  mail  to  each  person  who  was granted
 exemption pursuant to this section on the  latest  completed  assessment
 roll  an  application  form  and  a notice that such application must be
 filed between the fifteenth day of January  and  the  fifteenth  day  of
 March  every two years from the year in which such exemption was granted
 and be approved in order for the exemption to be granted. The department
 of finance shall, within three days of the completion and filing of  the
 tentative assessment roll, notify by mail any applicant who has included
 with  his  application at least one self-addressed, prepaid envelope, of
 the approval or denial of the application; provided, however,  where  an
 applicant  has  included  two  such envelopes, the department of finance
 shall, upon the filing of the  application,  send  by  mail,  notice  of
 receipt of that application. Where an applicant is entitled to notice of
 denial  provided  herein,  such  notice shall state the reasons for such
 denial and shall further state that such determination is reviewable  in
 a  manner  provided by law. Failure to mail any such application form or
 notices or the failure of such person to receive any or all of the  same
 shall not prevent the levy, collection and enforcement of the payment of
 the taxes on property owned by such person.
   6.  Any  conviction  of having made any willful false statement in the
 application for such exemption shall be punishable by a fine of not more
 than one hundred dollars and shall disqualify the  applicant  or  appli-
 cants from further exemption for a period of five years.
   7.  Notwithstanding  the  maximum  income  exemption eligibility level
 provided in subdivision three of this section, an exemption, subject  to
 all  other  provisions of this section, shall be granted as indicated in
 the following schedule:
 
           Annual Income                   Percentage Assessed Valuation
        as of July 1, 2006                     Exempt From Taxation
 
 More than $26,000 but less than $27,000             45 per centum
 $27,000 or more but less than $28,000               40 per centum
 $28,000 or more but less than $29,000               35 per centum
 $29,000 or more but less than $29,900               30 per centum
 $29,900 or more but less than $30,800               25 per centum
 $30,800 or more but less than $31,700               20 per centum
 $31,700 or more but less than $32,600               15 per centum
 $32,600 or more but less than $33,500               10 per centum
 $33,500 or more but less than $34,400                5 per centum
 S. 8474                            221
 
                                           Percentage Assessed Valuation
 Annual Income as of July 1, 2007              Exempt From Taxation
 
 More than $27,000 but less than $28,000             45 per centum
 $28,000 or more but less than $29,000               40 per centum
 $29,000 or more but less than $30,000               35 per centum
 $30,000 or more but less than $30,900               30 per centum
 $30,900 or more but less than $31,800               25 per centum
 $31,800 or more but less than $32,700               20 per centum
 $32,700 or more but less than $33,600               15 per centum
 $33,600 or more but less than $34,500               10 per centum
 $34,500 or more but less than $35,400                5 per centum
 
                                           Percentage Assessed Valuation
 Annual Income as of July 1, 2008              Exempt From Taxation
 
 More than $28,000 but less than $29,000             45 per centum
 $29,000 or more but less than $30,000               40 per centum
 $30,000 or more but less than $31,000               35 per centum
 $31,000 or more but less than $31,900               30 per centum
 $31,900 or more but less than $32,800               25 per centum
 $32,800 or more but less than $33,700               20 per centum
 $33,700 or more but less than $34,600               15 per centum
 $34,600 or more but less than $35,500               10 per centum
 $35,500 or more but less than $36,400                5 per centum
 
                                           Percentage Assessed Valuation
 Annual Income as of July 1, 2009              Exempt From Taxation
 
 More than $29,000 but less than $30,000             45 per centum
 $30,000 or more but less than $31,000               40 per centum
 $31,000 or more but less than $32,000               35 per centum
 $32,000 or more but less than $32,900               30 per centum
 $32,900 or more but less than $33,800               25 per centum
 $33,800 or more but less than $34,700               20 per centum
 $34,700 or more but less than $35,600               15 per centum
 $35,600 or more but less than $36,500               10 per centum
 $36,500 or more but less than $37,400                5 per centum
 
 Annual Income as of July 1, 2017          Percentage Assessed Valuation
                                               Exempt From Taxation
 
 More than $50,000 but less than $51,000             45 per centum
 $51,000 or more but less than $52,000               40 per centum
 $52,000 or more but less than $53,000               35 per centum
 $53,000 or more but less than $53,900               30 per centum
 $53,900 or more but less than $54,800               25 per centum
 $54,800 or more but less than $55,700               20 per centum
 $55,700 or more but less than $56,600               15 per centum
 $56,600 or more but less than $57,500               10 per centum
 $57,500 or more but less than $58,400                5 per centum
 
   8.  Any exemption provided by this section shall be computed after all
 partial exemptions allowed by law have been subtracted  from  the  total
 amount assessed.
 S. 8474                            222
 
   9. Exemption from taxation as provided in this section on real proper-
 ty  owned by husband and wife, one of whom is sixty-five years of age or
 older, once granted, shall not be rescinded solely because of the  death
 of  the  older spouse so long as the surviving spouse is at least sixty-
 two years of age.
   10. a. For the purposes of this section, title to that portion of real
 property  owned  by  a  cooperative  apartment  corporation  in  which a
 tenant-stockholder of such corporation resides and which is  represented
 by his or her share or shares of stock in such corporation as determined
 by its or their proportional relationship to the total outstanding stock
 of  the  corporation,  including that owned by the corporation, shall be
 deemed to be vested in such tenant-stockholder. That proportion  of  the
 assessment  of  real  property  owned  by a cooperative apartment corpo-
 ration, determined by the relationship of such real property  vested  in
 such  tenant-stockholder to such entire parcel and the buildings thereon
 owned by such cooperative apartment corporation in  which  such  tenant-
 stockholder  resides, shall be subject to exemption from taxation pursu-
 ant to this section and any exemption so granted shall  be  credited  by
 the  department  of  finance against the assessed valuation of such real
 property; the reduction in real property taxes realized thereby shall be
 credited by the cooperative apartment corporation against the amount  of
 such  taxes otherwise payable by or chargeable to such tenant-stockhold-
 er. Each cooperative apartment corporation  shall  notify  each  tenant-
 stockholder  in residence thereof of such provisions as are set forth in
 this section.
   b. Notwithstanding any other provision of  law,  a  tenant-stockholder
 who  resides  in a dwelling which is subject to the provisions of either
 article two, four, five or eleven of the private housing finance law and
 who is eligible for a rent increase exemption pursuant to chapter  seven
 of  title twenty-six of the code of the preceding municipality shall not
 be eligible for an exemption pursuant to this subdivision. Notwithstand-
 ing any other provision of law, a tenant-stockholder who  resides  in  a
 dwelling which is subject to the provisions of either article two, four,
 five  or eleven of the private housing finance law and who is not eligi-
 ble for a rent increase exemption pursuant to  chapter  seven  of  title
 twenty-six  of  this code but who meets the requirements for eligibility
 for an exemption pursuant to this section shall  be  eligible  for  such
 exemption  provided that such exemption shall be in an amount determined
 by multiplying  the  exemption  otherwise  allowable  pursuant  to  this
 section  by  a  fraction  having a numerator equal to the amount of real
 property taxes or payments in lieu of taxes that were paid with  respect
 to  such  dwelling  and  a  denominator equal to the full amount of real
 property taxes that would have been owed with respect to  such  dwelling
 had it not been granted an exemption or abatement of real property taxes
 pursuant  to any provision of law, provided, however, that any reduction
 in real property taxes received with respect to such  dwelling  pursuant
 to  chapter  seven  of title twenty-six of this code or pursuant to this
 section shall not be  considered  in  calculating  such  numerator.  Any
 tenant-stockholder  who  resides in a dwelling which was or continues to
 be subject to a mortgage insured or initially  insured  by  the  federal
 government  pursuant  to  section  two  hundred thirteen of the national
 housing act, as amended, and who is eligible for both  a  rent  increase
 exemption pursuant to chapter seven of title twenty-six of this code and
 an  exemption  pursuant  to  this subdivision, may apply for and receive
 either a  rent  increase  exemption  pursuant  to  such  chapter  or  an
 exemption pursuant to this subdivision, but not both.
 S. 8474                            223
 
   11.  Exemption  Option.  Notwithstanding any provision of this part to
 the contrary, real property owned by one or more persons  where  one  of
 such owners qualifies for a real property tax exemption pursuant to this
 section  or  section  11-245.4  of this part, and another of such owners
 qualifies  for  a  different  tax exemption pursuant to such sections of
 this part as authorized by state law, such owners shall have the  option
 of  choosing  the one exemption which is most beneficial to such owners.
 Such owners shall not be prohibited from taking one such exemption sole-
 ly on the basis that such owners qualify for more than one exemption and
 therefore are not eligible for any exemptions.
   § 11-245.4 Exemption for persons with disabilities. 1. (a) Real  prop-
 erty  owned  by  one or more persons with disabilities, or real property
 owned by a husband, wife, or both, or by siblings, at least one of  whom
 has a disability, or real property owned by one or more persons, some of
 whom  qualify  under this section and section 11-245.3 of this part, and
 whose income, as hereafter defined, is limited by reason of  such  disa-
 bility, shall be exempt from taxes on real estate to the extent of fifty
 per  centum  of  the assessed valuation thereof as hereinafter provided.
 For purposes of this section, sibling shall mean a brother or a  sister,
 whether related through half blood, whole blood or adoption.
   (b)  For  purposes  of this section, a person with a disability is one
 who has a physical or mental impairment, not due to current use of alco-
 hol or illegal drug use, which substantially limits such person's abili-
 ty to engage in one or more major life activities, such  as  caring  for
 one's self, performing manual tasks, walking, seeing, hearing, speaking,
 breathing,  learning  and  working,  and who (i) is certified to receive
 social security disability insurance  (SSDI)  or  supplemental  security
 income  (SSI) benefits under the federal social security act, or (ii) is
 certified to receive railroad retirement disability benefits  under  the
 federal  railroad  retirement  act,  or (iii) has received a certificate
 from the state commission for the blind and visually handicapped stating
 that such person is legally blind, or (iv) is  certified  to  receive  a
 United  States  postal  service disability pension. An award letter from
 the social security administration or the railroad retirement board or a
 certificate from the state commission for the blind and  visually  hand-
 icapped  or  an award letter from the United States postal service shall
 be submitted as proof of disability.
   2. Exemption from taxation for school purposes shall not be granted in
 the case of real property where a child resides if such child attends  a
 public school of elementary or secondary education.
   3. No exemption shall be granted:
   (a) if the income of the owner or the combined income of the owners of
 the  property  for the income tax year immediately preceding the date of
 making application for exemption exceeds the sum of twenty-six  thousand
 dollars  beginning  July  first, two thousand six, twenty-seven thousand
 dollars beginning July first, two thousand seven, twenty-eight  thousand
 dollars  beginning  July first, two thousand eight, twenty-nine thousand
 dollars beginning July first, two  thousand  nine,  and  fifty  thousand
 dollars  beginning  July  first, two thousand seventeen. Income tax year
 shall mean the twelve-month period for which the owner or owners filed a
 federal personal income tax return, or if no such return is  filed,  the
 calendar  year. Where title is vested in either the husband or the wife,
 their combined income may not exceed such sum, except where the  husband
 or  wife,  or  ex-husband  or ex-wife is absent from the property due to
 divorce, legal separation or abandonment, then only the  income  of  the
 spouse or ex-spouse residing on the property shall be considered and may
 S. 8474                            224
 
 not  exceed  such  sum.  Such  income  shall include social security and
 retirement benefits, interest, dividends, total gain from  the  sale  or
 exchange  of a capital asset which may be offset by a loss from the sale
 or  exchange  of a capital asset in the same income tax year, net rental
 income, salary or earnings, and net  income  from  self-employment,  but
 shall  not  include  a  return of capital, gifts, inheritances or monies
 earned through employment in the federal foster grandparent program  and
 any  such  income  shall  be offset by all medical and prescription drug
 expenses actually paid which were not reimbursed or paid for  by  insur-
 ance. In computing net rental income and net income from self-employment
 no  depreciation deduction shall be allowed for the exhaustion, wear and
 tear of real or personal property held for the production of income;
   (b) unless the property is used exclusively for residential  purposes,
 provided, however, that in the event any portion of such property is not
 so  used  exclusively  for  residential  purposes  but is used for other
 purposes, such portion shall be subject to taxation  and  the  remaining
 portion  only  shall  be  entitled  to  the  exemption  provided by this
 section;
   (c) unless the real property is the legal residence of and is occupied
 in whole or in part by the disabled person; except  where  the  disabled
 person  is absent from the residence while receiving health-related care
 as an inpatient of a residential health care  facility,  as  defined  in
 section twenty-eight hundred one of the public health law, provided that
 any  income  accruing  to  that  person  shall  be considered income for
 purposes of this section only to the extent that it exceeds  the  amount
 paid  by such person or spouse or sibling of such person for care in the
 facility.
   4. Application for such exemption must be made annually by the  owner,
 or  all  of the owners of the property, on forms prescribed by the state
 board, and shall be filed with the department of finance  on  or  before
 the  fifteenth  day of March of the appropriate year; provided, however,
 proof of a permanent disability need  be  submitted  only  in  the  year
 exemption  pursuant to this section is first sought or the disability is
 first determined to be permanent.
   5. At least sixty days prior to the fifteenth  day  of  March  of  the
 appropriate  year,  the  department of finance shall mail to each person
 who was granted  exemption  pursuant  to  this  section  on  the  latest
 completed  assessment  roll  an  application form and a notice that such
 application must be filed on or before the fifteenth day of March and be
 approved in order for the exemption to continue to be  granted.  Failure
 to  mail  such application form or the failure of such person to receive
 the same shall not prevent the levy, collection and enforcement  of  the
 payment of the taxes on property owned by such person.
   6.  Notwithstanding  the  maximum  income  exemption eligibility level
 provided in subdivision three of this section, an exemption, subject  to
 all  other  provisions of this section, shall be granted as indicated in
 the following schedule:

                                           Percentage Assessed Valuation
 Annual Income as of July 1, 2006              Exempt From Taxation
 
   More than $26,000 but less than $27,000           45 per centum
   $27,000 or more but less than $28,000             40 per centum
   $28,000 or more but less than $29,000             35 per centum
   $29,000 or more but less than $29,900             30 per centum
   $29,900 or more but less than $30,800             25 per centum
 S. 8474                            225
 
   $30,800 or more but less than $31,700             20 per centum
   $31,700 or more but less than $32,600             15 per centum
   $32,600 or more but less than $33,500             10 per centum
   $33,500 or more but less than $34,400              5 per centum
 
                                           Percentage Assessed Valuation
 Annual Income as of July 1, 2007              Exempt From Taxation
 
 More than $27,000 but less than $28,000             45 per centum
 $28,000 or more but less than $29,000               40 per centum
 $29,000 or more but less than $30,000               35 per centum
 $30,000 or more but less than $30,900               30 per centum
 $30,900 or more but less than $31,800               25 per centum
 $31,800 or more but less than $32,700               20 per centum
 $32,700 or more but less than $33,600               15 per centum
 $33,600 or more but less than $34,500               10 per centum
 $34,500 or more but less than $35,400                5 per centum
 
                                           Percentage Assessed Valuation
 Annual Income as of July 1, 2008              Exempt From Taxation
 
 More than $28,000 but less than $29,000             45 per centum
 $29,000 or more but less than $30,000               40 per centum
 $30,000 or more but less than $31,000               35 per centum
 $31,000 or more but less than $31,900               30 per centum
 $31,900 or more but less than $32,800               25 per centum
 $32,800 or more but less than $33,700               20 per centum
 $33,700 or more but less than $34,600               15 per centum
 $34,600 or more but less than $35,500               10 per centum
 $35,500 or more but less than $36,400                5 per centum
 
                                           Percentage Assessed Valuation
 Annual Income as of July 1, 2009              Exempt From Taxation
 
 More than $29,000 but less than $30,000             45 per centum
 $30,000 or more but less than $31,000               40 per centum
 $31,000 or more but less than $32,000               35 per centum
 $32,000 or more but less than $32,900               30 per centum
 $32,900 or more but less than $33,800               25 per centum
 $33,800 or more but less than $34,700               20 per centum
 $34,700 or more but less than $35,600               15 per centum
 $35,600 or more but less than $36,500               10 per centum
 $36,500 or more but less than $37,400                5 per centum
 
                                           Percentage Assessed Valuation
 Annual Income as of July 1, 2017              Exempt From Taxation
 
 More than $50,000 but less than $51,000             45 per centum
 $51,000 or more but less than $52,000               40 per centum
 $52,000 or more but less than $53,000               35 per centum
 $53,000 or more but less than $53,900               30 per centum
 $53,900 or more but less than $54,800               25 per centum
 $54,800 or more but less than $55,700               20 per centum
 $55,700 or more but less than $56,600               15 per centum
 S. 8474                            226
 
 $56,600 or more but less than $57,500               10 per centum
 $57,500 or more but less than $58,400                5 per centum
 
   7.  Any exemption provided by this section shall be computed after all
 other partial exemptions allowed by law have been  subtracted  from  the
 total  amount assessed; provided, however, that no parcel may receive an
 exemption pursuant to both this section and section 11-245.3.
   8. (a) For purposes of this section, title to  that  portion  of  real
 property  owned  by  a  cooperative  apartment  corporation  in  which a
 tenant-stockholder of such corporation resides, and which is represented
 by his or her share or shares of stock in such corporation as determined
 by its or their proportional relationship to the total outstanding stock
 of the corporation, including that owned by the  corporation,  shall  be
 deemed  to  be vested in such tenant-stockholder. That proportion of the
 assessment of such real property owned by a cooperative apartment corpo-
 ration determined by the relationship of such real  property  vested  in
 such  tenant-stockholder to such entire parcel and the buildings thereon
 owned by such cooperative apartment corporation in  which  such  tenant-
 stockholder resides shall be subject to exemption from taxation pursuant
 to  this  section  and any exemption so granted shall be credited by the
 department of finance against the assessed valuation of such real  prop-
 erty;  the  reduction  in  real property taxes realized thereby shall be
 credited by the cooperative apartment corporation against the amount  of
 such  taxes otherwise payable by or chargeable to such tenant-stockhold-
 er.
   (b) Notwithstanding any other provision of law,  a  tenant-stockholder
 who  resides  in a dwelling which is subject to the provisions of either
 article two, four, five or eleven of the  private  housing  finance  law
 shall not be eligible for an exemption pursuant to this subdivision.
   9.  Notwithstanding  any  other  provision of law to the contrary, the
 provisions of this section shall apply to real property  held  in  trust
 solely  for  the  benefit  of a person or persons who would otherwise be
 eligible for a real property tax exemption, pursuant to subdivision  one
 of this section, were such person or persons the owner or owners of such
 real property.
   10.  Exemption  Option.  Notwithstanding any provision of this part to
 the contrary, real property owned by one or more persons  where  one  of
 such owners qualifies for a real property tax exemption pursuant to this
 section  or  section  11-245.3  of this part, and another of such owners
 qualifies for a different tax exemption pursuant  to  such  sections  of
 this  part as authorized by state law, such owners shall have the option
 of choosing the one exemption which is most beneficial to  such  owners.
 Such owners shall not be prohibited from taking one such exemption sole-
 ly on the basis that such owners qualify for more than one exemption and
 therefore are not eligible for any exemptions.
   §  11-245.45  Exemption  for  veterans.  Pursuant  to paragraph (d) of
 subdivision eight of section four hundred fifty-eight of the real  prop-
 erty  tax law, the city hereby authorizes real property owned by a coop-
 erative apartment corporation to be exempt from taxation  in  accordance
 with  such  section  and any local laws adopted pursuant to such section
 beginning July first, nineteen hundred ninety-eight.
   §  11-245.46  Exemption  for  veterans;  taxes  for  school   purposes
 exempted.    Pursuant  to  paragraph three of subdivision one of section
 four hundred fifty-eight of the real property tax law, the  city  hereby
 provides that the exemption authorized pursuant to such section shall be
 applicable to taxes for school purposes.
 S. 8474                            227
 
   §  11-245.5  Alternative exemption for veterans. Pursuant to paragraph
 (d) of subdivision six of section four hundred fifty-eight-a of the real
 property tax law, the city hereby authorizes real property  owned  by  a
 cooperative  apartment corporation to be exempt from taxation in accord-
 ance  with  such  section  and  any  local laws adopted pursuant to such
 section beginning July first, nineteen hundred ninety-eight.
   § 11-245.6 Alternative  exemption  for  veterans;  maximum  exemptions
 allowable. Pursuant to subparagraph (ii) of paragraph (d) of subdivision
 two  of section four hundred fifty-eight-a of the real property tax law,
 the city hereby increases the maximum exemptions allowable in paragraphs
 (a),  (b)  and  (c)  of  subdivision  two  of   section   four   hundred
 fifty-eight-a of the real property tax law. The maximum exemption allow-
 able  in  such  paragraph  (a)  shall be fifteen percent of the assessed
 value of the qualifying residential real  property;  provided,  however,
 that such exemption shall not exceed forty-eight thousand dollars or the
 product  of  forty-eight thousand dollars multiplied by the latest class
 ratio, whichever is less. In addition to the exemption provided by  such
 paragraph  (a),  as  increased  by  this  section, the maximum exemption
 allowable in such paragraph (b) shall be ten  percent  of  the  assessed
 value  of  the  qualifying residential real property; provided, however,
 that such exemption shall not exceed thirty-two thousand dollars or  the
 product  of  thirty-two  thousand dollars multiplied by the latest class
 ratio, whichever is less. In addition to the exemptions provided by such
 paragraphs (a) and (b),  as  increased  by  this  section,  the  maximum
 exemption  allowable  in  such paragraph (c) shall be the product of the
 assessed value of the qualifying residential real property multiplied by
 fifty percent of the veteran's  disability  rating;  provided,  however,
 that  such exemption shall not exceed one hundred sixty thousand dollars
 or the product of one hundred sixty thousand dollars multiplied  by  the
 latest  class ratio, whichever is less. The maximum exemptions allowable
 in such paragraphs (a), (b) and (c), as increased by this section, shall
 not apply to any assessment roll completed and filed prior to the  first
 day of January, two thousand six.
   §  11-245.7  Alternative  exemption  for  veterans;  gold star parent.
 Pursuant to paragraph (b) of subdivision seven of section  four  hundred
 fifty-eight-a  of the real property tax law, and in accordance with such
 section and any local laws adopted pursuant  thereto,  the  city  hereby
 includes  a  gold star parent within the definition of "qualified owner"
 as provided in paragraph (c) of subdivision one  of  such  section,  and
 includes  property  owned by a gold star parent within the definition of
 "qualifying residential real property" as provided in paragraph  (d)  of
 subdivision  one  of  such  section,  provided that such property is the
 primary residence of the gold star parent.
   § 11-245.75 Alternative exemption for veterans; school district  taxa-
 tion exempted. Pursuant to subparagraph (i) of paragraph (d) of subdivi-
 sion  two of section four hundred fifty-eight-a of the real property tax
 law, the city hereby provides that the  exemptions  allowable  in  para-
 graphs  (a),  (b)  and  (c)  of  subdivision two of section four hundred
 fifty-eight-a of the real property tax law shall be applicable to school
 district taxation.
   § 11-245.8 ENERGY  STAR  appliances.  a.  For  the  purposes  of  this
 section,  the  following definitions shall apply in conjunction with the
 definitions found in sections 27-232 and 27-2004 of this code:
   (1) The term "ENERGY STAR" shall mean a designation  from  the  United
 States  environmental protection agency or department of energy indicat-
 S. 8474                            228
 
 ing that a product meets the energy efficiency standards  set  forth  by
 the agency for compliance with the ENERGY STAR program.
   (2)  The  term "household appliance" shall mean any refrigerator, room
 air conditioner, dishwasher or clothes washer, within a dwelling unit in
 a multiple dwelling that is provided  by  the  owner  of  such  multiple
 dwelling.  This definition shall also include any boiler or furnace that
 provides heat or hot water for any dwelling unit in a multiple dwelling.
   b. For any building for which any benefit  is  conferred  pursuant  to
 four  hundred  eighty-nine  of  the  real property tax law, whenever any
 household appliance in any dwelling unit,  or  any  household  appliance
 that  provides  heat  or  hot  water for any dwelling unit in a multiple
 dwelling, is installed or replaced with a new household appliance,  such
 new appliance shall be certified as Energy Star.
   c.  For  any  building  for which any benefit is conferred pursuant to
 section four hundred twenty-one-a of the real property tax law, whenever
 any household appliance in any dwelling unit, or any household appliance
 that provides heat or hot water for any  dwelling  unit  in  a  multiple
 dwelling,  is installed or replaced with a new household appliance, such
 new appliance shall be certified as Energy Star.
   d. The  commissioner  may  enact  rules  requiring  additional  energy
 conservation  measures  for  any  building  for  which  any  benefit  is
 conferred pursuant to section four hundred eighty-nine of the real prop-
 erty tax law or section four hundred twenty-one-a of the  real  property
 tax law.
   e.  The commissioner shall inform applicants for any benefits affected
 by this section of the requirements of this section.
   f. The requirements of subdivisions b and c of this section shall  not
 apply where:
   1) an ENERGY STAR certified household appliance of appropriate size is
 not  manufactured,  such  that  movement  of  walls or fixtures would be
 necessary to create sufficient space for such appliance; or
   2) an ENERGY STAR certified boiler or furnace of  sufficient  capacity
 is not manufactured.
   §  11-245.9  Notice  of  residential  property  tax exemptions. a. The
 commissioner of finance, or his or her designee, shall provide a  notice
 relating  to  the lien sale process to all property owners included with
 the notice of value sent to property owners by the department of finance
 and, in addition, no later than October thirty-first of  each  year,  to
 any property owner who is delinquent in the payment of any real property
 taxes, assessments, or any other charges that are made a lien subject to
 the provisions of chapter three of this title, except sewer rents, sewer
 charges  and  water rents, if such delinquency, in the aggregate, equals
 or exceeds the sum of one thousand dollars. This notice  shall  include,
 but  not be limited to, actions homeowners can take if a lien is sold on
 such property; the type of debt that can be sold in a lien sale; a time-
 line of statutory notifications required pursuant to section  11-320  of
 this title; a clear, concise explanation of the consequences of the sale
 of  a  tax lien; the telephone number and electronic mail address of the
 employee or employees designated pursuant to subdivision  f  of  section
 11-320 of this title; a conspicuous statement that an owner of any class
 of property may enter into a payment plan for the satisfaction of delin-
 quent  real  property taxes, assessments, sewer rents, sewer surcharges,
 water rents, and any other charges that are made a lien subject  to  the
 provisions  of  chapter  three  of this title, or exclusion from the tax
 lien sale; credits and property tax exemptions that may exclude  certain
 class  one  real  property  from  a tax lien sale; and clear and concise
 S. 8474                            229

 instructions on how an owner of any class of property  may  register  to
 receive  information  from  the  department,  through  electronic  mail,
 regarding outreach sessions relating to the sale of tax liens  conducted
 pursuant  to  subdivision j of section 11-320 of this title. Such notice
 shall also include information on the following real property tax  cred-
 its or real property tax exemptions:
   1. the senior citizen homeowner exemption pursuant to section 11-245.3
 of this part;
   2.  the  exemption  for  persons with disabilities pursuant to section
 11-245.4 of this part;
   3. the exemptions for  veterans  pursuant  to  sections  four  hundred
 fifty-eight and four hundred fifty-eight-a of the real property tax law;
   4.  the  school  tax  relief (STAR) exemption pursuant to section four
 hundred twenty-five of the real property tax law;
   5. the enhanced school tax relief (STAR) exemption pursuant to  subdi-
 vision four of section four hundred twenty-five of the real property tax
 law;
   6.  the state circuit breaker income tax credit pursuant to subsection
 (e) of section six hundred six of the tax law; and
   7. any other credit or residential real property tax exemption, which,
 in the discretion of  the  commissioner,  should  be  included  in  such
 notice.
   Upon  such  property owner's written request, or verbal request to 311
 or any employee designated pursuant to subdivision f of  section  11-320
 of this title, a Chinese, Korean, Russian or Spanish translation of such
 notice shall be provided promptly to such property owner.
   b. The notice required pursuant to this section shall include:
   1. a brief description of each exemption program; and
   2.  a  phone  number  at  the  department  and a website address where
 taxpayers can obtain additional information on  the  exemption  programs
 and all necessary forms and applications.
   c.  The  notice  that  is  required,  pursuant  to this section, to be
 provided by the commissioner of finance or his or her designee no  later
 than October thirty-first of each year shall include contact information
 for  the  office  of financial empowerment at the department of consumer
 and worker protection.
   § 11-245.10 Alternative exemption for veterans; transfer of title.  1.
 Pursuant to subdivision eight of section four hundred  fifty-eight-a  of
 the  real  property tax law, where a veteran, the spouse of a veteran or
 unremarried surviving spouse already receiving an exemption pursuant  to
 such  section  sells the property receiving such exemption and purchases
 property within the city, the department of finance shall  transfer  and
 prorate,  for  the remainder of the fiscal year, the exemption received.
 The prorated exemption shall be based upon the  date  the  veteran,  the
 spouse  of  the veteran or unremarried surviving spouse obtains title to
 the new property and shall be calculated by multiplying the tax rate for
 which taxes were levied, on the appropriate tax roll used for the fiscal
 year during which the transfer occurred, multiplied  by  the  previously
 granted  exempt  amount,  multiplied by the fraction of each fiscal year
 remaining subsequent to the transfer of title.
   2. Nothing in this section shall be construed to remove  the  require-
 ment  that  any  such  veteran, the spouse of the veteran or unremarried
 surviving spouse transferring an exemption pursuant to  subdivision  one
 of  this  section shall reapply for the exemption authorized pursuant to
 section four hundred fifty-eight-a of the real property tax  law  on  or
 before the following taxable status date, in the event such veteran, the
 S. 8474                            230
 
 spouse  of the veteran or unremarried surviving spouse wishes to receive
 the exemption in future fiscal years.
 
                                  PART 2
               EXEMPTION FOR CERTAIN NONPROFIT ORGANIZATIONS
 
   §  11-246  Taxation of property of nonprofit organizations, pharmaceu-
 tical societies and dental societies. 1. a. Pursuant to the requirements
 of sections four hundred twenty-a and four hundred forty-six of the real
 property tax law, real property owned by a  corporation  or  association
 which  is  organized or conducted exclusively for religious, charitable,
 hospital, educational or cemetery purposes, or for the purposes  of  the
 moral or mental improvement of men, women or children or for two or more
 such purposes shall not be taxable.
   b. Real property owned by a corporation or association which is organ-
 ized  or conducted exclusively for Bible, tract, benevolent, missionary,
 infirmary, public playground, scientific, literary,  library,  patriotic
 or  historical  purposes,  for the development of good sportsmanship for
 persons under the age of eighteen years through the  conduct  of  super-
 vised  athletic  games, or for the enforcement of laws relating to chil-
 dren or animals, or for two or more such purposes, and used  exclusively
 for  carrying  out  thereupon one or more of such purposes either by the
 owning corporation or association, or by  another  such  corporation  or
 association  as  provided  in  section four hundred twenty-b of the real
 property tax law shall not be taxable. Any  corporation  or  association
 which  uses  real property exempted from taxation pursuant to this para-
 graph shall make available to the council, the commissioner  of  finance
 and  the  public  a  report,  in  such  form as may be prescribed by the
 commissioner of finance, setting forth the efforts of  such  corporation
 or  association  undertaken  in  the  previous  calendar year to provide
 assistance to city programs and city residents, by  filing  such  report
 with the city clerk not later than June first of each year.
   c. Real property owned by a corporation or association which is organ-
 ized  or  conducted  exclusively  for bar association or medical society
 purposes, or both such purposes, and used exclusively for  carrying  out
 thereupon  one or both such purposes either by the owning corporation or
 association, or by another such  corporation  or  association  shall  be
 taxable  pursuant  to  the  authority  contained in section four hundred
 twenty-b of the real property tax law.
   2. Real property from which no rent is derived and which is  owned  by
 an  incorporated pharmaceutical society which is either wholly or partly
 within the city, which society has heretofore been or may  hereafter  be
 authorized  and  empowered  by  act  of the legislature to establish and
 which has established or may hereafter establish a college  of  pharmacy
 in this city shall be taxable.
   3.  Real  property from which no income is derived which is owned by a
 dental society of any judicial district which judicial district is whol-
 ly or partly within the city,  which  dental  society  was  incorporated
 under the education law shall be taxable.
   4.  Real  property  previously  exempt  from taxation but made taxable
 pursuant to this section as of the first of  January,  nineteen  hundred
 seventy-two  shall  be taxed for the period from the first of January to
 and including the thirtieth of June,  nineteen  hundred  seventy-two  by
 applying  one-half  of the tax rate for the fiscal year nineteen hundred
 seventy-one, seventy-two to the assessments made and exemptions  claimed
 with reference to the taxable status date falling on the twenty-fifth of
 S. 8474                            231
 
 January,  nineteen hundred seventy-two.  The taxes thus computed for the
 period from the first of January to and including the thirtieth of June,
 nineteen hundred seventy-two shall be due and payable on  the  first  of
 June, nineteen hundred seventy-two.
   5.  Real property which is taxable under this section shall be subject
 to any special ad valorem  levies  and  special  assessments  which  are
 imposed  to defray the cost of improvements or services furnished by the
 city.
   § 11-246.1 Denial; information required. The commissioner  of  finance
 shall  include,  in  any  written  communication  with  a property owner
 related to the denial of a  real  property  tax  exemption  pursuant  to
 section  four  hundred  twenty-a,  four  hundred  twenty-b, four hundred
 forty-six, or four hundred sixty-two  of  the  real  property  tax  law,
 information  on actions a property owner can take, upon notice of a sale
 of a tax lien of property of such owner, that may prevent  the  sale  of
 such tax lien.
 
                                  PART 3
                 TAX EXEMPTION FOR CERTAIN INDUSTRIAL AND
                           COMMERCIAL PROPERTIES
 
   § 11-247 Definitions. When used in this part:
   a.  "Applicant"  means any person or corporation obligated to pay real
 property taxes on the property for which an exemption is sought,  or  in
 the  case of exempt property, the record owner thereof, provided, howev-
 er, that such property is not commercial property  located  in  an  area
 designated as excluded pursuant to section 11-249 of this part;
   b. "Board" means the industrial and commercial incentive board;
   c.  "Commercial" means any non-residential property used primarily for
 the buying,  selling  or  otherwise  providing  of  goods  or  services,
 provided  that  the  use  of  such property has not been designated as a
 restricted commercial use pursuant to section 11-249 of this part;
   d. "Construction" means the building of new industrial  or  commercial
 structures on vacant or predominantly vacant land, or the modernization,
 rehabilitation or expansion or other improvements of an existing commer-
 cial  structure  where  such modernization, rehabilitation, expansion or
 other improvement is not physically or functionally integrated with  the
 existing  structure or results in additional usable square footage fifty
 per centum greater than the square footage of the existing structure;
   e. "Industrial" means property used primarily for the manufacturing or
 assembling of goods or the processing of raw materials;
   f. "Predominantly vacant land" means land, including land under water,
 on which not  more  than  fifteen  percent  of  the  lot  area  contains
 enclosed,  permanent  improvements;  in  addition, such land may include
 existing foundations. A fence, shed, garage, attendant's booth,  paving,
 pier, bulkhead, lighting fixtures, and similar items, or any improvement
 having  an  assessed  value  of less than two thousand dollars shall not
 constitute an enclosed, permanent improvement;
   g. "Reconstruction" means the modernization, rehabilitation, expansion
 or other improvement of an existing commercial or  industrial  structure
 where  the total proposed project cost is in an amount equal to at least
 twenty per centum of the assessed value of the property at the  time  an
 application  for  a  certificate of eligibility pursuant to this part is
 made, and where such modernization, rehabilitation, expansion  or  other
 improvement  is physically and functionally integrated with the existing
 structure and does not create additional usable square  footage  greater
 S. 8474                            232

 than  fifty  per  centum  of  the  usable square footage of the existing
 structure except in  a  case  where  the  existing  structure  has  been
 substantially destroyed by fire or other casualty;
   h.  "Residential  property"  shall  mean property, other than property
 used for  hotel  purposes,  on  which  will  exist  upon  completion  of
 construction  a building or structure containing more than one independ-
 ent dwelling unit or where more  than  one-third  of  the  total  square
 footage  of  said  structure  is to be used for residential purposes; it
 shall also mean, in the case of reconstruction, property on which exists
 or will exist upon completion of the reconstruction a building or struc-
 ture where more than one-third of the total square footage is used or is
 to be used for dwelling purposes;
   i. "Vacant  land"  means  land,  including  land  under  water,  which
 contains  no  enclosed,  permanent  improvement.  A fence, shed, garage,
 attendant's booth, paving, pier, bulkhead, lighting fixtures, and  simi-
 lar  items, or any improvement having an assessed value of less than two
 thousand dollars shall not constitute an  enclosed,  permanent  improve-
 ment.
   § 11-248 Industrial and commercial incentive board.  There shall be an
 industrial and commercial incentive board to consist of the deputy mayor
 who  shall be chairperson of the board, the commissioner of finance, the
 director of planning and the director of budget, each of whom shall have
 the power to designate an alternate to represent him  or  her  at  board
 meetings  with  all  the rights and powers, including the right to vote,
 reserved to all board members, provided  that  such  designation  be  in
 writing  to  the chairperson of the board, and three other members to be
 appointed by the mayor. The members of the board who  shall  be  agents,
 officers,  or employees of the city shall serve without compensation but
 shall be reimbursed for expenses necessarily incurred in the performance
 of their duties. The members of the board who are not agents,  officers,
 or  employees  of  the  city  shall  receive  as  compensation for their
 services one hundred dollars per diem, provided, however, that the total
 compensation paid to any such member shall  not  exceed  twelve  hundred
 dollars  for  any calendar year. Four members of the board shall consti-
 tute a quorum.
   § 11-249  Functions, powers and duties of  the  board;  annual  desig-
 nation  of  exemption  areas  and  restricted  commercial uses.   a. The
 members of the board shall have  the  following  functions,  powers  and
 duties:
   1.  to receive and review applications for certificates of eligibility
 pursuant  to the charter and pursuant to subdivision thirteen of section
 11-604 and subdivision (e) of section 11-503 of this title;
   2.   to make findings and  determinations  on  the  qualifications  of
 applicants  for  certificates  of  eligibility pursuant to this part and
 subdivision (e) of section 11-503 of this title;
   3. to issue certificates of eligibility and amendments thereto;
   4. to make recommendations to the tax commission on the termination of
 a tax exemption pursuant to section 11-253 of this part;
   5. to designate annually, pursuant to subdivision b of  this  section,
 areas  in which exemptions for commercial construction or reconstruction
 shall be granted as of right, areas from which such exemptions shall  be
 excluded  and commercial uses for which the granting of exemptions shall
 be restricted; and
   6.  to make and promulgate rules and  regulations  to  carry  out  the
 purposes of the board.
 S. 8474                            233
 
   b.  (1)  Not  later  than  October  first of each year the board shall
 publish a notice at least once in the official paper or a  newspaper  of
 general  circulation in the city setting forth: (i) the proposed bounda-
 ries of areas in which commercial construction or  reconstruction  shall
 be  granted  exemptions  as  of right, proposed boundaries of areas from
 which exemptions for commercial construction or reconstruction shall  be
 excluded and proposed restricted commercial uses; and (ii) the date, not
 earlier than ten nor later than thirty days following the publication of
 such  notice,  on which the board will hold a public hearing to hear all
 persons interested in the designation of such boundaries and  restricted
 commercial uses.
   (2)  Not  earlier  than  ten  nor later than thirty days following the
 conclusion of the public hearing provided for in paragraph one  of  this
 subdivision,  the board shall designate the boundaries of areas in which
 exemptions for commercial construction or reconstruction shall be grant-
 ed as of right and areas from which such exemptions  shall  be  excluded
 and  shall also designate restricted commercial uses.  Such designations
 shall be made upon the following determinations:
   (i)  With  respect  to  areas  in  which  exemption   for   commercial
 construction  or  reconstruction shall be granted as of right, the board
 shall determine that market  conditions  in  each  area  are  such  that
 exemptions  are  required  to  attract commercial construction or recon-
 struction to the area and that attracting such  construction  or  recon-
 struction,  and  the  granting of exemptions therefor, are in the public
 interest.  In making such determination, the board may  consider,  among
 other  factors,  that  the  area is experiencing economic distress or is
 characterized by an unusually large  number  of  vacant,  underutilized,
 unsuitable  or  substandard structures, or by other substandard, unsani-
 tary, deteriorated or deteriorating conditions, with or without tangible
 blight, or that commercial development in the area will be beneficial to
 the city's economy.
   (ii) With respect  to  areas  from  which  exemptions  for  commercial
 construction  or  reconstruction  are  to  be  excluded, the board shall
 determine that market conditions in each area are such  that  exemptions
 are not required to attract commercial construction or reconstruction to
 the  area,  or that it is not in the public interest to grant exemptions
 for commercial construction or reconstruction in the area.  No  applica-
 tions for exemptions for commercial construction or reconstruction shall
 be accepted from such areas.
   (iii)  With  respect  to  restricted  commercial uses, the board shall
 determine that it is not in the public interest to grant exemptions  for
 such  uses  unless  the  board  further determines that in certain areas
 designated pursuant to this subdivision, such uses will  have  an  espe-
 cially  positive  impact  on  the area's economy.   All applications for
 exemptions for restricted commercial uses shall be  determined  pursuant
 to  paragraphs  two and three of subdivision b of section 11-251 of this
 part.
   (3) Designations made pursuant to this subdivision shall be  effective
 on the first of January of each year.
   c. So far as practicable and subject to the approval of the mayor, the
 services of all other city departments and agencies shall be made avail-
 able  by their respective heads to the board for the carrying out of the
 functions stated in this part.   The head of any  department  or  agency
 shall furnish information in the possession of such department or agency
 when the board, after consultation with the mayor, so requests.
 S. 8474                            234
 
   §  11-250    Real  property  tax exemption.   a.   A real property tax
 exemption pursuant to this part shall be granted to  an  applicant  who,
 within a period of thirty-six months, or following an extension pursuant
 to  section  11-254  of this part within a period of forty-eight months,
 from  the date of issuance of a certificate of eligibility has completed
 reconstruction  or  construction  work  in  accordance  with  the  plans
 approved  by the board in the certificate of eligibility.  The amount of
 the tax exemption shall be determined as follows:
   (1)   In the  case  of  an  applicant  who  has  completed  industrial
 construction  or  reconstruction work, or commercial reconstruction work
 designated as of right pursuant to section 11-249 of  this  part  or  as
 specially  needed  pursuant  to  section  11-251  of  this part, the tax
 exemption shall continue for nineteen tax years in an amount  decreasing
 by five per centum each year from an exemption of ninety-five per centum
 of the exemption base, as defined in paragraph four of this subdivision.
   (2)  In  the  case  of an applicant who has completed other commercial
 reconstruction work, or new commercial construction work  designated  as
 of  right pursuant to section 11-249 of this part or as specially needed
 pursuant to section 11-251 of this part, the tax exemption shall contin-
 ue for ten tax years, in an amount decreasing by five  per  centum  each
 year from an exemption of fifty per centum of the exemption base.
   (3) In the case of an applicant who has completed other new commercial
 construction work, the exemption shall continue for five tax years in an
 amount decreasing by ten per centum each year from an exemption of fifty
 per centum of the exemption base.
   (4)  The  term  "exemption base" shall mean the difference between the
 final assessed value of the property as determined  upon  completion  of
 the  construction  or  reconstruction  work  and  the  lesser of (i) the
 assessed value of the property at the time an  application  for  certif-
 icate of eligibility pursuant to this part is made, or (ii) the assessed
 value  as  may  thereafter be reduced pursuant to application to the tax
 commission.
   The tax exemption shall be computed according to the following tables:
 
        CONSTRUCTION OR RECONSTRUCTION OF INDUSTRIAL STRUCTURES OR
  RECONSTRUCTION OF AS OF RIGHT OR SPECIALLY NEEDED COMMERCIAL STRUCTURES
 
 ========================================================================
       Year following
         completion                                  Percentage
           of work                                 of exemption
 ------------------------------------------------------------------------
              1...........................................95
              2...........................................90
              3...........................................85
              4...........................................80
              5...........................................75
              6...........................................70
              7...........................................65
              8...........................................60
              9...........................................55
             10...........................................50
             11...........................................45
             12...........................................40
             13...........................................35
 S. 8474                            235
 
             14...........................................30
             15...........................................25
             16...........................................20
             17...........................................15
             18...........................................10
             19........................................... 5
 ========================================================================
 
  RECONSTRUCTION OF OTHER COMMERCIAL STRUCTURES OR CONSTRUCTION OF AS OF
              RIGHT OR SPECIALLY NEEDED COMMERCIAL STRUCTURES
 
 ========================================================================
        Year following
         completion of                             Percentage
             work                                 of exemption
 ------------------------------------------------------------------------
              1..........................................50
              2..........................................45
              3..........................................40
              4..........................................35
              5..........................................30
              6..........................................25
              7..........................................20
              8..........................................15
              9..........................................10
             10.......................................... 5
 ========================================================================
 
              CONSTRUCTION OF OTHER NEW COMMERCIAL STRUCTURES
 ========================================================================
        Year following
         completion of                             Percentage
             work                                of exemption
 ------------------------------------------------------------------------
              1..........................................50
              2..........................................40
              3..........................................30
              4..........................................20
              5..........................................10
 ========================================================================
 
   b.  The taxes payable during the period from the issuance of a certif-
 icate of eligibility to the approval of the tax  exemption  pursuant  to
 section 11-252 of this part shall be paid on the lesser of:
   (1)  the assessed value of the property at the time an application for
 a certificate of eligibility pursuant to this part is made, or
   (2) the assessed value as may thereafter be reduced pursuant to appli-
 cation to the tax commission, provided, however, that if  reconstruction
 or  construction  is not completed in accordance with the plans approved
 in the certificate of  eligibility  including  any  amendments  thereto,
 taxes  shall  be  due and payable retroactively as otherwise required by
 law.
   c.  In all cases where the board shall have issued  a  certificate  of
 eligibility  prior  to  January  first, nineteen hundred eighty-two, the
 exemption percentage shall apply  to  any  subsequent  increase  in  the
 S. 8474                            236
 
 assessed  valuation  of the property during the tenure of the exemption.
 Where the board has issued a certificate  of  eligibility  on  or  after
 January  first,  nineteen  hundred  eighty-two, the exemption percentage
 shall  apply to any subsequent increase in the assessed valuation of the
 property during the first two years after approval of the tax  exemption
 pursuant  to  section  11-252  of  this part. Commencing two years after
 approval of the tax exemption pursuant to section 11-252 of  this  part,
 the  exemption  percentage  shall  apply  to  any subsequent increase in
 assessed valuation of the property only to the extent such  increase  is
 attributable  to the construction or reconstruction work approved in the
 certificate of eligibility.
   d.  The provisions of this part shall not apply  to  any  increase  in
 assessed  value  resulting  from the construction or reconstruction of a
 residential structure on any property receiving an exemption  under  the
 provisions of this part.  The provisions of this part shall apply exclu-
 sively  to  those  structures  and  the lands underlying them which were
 identified explicitly in the certificate of eligibility.
   e. The provisions of this part shall not apply if any new or rehabili-
 tated  construction  displaces  or  replaces  a  building  or  buildings
 containing more than twenty-five occupied dwelling units in existence on
 the  date an application for certificate of eligibility is submitted for
 preliminary approval pursuant to section 11-251 of this part, which  are
 administered  under  the  local  emergency housing rent control act, the
 rent stabilization law of nineteen hundred sixty-nine or  the  emergency
 tenant protection act of nineteen seventy-four, or their successor stat-
 utes  applicable  to  the city of Staten Island, unless a certificate of
 eviction has been issued for any of  the  displaced  or  replaced  units
 pursuant to the powers granted by the city rent and rehabilitation law.
   f.    The  provisions of this part shall not apply to an applicant who
 has commenced construction or reconstruction work prior to the  granting
 of  a certificate of eligibility except where applicant, having filed an
 application for a certificate of eligibility, receives  written  permis-
 sion  to  commence from the board or its designated representative prior
 to the granting of a certificate of eligibility.  Demolition of existing
 structures, site preparation limited to grading, filling or clearing, or
 the curing of a safety or sanitary hazard shall  not  be  deemed  to  be
 commencement of construction or reconstruction work.
   g.   Any property enjoying the benefits of a tax exemption approved by
 the board shall be ineligible  for  any  subsequent  or  additional  tax
 exemption  pursuant  to the provisions of this part until the expiration
 of the original exemption period or earlier termination of the  existing
 exemption by action of the tax commission.
   §  11-251  Applications for certificates of eligibility.  a.  Applica-
 tions for a certificate of eligibility pursuant to this  part  shall  be
 submitted  for  preliminary approval to the office for economic develop-
 ment commencing immediately after March first, nineteen hundred  eighty-
 two  and  continuing until the thirty-first of January, nineteen hundred
 eighty-six, on such form or forms as shall be prescribed by  the  board.
 In addition to any other information required by the board, the applica-
 tion  shall  include  plans for reconstruction or construction that have
 been certified by a professional engineer or an architect of the  appli-
 cant's choice and cost estimates or bids for the proposed reconstruction
 or  construction.    Upon  a finding by such office that the application
 satisfies the requirements of reconstruction or construction as  defined
 in this part, the application shall be presented to the board for evalu-
 S. 8474                            237
 
 ation  and  written notice thereof shall be given to the community board
 of the district in which the application site is located.
   b.  (1)    In  the  case  of an application for construction or recon-
 struction of an industrial structure or a commercial  structure  located
 in  an  area designated as of right, the board shall issue a certificate
 of eligibility upon  determining  that  the  application  satisfies  the
 requirements  of construction or reconstruction as defined in this part,
 that the applicant has obtained plans for construction or reconstruction
 certified by a professional engineer or architect, and that  the  appli-
 cant  has  otherwise complied with the provisions of this part and other
 applicable provisions of law.
   (2)  In the case of an application for construction or  reconstruction
 of a commercial structure not located in an as of right area, or involv-
 ing  a restricted commercial use, the board shall issue a certificate of
 eligibility upon making the determination specified in paragraph one  of
 this  subdivision  and  upon  making  the further determination that the
 granting of a tax exemption for the construction  or  reconstruction  of
 such a structure in the proposed location is in the public interest.  In
 making such determination, the board shall make findings that there is a
 need  in the area for the services the enterprise will provide, that the
 enterprise will generate or retain employment in the area,  and  that  a
 tax  incentive  is required to attract construction or reconstruction of
 such a structure to the area.  In addition, the board shall consider the
 economic impact such commercial structure will have in the area.
   (3)  In the case of an application for construction or  reconstruction
 of a commercial structure not located in an as of right area, or involv-
 ing  a  restricted commercial use, the board may make a further determi-
 nation that  special  circumstances  warrant  designating  the  proposed
 construction  or  reconstruction  as "specially needed".  In making such
 determination,  the  board  shall  make  findings  that  the  commercial
 services  to  be provided will have an especially positive impact on the
 area's or the city's economy and that  the  applicant  has  demonstrated
 that the project cannot go forward without the greater exemption granted
 by such designation.
   c.  Any meeting of the board at which an application for a certificate
 of  eligibility  is  to  be  considered shall be open to the public, and
 notice of such meeting shall be given at least two weeks  prior  thereto
 by publication in a newspaper of general circulation within the city.
   d.  The burden of proof shall be on the applicant to show by clear and
 convincing  evidence  that the requirements for granting a tax exemption
 pursuant to this part have been satisfied, and the board shall have  the
 authority to require that statements made in consideration of the appli-
 cation be taken under oath.
   e.    After the issuance of a certificate of eligibility the applicant
 shall apply to the city tax commission, during the  period  provided  by
 law  for filing applications for corrections of assessed valuations, for
 a tax exemption as provided for in section 11-250  of  this  part.   The
 application  shall be accompanied by a copy of the certificate of eligi-
 bility.
   § 11-252  Approval of tax exemption.   On  completion  of  the  recon-
 struction  or  construction work the applicant shall notify the board in
 writing of said completion.  The board shall determine  the  eligibility
 of  the applicant for the tax exemption as provided in section 11-250 of
 this part and shall notify the tax commission of such determination.  If
 the applicant is determined to be qualified the commission shall approve
 the tax exemption.
 S. 8474                            238
 
   § 11-253  Continuation of tax exemption; termination of tax exemption.
 The tax exemption approved by the board  shall  continue  in  accordance
 with  this part, provided that the applicant files an annual certificate
 of continuing use stating that the structure and property continue to be
 used  for  the industrial or commercial purposes justifying the issuance
 of the certificate of eligibility.   The certificate of  continuing  use
 shall  be  filed  with  the  tax  commission  on  such form or forms and
 containing such information as shall be prescribed by  the  tax  commis-
 sion.    The  tax  commission  shall  have  authority to terminate a tax
 exemption on failure of an applicant to file an  annual  certificate  of
 continuing  use  or on the recommendation of the commissioner of finance
 who, in reviewing the certificate filed by an applicant, has  determined
 that  the structure or property has ceased to be used for the industrial
 or commercial purposes justifying the issuance  of  the  certificate  of
 eligibility.
   §  11-254    Extension of time for completion.  Where an applicant has
 received a certificate of eligibility but has not completed or will  not
 be able to complete the construction or reconstruction work within thir-
 ty-six  months, the board shall, upon application, extend to forty-eight
 months, from the time of issuance of  such  certificate,  the  time  for
 completion  of  the  construction  or  reconstruction work; provided the
 applicant has completed not less than two-thirds of the work  as  speci-
 fied in the certified plans previously filed with the application at the
 time of such application for extension.
   §  11-255  Prior certificates of eligibility.  Any project for which a
 certificate of eligibility has been approved by the board prior  to  the
 enactment of this section shall be eligible for a tax exemption computed
 according to the tax exemption tables and formulae in effect on the date
 of such approval.

                                  PART 4
                     TAX EXEMPTION AND DEFERRAL OF TAX
                            PAYMENT FOR CERTAIN
                   INDUSTRIAL AND COMMERCIAL PROPERTIES
 
   § 11-256 Definitions. When used in this part:
   a.  "Applicant"  means any person obligated to pay real property taxes
 on the property for which an exemption from or abatement or deferral  of
 real property tax payments is sought, or in the case of exempt property,
 the record owner or lessee thereof.
   b.  "Approved  plans"  means  plans  submitted  to and approved by the
 department of buildings in  connection  with  the  applicant's  building
 permit,  including any amendments to such plans approved by such depart-
 ment before final inspection of the  work  for  which  such  permit  was
 issued.
   c.  "Benefit  period"  means  the  period  of time when a recipient is
 eligible to receive benefits pursuant to this part including in the case
 of  a  recipient  of  a  certificate  of  eligibility   for   commercial
 construction  work  in  a  deferral  area,  the  period of time when tax
 payments are to be deferred, the interim period when no tax payments are
 to be deferred and no deferred tax payments are required to be made, and
 the period of time when the deferred tax payments are to be made.
   d. "Commission" means the temporary commercial incentive area boundary
 commission.
   e. "Commercial construction work" means  the  construction  of  a  new
 building  or  structure, or portion thereof, or the modernization, reha-
 S. 8474                            239
 
 bilitation, expansion, or other improvement of an existing  building  or
 structure, or portion thereof, for use as commercial property.
   f.  "Commercial  property" means nonresidential property: (1) on which
 will exist after completion of commercial construction work, a  building
 or  structure  used  for  the  buying, selling or otherwise providing of
 goods or services including hotel services, or for  other  lawful  busi-
 ness,  commercial or manufacturing activities; and (2) (a) where, except
 as provided in subparagraph (b) of this paragraph and paragraph  (3)  of
 this  subdivision,  not  more  than  fifteen per centum of the total net
 square footage of any building or structure on such  property  was  used
 for  manufacturing  activities at any one or more times during the twen-
 ty-four months immediately preceding  the  date  of  application  for  a
 certificate of eligibility or (b) where not more than fifteen per centum
 of  the  total  net  square footage of any building or structure on such
 property was used for manufacturing activities at any one or more  times
 during  the  sixty  months immediately preceding the date of application
 for a certificate of eligibility if such property is located,  in  whole
 or  in  part, in the area in the borough of Manhattan lying south of the
 center line of 96th Street; and (3)  in  the  commercial  revitalization
 area,  and with respect to an application for a certificate of eligibil-
 ity filed on or after July first, two  thousand,  "commercial  property"
 means  nonresidential  property  on which will exist after completion of
 commercial construction work, a  building  or  structure  used  for  the
 buying,  selling  or  otherwise providing of goods or services including
 hotel services, or for other lawful business, commercial or  manufactur-
 ing activities.
   f-1. "Commercial revitalization area" means any district that is zoned
 C4, C5, C6, M1, M2 or M3 in accordance with the zoning resolution in any
 area of the city.
   g.  "Deferral area" means an area in which deferral of payment of real
 property taxes in accordance with section 11-257 of this part  shall  be
 available to a recipient who has performed commercial construction work.
   h.  "Excluded  area"  means each area specified in paragraphs (1), (2)
 and (3) of subdivision d of section 11-258 of this part.
   i. "Exemption base". (1)  For  purposes  of  computing  the  exemption
 pursuant  to  subdivision  a,  b, c or d of section 11-257 of this part,
 "exemption base" shall mean,  with  respect  to  property  that  is  the
 subject  of  a certificate of eligibility with an effective date of June
 thirtieth, nineteen hundred ninety-two or before:  (a)  for  the  first,
 second and third taxable years following the effective date of a certif-
 icate  of eligibility, the assessed value of improvements made since the
 effective date of such certificate which are attributable exclusively to
 commercial or industrial construction work described in approved  plans;
 and  (b)  for  all  other years, the assessed value of such improvements
 which have been made before the fourth taxable status date following the
 effective date of such certificate.
   (2) For purposes of computing the exemption pursuant to subdivision c,
 d or e of section 11-257 of this part, "exemption base" shall mean, with
 respect to property that is the subject of a certificate of  eligibility
 with  an  effective  date  of July first, nineteen hundred ninety-two or
 after: (a) for the first  through  fifth  taxable  years  following  the
 effective  date  of  a certificate of eligibility, the assessed value of
 improvements made since the effective date of such certificate which are
 attributable exclusively to commercial or renovation  construction  work
 described  in  approved plans; and (b) for all other years, the assessed
 S. 8474                            240
 
 value of such improvements which have been made before the sixth taxable
 status date following the effective date of such certificate.
   (3)  For purposes of computing the exemption pursuant to subdivision a
 or b of section 11-257 of this part, "exemption base" shall  mean,  with
 respect  to property that is the subject of a certificate of eligibility
 with an effective date of July first,  nineteen  hundred  ninety-two  or
 after:  (a)  for  the  first  through  fifth taxable years following the
 effective date of a certificate of eligibility, the  assessed  value  of
 improvements made since the effective date of such certificate which are
 attributable  exclusively  to commercial or industrial construction work
 described in approved plans plus any equalization increases or minus any
 equalization decreases in the assessed value of the property so improved
 (excluding the land) occurring subsequent to the effective date of  such
 certificate;  and  (b)  for  all other years, the assessed value of such
 improvements made before the sixth taxable  status  date  following  the
 effective  date  of  such certificate plus any equalization increases or
 minus any equalization decreases in the assessed value of  the  property
 so  improved  (excluding the land) occurring subsequent to the effective
 date of such certificate but before the fourteenth taxable  status  date
 following  the  effective  date of such certificate. For purposes of the
 preceding sentence: no adjustment shall be made to the assessed value of
 the improvements referred to in subparagraphs (a) and (b) of this  para-
 graph  for  any portion of an equalization increase or decrease which is
 being phased in pursuant to section eighteen hundred five  of  the  real
 property  tax law subsequent to the effective date of the certificate of
 eligibility if such increase or decrease occurred prior to  such  effec-
 tive date; with respect to any taxable year, an adjustment for an equal-
 ization  increase  or  decrease  shall  reflect only the portion of such
 increase or decrease which is being phased in during such  taxable  year
 or which was phased in during a prior taxable year; no adjustment for an
 equalization  decrease shall reduce the exemption base to an amount less
 than the assessed value of the improvements referred to in subparagraphs
 (a) and (b) of this paragraph, and, to the extent that any such decrease
 would reduce the exemption base below such amount, such  decrease  shall
 reduce  the  taxable  portion  of  the assessed value; and no adjustment
 shall be made for an equalization increase or decrease if  the  improve-
 ments  referred to in subparagraphs (a) and (b) of this paragraph do not
 result in a physical increase in the assessed value of the property.
   (4) Notwithstanding paragraph one of this subdivision, for purposes of
 computing the exemption pursuant to subdivision a of section  11-257  of
 this part, "exemption base" shall mean, with respect to industrial prop-
 erty  that  is  located  in  the  area in Staten Island; and that is the
 subject of a certificate of eligibility with  an  effective  date  after
 December  thirty-first,  nineteen  hundred  eighty-nine  and before July
 first, nineteen hundred ninety-two: (a) for the first, second and  third
 taxable years following the effective date of a certificate of eligibil-
 ity, the assessed value of improvements made since the effective date of
 such  certificate  which  are  attributable  exclusively  to  industrial
 construction work described in approved plans; and  (b)  for  all  other
 years,  the  assessed  value of such improvements made before the fourth
 taxable status date following the effective  date  of  such  certificate
 plus  any  equalization increases or minus any equalization decreases in
 the assessed value of the property  so  improved  (excluding  the  land)
 occurring  subsequent  to  the  fourth taxable status date following the
 effective date of such certificate but  before  the  fourteenth  taxable
 status  date  following  the  effective  date  of  such certificate. For
 S. 8474                            241
 
 purposes of the preceding sentence: no adjustment shall be made  to  the
 assessed  value of the improvements referred to in subparagraphs (a) and
 (b) of this paragraph for any portion of  an  equalization  increase  or
 decrease  which  is being phased in pursuant to section eighteen hundred
 five of the real property tax law subsequent to the  effective  date  of
 the  certificate  of  eligibility  if such increase or decrease occurred
 prior to such effective date; with  respect  to  any  taxable  year,  an
 adjustment  for  an equalization increase or decrease shall reflect only
 the portion of such increase or decrease which is being phased in during
 such taxable year or which was phased in during a prior taxable year; no
 adjustment for an equalization decrease shall reduce the exemption  base
 to  an  amount less than the assessed value of the improvements referred
 to in subparagraphs (a) and (b) of this paragraph, and,  to  the  extent
 that  any  such  decrease  would  reduce  the  exemption base below such
 amount, such decrease shall reduce the taxable portion of  the  assessed
 value;  and  no adjustment shall be made for an equalization increase or
 decrease if the improvements referred to in subparagraphs (a) and (b) of
 this paragraph do not result in a  physical  increase  in  the  assessed
 value of the property.
   (5)  For purposes of computing the exemption: (a) pursuant to subdivi-
 sion e.1 of section 11-257 of this part, "exemption  base"  shall  mean,
 with  respect to property that is the subject of a certificate of eligi-
 bility with an effective date of July first,  nineteen  hundred  ninety-
 five or after and that is located in the new construction exemption area
 specified  in  paragraph  one of subdivision e of section 11-258 of this
 part: for any taxable year following the effective date of a certificate
 of eligibility, the assessed value of improvements made since the effec-
 tive date of such certificate which are attributable exclusively to  the
 construction  of a new building or structure that meets the requirements
 set forth in subdivision i of section 11-259 of this part  as  described
 in approved plans, provided such improvements are made within thirty-six
 months  of the effective date of such certificate or by December thirty-
 first, nineteen hundred  ninety-nine,  whichever  is  earlier;  and  (b)
 pursuant  to  subdivision e.1 of section 11-257 of this part, "exemption
 base" shall mean, with respect to property that  is  the  subject  of  a
 certificate  of  eligibility with an effective date of July first, nine-
 teen hundred ninety-five or  after  and  that  is  located  in  the  new
 construction  exemption area specified in paragraph two of subdivision e
 of section 11-258 of this part:  for  any  taxable  year  following  the
 effective  date  of  a certificate of eligibility, the assessed value of
 improvements made since the effective date of such certificate which are
 attributable exclusively to the construction of a new building or struc-
 ture that meets the requirements set forth in subdivision i  of  section
 11-259  of  this  part  as  described  in  approved plans, provided such
 improvements are made within forty-two months of the effective  date  of
 such certificate.
   (6)  For  purposes  of  this  subdivision  "equalization  increase  or
 decrease" means an increase or decrease in the assessed value of proper-
 ty which is not attributable to  construction  work,  fire,  demolition,
 destruction or other change in the physical characteristics of the prop-
 erty (excluding gradual physical deterioration or obsolescence), or to a
 change in the description or boundaries of the property.
   j.  "Industrial  construction  work"  means  the construction of a new
 building or structure or the modernization, rehabilitation, expansion or
 improvement of an existing building or structure for use  as  industrial
 property.
 S. 8474                            242
 
   k.  "Industrial  property" means nonresidential property on which will
 exist after completion of industrial construction  work  a  building  or
 structure  wherein  at  least  seventy-five  per centum of the total net
 square footage is used or immediately available and held out for use for
 manufacturing  activities  involving the assembly of goods or the fabri-
 cation or processing of raw materials.
   l. "Initial assessed value" means  the  lesser  of:  (1)  the  taxable
 assessed  value  of  real  property appearing on the books of the annual
 record of the assessed valuation of real property on the effective  date
 of  a  recipient's certificate of eligibility; or (2) the assessed value
 to which such assessment is thereafter reduced pursuant  to  application
 to  the  tax  commission or court order. Where the real property is used
 for both residential and nonresidential purposes on the  effective  date
 of  such  certificate of eligibility, the initial assessed value of such
 real property, determined as provided in the preceding  sentence,  shall
 be apportioned between the residential and nonresidential portions ther-
 eof  in such manner as shall properly reflect the initial assessed value
 of each such portion. Such apportionment shall  be  in  accordance  with
 rules promulgated by the department of finance.
   m.  "Manufacturing  activity" means an activity involving the assembly
 of goods or the fabrication or processing of raw materials.
   n. "Minimum required expenditure" means  expenditure  for  commercial,
 renovation  or industrial construction work in an amount equal to twenty
 per centum of the initial assessed value; provided, however,  that  with
 respect  to a recipient who filed an application on or after July first,
 nineteen hundred ninety-five for a certificate of eligibility for indus-
 trial construction work or for commercial construction work in a special
 exemption area or a regular exemption area, minimum required expenditure
 means expenditure for such work in an amount equal to ten per centum  of
 the  initial  assessed  value; provided, however, that with respect to a
 recipient who filed an application on  or  after  July  first,  nineteen
 hundred  ninety-five  for  a  certificate  of eligibility for industrial
 construction work and for the purpose of receiving an abatement of  real
 property  taxes  in  accordance  with  paragraph (3) of subdivision a of
 section 11-257 of this part, minimum required expenditure means expendi-
 ture for such work in an amount equal to twenty-five per centum  of  the
 initial  assessed  value; and provided further that if the department of
 finance, after consultation  with  the  deputy  mayor  for  finance  and
 economic  development, determines that a greater expenditure is required
 to encourage significant industrial and commercial  development  it  may
 establish  by rule a higher percentage of initial assessed value, not to
 exceed fifty per centum thereof, as the  minimum  required  expenditure.
 Expenditure  for  residential construction work shall not be included in
 the minimum required expenditure; provided, however, that for  mixed-use
 property, expenditures for construction work related to the common areas
 and  systems  of  such  property  shall be allocated, in accordance with
 rules promulgated by the department of finance, between the  residential
 and  nonresidential  portions of the property. If real property was used
 for both residential and nonresidential purposes on the  effective  date
 of  the  certificate  of eligibility, the initial assessed value of such
 real property, for purposes of this subdivision, shall  be  the  initial
 assessed value apportioned to the nonresidential portions thereof.
   o.  "Person"  means  an  individual, corporation, partnership, associ-
 ation, agency, trust, estate, foreign or domestic government or subdivi-
 sion thereof, or other entity.
 S. 8474                            243
 
   p. "Recipient" means an applicant to whom a certificate of eligibility
 has been issued pursuant to this part, or the successor in  interest  of
 such  applicant,  provided  that  where  a person who has entered into a
 lease or purchase agreement with the owner or lessee of exempt  property
 has  been  a  co-applicant,  such person or the successor in interest of
 such person shall be the recipient.
   q. "Regular exemption area" means an area in which a regular exemption
 from taxes in accordance with section  11-257  of  this  part  shall  be
 available to a recipient who performs commercial construction work.
   r.  "Residential construction work" means any construction, moderniza-
 tion, rehabilitation, expansion or improvement of dwelling  units  other
 than dwelling units in a hotel.
   s. "Residential property" means property, other than property used for
 hotel  purposes,  on  which  exists,  or  will  exist upon completion of
 construction  work,  a  building  or  structure  used  for   residential
 purposes.
   t.  "Restricted  activity"  means any entertainment activity which the
 department of finance has identified in regulations promulgated pursuant
 to this part as an activity which, in the public interest, should not be
 encouraged through the benefits of this part.
   u. "Special exemption area" means an area in which the commission  has
 determined  that a special exemption from real property taxes in accord-
 ance with subdivision b of section 11-257 of this part shall  be  avail-
 able  to  a  recipient who performs commercial construction work and, in
 addition, means the area specified in paragraph four of subdivision c of
 section 11-258 of this part.
   v. "Mixed-use property" means property on which exists, or will  exist
 upon  completion  of construction work, a building or structure used for
 both residential and nonresidential purposes.
   w. "Renovation construction work" means the  modernization,  rehabili-
 tation,  expansion  or improvement of an existing building or structure,
 or portion thereof, for use  as  commercial  property  in  a  renovation
 exemption  area  where  such modernization, rehabilitation, expansion or
 improvement is physically and functionally integrated with the  existing
 building or structure, or portion thereof, does not increase the bulk of
 the  existing  building  or structure by more than thirty per centum and
 does not increase the height of the existing building  or  structure  by
 more than thirty per centum.
   x.  "Renovation  exemption area" means the area specified in paragraph
 (4) of subdivision d of section 11-258 of this part  in  which  a  reno-
 vation  exemption from taxes in accordance with subdivision e of section
 11-257 of this part shall be available to a recipient who performs reno-
 vation construction work.
   y. "New construction exemption areas" means  the  areas  specified  in
 subdivision  e of section 11-258 of this part in which an exemption from
 real property taxes in accordance with subdivision e.1 of section 11-257
 of this part shall be available to a  recipient  who  constructs  a  new
 building  or structure that meets the requirements set forth in subdivi-
 sion i of section 11-259 of this part.
   § 11-257 Real property tax exemption; deferral of  tax  payments.  The
 city shall be divided into six classes of areas as provided in this part
 and pursuant to designation of areas to be made by the temporary commer-
 cial  incentive area boundary commission. Within such areas, the follow-
 ing benefits shall be available to qualified recipients:
   a. (1) A recipient who, following the effective date of a  certificate
 of  eligibility,  has performed industrial construction work in any area
 S. 8474                            244
 
 of the city shall be eligible for an exemption from real property  taxes
 as  follows:  For  the  first thirteen tax years, the recipient shall be
 exempt from taxation on one hundred per centum of  the  exemption  base.
 For  the  following  nine  tax years, the recipient shall be exempt from
 taxation on a percentage of the exemption base beginning at  ninety  per
 centum  thereof  in  the  fourteenth  tax year and decreasing by ten per
 centum of said exemption base each year.
   The following table shall illustrate the computation of the  exemption
 for industrial construction work:
 
         Tax year following effective
         date of certificate
         of eligibility:             Amount of exemption:
         1 through 13 ............. Tax on 100% of exemption base
         14 ........................ Tax on 90% of exemption base
         15 ........................ Tax on 80% of exemption base
         16 ........................ Tax on 70% of exemption base
         17 ........................ Tax on 60% of exemption base
         18 ........................ Tax on 50% of exemption base
         19 ........................ Tax on 40% of exemption base
         20 ........................ Tax on 30% of exemption base
         21 ........................ Tax on 20% of exemption base
         22 ........................ Tax on 10% of exemption base
 
   (2) Notwithstanding paragraph one of this subdivision, a recipient who
 filed  an  application  for  a certificate of eligibility for industrial
 construction work in any area of such city on or after July first, nine-
 teen hundred ninety-five, and who, following the effective date of  such
 certificate  of  eligibility, has performed such industrial construction
 work shall be eligible for an exemption  from  real  property  taxes  as
 follows:  for the first sixteen tax years, the recipient shall be exempt
 from taxation on one hundred per centum of the exemption base.  For  the
 following nine tax years, the recipient shall be exempt from taxation on
 a percentage of the exemption base beginning at ninety per centum there-
 of  in the seventeenth tax year and decreasing by ten per centum of said
 exemption base each year.
   The following table shall illustrate the computation of the  exemption
 for industrial construction work pursuant to this paragraph:
 
         Tax year following effective
         date of certificate of
         eligibility:                Amount of exemption:
         1 through 16.............. Tax on 100% of exemption base
         17 ........................ Tax on 90% of exemption base
         18 ........................ Tax on 80% of exemption base
         19 ........................ Tax on 70% of exemption base
         20 ........................ Tax on 60% of exemption base
         21 ........................ Tax on 50% of exemption base
         22 ........................ Tax on 40% of exemption base
         23 ........................ Tax on 30% of exemption base
         24 ........................ Tax on 20% of exemption base
         25 ........................ Tax on 10% of exemption base
 
   (3)(a)  A  recipient  who  filed  an  application for a certificate of
 eligibility for industrial construction work in any area of such city on
 or after July first, nineteen hundred ninety-five,  and  who,  following
 S. 8474                            245
 
 the  effective  date  of such certificate of eligibility, both commenced
 and completed such work, shall be eligible  for  an  abatement  of  real
 property taxes as follows:  for the first tax year immediately following
 completion  of such work, and for the second, third and fourth tax years
 following completion of such work, the abatement shall equal  fifty  per
 centum  of  the real property tax that was imposed on the property which
 is the subject of the certificate of eligibility for the tax year  imme-
 diately preceding the effective date of such certificate of eligibility,
 provided,  however,  that if such property was fully or partially exempt
 from real property taxes during such tax year, then the abatement  shall
 equal  fifty  per  centum  of the real property tax that would have been
 imposed on such property but for such full or partial exemption. For the
 fifth and sixth tax years, the abatement shall equal forty per centum of
 such amount; for the seventh and eighth tax years, the  abatement  shall
 equal  thirty  per  centum  of  such amount; for the ninth and tenth tax
 years, the abatement shall equal twenty per centum of such  amount;  and
 for  the  eleventh  and twelfth tax years, the abatement shall equal ten
 per centum of such amount. Notwithstanding any inconsistent provision of
 this paragraph, a recipient shall not be eligible for an  abatement  for
 the first tax year following completion of such work, unless the recipi-
 ent  submits  proof  satisfactory to the department of finance that such
 work was completed on or before the taxable status date for  such  first
 tax year no later than thirty days after such taxable status date. Where
 the  recipient fails to submit such proof in accordance with the forego-
 ing sentence, a recipient shall not be eligible for an  abatement  until
 the  second  tax year following completion of such work. In such case, a
 recipient shall submit proof satisfactory to the department  of  finance
 that  such  work  was completed on or before the taxable status date for
 such first tax year no later than thirty days after the  taxable  status
 date for such second tax year. A recipient whose abatement begins in the
 second tax year following completion of such work shall not thereby have
 his or her twelve-year benefit period shortened.
   The  following table shall illustrate the computation of the abatement
 for industrial construction work pursuant to this paragraph:
 
         Tax year following completion
         of industrial construction
         work:                               Amount of abatement:
         1 ...................................................50%
         2 ...................................................50%
         3 ...................................................50%
         4 ...................................................50%
         5 ...................................................40%
         6 ...................................................40%
         7 ...................................................30%
         8 ...................................................30%
         9 ...................................................20%
         10 ..................................................20%
         11 ..................................................10%
         12 ..................................................10%
 
   (b) If, due to a determination of the department  of  finance  or  tax
 commission  of  such  city  or a court, the real property tax imposed on
 such property for the tax year immediately preceding the effective  date
 of  such  certificate of eligibility is changed, then any abatement that
 was granted in accordance with this paragraph prior  to  such  reduction
 S. 8474                            246
 
 shall be recalculated and any abatement to be granted in accordance with
 this  paragraph  shall be based on the real property tax imposed on such
 property for the tax year immediately preceding the  effective  date  of
 such  certificate  of eligibility, as changed by such determination. The
 amount equal to the difference between the abatement originally  granted
 and  the  abatement as so recalculated shall be deducted from any refund
 otherwise payable or remission otherwise due as a result of a change due
 to such determination, and any balance of such amount  remaining  unpaid
 after  making  any  such  deduction  shall  be paid to the department of
 finance within thirty days from the date of mailing by the department of
 finance of a notice of the amount payable.  Such  amount  payable  shall
 constitute  a  tax  lien  on such property as of the date of such notice
 and, if not paid within such thirty-day period, penalty and interest  at
 the  rate  applicable  to  delinquent  taxes  on  such property shall be
 charged and collected on such amount from the date of such notice to the
 date of payment.
   (c) No property which is the subject of a certificate  of  eligibility
 pursuant  to this part shall receive more than one abatement pursuant to
 this part and no abatement  shall  exceed  one  consecutive  twelve-year
 period as specified in subparagraph (a) of this paragraph.
   (d)  In  no  event  shall  an  abatement granted pursuant to this part
 exceed in any tax year the real property taxes imposed on  the  property
 which  is  the  subject of a certificate of eligibility pursuant to this
 part.
   (e) For the purpose of calculating an abatement of real property taxes
 pursuant to this part, where a tax lot contains more than  one  building
 or  structure and not all of the buildings or structures comprising such
 tax lot are the subject of a certificate of eligibility  for  industrial
 construction work pursuant to this part, the real property taxes imposed
 on such tax lot for the year immediately preceding the effective date of
 such  certificate  of  eligibility shall be apportioned among the build-
 ings, structures and land comprising such tax lot  and  only  such  real
 property  taxes as are allocable to the property which is the subject of
 the certificate of eligibility pursuant to this part shall be abated  in
 accordance  with  this paragraph. Such apportionment shall be in accord-
 ance with rules promulgated by the department of finance.
   (f) A recipient who filed an application for a certificate  of  eligi-
 bility for industrial construction work in the commercial revitalization
 area on or after July first, two thousand, and who, following the effec-
 tive  date  of  such  certificate  of  eligibility,  both  commenced and
 completed such work, shall be eligible for an abatement of real property
 taxes in accordance with subparagraph (a) of this  paragraph,  provided,
 however, that where the total net square footage of the industrial prop-
 erty  used or immediately available and held out for use for manufactur-
 ing activities involving the assembly of goods  or  the  fabrication  or
 processing  of raw materials is less than seventy-five per centum of the
 total net square footage of the industrial property,  the  abatement  of
 real property taxes shall be determined in accordance with rules promul-
 gated  by  the  department  of  finance.  Notwithstanding  the foregoing
 sentence, no such abatement shall be allowed where the total net  square
 footage  of  the  industrial  property used or immediately available and
 held out for use for such manufacturing activities after  completion  of
 industrial  construction  work is less than the total net square footage
 used or immediately available and held out for use for such  manufactur-
 ing  activities  before  the commencement of such construction work. For
 purposes of this subparagraph only, the  term  "industrial  construction
 S. 8474                            247
 
 work"   shall  mean  the  modernization,  rehabilitation,  expansion  or
 improvement of an existing building or structure for use  as  industrial
 property  and  the  term "industrial property" shall mean nonresidential
 property on which will exist after completion of industrial construction
 work  a building or structure wherein at least twenty-five per centum of
 the total net square footage is used or immediately available  and  held
 out for use for manufacturing activities involving the assembly of goods
 or the fabrication or processing of raw materials.
   b.  (1) A recipient who, following the effective date of a certificate
 of eligibility, has performed commercial construction work in a  special
 exemption  area  shall  be  eligible for an exemption from real property
 taxes as follows: For the first thirteen tax years, the recipient  shall
 be exempt from taxation on one hundred per centum of the exemption base.
 For  the  following  nine  tax years, the recipient shall be exempt from
 taxation on a percentage of the exemption base beginning at  ninety  per
 centum  thereof  in  the  fourteenth  tax year and decreasing by ten per
 centum of said exemption base each year.
   The following table shall illustrate the computation of the  exemption
 for commercial construction work in a special exemption area:
 
         Tax year following effective
         date of certificate
         of eligibility:             Amount of exemption:
         1 through 13 ............. Tax on 100% of exemption base
         14 ........................ Tax on 90% of exemption base
         15 ........................ Tax on 80% of exemption base
         16 ........................ Tax on 70% of exemption base
         17 ........................ Tax on 60% of exemption base
         18 ........................ Tax on 50% of exemption base
         19 ........................ Tax on 40% of exemption base
         20 ........................ Tax on 30% of exemption base
         21 ........................ Tax on 20% of exemption base
         22 ........................ Tax on 10% of exemption base
 
   (2) Notwithstanding paragraph one of this subdivision, a recipient who
 filed  an  application  for  a certificate of eligibility for commercial
 construction work in a special exemption area on or  after  July  first,
 nineteen  hundred  ninety-five, and who, following the effective date of
 such  certificate  of  eligibility,  has   performed   such   commercial
 construction  work shall be eligible for an exemption from real property
 taxes as follows: For the first sixteen tax years, the  recipient  shall
 be exempt from taxation on one hundred per centum of the exemption base.
 For  the  following  nine  tax years, the recipient shall be exempt from
 taxation on a percentage of the exemption base beginning at  ninety  per
 centum  thereof  in  the  seventeenth tax year and decreasing by ten per
 centum of said exemption base each year.
   The following table shall illustrate the computation of the  exemption
 for commercial construction work in a special exemption area pursuant to
 this paragraph:
 
         Tax year following effective
         date of certificate
         of eligibility:             Amount of exemption:
         1 through 16 ............. Tax on 100% of exemption base
         17 ........................ Tax on 90% of exemption base
         18 ........................ Tax on 80% of exemption base
 S. 8474                            248
 
         19 ........................ Tax on 70% of exemption base
         20 ........................ Tax on 60% of exemption base
         21 ........................ Tax on 50% of exemption base
         22 ........................ Tax on 40% of exemption base
         23 ........................ Tax on 30% of exemption base
         24 ........................ Tax on 20% on exemption base
         25 ........................ Tax on 10% of exemption base
 
   c.  (1) A recipient who, following the effective date of a certificate
 of eligibility, has performed commercial construction work in a  regular
 exemption  area  shall  be  eligible for an exemption from real property
 taxes as follows: For the first eight tax years, the recipient shall  be
 exempt  from  taxation  on one hundred per centum of the exemption base.
 For the following four tax years, the recipient  shall  be  exempt  from
 taxation  on  a percentage of the exemption base beginning at eighty per
 centum thereof in the ninth tax year and decreasing by twenty per centum
 of said exemption base each year.
   The following table shall illustrate the computation of the  exemption
 for commercial construction work in a regular exemption area:
 
         Tax year following effective
         date of certificate
         of eligibility:             Amount of exemption:
         1 through 8 .............. Tax on 100% of exemption base
         9 ......................... Tax on 80% of exemption base
         10 ........................ Tax on 60% of exemption base
         11 ........................ Tax on 40% of exemption base
         12 ........................ Tax on 20% of exemption base
 
   (2) Notwithstanding paragraph one of this subdivision, a recipient who
 filed  an  application  for  a certificate of eligibility for commercial
 construction work in a regular exemption area on or  after  July  first,
 nineteen  hundred  ninety-five, and who, following the effective date of
 such  certificate  of  eligibility,  has   performed   such   commercial
 construction  work shall be eligible for an exemption from real property
 taxes as follows: For the first eleven tax years, the recipient shall be
 exempt from taxation on one hundred per centum of  the  exemption  base.
 For  the  following  four  tax years, the recipient shall be exempt from
 taxation on a percentage of the exemption base beginning at  eighty  per
 centum  thereof  in  the  twelfth  tax year and decreasing by twenty per
 centum of said exemption base each year.
   The following table shall illustrate the computation of the  exemption
 for commercial construction work in a regular exemption area pursuant to
 this paragraph:
 
         Tax year following effective
         date of certificate
         of eligibility:             Amount of exemption:
         1 through 11 ............. Tax on 100% of exemption base
         12 ........................ Tax on 80% of exemption base
         13 ........................ Tax on 60% of exemption base
         14 ........................ Tax on 40% of exemption base
         15 ........................ Tax on 20% of exemption base
 
   d.  Except as provided in paragraphs two and three of subdivision d of
 section 11-258 of this part, a recipient who,  following  the  effective
 S. 8474                            249
 
 date   of   a  certificate  of  eligibility,  has  performed  commercial
 construction work in a deferral area shall be eligible for a deferral of
 tax payments as follows: For the first three  tax  years  following  the
 effective  date  of a certificate of eligibility, the tax payment on one
 hundred per centum of the exemption base  shall  be  deferred.  For  the
 following  four  tax  years,  the  tax  payment  on  a percentage of the
 exemption base beginning at eighty per centum thereof in the fourth  tax
 year  and  decreasing  by twenty per centum each year shall be deferred.
 The total amount of tax payments deferred pursuant to this part shall be
 paid subsequently over the course of ten tax years as follows:  Commenc-
 ing in the eleventh tax year following the effective date of the certif-
 icate of eligibility, through  and  including  the  twentieth  tax  year
 following  such effective date, an amount equal to ten per centum of the
 total amount of tax payments deferred pursuant to this section shall  be
 added  to  the amount of tax otherwise assessed and payable in each such
 tax year on the property subject to such deferral.
   The following table shall illustrate the computation of  deferral  and
 payment of taxes for commercial construction work in a deferral area:
 
 Tax year following
 effective date of
 certificate of
 eligibility:          Amount of tax payments to be deferred or paid:
 1 through 3 ......Deferral of tax payment on 100% of the exemption base
 4 ................ Deferral of tax payment on 80% of the exemption base
 5 ................ Deferral of tax payment on 60% of the exemption base
 6 ................ Deferral of tax payment on 40% of the exemption base
 7 ................ Deferral of tax payment on 20% of the exemption base
 8 through 10 ..... No tax payments are to be deferred and no deferred
                      tax payments are required to be made
 11 through 20 .... Payment each year of 10% of total dollar amount of
                      tax payments deferred pursuant to this part

   e.  A  recipient who, following the effective date of a certificate of
 eligibility, has performed renovation construction work in a  renovation
 exemption  area  shall  be  eligible for an exemption from real property
 taxes as follows: For the first eight tax years, the recipient shall  be
 exempt  from  taxation  on one hundred per centum of the exemption base.
 For the following four tax years, the recipient  shall  be  exempt  from
 taxation  on  a percentage of the exemption base beginning at eighty per
 centum thereof in the ninth tax year and decreasing by twenty per centum
 of said exemption base each year.
   The following table shall illustrate the computation of the  exemption
 for renovation construction work in a renovation exemption area:
 
         Tax year following effective
         date of certificate
         of eligibility:             Amount of exemption:
         1 through 8 .............. Tax on 100% of exemption base
         9 ......................... Tax on 80% of exemption base
         10 ........................ Tax on 60% of exemption base
         11 ........................ Tax on 40% of exemption base
         12 ........................ Tax on 20% of exemption base
 
   e.1. A recipient who, following the effective date of a certificate of
 eligibility,  constructs  a  new  building  or  structure that meets the
 S. 8474                            250
 
 requirements set forth in subdivision i of section 11-259 of  this  part
 in  the  new construction exemption area specified in paragraph one, two
 or three of subdivision e of section 11-258 of this part shall be eligi-
 ble  for an exemption from real property taxes as follows: for the first
 four tax years, the recipient shall  be  exempt  from  taxation  on  one
 hundred  per  centum  of  the exemption base. For the following four tax
 years, the recipient shall be exempt from taxation on  a  percentage  of
 the  exemption  base beginning at eighty per centum thereof in the fifth
 tax year and decreasing by twenty per centum of said exemption base each
 year.
   The following table shall illustrate the computation of the  exemption
 for  the  construction  of  a  new  building or structure that meets the
 requirements set forth in subdivision i of section 11-259 of  this  part
 in  the  new construction exemption area specified in paragraph one, two
 or three of subdivision e of section 11-258 of this part:
 
         Tax year following effective
         date of certificate
         of eligibility:             Amount of exemption:
         1 through 4 .............. Tax on 100% of exemption base
         5 ......................... Tax on 80% of exemption base
         6 ......................... Tax on 60% of exemption base
         7 ......................... Tax on 40% of exemption base
         8 ......................... Tax on 20% of exemption base
 
   f. There shall be no exemption from or deferral  of  payment  of  real
 property  taxes  available  pursuant  to  this  part  to  any person who
 performs commercial or renovation construction work in an excluded area.
   g. The benefits of this part shall be granted exclusively  for  indus-
 trial,  commercial or renovation construction work described in approved
 plans. No benefits shall be granted for residential  construction  work.
 Any  parcel  which is partly located in an excluded area shall be deemed
 to be entirely located in such area.
   h. No benefits pursuant to this part shall be granted for  work  which
 is  the  subject of a certificate of eligibility issued pursuant to part
 three of this subchapter.
   § 11-258 Temporary  commercial  incentive  area  boundary  commission;
 classes  of  area; excluded areas. a. There shall be a temporary commer-
 cial incentive area boundary commission to consist of the  deputy  mayor
 for  economic development and planning, the commissioner of finance, the
 chair of the city planning commission, the director  of  management  and
 budget,  the  borough  presidents, the speaker of the city council and a
 public member appointed by the mayor to serve at the  mayor's  pleasure.
 Each  member  except the public member shall have the power to designate
 an alternate to represent him or her at commission meetings to  exercise
 all  the  rights and powers of such member, including the right to vote,
 provided that such designation be made in writing to the  chair  of  the
 commission. The deputy mayor for economic development and planning shall
 be the chair of the commission. Each borough president shall be entitled
 to  vote  only  on  the  designation of areas within his or her borough.
 Commission members who shall be officers or employees of the city  shall
 serve  without  compensation but shall be reimbursed for expenses neces-
 sarily incurred in the performance of their duties. Any other commission
 member shall receive as exclusive compensation for his or  her  services
 one  hundred dollars per diem, provided, however, that the total compen-
 sation paid to any such member shall not exceed twelve  hundred  dollars
 S. 8474                            251

 for any calendar year. A majority of members of such commission entitled
 to  vote on a matter shall constitute a quorum for such issue. Decisions
 shall be made by majority vote of those present entitled to  vote  on  a
 matter.
   b. (1) The commission shall meet in nineteen hundred ninety-two, nine-
 teen  hundred  ninety-five and nineteen hundred ninety-nine to determine
 the boundaries of the various areas which it is authorized to  designate
 pursuant  to  this  section.  The  areas designated by the commission in
 effect as of December thirty-first, nineteen  hundred  ninety-one  shall
 remain  in  effect  until  the  first taxable status date after the city
 council approves a new designation pursuant to paragraph  four  of  this
 subdivision.
   (2)  Not  later  than  October first of each year when areas are to be
 designated, the commission shall publish notice of  proposed  boundaries
 of areas to be designated, and the date, not earlier than five nor later
 than fifteen days following the publication of such notice, on which the
 commission  will hold a public hearing to hear all persons interested in
 the designation of areas. The notice required by this paragraph shall be
 published in the City Record and a newspaper of general  circulation  in
 the  city,  and copies thereof shall be forwarded to each council member
 and community board.
   (3) The commission shall make such designation, and  notify  the  city
 council  of such designation, not later than November first of each year
 when areas are to be designated. The designation shall be  effective  as
 provided in paragraph four of this subdivision.
   (4)  Within  thirty  days  after  the first stated meeting of the city
 council following the receipt of notice of such  designation,  the  city
 council  may,  by majority vote, disapprove such designation. If, within
 such thirty-day period, the city council fails to act or fails to act by
 the required vote, the city council shall be  deemed  to  have  approved
 such  designation.  Such  designation shall be effective as of the first
 taxable status date after the city council approves such designation and
 shall remain in effect until the first taxable  status  date  after  the
 city council approves a new designation pursuant to this paragraph.
   c. (1) The commission may designate any area other than the area lying
 south  of  the  center  line  of  ninety-sixth  street in the borough of
 Manhattan to be a special exemption area if it  determines  that  market
 conditions  in  the  area  are  such  that the availability of a special
 exemption is required in order to encourage commercial construction work
 in such area. In making such determination, the commission shall consid-
 er, among other factors, the existence in such area of  a  special  need
 for commercial and job development, high unemployment, economic distress
 or  unusually  large  numbers  of  vacant,  underutilized, unsuitable or
 substandard structures, or other substandard,  unsanitary,  deteriorated
 or deteriorating conditions, with or without tangible blight.
   (2) Any area in the city, which the commission has not designated as a
 special exemption area shall be a regular exemption area.
   (3)  On  or  after  January  first,  nineteen  hundred ninety-two, the
 commission shall not designate any area to be either a deferral area  or
 an  excluded  area, nor shall the commission make any new designation in
 any urban renewal area designated pursuant to  article  fifteen  of  the
 general  municipal  law  so as to reduce the level of benefits available
 pursuant to this title in such area.
   (4) Notwithstanding any other provision of this part, any area in  the
 city  designated as an empire zone in accordance with article eighteen-b
 of the general municipal law, which the commission has not designated as
 S. 8474                            252
 
 a special exemption area, shall be a special exemption area as  of  July
 first, nineteen hundred ninety-five or as of the date of the designation
 of such area as an empire zone, whichever is later.
   §  11-259 Eligibility for benefits. a. A recipient of a certificate of
 eligibility with an effective date of June thirtieth,  nineteen  hundred
 ninety-two or before must make one-half the minimum required expenditure
 within eighteen months of the effective date of such recipient's certif-
 icate  of  eligibility, and make the minimum required expenditure within
 thirty-six months of the effective date of such certificate to be eligi-
 ble to receive the benefits of this part. A recipient of  a  certificate
 of  eligibility  with  an effective date of July first, nineteen hundred
 ninety-two or after must make one-half the minimum required  expenditure
 within  thirty  months of the effective date of such recipient's certif-
 icate of eligibility, and make the minimum required  expenditure  within
 sixty months of the effective date of such certificate to be eligible to
 receive  the benefits of this part. Any recipient who shall fail to make
 such expenditures shall become ineligible and shall pay, with  interest,
 any  taxes  for  which  an exemption or deferral was claimed pursuant to
 this section. This subdivision shall not apply to  the  recipient  of  a
 certificate  of eligibility for construction of a new building or struc-
 ture that meets the requirements set forth in subdivision i  of  section
 11-259 of this part in a new construction exemption area.
   b. No benefits pursuant to this part shall be granted for construction
 work on any condominium unit unless such unit is in a building or struc-
 ture  which,  if viewed as a whole and as if it were under single owner-
 ship, would qualify as commercial or industrial  property.  The  minimum
 required  expenditure  applicable  to  any recipient of a certificate of
 eligibility for construction work on a condominium unit shall  be  equal
 to  the minimum expenditure which would apply if a certificate of eligi-
 bility were issued for construction work on the  entire  property  where
 such  unit is located. Nothing in this subdivision shall be construed to
 prevent owners of condominium units in the same property from forming an
 association to be a recipient. This subdivision shall not apply  to  any
 applicant  whose  property would be, or recipient whose property is, the
 subject of a certificate of eligibility with an effective date  of  July
 first, nineteen hundred ninety-two or after.
   c.  No  benefits  pursuant  to  this  part  shall  be  granted for any
 construction work unless the applicant filed  an  application  for  such
 benefits on or before the date of issuance of a building permit for such
 work.  The  requirements  of this subdivision may be satisfied where the
 applicant's architect, contractor or other representative authorized  to
 file  the application for such building permit files with the department
 of finance on behalf of the applicant a preliminary application contain-
 ing such information as the department of  finance  shall  prescribe  by
 regulation.
   d. No benefits pursuant to this part shall be granted to any recipient
 for  construction work on property any part of which is to be used for a
 restricted activity.
   e. No benefits  pursuant  to  this  part  shall  be  granted  for  any
 construction  work  unless  the  applicant shall file, together with the
 application, an affidavit setting forth the following information:
   (1) a statement that within the seven years immediately preceding  the
 date of application for a certificate of eligibility, neither the appli-
 cant,  nor  any  person owning a substantial interest in the property as
 defined in paragraph four of this subdivision, nor any officer, director
 or general partner of the applicant or such person was  finally  adjudi-
 S. 8474                            253
 
 cated  by a court of competent jurisdiction to have violated section two
 hundred thirty-five of the real property law or any section  of  article
 one  hundred  fifty of the penal law or any similar arson law of another
 state  with  respect  to  any  building,  or was an officer, director or
 general partner of a person at the time such person was finally  adjudi-
 cated to have violated such law;
   (2)  a  statement setting forth any pending charges alleging violation
 of section two hundred thirty-five of  the  real  property  law  or  any
 section  of  article  one  hundred fifty of the penal law or any similar
 arson law of another jurisdiction with respect to any  building  by  the
 applicant or any person owning a substantial interest in the property as
 defined  in paragraph four of this subdivision, or any officer, director
 or general partner of the applicant or such person; and
   (3) a statement that the applicant has posted notice in a  conspicuous
 place  at  the  premises  which  are  the subject of the application and
 published notice in a newspaper of general circulation in the  city,  in
 such  form  as shall be prescribed by the department of finance, stating
 that persons having information concerning any violation by  the  appli-
 cant  or  a  person  having  a  substantial  interest in the property as
 defined in paragraph four of this subdivision has violated  section  two
 hundred  thirty-five  of the real property law or any section of article
 one hundred fifty of the penal law or any similar arson law  of  another
 jurisdiction may submit such information to the department of finance to
 be considered in determining the applicant's eligibility for benefits.
   (4)  "Substantial  interest"  as  used  in this subdivision shall mean
 ownership and control of an interest of ten per  centum  or  more  in  a
 property or of any person owning a property.
   f.  If any person described in the statement required by paragraph two
 of subdivision e of this section is finally adjudicated by  a  court  of
 competent  jurisdiction to be guilty of any charge listed in such state-
 ment, the recipient shall cease to be eligible for benefits pursuant  to
 this  part and shall pay with interest any taxes for which an exemption,
 abatement or deferral was claimed pursuant to this part.
   g. In addition to any  other  qualifications  for  exemption  from  or
 abatement  or  deferral  of  payment of taxes set forth in this part, an
 applicant must be:
   (1) obligated to pay real property tax on the property  for  which  an
 exemption,  abatement  or  deferral  is  sought, whether such obligation
 arises because of record ownership of  such  property,  or  because  the
 obligation to pay such tax has been assumed by contract; or
   (2)  the  record owner or lessee of property which is exempt from real
 property taxation who has entered into an agreement  to  sell  or  lease
 such  property  to  another  person. Such person shall be a co-applicant
 with such owner or lessee.
   h. A co-applicant with a public entity shall be an eligible  recipient
 pursuant  to  this  part,  provided that for such period as the property
 which is the subject of the certificate of eligibility  is  exempt  from
 real  property  taxation  because  it is owned or controlled by a public
 entity no benefits shall be available to such recipient pursuant to this
 part. Such recipient shall receive benefits pursuant to this  part  when
 such  property  ceases  to  be  eligible for exemption pursuant to other
 provisions of law, as follows: the recipient shall, commencing with  the
 date  such  tax exemption ceases, and continuing until the expiration of
 the benefit period pursuant to this part, receive the benefits to  which
 such  recipient  is  entitled  in the corresponding tax year pursuant to
 this part.
 S. 8474                            254
 
   i. (1) No  benefits  pursuant  to  this  part  shall  be  granted  for
 construction  of  a  new  building  or  structure  in a new construction
 exemption area unless such building or structure meets the  requirements
 set forth in subparagraphs two and three of this paragraph and, in addi-
 tion,  meets at least two of the five requirements set forth in subpara-
 graphs four through eight of this paragraph.
   (2) The height of at least fifty per centum  of  the  floors  in  such
 building  or  structure  shall be not less than twelve feet, nine inches
 measured from the top of the slab comprising the floor to the bottom  of
 the slab comprising the ceiling;
   (3) Such building or structure shall be served by fiber optic telecom-
 munications  wiring  and  shall  contain  vertical  penetrations for the
 distribution of fiber optic cabling to individual tenants on each floor;
   (4) The total square footage of such building or structure is not less
 than five hundred thousand gross square feet;
   (5) A minimum of two hundred thousand gross square feet or twenty-five
 per centum of such building or structure is comprised of floors  of  not
 less than forty thousand gross square feet;
   (6) At least ten per centum of the gross square footage of such build-
 ing  or structure is comprised of floors that contain no more than eight
 structural columns, excluding any columns within  the  core  or  on  the
 periphery of such building or structure;
   (7)  The electrical capacity of such building or structure is not less
 than six watts per net square foot;
   (8) Emergency backup power sufficient to accommodate  a  need  of  six
 watts  per net square foot is available in at least two hundred thousand
 gross square feet or twenty-five per centum of such building  or  struc-
 ture.
   j. No benefits pursuant to this part shall be granted for construction
 work  performed  pursuant to a building permit issued after July thirty-
 first, two thousand eight, except that if a building permit is issued on
 or before July thirty-first, two thousand eight for construction work on
 a building or structure described in an application for a certificate of
 eligibility filed on or  before  June  thirtieth,  two  thousand  eight,
 construction work performed as described in such application pursuant to
 any  additional  building  permit  issued  on or after August first, two
 thousand eight shall be eligible for benefits pursuant to this  part  in
 accordance with this subdivision.
   (1)  Except  as  provided  in  paragraph  two of this subdivision, all
 construction work performed pursuant to any such  application  shall  be
 completed  on or before December thirty-first, two thousand thirteen. No
 benefits shall be granted for construction  work  performed  after  such
 date,  and  any  exemption  granted pursuant to this part in relation to
 property on which such construction work was performed shall not  exceed
 the  amount of the exemption in effect for such property on the tax roll
 for which the taxable status date is January fifth, two  thousand  four-
 teen.
   (2)  All  construction work performed pursuant to any such application
 for the  construction  of  a  new  building  or  structure  in  the  new
 construction  exemption area specified in paragraph three of subdivision
 e of section 11-258 of this part shall be completed in  accordance  with
 paragraph four of subdivision i of this section and, if not completed in
 accordance  with  such  subparagraph, shall not be eligible for benefits
 pursuant to this part.
   (3) For purposes of this subdivision, construction work  as  described
 in  an  application  for  a  certificate  of eligibility shall be deemed
 S. 8474                            255
 
 completed on the date on which the  department  of  buildings  issues  a
 temporary  or  final  certificate  of occupancy or, if such construction
 work does not require the issuance of a certificate  of  occupancy,  the
 date  on  which  the  applicant and the applicant's architect or profes-
 sional engineer for such construction work submit to the  department  of
 finance  an  affidavit  certifying  that such construction work has been
 completed.  For purposes of this subdivision, a demolition permit  shall
 be deemed to be a building permit issued for construction work.
   §  11-260   Application for certificate of eligibility. a. Application
 for a certificate of eligibility pursuant to this part may be made imme-
 diately and continuing until June thirtieth,  two  thousand  eight;  and
 provided, further, however, that no benefits pursuant to this part shall
 be granted for construction work performed pursuant to a building permit
 issued  after  July  thirty-first,  two thousand eight. Such application
 shall state whether it  is  for  industrial,  commercial  or  renovation
 construction work, and shall be filed with the department of finance. In
 addition  to  any  other  information  required  by such department, the
 application shall include  cost  estimates  or  bids  for  the  proposed
 construction and an affidavit of a professional engineer or architect of
 the   applicant's   choice,  certifying  that  detailed  plans  for  the
 construction work have been submitted to the  department  of  buildings.
 Such  application  shall  also state that the applicant agrees to comply
 with and be subject to the rules issued from time to time by the depart-
 ment of finance to secure compliance with all applicable city, state and
 federal laws or which implement mayoral directives and executive  orders
 designed  to ensure equal employment opportunity. Such application shall
 also certify that all taxes currently due  and  owing  on  the  property
 which  is the subject of the application have been paid or are currently
 being paid in timely installments pursuant to written agreement with the
 department of finance.
   b. The burden of proof shall be on the applicant to show by clear  and
 convincing evidence that the requirements for granting an exemption from
 or  abatement or deferral of payment of taxes pursuant to this part have
 been satisfied. The department of finance shall have  the  authority  to
 require that statements in connection with the application be made under
 oath.
   c.  Upon  receipt  of  an application, the department of finance shall
 send written notice thereof  to  the  council  member  representing  the
 district where the proposed construction work is to take place.
   d.  The department of finance shall issue a certificate of eligibility
 upon determining that  the  applicant  satisfies  the  requirements  for
 industrial,  commercial or renovation construction work in an area where
 benefits are available for  such  work.  Such  certificate  shall  state
 whether  such  benefits  are to be granted for industrial, commercial or
 renovation construction work, and in which class of area the property is
 located. The effective date of such certificate, except as  provided  in
 paragraph  two  or  paragraph four of subdivision c of section 11-259 of
 this part, shall be the earlier of (1) the  date  on  which  a  building
 permit  for  the construction work is issued by the department of build-
 ings, or (2) the last day before the effective date of  any  designation
 of boundaries by the commission which changes the class of area in which
 the  property  is  located  so  as  to  reduce the level of benefits for
 commercial construction work on such property. Where the effective  date
 of  the certificate of eligibility is July first, nineteen hundred nine-
 ty-two or after, the benefits  granted  for  industrial,  commercial  or
 renovation  construction  work pursuant to this part shall be in accord-
 S. 8474                            256
 
 ance with the provisions of this part. Where the effective date  of  the
 certificate  of  eligibility is June thirtieth, nineteen hundred ninety-
 two or  before,  the  benefits  granted  for  industrial  or  commercial
 construction  work pursuant to this part shall be in accordance with the
 provisions of this part as it was in effect until June thirtieth,  nine-
 teen  hundred ninety-two.  No recipient whose property is the subject of
 a certificate of eligibility  for  commercial  construction  work  in  a
 deferral  area shall be eligible to apply for a certificate of eligibil-
 ity for renovation construction work on the  same  property,  where  the
 renovation  construction work is the same as, or similar to, the commer-
 cial construction work for  which  the  deferral  area  certificate  was
 issued,  until three years after the effective date of the deferral area
 certificate. No recipient  shall  receive  a  tax  deferral  and  a  tax
 exemption for the same expenditure on eligible construction work.
   e.  A  copy  of  the  certificate of eligibility shall be filed by the
 department of finance in the manner prescribed for recording a  mortgage
 pursuant to section two hundred ninety-one-d of the real property law.
   f. The department of finance may provide by rule for reasonable admin-
 istrative  charges or fees necessary to defray expenses in administering
 the benefit program provided by this part.
   § 11-261 Reporting  requirement;  termination  of  benefits.  a.  Upon
 approval  by  the  department  of  buildings  of  the plans submitted in
 connection with the building permit and any amendments  to  such  plans,
 the  recipient  shall  file  with  the department of finance a narrative
 description of such approved plans describing the industrial, commercial
 or renovation construction work for which such recipient seeks  benefits
 pursuant to this part.
   b.  For  the  duration  of the benefit period the recipient shall file
 annually with the department of finance, on or before the taxable status
 date, a certificate of continuing use stating the purposes for which the
 property described in the certificate of eligibility is being  used  and
 the  net  square footage allotted to each such purpose. Such certificate
 of continuing use shall be on a form prescribed  by  the  department  of
 finance  and  shall  state  the  total number of workers employed on the
 property and the number of such workers  who  are  city  residents.  The
 department  of finance shall have authority to terminate benefits pursu-
 ant to this part upon failure of a recipient to file such certificate by
 the taxable status date. The burden of proof shall be on  the  recipient
 to  establish  continuing eligibility for benefits and the department of
 finance shall have the authority to require that statements made in such
 certificate shall be made under oath.
   c. A recipient shall file an amendment to the  latest  certificate  of
 continuing  use  prior  to (1) converting square footage within property
 which is the subject of a  certificate  of  eligibility  for  industrial
 construction work from use for the manufacturing activities described in
 such certificate of continuing use where such conversion results in less
 than  sixty-five  per  centum  of total net square footage being used or
 held out for use for manufacturing activities;  or  (2)  converting  any
 portion of property which is the subject of a certificate of eligibility
 to use for any restricted activity or as residential property.
   d. No later than eighteen months after the effective date of a certif-
 icate  of eligibility with an effective date of June thirtieth, nineteen
 hundred ninety-two or before, the recipient shall  present  evidence  to
 the  department  of  finance  demonstrating  that the recipient has made
 one-half of the minimum required expenditure. Not later than  thirty-six
 months  after  the  effective  date  of such certificate, such recipient
 S. 8474                            257
 
 shall present evidence to such department demonstrating that the recipi-
 ent has made the minimum required expenditure.  Not  later  than  thirty
 months  after the effective date of a certificate of eligibility with an
 effective  date of July first, nineteen hundred ninety-two or after, the
 recipient shall present evidence to the  department  of  finance  demon-
 strating  that  the  recipient has made one-half of the minimum required
 expenditure. Such evidence shall be presented in  the  form  and  manner
 prescribed  by  such  department.  The  burden  of proof shall be on the
 recipient to show by clear and convincing  evidence  that  the  required
 expenditures  have  been  made.  This subdivision shall not apply to the
 recipient of a certificate of eligibility  for  construction  of  a  new
 building  or structure that meets the requirements set forth in subdivi-
 sion i of section 11-259 of this part in a  new  construction  exemption
 area.
   e.  A  recipient of a certificate of eligibility for construction of a
 new building or structure in a new  construction  exemption  area  shall
 present  evidence  to  the  department of finance demonstrating that the
 requirements of subdivision i of section 11-259 of this part  have  been
 met.  Such evidence shall be presented in the form and manner and at the
 time prescribed by such department. The burden of proof shall be on  the
 recipient  to  show  by clear and convincing evidence that such require-
 ments have been met.
   § 11-262 Conversion of property. a. Any recipient  whose  property  is
 the subject of a certificate of eligibility for commercial or renovation
 construction work, and who, prior to the expiration of the benefit peri-
 od, uses such property as industrial property, shall continue to receive
 benefits  for commercial or renovation construction work as the case may
 be.
   b. Any recipient whose property is the subject  of  a  certificate  of
 eligibility  for  industrial  construction  work,  and who, prior to the
 expiration of the benefit period, uses such property as commercial prop-
 erty, shall cease to be eligible for further exemption or abatement  for
 industrial construction work as of the last date to which such recipient
 proves  by  clear and convincing evidence that such property was used as
 industrial property, and shall pay with interest any taxes for which  an
 exemption or abatement was claimed after such date, except that:
   (1)  a  recipient  of  a  certificate  of  eligibility  for industrial
 construction work in a special exemption area who would have been eligi-
 ble to receive a certificate of eligibility for commercial  construction
 work  at  the time such recipient applied for benefits shall continue to
 receive an exemption for industrial construction; and
   (2) a  recipient  of  a  certificate  of  eligibility  for  industrial
 construction work in a regular exemption area who would have been eligi-
 ble  to receive a certificate of eligibility for commercial construction
 work at the time such recipient applied for benefits  shall,  commencing
 with  the date of conversion to commercial property and continuing until
 the expiration of the benefit period for commercial  construction  work,
 receive  any  exemption  which such recipient would have received in the
 corresponding tax year pursuant to  a  certificate  of  eligibility  for
 commercial construction work; and
   (3)  a  recipient  of  a  certificate  of  eligibility  for industrial
 construction work in any area of the city on  whose  property  at  least
 sixty-five  per centum of the net square footage continues to be used or
 held out for  use  for  manufacturing  activities  after  conversion  to
 commercial  property, shall not be required to pay the pro rata share of
 S. 8474                            258
 
 tax for which an exemption was claimed during the tax year in which such
 conversion occurred.
   c.  Except as provided in subdivision d of this section, any recipient
 whose property is the  subject  of  a  certificate  of  eligibility  for
 commercial,  industrial  or  renovation  construction work, and who uses
 such property as residential property or  for  any  restricted  activity
 prior  to the expiration of the benefit period, shall cease to be eligi-
 ble for further exemption, abatement or deferral as  of  the  date  such
 property  was  first  used as residential property or for any restricted
 activity. In the case of property in an area that was designated  as  an
 exemption  area  at  the time the certificate of eligibility was issued,
 such recipient shall pay with interest any taxes for which an  exemption
 was  claimed  after  such  date, including the pro rata share of tax for
 which any exemption was claimed during the tax year in  which  such  use
 occurred.  In  the case of industrial property, such recipient shall pay
 with interest any taxes for which an exemption or abatement was  claimed
 after  such  date,  including  the  pro  rata share of tax for which any
 exemption or abatement was claimed during the tax year in which such use
 occurred. In the case of property in an area that was  designated  as  a
 deferral area at the time the certificate of eligibility was issued, all
 deferred tax payments on the property shall become due and payable imme-
 diately.
   d.  Notwithstanding subdivision c of this section, any recipient whose
 property is the subject of a certificate of eligibility  for  commercial
 or  renovation  construction  work with an effective date of July first,
 nineteen hundred ninety-two or after, and who, prior to  the  expiration
 of  the  benefit  period, uses a portion of such property as residential
 property, shall cease to be eligible for further exemption  for  commer-
 cial  or  renovation construction work for that portion of such property
 used as residential property as of the date such portion of the property
 was first used as residential property. Such recipient shall  pay,  with
 interest,  any  taxes for which an exemption was claimed after such date
 attributable to that portion of the property used as residential proper-
 ty, including the pro rata share of tax for  which  such  exemption  was
 claimed  during  the tax year in which such use occurred. Such recipient
 shall continue to receive an  exemption  for  commercial  or  renovation
 construction work for that portion of the property which continues to be
 used as commercial property.
   §  11-263  Administration  of  the  benefit program. The department of
 finance shall have, in addition  to  any  other  functions,  powers  and
 duties  which  have been or may be conferred on it by law, the following
 functions, powers and duties:
   (1) To publicize the availability of benefits pursuant  to  this  part
 for industrial, commercial and renovation construction work.
   (2)  To  receive and review applications for certificates of eligibil-
 ity, issue such certificates where authorized pursuant to section 11-260
 of this part, and record the issuance of such certificates as prescribed
 in such section.
   (3) To receive evidence of expenditures  made  for  construction,  and
 where  such expenditures do not equal the amount required to qualify for
 exemption from or abatement or deferral of tax payments to  take  appro-
 priate  action, including but not limited to denying, reducing, suspend-
 ing, terminating or revoking benefits pursuant to this part.
   (4) To enter and inspect property to determine whether  it  is  indus-
 trial  or  commercial or mixed-use and to determine whether (a) any such
 property is being used for any restricted use, or (b) any property which
 S. 8474                            259
 
 is  the  subject  of  a  certificate  of  eligibility   for   industrial
 construction  work  is  being  used  as  commercial property, or (c) any
 industrial or commercial property is being used as residential or mixed-
 use property, or (d) all or part of the nonresidential portion of mixed-
 use property is being used as residential property.
   (5)  To  collect all real property taxes for which payment is deferred
 pursuant to this part.
   (6) To collect all real property taxes, with interest, due  and  owing
 as  a  result of reduction, suspension, termination or revocation of any
 exemption from or abatement or deferral of  taxes  granted  pursuant  to
 this part.
   (7)  To  make  and promulgate regulations to carry out the purposes of
 this part including, but not limited to,  regulations  requiring  appli-
 cants  to  publish  notice of their applications, defining manufacturing
 and commercial activities and specifying the nature of  work  for  which
 expenses  may be included in the minimum required expenditure, provided,
 however, that any regulation increasing the minimum required expenditure
 shall not apply to any person who is a recipient on the  effective  date
 of  such  regulation.  Such regulations shall include a requirement that
 with respect to the construction work recipients and  their  contractors
 shall be equal opportunity employers and shall also provide that persons
 employed in the construction work shall implement a training program for
 economically  disadvantaged  persons enrolled or eligible to be enrolled
 in training programs approved by the department of labor,  with  partic-
 ular reference to city residents.
   §  11-264 Tax lien; interest rate. a. All taxes plus interest required
 to be paid retroactively pursuant to this part shall  constitute  a  tax
 lien  as  of the date it is determined such taxes and interest are owed.
 All interest shall be calculated from the date the taxes would have been
 due but for the exemption, abatement or  deferral  claimed  pursuant  to
 this  part  at  three  per  centum above the applicable rate of interest
 imposed by the city generally for non-payment of real  property  tax  on
 such date.
   b.  All taxes for which payment is deferred pursuant to section 11-257
 of this part shall constitute a tax lien as of the date they are due and
 payable in accordance with the provisions of that section.
   § 11-265 Penalties for non-compliance, false statements and omissions.
 a. The department of finance may deny, reduce, suspend, revoke or termi-
 nate any exemption from or abatement or deferral of tax payments  pursu-
 ant to this part whenever:
   (1)  a recipient fails to comply with the requirements of this part or
 the rules and regulations  promulgated  by  the  department  of  finance
 pursuant thereto; or
   (2) an application, certificate, report or other document delivered by
 an  applicant  or  recipient  hereunder  contains  a false or misleading
 statement as to a material fact or omits  to  state  any  material  fact
 necessary  in order to make the statements therein not false or mislead-
 ing, and may declare any applicant or recipient who makes such false  or
 misleading  statement or omission to be ineligible for future exemption,
 abatement or deferral pursuant to this part for the same or other  prop-
 erty.
   b. Notwithstanding any other law to the contrary, a recipient shall be
 personally liable for any taxes owed pursuant to this part whenever such
 recipient fails to comply with such law and rules or makes such false or
 misleading  statement  or omission, and the department of finance deter-
 mines that such act was due to the recipient's willful neglect, or  that
 S. 8474                            260

 under  the  circumstances such act constituted a fraud on the department
 of finance or a buyer or prospective buyer of the property.  The  remedy
 provided  herein  for  an action in personam shall be in addition to any
 other  remedy  or  procedure for the enforcement of collection of delin-
 quent taxes provided by any general, special or  local  law.  Any  lease
 provision which obligates a tenant to pay taxes which become due because
 of  willful  neglect  or fraud by the recipient, or otherwise relieve or
 indemnify the recipient from any personal liability  arising  hereunder,
 shall  be  void  as against public policy except where the imposition of
 such taxes or liability is  occasioned  by  actions  of  the  tenant  in
 violation of the lease.
   §  11-266  Code  violations; suspension of benefits. a. If a court, or
 the environmental control  board  of  the  preceding  municipality  with
 respect  to  matters within its jurisdiction, finds that at the property
 which is the subject of a certificate of eligibility there  has  been  a
 violation  of  any  of  the  provisions  of  the  building, fire and air
 pollution control codes of  the  preceding  municipality  set  forth  in
 subdivision b of this section, all benefits pursuant to such certificate
 shall  be  suspended  unless  within  one  hundred eighty days after the
 department of finance has sent notice of such finding to the  recipient,
 and  all  other  persons having a financial interest in the property who
 have filed a timely request for such notice  in  such  form  as  may  be
 prescribed    by the department of finance, the recipient submits to the
 department of finance, certification from the department  of  buildings,
 the  fire  department  or  the  department  of  environmental protection
 respectively that the underlying code violation has been cured.  If  the
 recipient  fails  to  submit  the  required certification within the one
 hundred eighty day period, the period of suspension shall  be  effective
 retroactively  to  the  time of the finding by the court or the environ-
 mental control board. The suspension of benefits  shall  continue  until
 the  recipient submits to the department of finance the required certif-
 ication that the violation has been cured.
   If the original finding of violation or the denial of certification is
 appealed and a court or appropriate governmental agency  finally  deter-
 mines  that  the  finding  of  violation  or denial of certification was
 invalid, any benefits lost pursuant to this section to which the recipi-
 ent was entitled shall be restored retroactively.
   As applied to a recipient who is eligible for deferral of tax payments
 pursuant to subdivision d of section 11-257 of this part, suspension  of
 benefits  shall be deferred by operation of such section and interest at
 the rate charged by the department of finance for overdue taxes shall be
 charged on the amount of any tax payments already deferred by  operation
 of such section. The interest charged shall accrue from the beginning of
 the period of suspension.
   b.  The  provisions  of  subdivision  a of this section shall apply to
 violations of the following provision of the code of the preceding muni-
 cipality:
     (1) section 27-4260 of the preceding municipality;
     (2) section 27-4265 of the preceding municipality;
     (3) section 27-4267 of the preceding municipality;
     (4) section 27-954 of the preceding municipality;
     (5) section 27-339 of the preceding municipality;
     (6) subdivision (c) of section 27-353 of the preceding municipality;
     (7) paragraph twelve of subdivision (f) of  section  27-972  of  the
   preceding municipality;
 S. 8474                            261
 
     (8)  paragraph  ten  of  subdivision  (g)  of  section 27-972 of the
   preceding municipality;
     (9) subdivision (c) of section 27-975 of the preceding municipality;
     (10)  subdivision  (c)  of  section  27-989 of the preceding munici-
   pality;
     (11) the following provisions to the extent applicable  to  cabarets
   as  defined  in  article two of subchapter two of the building code of
   the preceding municipality:
     (a) section 27-542 of the preceding municipality;
     (b) subparagraph d of paragraph two of subdivision  (b)  of  section
   27-547 of the preceding municipality;
     (c)  paragraph  three  of  subdivision  (a) of section 27-549 of the
   preceding municipality;
     (d) subdivision (b) of section 27-549 of the preceding municipality;
     (12) section 27-127 of the preceding municipality when the violation
   concerns an unsafe condition on a facade of a building  which  exceeds
   six stories in height;
     (13)  section  five  hundred  one  of reference standard 13-1 of the
   preceding municipality;
     (14) section one thousand three of reference standard  13-1  of  the
   preceding municipality;
     (15)  paragraph  six  of  subdivision  (b)  of section 24-178 of the
   preceding municipality; and
     (16) section 24-185 of the preceding municipality.
   § 11-267 Annual report. The department  of  finance  shall  submit  an
 annual  report  to  the council, on April first of each year, concerning
 the status of the program established pursuant  to  this  part  and  its
 effects  in the city, including information on certificates of eligibil-
 ity issued and jobs created in each area where benefits are available.
                                 CHAPTER 3
                          TAX LIENS AND TAX SALES
   § 11-301 When taxes, assessments, sewer rents,  sewer  surcharges  and
 water  rents to be liens on land assessed. All taxes and all assessments
 and all sewer rents, sewer surcharges and water rents, and the  interest
 and charges thereon, which may be laid or may have heretofore been laid,
 upon  any real estate now in the city, shall continue to be, until paid,
 a lien thereon, and shall be preferred in payment to all other  charges.
 The  words  "water  rents"  whenever they are used in this chapter shall
 include uniform annual charges and extra and miscellaneous  charges  for
 the  supply  of  water,  charges in accordance with meter rates, minimum
 charges for the supply of water by meter,  annual  service  charges  and
 charges  for  meters and their connections and for their setting, repair
 and maintenance, penalties and fines and  all  lawful  charges  for  the
 supply  of  water  imposed pursuant to the New York city municipal water
 finance authority act, which is set forth in title two-A of article five
 of the public authorities law. Charges  for  expense  of  meters,  their
 connections, setting, repair or maintenance shall not be due or become a
 charge or lien on the premises where a water meter shall be installed or
 against  which a charge shall be made, until such charge shall have been
 definitely fixed by the commissioner of environmental protection, and an
 entry of the amount thereof shall have been made with the date  of  such
 entry  in  the  book  in  which  the charges for water supplied by meter
 against such premises are to be entered. A  charge  in  accordance  with
 meter  rates  or  minimum  charges  for  the supply of water measured by
 meter, and a service charge shall not be due or become a lien or  charge
 upon  the  premises  where  such meter is installed until an entry shall
 S. 8474                            262
 
 have been made indicating that such premises are metered, with the  date
 of  such entry in the book in which the charges for water by meter meas-
 urement against such premises are to be entered. The words "sewer rents"
 when used in this chapter shall mean any rents or charges imposed pursu-
 ant  to  section  24-514  of  the  code of the preceding municipality or
 pursuant to the New York city municipal  water  finance  authority  act,
 which is set forth in title two-A of article five of the public authori-
 ties  law.  The words "sewer surcharges" when used in this chapter shall
 mean the charges imposed pursuant to section 24-523 of the code  of  the
 preceding  municipality or pursuant to the New York city municipal water
 finance authority act, which is set forth in title two-A of article five
 of the public authorities law. Whenever an increase  in  the  amount  of
 uniform annual charges or extra or miscellaneous charges shall have been
 made  or a charge shall have been made for water services for any build-
 ing completed subsequent to the first day of January in each  year,  the
 amount  of such increase of the charge or new charge for such new build-
 ing shall not be due or become a lien or  charge  against  the  premises
 until  the amounts thereof shall have been entered with the date of such
 entries, respectively, in the books in which the uniform annual  charges
 and  extra  or  miscellaneous  charges  against  such premises are to be
 entered. The words "tax lien" when used in this chapter shall  mean  the
 lien  arising  pursuant to the provisions of this chapter or pursuant to
 the New York city municipal water finance authority act,  which  is  set
 forth in title two-A of article five of the public authorities law, as a
 result  of  the  nonpayment  of  taxes,  assessments, sewer rents, sewer
 surcharges, water rents, any other charges that are made a lien  subject
 to  the  provisions of this chapter, the costs of any advertisements and
 notices given pursuant to this chapter, any other charges that  are  due
 and  payable,  a surcharge pursuant to section 11-332 of this chapter if
 the tax lien is sold, interest and penalties thereon and  the  right  of
 the  city to receive such amounts. The words "tax lien certificate" when
 used in this chapter shall mean the instrument evidencing a tax lien and
 executed by the commissioner of finance or his or her designee  at  such
 time  as  such lien is transferred to a purchaser upon sale of such lien
 by the city.
   § 11-302 Interest rates not  to  be  reduced.    The  commissioner  of
 finance  shall not reduce the rate of interest upon any taxes or assess-
 ment below the amount fixed by law.
   § 11-302.1 Error in record of payment of tax or assessment. (a) If the
 records of the department of finance show a charge  as  paid  due  to  a
 misapplied payment or other error, and the department later corrects the
 records,  interest  shall  not be imposed until after the department (i)
 corrects the error and (ii) sends a statement of account or other  simi-
 lar  bill  or  notice stating the amount due and when the charge must be
 paid to avoid the accrual of interest.
   (b) The provisions of this section shall not apply to  an  installment
 of  tax  or  an  assessment  for  which payment, made electronically, by
 check, or by other means, was dishonored.
   (c) The provisions of this section shall not apply where the error  in
 the  records  of  the  department was made as a result of fraud or other
 criminal conduct by the taxpayer or any person  acting  on  his  or  her
 behalf or at his or her request.
   § 11-303  Arrears to be provided for in assessment rolls.  There shall
 be  ruled in the yearly assessment rolls of the taxes in each section or
 ward, a column headed "arrears," in which the  commissioner  of  finance
 shall  annually before any taxes for the year are collected, cause to be
 S. 8474                            263
 
 entered the word "arrears" opposite to the ward, lot,  town,  block  and
 map numbers on which any arrears of taxes, sewer rents, sewer surcharges
 or  water  rents  shall  be due, or on which any assessment shall remain
 unpaid  which was due or confirmed one month prior to the first of July,
 then last past.
   § 11-304 Bills for taxes to show arrears.   There  shall  be  ruled  a
 column  for "arrears" in every bill rendered for taxes for lots on which
 such arrears or assessments, sewer  rents,  sewer  surcharges  or  water
 rents,  and  interest and penalties thereon, may be due as aforesaid, or
 may have been sold and yet be redeemable, in which shall be written in a
 conspicuous place, "arrears".   The columns for  arrears  indicate  lots
 sold  for  arrears,  or to be sold therefor; arrears to be paid and lots
 redeemed at the office of the city collector.
   § 11-305  Commissioner of finance to publish notice of confirmation of
 assessments.  It shall be the duty of the  commissioner  of  finance  to
 give public notice, by advertisement, for at least ten days, in the City
 Record  and as soon as practicable and within ten days after the confir-
 mation of any assessment, that the same has been  confirmed,  specifying
 the title of such assessment, and the date of its confirmation, and also
 the  date  of  entry  in the record of titles of assessments kept in the
 department of finance, addressed as a  class to all persons,  owners  of
 property  affected  by  any  such  assessment,  that  unless  the amount
 assessed for benefit on any person or  property  shall  be  paid  within
 ninety days after the date of the entry of any such assessment, interest
 shall  be  thereafter collected thereon as provided in section 11-306 of
 this chapter.
   § 11-306 Interest to be charged if assessments unpaid for ninety days;
 payment in installments.  If any assessment shall remain unpaid for  the
 period  of ninety days after the date of the entry thereof on the record
 of titles of assessments, it shall be the duty of  the  commissioner  of
 finance  or  his or her designee to charge, collect and receive interest
 thereon, at the rate of seven percent per annum, to be calculated to the
 date of payment from the date when such  assessment  became  a  lien  as
 provided  by section three hundred fourteen of the New York city charter
 in force at the time of the adoption of the New  York  city  charter  by
 referendum  in  the  year nineteen hundred sixty-one, provided, however,
 that the city collector shall accept and credit as payments  on  account
 of  assessments  now  or  hereafter levied against any parcel or plot of
 property, such sums of money not less than twenty-five dollars or multi-
 ples thereof in amount as may be tendered for payment on account of  any
 assessment  now or hereafter levied against any property.  Upon requisi-
 tion by the commissioner of finance for the assessed  valuation  of  the
 property  affected  by  any assessment, the president of the tax commis-
 sion, or any tax commissioner duly assigned by him or her, shall  forth-
 with certify the same to the commissioner of finance.
   §  11-307  Payments in installments of assessments heretofore or here-
 after confirmed.  Upon the application in writing  of  the  owner  of  a
 parcel  of  real property affected by an unpaid assessment heretofore or
 hereafter confirmed the amount of which is one hundred dollars or  more,
 the commissioner of finance shall divide the assessment upon such parcel
 into  fifteen parts or, if the application so requests, into five parts,
 as nearly equal as may be, or if the amount of such assessment is  fifty
 dollars  or  more  but less than one hundred dollars the commissioner of
 finance shall divide the assessment upon such parcel into five parts  as
 nearly  equal as may be.  One part thereof in any event shall be due and
 payable, and in each case as many more of such parts shall  be  due  and
 S. 8474                            264
 
 payable  as  years  may  have  elapsed  since the entry of such original
 assessment for collection.  Such parts thereof with interest at the rate
 of seven percent per annum on the amount of the assessment unpaid  shall
 be  paid  at  the time of application as a condition of the extension of
 time of payment of the remainder as provided  in  this  section.    Upon
 payment  of  such  parts  and interests, the balance of such assessments
 shall cease to be a lien upon such real property except  as  hereinafter
 provided;  and  the remaining parts shall be paid in annual installments
 as herein provided.  Of such installments the first,  with  interest  at
 the  rate of four percent thereon, and on the installments thereafter to
 become due, from the date of payment of the  parts  of  such  assessment
 paid  as  hereinbefore  provided,  shall become due and payable and be a
 lien on the real property assessed, on the next ensuing  anniversary  of
 the  date  of entry of the assessment in the record of titles of assess-
 ments confirmed; and one, with interest at the rate of four percent  per
 annum  thereon  and  on  the installments thereafter to become due shall
 become due and payable and be a lien upon the  real  property  assessed,
 annually  thereafter.    After  the  time  herein  specified  for annual
 installments and interest to become due, the amount of the lien  thereon
 shall  bear  interest  at  the  rate  of  seven percent per annum.   Any
 installment assessment shall not be further divided  into  installments.
 The  first  installment  of  an assessment divided within the ninety-day
 period provided by section 11-306 of this chapter during  which  assess-
 ment  may be paid without interest shall not be subject to interest, but
 the second installment with interest at the rate  of  four  percent  per
 annum  from  the original date of entry shall become due and payable and
 be a lien upon the real property on the anniversary date of entry of the
 assessment and the remaining installments with interest shall become due
 and payable and be a lien on the real property as hereinbefore provided.
 The installments not due with interest at the rate of four  percent  per
 annum to the date of payment may be paid at any time.  The provisions of
 this  chapter with reference to the sale of tax liens shall apply to the
 several unpaid installments and the interest thereon in the same  manner
 as  if  each installment and the interest thereon had been imposed as an
 assessment payable in one payment, at the time such installment became a
 lien.  In the event of the acquisition by condemnation by the  city  for
 public  purposes any property upon which there are installments not due,
 such installments shall become due as of the date of the  entry  of  the
 final  order  of  the supreme court or the confirmation of the report of
 the commissioners in the condemnation proceedings, and shall be set  off
 against an award that may be made for the property acquired.
   When an award for damage shall accrue to the same person who is or was
 at  the time the assessment was confirmed liable for the assessments for
 benefit on the abutting property  in  the  same  proceedings,  only  the
 portion  of  the assessment in excess of such award may be considered in
 levying in installments under the provisions of this section.  Except as
 provided in this section, no such annual installment shall be a lien  or
 deemed to be an encumbrance upon the title to the real property assessed
 until it becomes due as herein provided.
   §  11-308 Apportionment of assessment.  If a sum of money in gross has
 been or shall be assessed upon any lands or premises in  the  city,  any
 person or persons claiming any divided or undivided part thereof may pay
 such  part  of  the  sums of money so assessed, also of the interest and
 charges due or charged thereon, as the commissioner of finance may  deem
 to  be  just  and  equitable.   The  remainder  of  the  sum of money so
 assessed, together with the interest and charges, shall be a  lien  upon
 S. 8474                            265
 
 the  residue  of  the land and premises only, and the tax lien upon such
 residue may be sold in pursuance of the provisions of this  chapter,  to
 satisfy the residue of such assessment, interest, or charges thereon, in
 the  same  manner  as  though  the  residue  of such assessment had been
 imposed upon such residue of such land or premises.
   § 11-309 Notifying taxpayers of assessments. a. The owner of any  lot,
 piece  or  parcel  of  land  in  the city of Staten Island or any person
 interested in such lot, piece or parcel, may file with the department of
 finance, a statement  containing  a  brief  description  of  such  land,
 together  with  the section, block and lot number thereof, or such other
 identifying information as at the time is established by the  department
 of finance, and a statement of the applicant's interest therein, togeth-
 er  with  a  written  request  that such lot, piece or parcel of land be
 registered in the name of the applicant. In such statement the applicant
 shall designate a post office address to which  notifications  addressed
 to  such applicant shall be sent. A brief description of such lot, piece
 or parcel of land corresponding to the description thereof in the state-
 ment so filed, together with the name of the applicant and  his  or  her
 post office address and the date of such application, shall thereupon be
 registered in the department of finance.
   b.  As  soon as any assessment for a local improvement shall have been
 confirmed, including assessments confirmed by a court of record, and the
 list thereof shall have been entered and  filed  in  the  department  of
 finance,  such  assessment  list shall be examined and thereupon, within
 twenty days after such entry there shall be mailed a notice addressed to
 each person in whose name any lot, piece or parcel of land, affected  by
 such assessment, is registered, at the post office address registered in
 the records of the department of finance, which notice shall contain the
 brief  description of the lot, piece or parcel of land registered in the
 name of the person to whom such notice is addressed, together  with  the
 amount assessed thereon, date of entry, and title of the improvement for
 which  such  assessment is made, and a statement of the rate of interest
 or penalty imposed for the nonpayment of such assessment, and  the  date
 from  which  the interest or penalty will be computed. Failure to comply
 with the provisions herein however, shall in no manner affect the valid-
 ity  or  collectability  of  any  assessment  heretofore  or   hereafter
 confirmed,  nor  shall any claim arise or exist against the comptroller,
 the commissioner of finance, or any officer of the  city  by  reason  of
 such failure.
   c.  The  commissioner  of finance or his or her designee shall for the
 purpose of this section provide appropriate records for each section  of
 the  city,  included  within  the respective boroughs, as the same shall
 appear upon the tax maps of the city.
   § 11-310 Water charges and sewer rents to be  transmitted  to  commis-
 sioner  of finance.   The commissioner of environmental protection shall
 cause to be transmitted to the commissioner of finance an account of all
 water rents, charges, fines and penalties and all sewer rents,  charges,
 fines and penalties as the same become due or accrue.
   §  11-311  Sewer  surcharges  to  be  transmitted  to  commissioner of
 finance.  The commissioner of environmental protection shall cause to be
 transmitted to the commissioner of  finance  an  account  of  all  sewer
 surcharges, fines and penalties as the same become due or accrue.
   §  11-312  Water  rents; when payable; penalty for nonpayment. a. One-
 half (i) the uniform annual water charges and  extra  and  miscellaneous
 charges  for  water  not  metered  and (ii) annual service charges shall
 become due and payable, in advance if entered on January first, nineteen
 S. 8474                            266
 
 hundred seventy-four for the period commencing January  first,  nineteen
 hundred  seventy-four and ending June thirtieth, nineteen hundred seven-
 ty-four.  Commencing on June thirtieth, nineteen  hundred  seventy-four,
 uniform  annual  water  charges  and extra and miscellaneous charges for
 water not metered and annual service charges shall be due and payable in
 advance on the thirtieth day of June in each year, if entered. If any of
 such rents and charges which become due and payable on  or  before  June
 thirtieth,  nineteen hundred seventy-six shall not have been paid to the
 commissioner of finance or his or her designee on or before the last day
 of the month following the month of entry, it shall be the duty  of  the
 commissioner  of  finance  or his or her designee to charge, collect and
 receive interest thereon to be calculated at the rate of  seven  percent
 per annum from the date when such rents and charges became due and paya-
 ble  to  December thirty-first, nineteen hundred seventy-six, and at the
 rate of fifteen percent per annum from January first,  nineteen  hundred
 seventy-seven  to  the date of payment. If any of such rents and charges
 which shall become due and payable on or after June thirtieth,  nineteen
 hundred seventy-seven are not paid to the commissioner of finance or his
 or  her  designee  on  or before the last day of the month following the
 month of entry, it shall be the duty of the commissioner of  finance  or
 his  or  her designee to charge, collect and receive interest thereon to
 be calculated at the rate of fifteen percent per  annum  from  the  date
 when  such  rents  and  charges  became  due  and payable to the date of
 payment. If not so entered and payable, but entered at any  time  subse-
 quent  thereto,  they  shall  be due and payable when entered and notice
 thereof shall be mailed within five days of such entry to  the  premises
 against  which  they  are  imposed  addressed to either the owner or the
 occupant and, if entered on or before  December  thirty-first,  nineteen
 hundred  seventy-six but not paid on or before the last day of the month
 following the month of entry, it shall be the duty of  the  commissioner
 of  finance or his or her designee to charge, collect and receive inter-
 est thereon to be calculated at the rate of seven percent per annum from
 the date of entry to December thirty-first,  nineteen  hundred  seventy-
 six,  and  at  the rate of fifteen percent per annum from January first,
 nineteen hundred seventy-seven to the date of payment; if entered on  or
 after  January  first, nineteen hundred seventy-seven but not paid on or
 before the last day of the month following the month of entry, it  shall
 be  the  duty  of  the commissioner of finance or his or her designee to
 charge, collect and receive interest thereon to  be  calculated  at  the
 rate  of fifteen percent per annum from the date of entry to the date of
 payment.
   b. All charges for meters and their connections and for their setting,
 repair and maintenance, and all charges in accordance with  meter  rates
 for supply of water measured by meter, including minimum charges for the
 supply  of  water  measured  by  meter,  shall  be  due and payable when
 entered, and notice thereof shall be mailed within  five  days  of  such
 entry stating the amount due and the nature of the rent or charge to the
 last  known  address  of  the person whose name appears on the record of
 such rents and charges as being the owner, occupant or agent  or,  where
 no  name  appears,  to the premises addressed to either the owner or the
 occupant, and if entered on or before  December  thirty-first,  nineteen
 hundred  seventy-six but not paid on or before the last day of the month
 following the month of entry, it shall be the duty of  the  commissioner
 of  finance or his or her designee to charge, collect and receive inter-
 est thereon to be calculated at the rate of seven percent per annum from
 the date of entry to December thirty-first,  nineteen  hundred  seventy-
 S. 8474                            267
 
 six,  and  at  the rate of fifteen percent per annum from January first,
 nineteen hundred seventy-seven to the date of payment; if entered on  or
 after  January  first, nineteen hundred seventy-seven but not paid on or
 before  the  thirtieth  day following the date of entry, it shall be the
 duty of the commissioner of finance or his or her  designee  to  charge,
 collect  and  receive  interest  thereon to be calculated at the rate of
 fifteen percent per annum from the date of entry to the date of payment.
   § 11-313 Sewer rents; when payable; penalty for nonpayment. a. As used
 in this section:
   1. The term "metered premises" shall mean premises, or any part there-
 of, (a) to which water is supplied by the municipal water supply  system
 or  by  a  private water company, and (b) at which the quantity of water
 supplied is measured by a water meter.
   2. The term "unmetered premises" shall  mean  premises,  or  any  part
 thereof,  (a)  to  which water is supplied by the municipal water supply
 system or by a private water company, and (b) at which the  quantity  of
 water supplied is not measured by a water meter.
   b. The sewer rents charged against metered premises in accordance with
 the  provisions  of paragraphs two and three of subdivision b of section
 24-514 of the code of the preceding  municipality  and  the  rules  duly
 promulgated  pursuant  to  such section, including the minimum rents for
 the use of the sewer system, charged pursuant to such section and rules,
 and the sewer rents charged against any premises in accordance with  the
 provisions  of  paragraphs  four  and  five  of subdivision b of section
 24-514 of the code of the preceding municipality and rules duly  promul-
 gated  pursuant to such section, including the minimum rents for the use
 of the sewer system, charged pursuant to such section  and  rules  shall
 become  due  and  shall become a charge or lien on the premises when the
 amount thereof shall have been fixed by  the  commissioner  of  environ-
 mental  protection,  and  an  entry thereof shall have been made against
 such premises with the date of such entry, in the book  in  which  sewer
 rents  are to be entered. The sewer surcharges charged against any prem-
 ises pursuant to section 24-523 of the code  of  the  preceding  munici-
 pality  shall  become due and shall become a charge or lien on the prem-
 ises when the amount thereof shall have been fixed by  the  commissioner
 of  environmental  protection  and an entry thereof shall have been made
 against such premises in the book in which sewer surcharges  are  to  be
 entered.  A notice thereof, stating the amount due and the nature of the
 rent, surcharge or charge shall be mailed, within five days  after  such
 entry,  to  the last known address of the person whose name appears upon
 the records in the office of the department  of  finance  as  being  the
 owner,  occupant  or  agent  or,  where no name appears, to the premises
 addressed to either the owner or the occupant. If such  rent,  surcharge
 or  charge  shall  have been entered on or before December thirty-first,
 nineteen hundred seventy-six but not paid on or before the last  day  of
 the  month  following  the  month  of entry, it shall be the duty of the
 commissioner of finance or his or her designee to  charge,  collect  and
 receive  interest  thereon to be calculated at the rate of seven percent
 per annum from the date of  entry  to  December  thirty-first,  nineteen
 hundred  seventy-six,  and at the rate of fifteen percent per annum from
 January first, nineteen hundred seventy-seven to the date of payment; if
 entered on or after January first, nineteen  hundred  seventy-seven  but
 not  paid on or before the thirtieth day following the date of entry, it
 shall be the duty of the commissioner of finance or his or her  designee
 to  charge, collect and receive interest thereon to be calculated at the
 rate of fifteen percent per annum from the date of entry to the date  of
 S. 8474                            268
 
 payment.  The  rents  or charges for the use of the sewer system charged
 during any specified period  of  time  pursuant  to  the  provisions  of
 section  24-514  of the code of the preceding municipality and the rules
 promulgated  thereunder  shall  be  computed,  in  accordance  with  the
 provisions of such section and the rules duly promulgated thereunder, on
 the basis of water rents or charges computed for the same period.
   c. Sewer rents charged against unmetered premises in  accordance  with
 the  provisions  of paragraphs two and three of subdivision b of section
 24-514 of the code of the preceding  municipality  and  the  rules  duly
 promulgated  pursuant  to  such section, for the use of the sewer system
 during the one-year period commencing on the first day of July  of  each
 year,  shall be due and payable and shall become a charge or lien on the
 premises on the first day of January following such first day  of  July,
 if  entered,  except that commencing on June thirtieth, nineteen hundred
 seventy-four such sewer rents shall be due and payable in advance on the
 thirtieth day of June in each year,  if  entered,  and  shall  become  a
 charge  or  lien  on  the premises on such date. If any of such rents or
 charges which became due and payable on or before June thirtieth,  nine-
 teen hundred seventy-six shall not have been paid to the commissioner of
 finance  or  his or her designee within thirty days after such first day
 of January, or, commencing  on  the  thirtieth  day  of  June,  nineteen
 hundred  seventy-four,  on or before the last day of the month following
 the month of entry, it shall be the duty of the commissioner of  finance
 or  his  or her designee to charge, collect and receive interest thereon
 to be calculated at the rate of seven percent per annum  from  the  date
 when such charges became due and payable to December thirty-first, nine-
 teen  hundred  seventy-six, and at the rate of fifteen percent per annum
 from January first,  nineteen  hundred  seventy-seven  to  the  date  of
 payment.  If  any  of  such  rents or charges which shall become due and
 payable on or after June thirtieth, nineteen hundred  seventy-seven  are
 not  paid  to  the  commissioner of finance or his or her designee on or
 before the last day of the month following the month of entry, it  shall
 be  the  duty  of  the commissioner of finance or his or her designee to
 charge, collect and receive interest thereon to  be  calculated  at  the
 rate  of  fifteen  percent  per  annum  from the date when such rents or
 charges became due and payable to the date of payment. If not so entered
 and payable, but entered at any time subsequent thereto, they  shall  be
 due  and  payable and shall become a charge or lien on the premises when
 entered and notice thereof shall be mailed within five days  after  such
 entry,  to  the last known address of the person whose name appears upon
 the records in the department of finance as the owner or the occupant or
 if no name appears, to the premises addressed to  either  the  owner  or
 occupant.  If  any  of  such  rents  or charges which were entered on or
 before December thirty-first, nineteen hundred seventy-six but not  paid
 on  or before the last day of the month following the month of entry, it
 shall be the duty of the commissioner of finance or his or her  designee
 to  charge, collect and receive interest thereon to be calculated at the
 rate of seven percent per annum from the date of entry to December thir-
 ty-first, nineteen hundred seventy-six,  and  at  the  rate  of  fifteen
 percent  per annum from January first, nineteen hundred seventy-seven to
 the date of payment; if entered on  or  after  January  first,  nineteen
 hundred  seventy-seven  but  not  paid  on or before the last day of the
 month following the month of entry, it shall be the duty of the  commis-
 sioner  of finance or his or her designee to charge, collect and receive
 interest thereon to be calculated at the rate  of  fifteen  percent  per
 annum  from  the  date  of entry to the date of payment. The sewer rents
 S. 8474                            269
 
 charged against unmetered premises for  the  use  of  the  sewer  system
 during  the  one-year period commencing on the first day of July of each
 year shall be computed in accordance  with  the  provisions  of  section
 24-514  of  the  code  of  the preceding municipality and the rules duly
 promulgated thereunder,  upon  the  basis  of  water  rents  or  charges
 computed for the same period.
   d.  Whenever  an  increase  in  the  amount  of the sewer rent charged
 against unmetered premises shall have been made or a charge  shall  have
 been  made  for  sewer services for any building completed subsequent to
 the first day of July in each year, the amount of such increase  of  the
 charge  or new charge for such new building shall not be due or become a
 lien or charge against the premises until the amounts thereof shall have
 been entered with the date of such entries, respectively, in  the  books
 in which sewer rents charged against such premises are to be entered.
   e. No later than the twenty-fifth day of May in each year, the banking
 commission  shall  transmit a written recommendation to the council of a
 proposed interest rate to be charged for nonpayment of sewer  rents.  In
 making such recommendations the commission shall consider the prevailing
 interest  rates charged for commercial loans extended to prime borrowers
 by commercial banks operating in the city and shall propose a rate of at
 least six per centum per annum greater than such rates. The council  may
 by  resolution  adopt  an  interest rate to be charged for nonpayment of
 sewer rents pursuant to section 11-224 of the code and,  for  nonpayment
 of  sewer  rents that become due and payable on or after July first, two
 thousand five, pursuant to section 11-224.1 of the code, and may specify
 in such resolution the date on which  such  interest  rate  is  to  take
 effect.
   §  11-314  Notice  of  rules  and regulations; penalty for nonpayment;
 water supply cut off. The rates and charges for  supply  of  water,  the
 annual  service  charges and minimum charges, the sewer rents, the sewer
 surcharges, the rules and regulations concerning the use of  water,  all
 other  rules  and  regulations  affecting  users  of water or concerning
 charges for supply of water, restrictions of the use of water, installa-
 tion of  meters,  and  all  rules  and  regulations  affecting  property
 connected  with  the sewer system, penalties and fines for violations of
 rules and regulations shall be printed on each bill and permit so far as
 in the judgment of the commissioner of environmental protection they are
 applicable. This section and such printing  and  the  printing  of  this
 section  on such bills and permits shall be sufficient notice to owners,
 tenants or occupants of premises to authorize the imposition and  recov-
 ery  of  any  charges, surcharges and fines imposed under such rules and
 regulations and of any penalties imposed in pursuance of this chapter in
 addition to cutting off the supply of water. Where water charges payable
 in advance or sewer rents or charges payable as provided in  subdivision
 c  of  section  11-313  of  this chapter, are not paid within the period
 covered by such charges or rents, and a notice  of  such  nonpayment  is
 mailed  by  the  commissioner  of  finance  to the premises addressed to
 "owner or occupant," the commissioner of  environmental  protection  may
 shut  off  the supply of water to such premises. Where water charges not
 payable in advance or sewer rents, sewer surcharges or  charges  payable
 as  provided  in  subdivisions b and d of section 11-313 of this chapter
 have been made by the department and remain unpaid for more than  thirty
 days or where the commissioner of environmental protection has certified
 that  there  is  a  flagrant  and  continued violation of a provision or
 provisions of section 24-523 of the code or of any  rule  or  regulation
 promulgated  pursuant  thereto  or  of  any order of the commissioner of
 S. 8474                            270

 environmental protection issued pursuant thereto, after  notice  thereof
 mailed to the premises addressed to "owner or occupant," the commission-
 er  of  environmental protection may shut off the supply of water to the
 premises.
   §  11-315  Enforcement  of collection of sewer rents, sewer surcharges
 and water rents. Sewer rents, sewer surcharges, charges,  penalties  and
 fines,  and  interest  thereon,  and water rents, charges, penalties and
 fines, and interest thereon, shall after they are payable to the commis-
 sioner of finance or his or her  designee  be  enforced  in  the  manner
 provided  in this chapter and chapter four of this title. In addition to
 collecting sewer rents, sewer surcharges, charges, penalties  and  fines
 and  interest  thereon and water rents, charges, penalties and fines and
 interest thereon in the manner provided in this chapter and chapter four
 of this title, the city  may  maintain  an  action  for  their  recovery
 against  the  person  for whose benefit or by whom the water is taken or
 used or for whose benefit or by whom sewer service is used.
   § 11-316 Bills of arrears of taxes, assessments,  sewer  rents,  sewer
 surcharges  and  water  rents,  any  other  charges that are made a lien
 subject to the provisions of this chapter, and  interest  and  penalties
 thereon  to  be furnished when requested. The commissioner of finance or
 his or her designee, upon the written request of the owner, the proposed
 vendee under a contract of sale, a mortgagee, any person having a vested
 or contingent interest in any lot  or  lots  or  their  duly  authorized
 agent, or any person who has made a filing pursuant to section 11-309 of
 this  chapter shall furnish a bill of all arrears of taxes on any lot or
 lots due prior to the first of  September,  then  last  past,  of  sewer
 rents,  sewer surcharges and water rents, assessments, any other charges
 that are made a lien subject to the  provisions  of  this  chapter,  and
 interest  and  penalties  thereon,  which  are due and payable. Upon the
 payment of such bill which shall be called a bill of arrears the receipt
 of the commissioner of finance or his or her designee thereon  shall  be
 conclusive  evidence of such payment. The commissioner of finance or his
 or her designee shall  cause  to  be  kept  an  account  of  amounts  so
 collected,  and the certificate of the commissioner of finance or his or
 her designee, that there are no tax liens on such  lot  or  lots,  shall
 forever  free  such  lot  or  lots from all liens of taxes, sewer rents,
 sewer surcharges or water rents, assessments, any other charges that are
 made a lien subject to the provisions of this chapter, and interest  and
 penalties  thereon  that  are  due and payable prior to the date of such
 receipt or certificate, but not from the lien of any tax lien duly  sold
 and not theretofore satisfied.
   § 11-317 Fees for searches to be added to bills. Fees for such search-
 es  shall  be  included in the bills mentioned in section 11-316 of this
 chapter, and also charges for certificates, which shall be given by  the
 commissioner  of finance or his or her designee respecting lots on which
 there may be no arrears when searches are required. Such fees  shall  be
 regulated by local law.
   §  11-318 Fee for certified search and bill of arrears. A fee of twen-
 ty-five dollars shall be paid to and collected by  the  commissioner  of
 finance  or  his  or  her  designee on his or her furnishing a certified
 search and bill of arrears on each lot or piece of property mentioned or
 referred to in the written request therefor. The commissioner of finance
 shall be authorized to waive or reduce such fee in connection  with  any
 sale of a tax lien or tax liens pursuant to this chapter.
   § 11-319 Sales of tax liens.  a. A tax lien or tax liens on a property
 or  any  component  of  the  amount  thereof  may be sold by the city as
 S. 8474                            271
 
 authorized by subdivision b of this section, when such tax lien  or  tax
 liens  shall  have  remained  unpaid  in  whole or in part for one year,
 provided, however, that a tax lien or tax liens on any class one proper-
 ty  or any class two property that is a residential condominium or resi-
 dential cooperative, as such classes of property are defined in subdivi-
 sion one of section eighteen hundred two of the real property  tax  law,
 may  be  sold  by  the city only when the real property tax component of
 such tax lien or tax liens shall have remained unpaid  in  whole  or  in
 part  for  three  years  and, in the case of any such class one property
 that is not vacant land or any such class two property that is  a  resi-
 dential condominium or residential cooperative, as such classes of prop-
 erty  are  defined in subdivision one of section eighteen hundred two of
 the real property tax law, equals or exceeds the sum  of  five  thousand
 dollars,  or, in the case of any class two residential property owned by
 a company organized pursuant to article eleven of  the  private  housing
 finance law that is not a residential condominium or a residential coop-
 erative,  as  such classes of property are defined in subdivision one of
 section eighteen hundred two of the  real  property  tax  law,  for  two
 years,  and  equals  or exceeds the sum of five thousand dollars, or, in
 the case of abandoned class one property or abandoned class two property
 that is a residential condominium or residential cooperative, for  eigh-
 teen  months,  and  after such sale, shall be transferred, in the manner
 provided by this chapter, and provided, further, however, that  (i)  the
 real property tax component of such tax lien may not be sold pursuant to
 this subdivision on any: (A) residential real property in class one that
 is  receiving  an  exemption pursuant to section 11-245.3 or 11-245.4 of
 this title, or pursuant to section four hundred fifty-eight of the  real
 property  tax  law with respect to real property purchased with payments
 received as prisoner of war compensation from the United States  govern-
 ment,  or pursuant to paragraph (b) or (c) of subdivision two of section
 four hundred fifty-eight-a of the real property tax law,  or  where  the
 owner  of such residential real property in class one is receiving bene-
 fits in accordance with department of finance memorandum  05-3,  or  any
 successor  memorandum  thereto, relating to active duty military person-
 nel, or where the owner of such residential real property in  class  one
 has  been  allowed  a  credit  pursuant to subsection (e) of section six
 hundred six of the tax law for the calendar year in which  the  date  of
 the  first  publication,  pursuant to subdivision a of section 11-320 of
 this chapter, of the notice of sale, occurs or  for  the  calendar  year
 immediately  preceding  such date; or (B) real property that was granted
 an exemption pursuant to section four  hundred  twenty-a,  four  hundred
 twenty-b,  four hundred forty-six, or four hundred sixty-two of the real
 property tax law in one of the two fiscal years preceding  the  date  of
 such  sale,  provided  that: (1) such exemption was granted to such real
 property upon the application of a not-for-profit organization that owns
 such real property on or after the date on which such real property  was
 conveyed  to such not-for-profit organization; (2) the real property tax
 component of such lien arose on or after the date  on  which  such  real
 property  was conveyed to such not-for-profit organization; and (3) such
 not-for-profit organization is organized or conducted  for  one  of  the
 purposes  described  in paragraph a or paragraph b of subdivision one of
 section 11-246 of this title, and (ii) the sewer rents component,  sewer
 surcharges  component  or water rents component of such tax lien may not
 be sold pursuant to this subdivision on any one family residential  real
 property  in  class  one  or on any two or three family residential real
 property in class one that is receiving an exemption pursuant to section
 S. 8474                            272
 
 11-245.3 or 11-245.4 of this title, or pursuant to section four  hundred
 fifty-eight  of  the real property tax law with respect to real property
 purchased with payments received as prisoner of  war  compensation  from
 the  United  States  government,  or pursuant to paragraph (b) or (c) of
 subdivision two of section four hundred fifty-eight-a of the real  prop-
 erty  tax law, or where the owner of any two or three family residential
 real property in class one is  receiving  benefits  in  accordance  with
 department of finance memorandum 05-3, or any successor memorandum ther-
 eto,  relating  to active duty military personnel, or where the owner of
 any two or three family residential real property in class one has  been
 allowed  a  credit pursuant to subsection (e) of section six hundred six
 of the tax law for the calendar year in which  the  date  of  the  first
 publication,  pursuant  to subdivision a of section 11-320 of this chap-
 ter, of the notice of sale, occurs or for the calendar year  immediately
 preceding  such date. A tax lien or tax liens on any property classified
 as a class two property, except a class two property that is a  residen-
 tial  condominium or residential cooperative, or a class two residential
 property owned by a company organized pursuant to article eleven of  the
 private  housing  finance law that is not a residential condominium or a
 residential cooperative, or class three property,  as  such  classes  of
 property  are defined in subdivision one of section eighteen hundred two
 of the real property tax law, shall not be sold by the city unless  such
 tax  lien  or  tax liens include a real property tax component as of the
 date of the first publication, pursuant  to  subdivision  a  of  section
 11-320  of  this  chapter,  of the notice of sale.   Notwithstanding any
 provision of this subdivision to the contrary, any such tax lien or  tax
 liens that remain unpaid in whole or in part after such date may be sold
 regardless of whether such tax lien or tax liens include a real property
 tax  component.  A  tax  lien or tax liens on a property classified as a
 class four property, as such class of property is defined in subdivision
 one of section eighteen hundred two of the real property tax law,  shall
 not be sold by the city unless such tax lien or tax liens include a real
 property  tax  component  or  sewer  rents component or sewer surcharges
 component or water rents component or emergency  repair  charges  compo-
 nent,  where  such  emergency repair charges accrued on or after January
 first, two thousand six and are made a lien pursuant to section  27-2144
 of  this  code,  as  of  the  date of the first publication, pursuant to
 subdivision a of section 11-320 of this chapter, of the notice of  sale,
 provided,  however, that any tax lien or tax liens that remain unpaid in
 whole or in part after such date may be sold regardless of whether  such
 tax lien or tax liens include a real property tax component, sewer rents
 component, sewer surcharges component, water rents component or emergen-
 cy repair charges component. For purposes of this subdivision, the words
 "real property tax" shall not include an assessment or charge upon prop-
 erty  imposed  pursuant  to section 25-411 of this code. A sale of a tax
 lien or tax liens shall include, in addition to such lien or liens  that
 have  remained  unpaid in whole or in part for one year, or, in the case
 of any class one property or class two property that  is  a  residential
 condominium  or  residential  cooperative,  when  the  real property tax
 component of such lien or liens has remained unpaid in whole or in  part
 for  three  years, or, in the case of any class two residential property
 owned by a company organized pursuant to article eleven of  the  private
 housing  finance law that is not a residential condominium or a residen-
 tial cooperative, when the real property tax component of such  lien  or
 liens  has remained unpaid in whole or in part for two years, and equals
 or exceeds the sum of five thousand  dollars,  any  taxes,  assessments,
 S. 8474                            273
 
 sewer  rents,  sewer surcharges, water rents, any other charges that are
 made a lien subject to the provisions of this chapter, the costs of  any
 advertisements  and  notices  given  pursuant to this chapter, any other
 charges that are due and payable, a surcharge pursuant to section 11-332
 of this chapter, and interest and penalties thereon or such component of
 the  amount  thereof  as  shall  be  determined  by  the commissioner of
 finance. The commissioner  of  finance  may  promulgate  rules  defining
 "abandoned" property, as such term is used in this subdivision.
   a-1. A subsequent tax lien or tax liens on a property or any component
 of  the amount thereof may be sold by the city pursuant to this chapter,
 provided, however, that notwithstanding any provision in this chapter to
 the contrary, such tax lien or tax  liens  may  be  sold  regardless  of
 whether  such  tax lien or tax liens have remained unpaid in whole or in
 part for one year and, notwithstanding any provision in this chapter  to
 the contrary, in the case of any class one property or class two proper-
 ty  that  is  a  residential  condominium or residential cooperative or,
 beginning January first, two thousand twelve, in the case of  any  class
 two  residential property owned by a company organized pursuant to arti-
 cle eleven of the private housing finance law that is not a  residential
 condominium or a residential cooperative, such tax lien or tax liens may
 be sold if the real property tax component of such tax lien or tax liens
 has  remained  unpaid  in  whole  or in part for one year, and provided,
 further, however, that (i) the real property tax component of  such  tax
 lien  may  not  be  sold pursuant to this subdivision on any residential
 real property in class one that is receiving an  exemption  pursuant  to
 section  11-245.3 or 11-245.4 of this title, or pursuant to section four
 hundred fifty-eight of the real property tax law with  respect  to  real
 property  purchased  with  payments  received as prisoner of war compen-
 sation from the United States government, or pursuant to  paragraph  (b)
 or  (c)  of subdivision two of section four hundred fifty-eight-a of the
 real property tax law, or where the owner of such residential real prop-
 erty in class one is receiving benefits in accordance with department of
 finance memorandum 05-3, or any successor memorandum  thereto,  relating
 to  active  duty military personnel, or where the owner of such residen-
 tial real property in class one has been allowed a  credit  pursuant  to
 subsection  (e) of section six hundred six of the tax law for the calen-
 dar year in which the date of the first publication, pursuant to  subdi-
 vision  a  of  section  11-320  of  this chapter, of the notice of sale,
 occurs or for the calendar year immediately preceding such date and (ii)
 the sewer rents component, sewer surcharges  component  or  water  rents
 component  of such tax lien may not be sold pursuant to this subdivision
 on any one family residential real property in class one or on  any  two
 or three family residential real property in class one that is receiving
 an  exemption pursuant to section 11-245.3 or 11-245.4 of this title, or
 pursuant to section four hundred fifty-eight of the  real  property  tax
 law  with  respect  to real property purchased with payments received as
 prisoner of war compensation  from  the  United  States  government,  or
 pursuant  to  paragraph  (b)  or  (c) of subdivision two of section four
 hundred fifty-eight-a of the real property tax law, or where  the  owner
 of  any  two  or  three family residential real property in class one is
 receiving benefits in accordance with department of  finance  memorandum
 05-3, or any successor memorandum thereto, relating to active duty mili-
 tary  personnel,  or where the owner of any two or three family residen-
 tial real property in class one has been allowed a  credit  pursuant  to
 subsection  (e) of section six hundred six of the tax law for the calen-
 dar year in which the date of the first publication, pursuant to  subdi-
 S. 8474                            274
 
 vision  a  of  section  11-320  of  this chapter, of the notice of sale,
 occurs or for the calendar year immediately  preceding  such  date.  For
 purposes  of  this  subdivision,  the  term  "subsequent tax lien or tax
 liens" shall mean any tax lien or tax liens on property that become such
 on  or after the date of sale of any tax lien or tax liens on such prop-
 erty that have been sold pursuant to this  chapter,  provided  that  the
 prior  tax  lien  or tax liens remain unpaid as of the date of the first
 publication, pursuant to subdivision a of section 11-320 of  this  chap-
 ter,  of  the  notice of sale of the subsequent tax lien or tax liens. A
 subsequent tax lien or tax liens on any property classified as  a  class
 two  property,  except a class two property that is a residential condo-
 minium or residential cooperative, or a class two  residential  property
 owned  by  a company organized pursuant to article eleven of the private
 housing finance law that is not a residential condominium or a  residen-
 tial  cooperative,  or class three property, as such classes of property
 are defined in subdivision one of section eighteen hundred  two  of  the
 real  property  tax  law,  shall not be sold by the city unless such tax
 lien or tax liens include a real property tax component as of  the  date
 of the first publication, pursuant to subdivision a of section 11-320 of
 this  chapter,  of  the notice of sale. Notwithstanding any provision of
 this subdivision to the contrary, any such tax lien or  tax  liens  that
 remain unpaid in whole or in part after such date may be sold regardless
 of whether such tax lien or tax liens include a real property tax compo-
 nent.   A subsequent tax lien or tax liens on a property classified as a
 class four property, as such class of property is defined in subdivision
 one of section eighteen hundred two of the real property tax law,  shall
 not be sold by the city unless such tax lien or tax liens include a real
 property  tax  component  or  sewer  rents component or sewer surcharges
 component or water rents component or emergency  repair  charges  compo-
 nent,  where  such  emergency repair charges accrued on or after January
 first, two thousand six and are made a lien pursuant to section  27-2144
 of  this  code,  as  of  the  date of the first publication, pursuant to
 subdivision a of section 11-320 of this chapter, of the notice of  sale,
 provided,  however, that any tax lien or tax liens that remain unpaid in
 whole or in part after such date may be sold regardless of whether  such
 tax lien or tax liens include a real property tax component, sewer rents
 component, sewer surcharges component, water rents component or emergen-
 cy repair charges component. For purposes of this subdivision, the words
 "real property tax" shall not include an assessment or charge upon prop-
 erty  imposed  pursuant  to section 25-411 of this code. Nothing in this
 subdivision shall be deemed to limit the  rights  conferred  by  section
 11-332  of  this  chapter  on  the holder of a tax lien certificate with
 respect to a subsequent tax lien.
   a-2. In addition to any sale authorized pursuant to subdivision  a  or
 subdivision  a-1  of  this  section and notwithstanding any provision of
 this chapter to the contrary, beginning on December first, two  thousand
 seven,  the  water rents, sewer rents and sewer surcharges components of
 any tax lien on any class of real property, as  such  real  property  is
 classified  in  subdivision  one  of section eighteen hundred two of the
 real property tax law, may be sold by the city pursuant to this chapter,
 where such water rents, sewer rents or  sewer  surcharges  component  of
 such  tax  lien,  as  of  the date of the first publication, pursuant to
 subdivision a of section 11-320 of this chapter, of the notice of  sale:
 (i) shall have remained unpaid in whole or in part for one year and (ii)
 equals or exceeds the sum of one thousand dollars or, beginning on March
 first, two thousand eleven, in the case of any two or three family resi-
 S. 8474                            275
 
 dential  real property in class one, for one year, and equals or exceeds
 the sum of two thousand dollars, or, beginning  on  January  first,  two
 thousand  twenty-one, in the case of any two or three family residential
 real  property in class one, for one year, and equals or exceeds the sum
 of three thousand dollars, or, beginning on January first, two  thousand
 twelve,  in  the  case  of any class two residential property owned by a
 company organized pursuant to article  eleven  of  the  private  housing
 finance law that is not a residential condominium or a residential coop-
 erative,  as  such  class  of  property is defined in subdivision one of
 section eighteen hundred two of the  real  property  tax  law,  for  two
 years, and equals or exceeds the sum of five thousand dollars; provided,
 however,  that  such water rents, sewer rents or sewer surcharges compo-
 nent of such tax lien may not be sold pursuant to  this  subdivision  on
 any  one  family residential real property in class one or on any two or
 three family residential real property in class one that is receiving an
 exemption pursuant to section 11-245.3 or 11-245.4  of  this  title,  or
 pursuant  to  section  four hundred fifty-eight of the real property tax
 law with respect to real property purchased with  payments  received  as
 prisoner  of  war  compensation  from  the  United States government, or
 pursuant to paragraph (b) or (c) of  subdivision  two  of  section  four
 hundred  fifty-eight-a  of the real property tax law, or where the owner
 of any two or three family residential real property  in  class  one  is
 receiving  benefits  in accordance with department of finance memorandum
 05-3, or any successor memorandum thereto, relating to active duty mili-
 tary personnel, or where the owner of any two or three  family  residen-
 tial  real  property  in class one has been allowed a credit pursuant to
 subsection (e) of section six hundred six of the tax law for the  calen-
 dar  year in which the date of the first publication, pursuant to subdi-
 vision a of section 11-320 of this  chapter,  of  the  notice  of  sale,
 occurs  or  for the calendar year immediately preceding such date. After
 such sale, any such water rents, sewer rents or sewer surcharges  compo-
 nent  of such tax lien may be transferred in the manner provided by this
 chapter.
   a-3. In addition to any sale authorized pursuant to subdivision  a  or
 subdivision  a-1  of  this  section and notwithstanding any provision of
 this chapter to the contrary, beginning on December first, two  thousand
 seven, a subsequent tax lien on any class of real property, as such real
 property  is  classified  in subdivision one of section eighteen hundred
 two of the real property tax law, may be sold by the  city  pursuant  to
 this  chapter,  regardless  of  whether such subsequent tax lien, or any
 component of the amount thereof, shall have remained unpaid in whole  or
 in  part  for  one  year,  and regardless of whether such subsequent tax
 lien, or any component of the amount thereof, equals or exceeds the  sum
 of  one thousand dollars or beginning on March first, two thousand elev-
 en, in the case of any two or three family residential real property  in
 class  one,  a  subsequent  tax lien on such property may be sold by the
 city pursuant to this chapter, regardless of whether such subsequent tax
 lien, or any component of the amount thereof, shall have remained unpaid
 in whole or in part for one year, and regardless of whether such  subse-
 quent  tax  lien,  or  any  component  of  the amount thereof, equals or
 exceeds the sum of two thousand dollars, or, beginning on January first,
 two thousand twenty-one, in the case of any two or three family residen-
 tial real property in class one, a subsequent tax lien on such  property
 may  be sold by the city pursuant to this chapter, regardless of whether
 such subsequent tax lien, or any component of the amount thereof,  shall
 have remained unpaid in whole or in part for one year, and regardless of
 S. 8474                            276
 
 whether  such subsequent tax lien, or any component of the amount there-
 of, equals or exceeds the sum of three thousand dollars,  or,  beginning
 on  January  first,  two  thousand  twelve, in the case of any class two
 residential  property  owned  by a company organized pursuant to article
 eleven of the private housing finance law  that  is  not  a  residential
 condominium  or  a residential cooperative, as such class of property is
 defined in subdivision one of section eighteen hundred two of  the  real
 property  tax law, a subsequent tax lien on such property may be sold by
 the city pursuant to this chapter, regardless of whether such subsequent
 tax lien, or any component of the amount thereof,  shall  have  remained
 unpaid in whole or in part for two years, and regardless of whether such
 subsequent  tax  lien, or any component of the amount thereof, equals or
 exceeds the sum of five thousand dollars; provided, however,  that  such
 subsequent  tax lien may not be sold pursuant to this subdivision on any
 one family residential real property in class one or on any two or three
 family residential real property in  class  one  that  is  receiving  an
 exemption  pursuant  to  section  11-245.3 or 11-245.4 of this title, or
 pursuant to section four hundred fifty-eight of the  real  property  tax
 law  with  respect  to real property purchased with payments received as
 prisoner of war compensation  from  the  United  States  government,  or
 pursuant  to  paragraph  (b)  or  (c) of subdivision two of section four
 hundred fifty-eight-a of the real property tax law, or where  the  owner
 of  any  two  or  three family residential real property in class one is
 receiving benefits in accordance with department of  finance  memorandum
 05-3, or any successor memorandum thereto, relating to active duty mili-
 tary  personnel,  or where the owner of any two or three family residen-
 tial real property in class one has been allowed a  credit  pursuant  to
 subsection  (e) of section six hundred six of the tax law for the calen-
 dar year in which the date of the first publication, pursuant to  subdi-
 vision  a  of  section  11-320  of  this chapter, of the notice of sale,
 occurs or for the calendar year immediately preceding such  date.  After
 such  sale, any such subsequent tax lien, or any component of the amount
 thereof, may be transferred in the manner provided by this chapter.  For
 purposes  of this subdivision, the term "subsequent tax lien" shall mean
 the water rents, sewer rents or sewer surcharges component  of  any  tax
 lien  on  property that becomes such on or after the date of sale of any
 water rents, sewer rents or sewer surcharges component of any  tax  lien
 on  such  property that has been sold pursuant to this chapter, provided
 that the prior tax lien remains unpaid as  of  the  date  of  the  first
 publication,  pursuant  to subdivision a of section 11-320 of this chap-
 ter, of the notice of sale of the subsequent tax lien. Nothing  in  this
 subdivision  shall  be  deemed  to limit the rights conferred by section
 11-332 of this chapter on the holder of  a  tax  lien  certificate  with
 respect to a subsequent tax lien.
   a-4.  In  addition  to  any sale authorized pursuant to subdivision a,
 a-1, a-2 or a-3 of this section and  notwithstanding  any  provision  of
 this  chapter  to  the  contrary, beginning on March first, two thousand
 eleven, the emergency repair charges component or  alternative  enforce-
 ment  expenses  and  fees component, where such emergency repair charges
 accrued on or after January first, two thousand six and are made a  lien
 pursuant  to  section  27-2144  of  this code, or where such alternative
 enforcement expenses and fees  are  made  a  lien  pursuant  to  section
 27-2153  of this code, of any tax lien on any class of real property, as
 such real property is defined in subdivision  one  of  section  eighteen
 hundred two of the real property tax law, may be sold by the city pursu-
 ant  to  this  chapter, where such emergency repair charges component or
 S. 8474                            277

 alternative enforcement expenses and fees component of such tax lien, as
 of the date of the first  publication,  pursuant  to  subdivision  a  of
 section  11-320  of  this chapter, of the notice of sale: (i) shall have
 remained  unpaid  in  whole  or  in part for one year and (ii) equals or
 exceeds the sum of one thousand dollars or, beginning on January  first,
 two  thousand  twelve, in the case of any class two residential property
 owned by a company organized pursuant to article eleven of  the  private
 housing  finance law that is not a residential condominium or a residen-
 tial cooperative, as such class of property is  defined  in  subdivision
 one  of  section  eighteen hundred two of the real property tax law, for
 two years, and equals or exceeds  the  sum  of  five  thousand  dollars;
 provided,  however,  that  such  emergency  repair  charges component or
 alternative enforcement expenses and fees component of such tax lien may
 only be sold pursuant to this subdivision on any one, two or three fami-
 ly residential real property in class one, where such one, two or  three
 family residential property in class one is not the primary residence of
 the  owner. After such sale, any such emergency repair charges component
 or alternative enforcement expenses and fees component of such tax  lien
 may be transferred in the manner provided by this chapter.
   a-5.  In  addition  to  any sale authorized pursuant to subdivision a,
 a-1, a-2 or a-3 of this section and  notwithstanding  any  provision  of
 this  chapter  to  the  contrary, beginning on March first, two thousand
 eleven, a subsequent tax lien on any class of real property,  or  begin-
 ning  on January first, two thousand twelve in the case of any class two
 residential property owned by a company organized  pursuant  to  article
 eleven  of  the  private  housing  finance law that is not a residential
 condominium or a residential cooperative, a subsequent tax lien on  such
 property,  may  be sold by the city pursuant to this chapter, regardless
 of the length of time such subsequent tax lien, or any component of  the
 amount thereof, shall have remained unpaid, and regardless of the amount
 of  such  subsequent  tax lien. After such sale, any such subsequent tax
 lien, or any component of the amount thereof, may be transferred in  the
 manner  provided  by this chapter. For purposes of this subdivision, the
 term "subsequent tax lien"  shall  mean  the  emergency  repair  charges
 component  or alternative enforcement expenses and fees component, where
 such emergency repair charges accrued on or  after  January  first,  two
 thousand  six  and  are  made a lien pursuant to section 27-2144 of this
 code, or where such alternative enforcement expenses and fees are made a
 lien pursuant to section 27-2153 of this code, of any tax lien on  prop-
 erty  that  becomes  such  on or after the date of sale of any emergency
 repair charges component or alternative enforcement  expenses  and  fees
 component,  of any tax lien on such property that has been sold pursuant
 to this chapter, provided that the prior tax lien remains unpaid  as  of
 the  date of the first publication, pursuant to subdivision a of section
 11-320 of this chapter, of the notice of  sale  of  the  subsequent  tax
 lien.    Nothing in this subdivision shall be deemed to limit the rights
 conferred by section 11-332 of this chapter on the holder of a tax  lien
 certificate with respect to a subsequent tax lien.
   a-6.  Notwithstanding  any  provision of this chapter to the contrary,
 beginning on September  first,  two  thousand  seventeen,  a  lien  that
 includes  civil  penalties  for  a violation of section 28-201.1 of this
 code where such civil penalties accrued on  or  after  July  first,  two
 thousand  seventeen, and became a lien pursuant to section 28-204.6.6 of
 this code, may be sold by the city pursuant to this chapter, where  such
 civil  penalties  component  of  such  lien, as of the date of the first
 publication, pursuant to subdivision a of section 11-320 of  this  chap-
 S. 8474                            278
 
 ter, of the notice of sale (i) shall have remained unpaid in whole or in
 part  for  one  year  or  more and (ii) equals or exceeds the sum of one
 thousand dollars. After such sale, any such civil penalties component of
 such lien may be transferred in the manner provided by this chapter.
   b.  The  commissioner  of finance, on behalf of the city, may sell tax
 liens, either individually, in combinations, or in the aggregate, pursu-
 ant to the procedures provided herein. The commissioner of finance shall
 establish the terms and conditions of a sale of a tax lien or tax liens.
   1. (i) The commissioner of finance may, in his or her discretion, sell
 a tax lien or tax liens through a competitive sale. In addition  to  the
 advertisement  and  notice  required  to be provided pursuant to section
 11-320 of this chapter, the commissioner of finance or his or her desig-
 nee shall cause to be published a notice of intention to sell a tax lien
 or tax liens through a competitive sale, which notice shall include  the
 terms  and conditions for such sale, the criteria by which bids shall be
 evaluated, and a request for any other information or documents that the
 commissioner of finance may require. Such notice shall be  published  in
 one  newspaper of general circulation in the city, not less than fifteen
 days prior to the date designated by the commissioner for the submission
 of bids.
   (ii) The commissioner of finance may, in his or her discretion, estab-
 lish criteria  for  the  eligibility  of  bidders  pursuant  to  section
 11-321.1 of this chapter.
   (iii)  The  commissioner of finance may reject any or all bids, or may
 accept any combination of bids in a competitive sale.
   2. (i) The commissioner of finance may, in his or her discretion, sell
 a tax lien or tax liens through a negotiated sale. In  addition  to  the
 advertisement  and  notice  required  to be provided pursuant to section
 11-320 of this chapter, the commissioner of finance or his or her desig-
 nee shall cause to be published a notice of intention to sell a tax lien
 or tax liens through a negotiated sale, which notice shall advise that a
 request for statements of interest is available at  the  office  of  the
 department  of  finance,  and  which  may  require the submission of any
 information  or  documents  that  the  commissioner  deems  appropriate,
 provided,  however,  that  if the negotiated sale is to a trust or other
 entity created by the city or in which the  city  has  an  ownership  or
 residual  interest,  then  the requirement that the notice advise that a
 request for statements of interest is available at  the  office  of  the
 department of finance shall not apply. Such notice shall be published in
 one  newspaper of general circulation in the city, not less than fifteen
 days prior to the date designated by the commissioner for the receipt of
 statements of interest, or if the negotiated sale is to  such  trust  or
 other  entity, then such notice shall be published not less than fifteen
 days prior to the date of sale. For purposes of this  subparagraph,  the
 words "date of sale" shall have the same meaning provided in subdivision
 e of section 11-320 of this chapter.
   (ii)  The  commissioner  of finance may engage in a negotiated sale in
 accordance with criteria to be established pursuant to section  11-321.1
 of this chapter.
   (iii)  The  commissioner  of  finance  may execute a purchase and sale
 agreement and other necessary agreements with a designated purchaser  or
 purchasers to complete a negotiated sale.
   3.  The  commissioner of finance may establish a minimum price for the
 sale of tax liens that may be at a discount from or premium to the  lien
 amount.  Notwithstanding  the  preceding  sentence,  the commissioner of
 finance may not establish a minimum price for the sale of an  individual
 S. 8474                            279
 
 tax lien that is at a discount from the lien amount. The commissioner of
 finance  shall  sell  such  tax  liens  at a purchase price that, in the
 determination of such commissioner, is in  the  best  interests  of  the
 city.  The commissioner of finance, in his or her discretion, may accept
 cash or cash equivalent in immediately available funds, or other consid-
 eration acceptable to the commissioner, or any  combination  thereof  in
 payment for a tax lien or tax liens.
   4.  The  amount  of  a  tax lien that is sold pursuant to this chapter
 shall be the unpaid amount of the lien as of the date of sale, including
 any interest and penalties thereon, any taxes, assessments, sewer rents,
 sewer surcharges, water rents, any other charges that are  made  a  lien
 subject  to  the provisions of this chapter, the costs of any advertise-
 ments and notices given pursuant to this chapter, any other charges that
 are due and payable, any surcharge pursuant to section  11-332  of  this
 chapter,  and  interest  and penalties thereon, or such component of the
 amount thereof as shall be determined by the  commissioner  of  finance,
 notwithstanding  the  amount paid for purchase of the tax lien or compo-
 nent of the amount thereof. For purposes of this  paragraph,  the  words
 "date  of sale" shall have the same meaning provided in subdivision y of
 section 11-320 of this chapter.
   5. (i) The commissioner of finance may, subsequent to  the  offer  for
 sale of any tax lien or tax liens and the failure to complete such sale,
 offer  such  tax lien or tax liens for sale again to any other person or
 persons who satisfied the terms  and  conditions  of  the  sale  without
 providing  any  additional  advertisements  or  notices pursuant to this
 chapter.
   (ii) Notwithstanding subparagraph (i) of this paragraph, any tax  lien
 that  was noticed for sale pursuant to this chapter, but was not sold on
 the original date of sale, may be sold without any additional advertise-
 ments or notices pursuant to this chapter if the subsequent date of sale
 is within six months of the second publication, pursuant to  subdivision
 a  of section 11-320 of this chapter, of the notice of the original date
 of sale. If the subsequent date of sale is more than  six  months  after
 the  second  publication, pursuant to subdivision a of section 11-320 of
 this chapter, of the notice of the  original  date  of  sale,  then  the
 commissioner of finance, or his or her designee, shall provide notice of
 the  subsequent date of sale pursuant to subdivision b of section 11-320
 of this chapter. No other additional advertisements or notices shall  be
 necessary prior to the date of sale.
   6.  The rate of interest on any tax lien certificate shall be the rate
 adopted for nonpayment of taxes on real property, pursuant  to  subdivi-
 sion (e) of section 11-224.1 of this title, that is in effect on January
 first of the year in which the tax lien is sold.
   7. It is the intent of the city that a sale of a tax lien or tax liens
 pursuant to this chapter shall be a sale and not a borrowing.
   8.  Whenever  any tax lien purchased at a tax lien sale is found to be
 invalid, void or defective in whole or in part, or not to conform to any
 representation or warranty with respect thereto, made by the commission-
 er of finance in connection with the sale thereof, by judgment or decree
 of a court of competent jurisdiction or by determination of the  commis-
 sioner  of  finance,  the  commissioner  of  finance  may, in his or her
 discretion, substitute for such tax lien or portion thereof another  tax
 lien that has a value equivalent to the value of the tax lien or portion
 thereof  found  to be invalid, void, defective, or not to so conform, or
 may refund such value of the tax lien or portion  thereof  found  to  be
 invalid, void, defective, or not to so conform, or may use a combination
 S. 8474                            280
 
 of  substitution  and  refund.  No  other remedy shall be available to a
 purchaser of a tax lien which is found to be invalid,  void,  defective,
 or  not  to conform to a representation or warranty with respect thereto
 made by the commissioner of finance in connection with the sale thereof,
 in  whole or in part. Whenever a tax lien of such equivalent value is to
 be substituted for a tax lien that has been found invalid, void,  defec-
 tive,  or  not  to  so  conform,  in  whole or in part, pursuant to this
 section, the commissioner of  finance  or  his  or  her  designee  shall
 provide  mailed  notice of the intention to substitute such lien of such
 equivalent value to any person  required  to  be  notified  pursuant  to
 section 11-320(b) of this chapter.
   9.  The  commissioner  of  finance  may  establish  requirements for a
 purchaser of a tax lien to provide any information  and  documents  that
 the  commissioner  of  finance  deems  necessary,  including information
 concerning the collection and enforcement of tax liens.  The commission-
 er of finance shall require the purchaser of a tax lien to  provide  the
 owner  of  property  on  which a tax lien has been sold pursuant to this
 chapter a detailed itemization of taxes, interest, surcharges, and  fees
 charged  to such owner on all tax lien statements of amounts due or bill
 of charges. Such fees shall be bona fide, reasonable and, in the case of
 attorneys' fees, customary.
   10. (i) On and after January first, two thousand twelve, no  tax  lien
 shall  be  sold  pursuant  to  this chapter on any class two residential
 property owned by a company organized pursuant to article eleven of  the
 private  housing  finance law that is a residential condominium or resi-
 dential cooperative. If, notwithstanding  the  foregoing  sentence,  any
 such  tax  lien  is  sold in error pursuant to this chapter on and after
 January first, two thousand twelve on such property, then the provisions
 of paragraph eight of this subdivision shall apply to such sale, includ-
 ing the authority of the commissioner of finance to substitute for  such
 tax  lien  another  tax lien that has a value equivalent to the value of
 such tax lien or to refund the value of such tax lien. For the  purposes
 of  this  paragraph,  property owned by such company shall be limited to
 property owned for the purpose, as set forth  in  section  five  hundred
 seventy-one of the private housing finance law, of providing housing for
 families and persons of low income.
   (ii) No later than May first, two thousand eleven, the commissioner of
 finance,  in  consultation with the commissioner of housing preservation
 and development, shall notify by mail any class two residential property
 owned by a company organized pursuant to article eleven of  the  private
 housing finance law that is not a residential condominium or residential
 cooperative, of the authority of the commissioner of finance to sell the
 tax  liens on such property. Such notification shall include information
 relating to the lien  sale  process,  including,  but  not  limited  to,
 actions homeowners can take if a lien is sold on such property; the type
 of debt that can be sold in a lien sale; a timeline of statutory notifi-
 cations  required  pursuant  to section 11-320 of this chapter; a clear,
 concise explanation of the consequences of the sale of a tax  lien;  the
 telephone  number and electronic mail address of the employee or employ-
 ees designated pursuant to subdivision f of section 11-320 of this chap-
 ter; a conspicuous statement that the owner of the  property  may  enter
 into  a  payment  plan for exclusion from the tax lien sale; and credits
 and property tax exemptions that may exclude a property from a tax  lien
 sale  and  any  other  credit or residential real property tax exemption
 information, which, in the discretion of the  commissioner  of  finance,
 should be included in such notification.
 S. 8474                            281
 
   Upon  such  property owner's written request, or verbal request to 311
 or any employee designated pursuant to subdivision f of  section  11-320
 of  this  chapter,  a Chinese, Korean, Russian or Spanish translation of
 such notice shall be provided promptly to such property owner.
   11.  No  later than the first of September in the year next succeeding
 the effective date of this section, the appropriate agency shall promul-
 gate rules identifying or describing any existing  procedures  governing
 challenges  to  the validity of any real property tax, sewer rent, sewer
 surcharge, water rent, emergency repair charge or  alternative  enforce-
 ment expense or fee.
   12. On or after January first, two thousand fifteen and before January
 first,  two  thousand  seventeen,  no tax lien shall be sold pursuant to
 this chapter on the following properties: (i) properties enrolled in the
 city's Build It Back Program; and (ii) properties defined  as  "eligible
 real  property"  pursuant  to  subdivision three of section four hundred
 sixty-seven-g of the real property  tax  law.  If,  notwithstanding  the
 foregoing  sentence, any such tax lien is sold in error pursuant to this
 chapter during such time period on properties described in  subparagraph
 (i) or (ii) of this paragraph, then the provisions of paragraph eight of
 this  subdivision  shall  apply to such sale, including the authority of
 the commissioner of finance to substitute for such tax lien another  tax
 lien  that  has  a  value equivalent to the value of such tax lien or to
 refund the value of such lien.
   13. Notwithstanding any provision of this chapter to the contrary,  no
 tax  lien shall be sold pursuant to this chapter on any of the following
 properties: (i) any real property for which the owner in good faith  has
 submitted  an application that is pending with the department of finance
 for a real property tax exemption pursuant to section four hundred twen-
 ty-a, four hundred twenty-b, four hundred  forty-six,  or  four  hundred
 sixty-two  of  the real property tax law; and (ii) any real property for
 which the owner has in good faith filed an appeal with the  tax  commis-
 sion  of  a  denial  of any such application and such appeal is pending.
 There shall be a rebuttable presumption that an application or an appeal
 referenced in the preceding sentence was not  submitted  in  good  faith
 where,  within  the  twenty-four months preceding the submission of such
 application or such appeal, the period for the filing of an appeal of  a
 denial by the department of finance of a previous application for a real
 property  tax  exemption pursuant to section four hundred twenty-a, four
 hundred twenty-b, four hundred forty-six, or four hundred  sixty-two  of
 the real property tax law has expired.
   §  11-320  Notice  of  sale to be advertised and mailed. a. 1. The tax
 lien on property in the city shall  not  be  sold  pursuant  to  section
 11-319 of this chapter unless notice of such sale as provided herein has
 been  published  twice,  the  first  publication to be in a newspaper of
 general circulation in the city, not less than ninety days preceding the
 date of the sale, and the second publication  to  be  in  a  publication
 designated  by  the  commissioner  of  finance,  not  less than ten days
 preceding the date  of  the  sale.  Such  publication  shall  include  a
 description  by  block  and  lot  or by such other identification as the
 commissioner of finance may deem appropriate, of the property upon which
 the tax lien exists that may be included in the sale,  and  a  statement
 that  a list of the tax liens that may be included in the sale is avail-
 able for inspection in the office of the city register and the office of
 the county clerk. The commissioner of finance shall file  such  list  in
 the  office  of the city register and the office of the county clerk not
 less than ninety days prior to the date of sale.
 S. 8474                            282
 
   2. Not less than ninety days preceding  the  date  of  the  sale,  the
 commissioner  of  finance shall post online, to the extent such informa-
 tion is available, the borough, block and lot of any property on which a
 lien has been or will be noticed for sale in accordance  with  paragraph
 one  of  this  subdivision  and  that, in one or more of the five fiscal
 years preceding the date of the sale, was in receipt of a real  property
 tax  exemption  pursuant  to section four hundred twenty-a, four hundred
 twenty-b, four hundred forty-six or four hundred sixty-two of  the  real
 property tax law and, in addition, shall post online, to the extent such
 information  is available, the borough, block and lot of any vacant land
 classified as class one or  class  four  pursuant  to  section  eighteen
 hundred  two  of  the  real property tax law on which a lien has been or
 will be noticed for sale in accordance with paragraph one of this subdi-
 vision.  Any failure to comply with this paragraph shall not affect  the
 validity of any sale of tax liens pursuant to this chapter.
   b. 1. A tax lien shall not be sold unless the commissioner of finance,
 or  his  or her designee, notifies the owner of record at the address of
 record and any other person  who  has  registered  pursuant  to  section
 11-309  of this chapter, or pursuant to section 11-416 or 11-417 of this
 title, by first class mail, of the intention to sell the tax lien. If no
 such registrations have been filed then such commissioner, or his or her
 designee, shall notify the  person  whose  name  and  address,  if  any,
 appears  in  the  latest  annual record of assessed valuations, by first
 class mail, of the intention to sell the tax lien.  Such  mailed  notice
 shall  include  a  description of the property by block and lot and such
 other identifying information as the commissioner of  finance  may  deem
 appropriate,  the  amount  of the tax lien, including all taxes, assess-
 ments, sewer rents, sewer surcharges, water  rents,  any  other  charges
 that  are made a lien subject to the provisions of this chapter, as well
 as an estimate of the costs of  any  advertisements  and  notices  given
 pursuant  to this chapter, any other charges that are due and payable on
 the date specified in such publication, a surcharge pursuant to  section
 11-332  of this chapter if the tax lien is sold, and interest and penal-
 ties thereon, and shall be mailed to such owner and such  other  persons
 four  times:  not  less than ninety, sixty, thirty and ten days prior to
 the date of sale. Such notice shall state that if default  continues  to
 be  made in payment of the amounts due on such property, the tax lien on
 such property shall be sold as provided in section 11-319 of this  chap-
 ter. If, notwithstanding such notice, the owner shall continue to refuse
 or  neglect to pay the amounts due on such property, the commissioner of
 finance may sell the tax lien on such property as  provided  in  section
 11-319 of this chapter.
   2.  (i)  Such notices shall also include, with respect to any property
 owner in class one or class two, as such classes of property are defined
 in subdivision one of section eighteen hundred two of the real  property
 tax  law,  an exemption eligibility checklist. The exemption eligibility
 checklist shall also be posted on  the  website  of  the  department  of
 finance  no  later  than the first business day after March fifteenth of
 every year prior to the date of sale, and shall continue to be posted on
 such website until ten days prior to the date of sale. Within ten  busi-
 ness days of receipt of a completed exemption eligibility checklist from
 such property owner, provided that such receipt occurs prior to the date
 of sale of any tax lien or tax liens on his or her property, the depart-
 ment  of  finance shall review such checklist to determine, based on the
 information provided by the property owner, whether such property  owner
 could  be eligible for any exemption, credit or other benefit that would
 S. 8474                            283
 
 entitle them to be excluded from a tax lien sale and, if the  department
 determines  that  such  property  owner  could  be eligible for any such
 exemption, credit or other benefit, shall mail such  property  owner  an
 application  for the appropriate exemption, credit or other benefit. If,
 within twenty business days of  the  date  the  department  mailed  such
 application,  the  department  of  finance  has not received a completed
 application from such property owner, such department  shall  mail  such
 property  owner  a  second application, and shall telephone the property
 owner, if the property owner has included his or her telephone number on
 the exemption eligibility checklist.
   (ii) Any such property owner who returns to the department of  finance
 a completed exemption eligibility checklist prior to the date of sale of
 any  tax  lien  or tax liens on his or her property and who subsequently
 submits a completed application for the appropriate exemption, credit or
 other benefit either prior to, on or up to ninety days after such  sale,
 shall have his or her application reviewed by the department of finance.
 If, prior to the date of sale, the department of finance determines that
 such  property  owner  is  qualified for such exemption, credit or other
 benefit or will be qualified as of the date of sale, then the  tax  lien
 or  tax liens on his or her property shall not be sold on such date. If,
 on or after the date of sale, the department of finance determines  that
 such  property  owner  is or was qualified for such exemption, credit or
 other benefit as of the date of sale, then any tax lien or tax liens  on
 his or her property that were sold shall be deemed defective.
   (iii)  Not  later  than  thirty  days  prior to such date of sale, the
 department of finance shall submit to the council a list,  disaggregated
 by  council  district,  of  all  properties  for  which  property owners
 returned a completed eligibility checklist to the department of  finance
 at least thirty-five days prior to the date of sale, but for which prop-
 erty  owners  have  not  yet  submitted  a completed application for the
 appropriate exemption, credit or other benefit.
   (iv) Not later than thirty days after such date of sale,  the  depart-
 ment  of  finance  shall  submit to the council a list, disaggregated by
 council district, of all properties for which property owners returned a
 completed eligibility checklist to the department of  finance  prior  to
 the date of sale, but for which property owners have not yet submitted a
 completed  application  for  the  appropriate exemption, credit or other
 benefit.
   (v) Upon the written or verbal request of  such  property  owner,  the
 department  of  finance shall provide prompt assistance to such property
 owner in completing an application for the appropriate exemption, credit
 or other benefit.
   2-a. If, prior to the date of sale, the department of finance confirms
 that a property is the subject of (i) a judicial proceeding or  (ii)  an
 investigation  or  a  prosecution  by any agency or office of the United
 States or any state or subdivision thereof with regard to the  ownership
 of  such  property  arising  from  the  fraudulent transmittal of a deed
 relating to such property, such department shall  remove  such  property
 from  the sale, provided that the owner of such property has provided an
 affidavit to such department and any such other  documentation  required
 by  such  department  to  establish that such property is the subject of
 such a proceeding, investigation or prosecution. Any such removal  shall
 relate  only  to the sale of a tax lien or tax liens for which the owner
 has received notice pursuant to paragraph one of subdivision b  of  this
 section.  Failure  by  the department of finance to remove such property
 S. 8474                            284
 
 shall not affect the validity of any sale of tax liens pursuant to  this
 chapter.
   3.  The notice provided not less than ninety days prior to the date of
 sale shall also include information relating to the lien  sale  process,
 including,  but not limited to, actions homeowners can take if a lien is
 sold on such property; the type of debt that can be sold in a lien sale;
 a timeline of statutory notifications required pursuant to this section;
 a clear, concise explanation of the consequences of the sale  of  a  tax
 lien;  the  telephone number and electronic mail address of the employee
 or employees designated pursuant to subdivision f  of  this  section;  a
 conspicuous  statement  that  the owner of the property may enter into a
 payment plan for exclusion from the tax lien sale; and credits and prop-
 erty tax exemptions that may exclude certain  class  one  real  property
 from  a tax lien sale. Such notice shall also include information on the
 following real property tax exemptions, credits or other benefits:
   (i)  the  senior  citizen  homeowner  exemption  pursuant  to  section
 11-245.3 of this title;
   (ii)  the  exemption for persons with disabilities pursuant to section
 11-245.4 of this title;
   (iii) the exemption for veterans  pursuant  to  section  four  hundred
 fifty-eight  of the real property tax law, with respect to real property
 purchased with payments received as prisoner of  war  compensation  from
 the United States government;
   (iv)  the  exemption  for veterans pursuant to paragraph (b) or (c) of
 subdivision two of section four hundred fifty-eight-a of the real  prop-
 erty tax law;
   (v) the state circuit breaker income tax credit pursuant to subsection
 (e) of section six hundred six of the tax law; and
   (vi) the active duty military personnel benefit pursuant to department
 of finance memorandum 05-3, or any successor memorandum thereto.
   Upon  such  property owner's written request, or verbal request to 311
 or any employee designated pursuant to subdivision f of this section,  a
 Chinese,  Korean, Russian or Spanish translation of such notice shall be
 provided promptly to such property owner.
   4. Such notice shall also include, with respect to a property that was
 in receipt of a real property tax exemption  pursuant  to  section  four
 hundred twenty-a, four hundred twenty-b, four hundred forty-six, or four
 hundred  sixty-two  of  the  real property tax law in one or more of the
 three fiscal years preceding the date of the notice  provided  not  less
 than ninety days prior to the date of sale, or with respect to a proper-
 ty  in  class  four, as such class of property is defined in subdivision
 one of section eighteen hundred two of the real property tax law, infor-
 mation relating to the initial application and renewal process for  such
 property  tax  exemptions,  and  other actions available to the owner of
 such property in the event such property is noticed for sale pursuant to
 this subdivision, including, if available, an adjustment or cancellation
 of back taxes. Upon request of the owner of such property, a translation
 of such notice in any of the top  ten  languages  most  commonly  spoken
 within  the  city as determined by the department of city planning shall
 be provided to such owner.
   5. The department of  finance  and  the  department  of  environmental
 protection  shall,  to  the  extent practicable, contact by telephone or
 electronic mail any person who (i) has registered their telephone number
 or electronic mail address with such departments and (ii)  has  received
 the  ninety-day  notice  described in paragraph one of this subdivision.
 Any such contact shall be made within a time period reasonably proximate
 S. 8474                            285
 
 to the mailing of such notice, shall inform such person of the intention
 to sell a tax lien and shall  provide  such  other  information  as  the
 respective  commissioner  deems appropriate, which may include, but need
 not  be  limited to, the telephone numbers and electronic mail addresses
 of the employees designated pursuant to subdivision f of  this  section.
 The  department  of  finance shall contact by electronic mail any person
 who has registered pursuant to subdivision a of section 11-245.8 of this
 title to receive information about the outreach  sessions  described  in
 subdivision j of this section and provide such information within a time
 period  reasonably  proximate to the scheduled outreach session. Failure
 by  the  department  of  finance  or  the  department  of  environmental
 protection  to  contact  any such person by telephone or electronic mail
 shall not affect the validity of any sale of tax liens pursuant to  this
 chapter.
   c.  Such notices shall advise the owner of such property of his or her
 continued obligation to pay the amounts due on such property.  No  other
 notices  or  demands  shall  be required to be made to the owner of such
 property to authorize the sale of a tax lien or tax liens on such  prop-
 erty pursuant to section 11-319 of this chapter.
   c-1.  Where  a  tax  lien on property in the city has been noticed for
 sale pursuant to subdivision b of this section and such lien,  prior  to
 the  date  of  sale,  has  been  paid  or is otherwise determined by the
 commissioner of finance not to be eligible to be sold, such commissioner
 shall promptly provide written notification to the owner of such proper-
 ty that such lien will not be or was not included in such sale  and  the
 reason therefor.
   d. 1. The commissioner of finance or his or her designee shall, within
 ninety  days  after the delivery of the tax lien certificate, notify any
 person who was required to be notified of such sale pursuant to subdivi-
 sion (b) of section 11-320 of this chapter, by first  class  mail,  that
 such  sale has occurred. Such notice shall state the date of the sale of
 the tax lien, the name and address of the purchaser of the tax lien, the
 amount of such lien, a description of the property by block and lot  and
 such other identifying information as the commissioner of finance or his
 or  her designee shall deem appropriate, and the terms and conditions of
 the tax lien certificate, including the right to satisfy the lien within
 the time periods specified in  this  chapter.  Such  notice  shall  also
 include the telephone number and electronic mail address of the employee
 or employees designated pursuant to subdivision f of this section.
   2.  Any  written  communication  from the purchaser of the tax lien or
 liens to an owner of property, on which a tax lien has been sold  pursu-
 ant  to  the  provisions  of  this  chapter, shall include the following
 information:
   (i) an explanation of the roles of the purchaser of the tax  lien  and
 the  employee  or employees designated pursuant to subdivision f of this
 section;
   (ii) the  names  and  contact  information,  including  the  telephone
 number, electronic mail and mailing addresses of such persons; and
   (iii)  a statement informing such owner that he or she may be eligible
 to enter into a forbearance agreement with the  purchaser  of  such  tax
 lien.
   3. The requirement to send such written communication shall be subject
 to federal, state and local debt collection laws.
   4.  Failure  to  provide notice pursuant to this subdivision shall not
 affect the validity of any sale of a tax lien or tax liens  pursuant  to
 this chapter.
 S. 8474                            286
 
   e. The words "date of sale" when used in this section shall mean:
   (1)  for  a  negotiated  sale,  the  date  of  signing of the tax lien
 purchase agreement, and (2) for a competitive sale, the date  designated
 by the commissioner of finance for the submission of bids.
   f.  The  commissioner  of  finance  shall designate an employee of the
 department to respond to inquiries from owners of property for  which  a
 tax  lien has been sold or noticed for sale pursuant to subdivision a of
 this section and shall  designate  an  employee  of  the  department  to
 respond  to  inquiries  from  owners sixty-five years of age or older of
 property for which a tax lien has been sold or noticed for sale pursuant
 to subdivision a of this  section.  The  commissioner  of  environmental
 protection  shall  designate  at least one employee of the department of
 environmental protection to respond to inquiries from owners of property
 for which a tax lien containing a water  rents,  sewer  rents  or  sewer
 surcharges  component  has  been  sold  or  noticed for sale pursuant to
 subdivision a of this section. The telephone numbers and electronic mail
 addresses of employees designated pursuant to this subdivision shall  be
 posted  online  and  shall  be  included on all publications and notices
 required by subdivisions a and b of this  section.  Failure  to  include
 such  numbers  and  addresses on all such publications and notices shall
 not affect the validity of any sale of tax liens pursuant to this  chap-
 ter.
   g.  No later than one hundred twenty days after the tax lien sale, the
 commissioner of finance shall submit to the council a list of all  prop-
 erties, identified by block and lot, noticed for sale pursuant to subdi-
 vision  b of this section. Such list shall also include a description of
 the disposition of such properties that shall include, but not be limit-
 ed to, whether an owner entered into a payment plan with the city pursu-
 ant to section 11-322 or 11-322.1 of  this  chapter,  whether  an  owner
 satisfied  the  tax lien or liens, whether ownership of the property was
 transferred, provided that such information is available to the city, or
 whether the property was distressed, as defined in subdivision  four  of
 section  11-401  of this title, or removed from the sale pursuant to the
 discretion of the commissioner of housing preservation and development.
   h. 1. On a quarterly basis, a purchaser of tax liens shall provide  to
 the  council  a list of all properties on which tax liens have been sold
 where, subsequent to such sale, there has been a transfer  of  ownership
 of the property, provided that a purchaser of tax liens has knowledge of
 such transfers, for the following groups:
   (i)  all  properties  on  which  liens for emergency repair charges or
 alternative enforcement  expenses  and  fees  have  been  sold  to  such
 purchaser pursuant to subdivision a-4 of section 11-319 of this chapter;
 and
   (ii)  all  class two residential property owned by a company organized
 pursuant to article eleven of the private housing finance  law  that  is
 not  a residential condominium or a residential cooperative on which any
 tax lien has been sold pursuant to subdivision a, a-2 or a-4 of  section
 11-319 of this chapter.
   2.  When  available,  a purchaser of tax liens shall include the names
 and contact information of the new owners of record of such properties.
   i. On a quarterly basis, a purchaser of tax liens shall provide to the
 council a property status report. For each property, such  report  shall
 include:  (1)  information  about  such property, including property tax
 class; property type; description of the tax lien or tax liens that have
 been sold to such purchaser on such property pursuant to  this  chapter,
 including  the  amount  of  the  tax lien or tax liens, the costs of any
 S. 8474                            287

 advertisements and notices given pursuant to this chapter; the amount of
 the surcharge pursuant to section 11-332 of this chapter; and the amount
 of interest and penalties thereon; and (2) the status of the tax lien or
 tax liens, including foreclosure information, if applicable; whether the
 property  owner entered into an installment agreement; whether the prop-
 erty owner is current on such installment agreement; and whether the tax
 lien or tax liens on such property have been deemed defective,  and,  if
 so,  the reason any such lien or liens were deemed defective. Each prop-
 erty listed in the report shall be identified by block and lot.
   j. (1) At the  request  of  a  council  member,  the  commissioner  of
 finance,  in  consultation with the commissioner of housing preservation
 and development and the commissioner of  environmental  protection,  may
 conduct  outreach  sessions  in  the  district  of  such council member,
 provided, however, that, the commissioner of finance shall conduct  such
 outreach  sessions in the ten council districts with the greatest number
 of properties for which a notice of intention to sell  a  tax  lien  has
 been  mailed ninety days prior to the date of sale pursuant to paragraph
 one of subdivision b of this section, and  provided,  further,  however,
 that,  such  commissioner  shall conduct additional outreach sessions in
 the five council districts with the greatest number  of  properties  for
 which  a  notice  of intention to sell a tax lien has been mailed ninety
 days prior to the date of sale pursuant to such paragraph. To the extent
 practicable, the commissioner of finance  shall  schedule  the  outreach
 sessions  in  the  five  council  districts  described  in the preceding
 sentence such that one occurs prior to the  mailing  of  the  notice  of
 intention  to  sell a tax lien that is required to be mailed thirty days
 prior to the date of sale pursuant to paragraph one of subdivision b  of
 this  section  and  one  occurs subsequent to such mailing. The scope of
 such outreach sessions shall include, but need not be  limited  to,  (i)
 actions  property  owners  can  take if a lien is sold on such property;
 (ii) the type of tax lien or tax liens that can be sold in  a  tax  lien
 sale;  (iii)  installment  agreement  information,  including  informing
 attendees in such outreach sessions of their option  to  enter  into  an
 installment  agreement for exclusion from the tax lien sale with no down
 payment,  with  options  for  income-based  installment  agreements   or
 installment  agreements with a term of up to ten years; (iv) credits and
 property tax exemptions that may exclude a  property  from  a  tax  lien
 sale;  (v) distribution of a customer survey to property owners who have
 received notice of the intention to sell a tax lien on  their  property,
 in  order to determine the circumstances that led to the creation of the
 lien; and (vi)  any  other  credit  or  residential  real  property  tax
 exemption  information,  which, in the discretion of the commissioner of
 finance, should be included in such outreach sessions. (2)  The  commis-
 sioner  of  finance  shall  make a good faith effort to have a financial
 counselor available at such outreach sessions. No later than ninety days
 after the tax lien sale, the commissioner of finance shall submit to the
 council a report on the number of outreach sessions  performed  in  each
 council  district  during  the  ninety-day period preceding the tax lien
 sale. Such report shall include: (i) the number  of  installment  agree-
 ments  begun  by  property  owners  or,  as  defined in subdivision b of
 section 11-322 of this chapter, other eligible persons acting on  behalf
 of property owners at each outreach session; (ii) the number of property
 tax  exemption  applications  begun  at each outreach session; (iii) the
 total number of attendees at each outreach session; (iv) the  number  of
 outreach  sessions at which a financial counselor was available; (v) the
 number of property owners, or other eligible persons acting on behalf of
 S. 8474                            288
 
 property owners, who consulted a financial counselor  at  each  outreach
 session  at  which  a  financial  counselor  was available; and (vi) the
 results of such surveys. Such report and the results  of  each  outreach
 session shall be disaggregated by council district.
   k.  The  commissioner  of  finance  shall  post online the information
 reported to the council  pursuant  to  subdivisions  h  and  i  of  this
 section,  provided  that  no  information  shall  be  posted online that
 specifically identifies any property or property owner,  except  by  zip
 code and a randomly generated identifier.
   §  11-321  Continuation of sale; notice required. A sale of a tax lien
 or tax liens may be continued from time to time, if necessary, until all
 the tax liens on the property so advertised and noticed  shall  be  sold
 unless  such  sale  is  canceled or postponed in accordance with section
 11-322 or 11-322.1 of this chapter. If a sale of a tax lien or tax liens
 is continued, the commissioner of finance, or his or her designee, shall
 give such notice as is practicable of such continuation.
   § 11-322 Postponement or cancellation  of  sales;  installment  agree-
 ments.  a. It shall be lawful for the commissioner of finance, or his or
 her designee, to postpone or cancel any proposed sale of a tax  lien  or
 tax  liens  on  property that shall have been advertised and noticed for
 sale prior to the date of sale. For purposes of this section, the  words
 "date  of sale" shall have the same meaning provided in subdivision e of
 section 11-320 of this chapter. The city shall not  be  liable  for  any
 damages  as  a result of cancellation or postponement of a proposed sale
 of a tax lien or tax liens, nor shall any cause  of  action  arise  from
 such cancellation or postponement.
   b.  In  accordance  with  rules  promulgated  by  the commissioners of
 finance and environmental protection, a property owner, or other  eligi-
 ble  person, as defined by rule, acting on behalf of an owner, may enter
 into agreements  with  the  departments  of  finance  and  environmental
 protection  for the payment in installments of any delinquent real prop-
 erty taxes, assessments, sewer rents, sewer surcharges, water rents,  or
 any other charges that are made a lien subject to the provisions of this
 chapter.  The proposed sale of a tax lien or tax liens on property shall
 be  cancelled  when a property owner, or other eligible person acting on
 behalf of an owner, enters into an agreement with the respective  agency
 for  the  payment  of  any such lien. Such rules shall also provide that
 such property owners or such other eligible persons be given information
 regarding eligibility for real property tax exemption programs prior  to
 entering  into  such  agreements.  As used in this subdivision, the term
 "other eligible person" shall include a fiduciary, as defined  in  para-
 graph  three of subdivision (a) of section 11-1.1 of the estates, powers
 and trusts law, acting with respect to the administration of the proper-
 ty of an estate of a decedent who owned the real property as to which an
 agreement under this subdivision is sought, or on behalf of a  benefici-
 ary  of  such  real  property from such estate. Any rules promulgated in
 accordance with this subdivision defining "other eligible person"  shall
 include  in  such  definition  the  means by which a beneficiary of real
 property of the estate of a decedent who owned real property as to which
 an agreement under this subdivision is sought meets  the  definition  of
 "other  eligible person". Such means shall include the furnishing of any
 death certificates or other relevant  documents  that  substantiate  the
 claim  of  a  beneficiary that they are the legal owner of the property.
 Notwithstanding any other provision of this section, no  more  than  one
 such  agreement with each respective agency may be in effect for a prop-
 erty at any one time.
 S. 8474                            289
 
   1. If payments required from  a  property  owner,  or  other  eligible
 person  acting  on behalf of an owner, pursuant to such an agreement are
 not made for a period of six months, such property owner, or such  other
 eligible person, shall be in default of such agreement, and the tax lien
 or  tax  liens  on  the subject property may be sold, provided, however,
 that such default may be cured upon such property owner's, or such other
 eligible person's, bringing all installment  payments  and  all  current
 charges  that  are  outstanding  at the time of the default to a current
 status, which shall include, but not  be  limited  to,  any  outstanding
 interest  and  fees,  prior to the date of sale, provided, however, that
 such property owner, or such other eligible person, may  elect  to  cure
 such  default  by  entering into a new installment agreement with a down
 payment of twenty percent or  more,  of  all  delinquent  real  property
 taxes, assessments, sewer rents, sewer surcharges, water rents and other
 charges  that are made a lien subject to the provisions of this chapter,
 including any outstanding interest and fees, prior to the date of  sale.
 If  such  default  is not cured prior to the date of sale, such property
 owner, and any other eligible person acting on behalf of an owner, shall
 not be eligible to enter into an installment agreement for  the  subject
 property  for  five  years,  unless  there  is  a finding of extenuating
 circumstances by the department that entered into the installment agree-
 ment with the property owner or such other eligible  person.    Notwith-
 standing  the prohibition against entering into an installment agreement
 for the subject property for five years, a property owner, or such other
 eligible person, who has defaulted on an installment agreement and whose
 lien has been sold and, subsequent to the sale of the lien, whose  prop-
 erty  on  which the lien was sold is subject to another tax lien that is
 eligible to be sold, may elect to enter into another installment  agree-
 ment  with  respect  to such other lien before the end of such five-year
 period, provided that  such  property  owner,  or  such  other  eligible
 person,  makes  a  down payment of twenty percent or more, of all delin-
 quent real property taxes, assessments, sewer rents,  sewer  surcharges,
 water  rents  and  other  charges  that  are  made a lien subject to the
 provisions of this chapter, including any outstanding interest and fees,
 prior to the date of the sale. No such property  owner,  or  such  other
 eligible  person,  may  make the election that is authorized pursuant to
 this paragraph to enter  into  an  installment  agreement  with  a  down
 payment  more than once for the subject property. The standards relating
 to defaults and cures of defaults of installment agreements set forth in
 this paragraph apply to installment agreements entered into pursuant  to
 such election.
   2. An installment agreement shall provide for payments by the property
 owner, or other eligible person acting on behalf of an owner, on a quar-
 terly  or  monthly basis, for a period not less than eight years and not
 more than ten years, provided that a property owner, or  other  eligible
 person  acting on behalf of an owner, may elect a period less than eight
 years. Except as provided in paragraph one of  this  subdivision,  there
 shall  be  no  down  payment required upon the property owner's, or such
 other eligible person's, entering into the  installment  agreement  with
 the  respective  department,  but  the property owner, or other eligible
 person acting on behalf of an owner, may elect to make a  down  payment.
 With respect to installment agreements with the commissioner of environ-
 mental  protection,  the determination of whether payments shall be on a
 quarterly or monthly basis shall be in the discretion  of  such  commis-
 sioner,  except as provided in paragraph three of this subdivision. With
 respect to installment agreements with the commissioner of finance,  the
 S. 8474                            290
 
 determination  of  whether  payments  shall be on a quarterly or monthly
 basis shall be in the discretion of the property owner, or other  eligi-
 ble person acting on behalf of an owner.
   3. Beginning on January first, two thousand twelve, any property owner
 who  has  entered into an installment agreement with the commissioner of
 environmental protection pursuant to this subdivision and who has  auto-
 mated  meter  reading  shall  receive  a  consolidated  monthly bill for
 current sewer rents, sewer surcharges and water rents  and  any  payment
 due under such installment agreement.
   4. No later than September first, two thousand eleven, the commission-
 ers  of  finance  and  environmental  protection  shall promulgate rules
 governing installment agreements, including  but  not  limited  to,  the
 terms  and conditions of such agreements, the payment schedules, and the
 definition and consequences of default; no later than  June  first,  two
 thousand  fourteen,  the  commissioners  of  finance  and  environmental
 protection shall promulgate rules governing  eligibility  of  owners  or
 other eligible persons acting on behalf of owners to enter into install-
 ment agreements.
   5.  All  installment  agreements executed on or after March first, two
 thousand fifteen shall include a conspicuous statement that if  payments
 required  from  a  property  owner pursuant to such an agreement are not
 made for a period of six months, such property owner shall be in default
 of such agreement, and the tax lien or tax liens on the subject property
 may be sold, provided, however, that such default may be cured upon such
 property owner's bringing  all  installment  payments  and  all  current
 charges  that  are  outstanding  at the time of the default to a current
 status, which shall include, but not  be  limited  to,  any  outstanding
 interest  and fees, prior to the date of sale. Such statement shall also
 include a notification that if such default is not cured  prior  to  the
 date of sale, such property owner shall not be eligible to enter into an
 installment  agreement  for  the subject property for five years, unless
 there is a finding of extenuating circumstances in accordance with rules
 promulgated by the department that entered into the  installment  agree-
 ment  with  the  property  owner. Such statement shall include the defi-
 nition of extenuating circumstances. All  installment  agreements  shall
 also include a statement describing the conditions under which the prop-
 erty  owner,  or any other eligible person acting on behalf of an owner,
 may be eligible, after default, to enter into another installment agree-
 ment after such default, in accordance with paragraph one of this subdi-
 vision.
   6. If a property owner, or other eligible person acting on  behalf  of
 an owner, who has entered into an installment agreement with the depart-
 ment  of  finance,  fails  to make a payment pursuant to such agreement,
 then the department of finance shall, after the  first  missed  payment,
 mail  a letter to the property owner, or other eligible person acting on
 behalf of an owner, stating that such owner, or other  eligible  person,
 is  at  risk  of being in default of such agreement. The letter shall be
 mailed after the first missed payment if the department has not received
 payment within two weeks of the due date.
   c. No later than January thirty-first, two thousand  twenty-four,  and
 no  later  than every January thirty-first thereafter, the department of
 finance shall submit a report to the mayor and to  the  speaker  of  the
 council  on  real  property  with an assessed value of two hundred fifty
 thousand dollars or less for which: (A) the owner of such real  property
 has  entered  into an agreement pursuant to this section for the payment
 in installments of real property taxes,  assessments  or  other  charges
 S. 8474                            291
 
 that  are made a lien subject to the provisions of chapter three of this
 title other than water rents, sewer rents, or sewer surcharges; and  (B)
 such unpaid taxes are subject to the interest rate described in subdivi-
 sion  e  of  section  11-313  of this chapter for the preceding calendar
 year, including, but not limited to the following data:
   1. the number of such agreements executed during the preceding  calen-
 dar year;
   2. the number of such agreements that were in effect on December thir-
 ty-first of the preceding calendar year;
   3.  the  number of applications for such agreements that were received
 during the preceding calendar year, and the number of such  applications
 that were not approved;
   4.  the  average  amount of property taxes and charges subject to such
 agreements; and
   5. the number of such agreements that entered  into  default  and  the
 number of defaults that were cured.
   §  11-322.1  Hardship  installment  agreements.  a.  Definitions.  For
 purposes of this section, the following terms have the  following  mean-
 ings:
   1. Applicant. The term "applicant" means a property owner who files an
 application  for  an installment agreement under this section. Such term
 includes a property owner who has entered into an installment  agreement
 after filing such an application.
   2.  Default.  The  term  "default"  means  that an installment payment
 required under the installment agreement entered into under this section
 remains unpaid in whole or in part for six months from the date  payment
 is  required  to be made, or any other tax or charge that becomes due on
 the property during the term of such agreement remains unpaid  in  whole
 or in part for six months.
   3. Department. The term "department" means the department of finance.
   4. Dwelling unit. The term "dwelling unit" means a unit in a condomin-
 ium used primarily for residential purposes.
   5.  Fair  market  value.  The  term "fair market value" means the fair
 market value of property as determined by the  department  or  the  fair
 market  value  as  determined  by an appraisal obtained by the applicant
 pursuant to paragraph four of subdivision g of  this  section,  provided
 that  such appraisal shall be subject to review, and may be rejected, by
 the department.
   6. Income. The term "income"  means  the  adjusted  gross  income  for
 federal  income  tax  purposes  as reported on an applicant's federal or
 state income tax return for the applicable income tax year,  subject  to
 any  subsequent amendments or revisions; provided that if no such return
 was filed for  the  applicable  income  tax  year,  "income"  means  the
 adjusted  gross income that would have been so reported if such a return
 had been filed.
   7. Income tax year. The term "income tax year" means the  most  recent
 calendar  year  or fiscal year for which an applicant filed a federal or
 state income tax return.
   8. Net equity. The term "net equity" means the fair  market  value  of
 property  minus  any liabilities outstanding against such property, such
 as mortgages, outstanding property taxes, water and sewer  charges,  and
 any other liens on such property.
   9.  Property.  The  term  "property" means real property classified as
 class one pursuant to section eighteen hundred two of the real  property
 tax law or a dwelling unit in a condominium.
 S. 8474                            292
 
   10.  Property  owner. The term "property owner" means an owner of real
 property classified as class one pursuant to  section  eighteen  hundred
 two of the real property tax law or of a dwelling unit in a condominium,
 or other eligible person, as defined in subdivision (i) of section 40-03
 of title nineteen of the rules of the city of New York, acting on behalf
 of such owner.
   b. A property owner who satisfies the requirements described in subdi-
 vision  c and d, e or f of this section may enter into an agreement with
 the department pursuant to this section for the payment in  installments
 of  real  property  taxes,  assessments or other charges that are made a
 lien subject to the provisions of this chapter, except for sewer  rents,
 sewer surcharges or water rents. The entry into an installment agreement
 pursuant  to  this  section  shall  not  suspend the accrual of interest
 charged against the property pursuant to section 11-301 of this chapter.
 A property owner may  only  have  one  installment  agreement  with  the
 department in effect at any one time.
   c.  Eligibility  requirements  for an installment agreement under this
 section. To be eligible to enter into an installment agreement  pursuant
 to  this  section,  an  applicant  must  demonstrate  that the following
 requirements are met:
   1. The applicant is a property owner.
   2. The property shall have been the primary residence of the applicant
 for an uninterrupted period  of  not  less  than  one  year  immediately
 preceding  the  date  the  application  for the installment agreement is
 submitted and continues to be the primary  residence  of  the  applicant
 through  the date the installment agreement is entered into.  Hospitali-
 zation or a temporary stay in a nursing home or rehabilitation  facility
 for  a  period  of  not  more than three years shall not be considered a
 change in primary residence.
   3. The combined income of the applicant  and  of  all  the  additional
 property  owners may not exceed eighty-six thousand four hundred dollars
 for the income tax year immediately preceding the date of  the  applica-
 tion  for  the  installment  agreement.  The department shall promulgate
 rules that establish a process for an applicant  to  seek  an  exception
 from the requirement that income information from all additional proper-
 ty owners be provided in cases of hardship.
   d.  Eligibility  requirement  for senior low-income installment agree-
 ment. In addition to the requirements set forth in subdivision c of this
 section, to be eligible to enter into a  senior  low-income  installment
 agreement  pursuant  to subdivision l of this section, an applicant must
 be sixty-five years of age or older when the application is submitted.
   e. Eligibility requirement for fixed length  income-based  installment
 agreement.  To  be  eligible  to  enter into a fixed length income-based
 installment agreement pursuant to subdivision  m  of  this  section,  an
 applicant  must  satisfy  the requirements set forth in subdivision c of
 this section.
   f. Eligibility requirements for extenuating circumstances income-based
 installment agreement. In addition to  the  requirements  set  forth  in
 subdivision  c of this section, for an applicant to be eligible to enter
 into an extenuating  circumstances  income-based  installment  agreement
 pursuant  to  subdivision  n of this section, the department must make a
 finding of extenuating circumstances pursuant to the  process  described
 in  paragraph four of subdivision (e) of section 40-03 of title nineteen
 of the rules of the city of New York.
   g. Initial application procedure. 1. An  initial  application  for  an
 installment agreement under this section shall include:
 S. 8474                            293
 
   (a)  for  installment agreements that provide for the payment of taxes
 and charges that will accrue after the date of  the  installment  agree-
 ment,  a  title  search identifying all mortgages and other liens on the
 property; and
   (b)  the  signature of a primary resident of the property, and if such
 primary resident does not hold an ownership interest of at  least  fifty
 percent in the subject property, the signature of any other owner of the
 property who, in combination with such primary resident, holds an owner-
 ship  interest of at least fifty percent in such property, consenting to
 the application for an installment agreement.
   2. A complete application must be submitted to, and approved  by,  the
 department.
   3. An applicant may select a monthly or quarterly payment schedule and
 may  also select the amount that is required to be paid under the appli-
 cable installment agreement pursuant to the options  available  pursuant
 to subdivision l, m or n of this section.
   4.  An  applicant  who  is  the property owner of a dwelling unit in a
 condominium may submit an appraisal obtained by such  applicant  of  the
 fair market value of such dwelling unit provided that:
   (a)  the  valuation  date of such appraisal is a date within, and such
 appraisal shall have been prepared no more than, twelve months prior  to
 submission of an application;
   (b) the cost of such appraisal shall be borne by such applicant; and
   (c)  the  cost  of  such  appraisal  may not be included in the amount
 subject to the installment agreement.
   h. Renewal. 1. An  installment  agreement  under  this  section  shall
 terminate  unless an applicant files a renewal application each year. At
 least sixty days before one year from the date such  installment  agree-
 ment  was entered into or renewed, the department shall mail each appli-
 cant a renewal  application,  provided,  however,  that  upon  any  such
 renewal  application being made by the applicant, any installment agree-
 ment then in effect with respect  to  such  applicant  shall  be  deemed
 renewed  until  such time as the department shall have found such appli-
 cant to be either eligible or ineligible for the renewal of the install-
 ment agreement but in no event for more than six additional months.
   2. To renew an installment agreement under this section, an  applicant
 must  submit  a  renewal  application to the department on or before one
 year from the date such installment agreement was entered into and  each
 year  thereafter  for  which  renewal is sought. To be eligible to renew
 such agreement, an applicant must demonstrate that:
   (a) the property continues to be the primary residence of such  appli-
 cant  and  such  residence  has  been  uninterrupted  since the date the
 initial installment agreement was entered into; and
   (b) the combined income of such applicant and of  all  the  additional
 property owners does not exceed fifty-eight thousand three hundred nine-
 ty-nine  dollars  for the income tax year immediately preceding the date
 of the renewal of such installment agreement, except that  an  applicant
 for  the  renewal  of  a fixed length income-based installment agreement
 pursuant to subdivision m of this section  is  not  required  to  submit
 income information.
   i.  Effects of installment agreement on tax lien and tax lien sale. 1.
 The execution of an installment agreement pursuant to this section shall
 not suspend the accrual of liens, interest and other charges against the
 property, which continue to accrue in accordance with applicable law.
   2. A property  for  which  an  application  has  been  submitted  that
 contains proof of income and, for a senior low-income installment agree-
 S. 8474                            294
 
 ment  described in subdivision l of this section, proof of age, and that
 is signed, but is otherwise incomplete, shall be withdrawn from the next
 tax lien sale. Such property, however, may be included in the  tax  lien
 sale  subsequent to the next tax lien sale if a completed application is
 not submitted within forty-five days from the  date  of  the  additional
 information request notice sent to the applicant by the department or if
 the completed application is denied.
   j.  Amount subject to installment agreement. 1. Each approved install-
 ment agreement shall set forth terms of  repayment,  including  (a)  the
 frequency  of payments, (b) the percentage of the taxes and charges that
 forms the basis of  the  required  payment  for  the  senior  low-income
 installment agreement described in subdivision l of this section, or the
 percentage  of the combined income of the property owners for the income
 tax year immediately preceding the initial application  that  forms  the
 basis  of  the  required  payment  for the installment agreement for the
 fixed length income-based and the extenuating circumstances income-based
 installment agreements described in subdivisions m and  n  respectively,
 (c) the payment schedule, and (d) the payment amount.
   2.  A  lien  sold in a tax lien sale before the date of an application
 for an installment agreement is  not  eligible  to  be  included  in  an
 installment agreement under this section.
   3.  The  applicant  may choose to include the cost of the title search
 required to be submitted with an application  pursuant  to  subparagraph
 (a)  of  paragraph  one  of  subdivision g of this section in the amount
 subject to the installment agreement. If an applicant chooses to include
 such cost, the applicant may either select a title  company  to  conduct
 the  required  search and present documentation to the department of the
 cost, or direct the department to use a title company  selected  by  the
 department. The department shall pay the cost of the title search and be
 reimbursed  by  the  applicant  through  the addition of the cost to the
 amount subject to the installment agreement. The  applicant  shall  make
 such  reimbursement  in  the first year of the installment agreement, in
 monthly or quarterly payments, consistent  with  the  payment  frequency
 selected  for  the  installment  agreement. The cost of the title search
 shall bear interest at the same rate as  the  interest  on  unpaid  real
 property tax as provided in section 11-224.1 of this title.
   4.  (a)  Any  time the amount of the liens on a property subject to an
 installment agreement under this section exceeds twenty-five percent  of
 the  net  equity in such property, the applicant shall pay all taxes and
 charges imposed against the property that exceed twenty-five percent  of
 the  net equity in the property as such taxes and charges become due, in
 addition to the payment amount set forth in the installment agreement.
   (b) Notwithstanding subparagraph (a) of this  paragraph  and  provided
 that  section five hundred eighty-one of the real property tax law is in
 effect in the same form as such section was in effect as of  the  effec-
 tive  date  of  this  section, for property that is a dwelling unit in a
 condominium subject to an installment agreement under this  section  and
 for  which an appraisal has not been obtained pursuant to paragraph four
 of subdivision g of this section, any  time  the  amount  of  the  liens
 subject  to  such  agreement  exceeds fifty percent of the net equity in
 such property, the applicant shall pay all  taxes  and  charges  imposed
 against  such  property  that  exceed fifty percent of the net equity in
 such property as such taxes and charges become due, in addition  to  the
 payment amount set forth in the installment agreement. For property that
 is  a dwelling unit in a condominium and for which an appraisal has been
 obtained pursuant to paragraph four of subdivision g  of  this  section,
 S. 8474                            295
 
 any  time  the  amount  of the liens subject to an installment agreement
 under this section exceeds the higher of (i) fifty percent  of  the  net
 equity in such property based on the fair market value determined by the
 department;  or (ii) twenty-five percent of the net equity in such prop-
 erty based on the fair market value determined by the appraisal obtained
 by the applicant, the applicant shall pay all taxes and charges  imposed
 against such property that exceed the higher of the amounts described by
 clauses  (i)  and  (ii)  of  this subparagraph as such taxes and charges
 become due, in addition to the payment amount set forth in the  install-
 ment agreement.
   (c) The department shall provide each applicant with a written projec-
 tion  at  the  time the installment agreement is entered into as to when
 the twenty-five or fifty percent threshold, as  determined  pursuant  to
 subparagraphs  (a)  and  (b)  of  this  paragraph, will be exceeded. The
 department shall also notify each property owner  in  writing  when  the
 amount of the liens exceeds such threshold. Failure by the department to
 provide  an applicant with such projection or to notify a property owner
 when the amount of the liens exceeds the applicable threshold,  however,
 shall not affect the validity of the installment agreement that has been
 entered into, nor shall any claim arise or exist against the commission-
 er  of  finance  or  any officer or agency of the city by reason of such
 failure to provide such projection or such notification.
   5. If at any time the department determines that the fair market value
 of a property subject to an installment agreement under this section has
 increased, an applicant may request that the net equity in such property
 be recalculated and the net equity amount included in  such  installment
 agreement  be  adjusted  to  reflect the recalculated net equity in such
 property.
   6. If the combined income  of  all  of  the  property  owners  exceeds
 fifty-eight  thousand  three  hundred ninety-nine dollars for the income
 tax year immediately preceding the date of making a renewal  application
 pursuant  to  subdivision h of this section, the applicant shall pay all
 taxes and charges imposed against the property after the  date  of  such
 renewal application as such taxes and charges become due, in addition to
 the payment amount set forth in such installment agreement.
   k.  Termination  of installment agreement. 1. An installment agreement
 shall be terminated when any of the following occurs:
   (a) The property whose liens  are  the  subject  of  such  installment
 agreement is no longer the primary residence of the applicant. An appli-
 cant  whose  installment  agreement  has been terminated because of such
 reason may apply to enter into  an  installment  agreement  pursuant  to
 section 11-322 of this chapter.
   (b)  The fixed term of the installment agreement expires. An applicant
 whose installment agreement has been terminated because of such  expira-
 tion  may  apply  to  enter  into  an  installment agreement pursuant to
 section 11-322 of this chapter or to this section.
   (c) The applicant is deceased.
   (d) The applicant opts out of an installment agreement without a fixed
 term as described in paragraph one of subdivision l of this section.  An
 applicant  who  opts  out  of  such agreement may apply to enter into an
 installment agreement pursuant to section 11-322 of this chapter  or  to
 this section.
   (e)  The  applicant  does  not  file  a  timely renewal application in
 accordance with the provisions of subdivision h of this section.
 S. 8474                            296
 
   (f) The applicant is in default and has  not  cured  such  default  as
 provided  in  subparagraph  (a)  of  paragraph three of this subdivision
 prior to the next tax lien sale.
   (g)  The  applicant has defaulted on the installment agreement and has
 cured such default by entering into a new installment agreement pursuant
 to clause two or three of subparagraph (a) of paragraph  three  of  this
 subdivision.
   2.  If  an  installment agreement is terminated, all taxes and charges
 that accrued before such termination are required to be  paid.  If  such
 taxes  and  charges are not paid within nine months of such termination,
 the tax lien or tax liens on such property may be sold.  Notwithstanding
 the  preceding  sentence,  if  an  agreement  is  terminated pursuant to
 subparagraph (c) of paragraph  one  of  this  subdivision,  a  surviving
 spouse  has  eighteen  months from the death of the applicant to pay all
 taxes and charges on such property before the tax lien or tax  liens  on
 such  property may be sold. If such surviving spouse is a property owner
 he or she may enter into a separate installment  agreement  pursuant  to
 section 11-322 of this chapter or subdivision l, m or n of this section,
 as  long as he or she meets the eligibility requirements for the respec-
 tive installment agreement.
   3. (a) An applicant may cure a default by:
   (i) bringing all installment payments and all current charges, includ-
 ing but not limited to any interest and fees, that  are  outstanding  at
 the time of the default to a current status prior to the date of the tax
 lien sale;
   (ii)  entering into a new installment agreement with a down payment of
 twenty percent or more, of all delinquent real property  taxes,  assess-
 ments, sewer rents, sewer surcharges, water rents and other charges that
 are made a lien subject to the provisions of this chapter, including any
 outstanding interest and fees, prior to the date of such sale; or
   (iii)  entering into a new installment agreement under this section if
 the department has made a finding of extenuating circumstances  pursuant
 to the process described in paragraph four of subdivision (e) of section
 40-03 of title nineteen of the rules of the city of New York.
   (b)  If a default is not cured prior to the date of the tax lien sale,
 such applicant shall not be eligible to enter into an installment agree-
 ment for the subject property for five years, unless the department  has
 made  a  finding  of  extenuating  circumstances pursuant to the process
 described in paragraph four of subdivision (e) of section 40-03 of title
 nineteen of the rules of the city of New York.
   (c) Notwithstanding the prohibition in subparagraph (b) of this  para-
 graph  against  entering  into  an installment agreement for the subject
 property for five years, an applicant who has defaulted on  an  install-
 ment  agreement  and whose lien has been sold and, after the sale of the
 lien, whose property on which the lien was sold is  subject  to  another
 tax  lien  that  is eligible to be sold, may apply to enter into another
 installment agreement with respect to such other lien before the end  of
 such five-year period, provided that such applicant makes a down payment
 of  twenty  percent  or  more,  of  all  delinquent real property taxes,
 assessments, sewer rents, sewer surcharges, water rents and other charg-
 es that are made a lien subject  to  the  provisions  of  this  chapter,
 including  any  outstanding  interest and fees, prior to the date of the
 tax lien sale. An applicant shall not be eligible to enter  an  install-
 ment  agreement  with  a  down payment under this subparagraph more than
 once for the subject property.
 S. 8474                            297
 
   (d) If a property owner who has entered into an installment  agreement
 with  the  department  pursuant  to this section fails to make a payment
 pursuant to such agreement, the department shall, after the first missed
 payment, mail a letter or send an email, when such address is known,  to
 the  property  owner  stating  that  such  owner  is at risk of being in
 default of such agreement. The letter or email shall be sent  after  the
 first  missed  payment if the department has not received payment within
 two weeks of the due date. Failure by the department to mail such letter
 or send such email, however,  shall  not  affect  the  validity  of  the
 installment  agreement  that  has been entered into, nor shall any claim
 arise or exist against the commissioner of finance  or  any  officer  or
 agency of the city by reason of such failure to mail such letter or send
 such email.
   l.  Senior  low-income  installment agreement. 1. At the option of the
 applicant, a senior low-income installment  agreement  may  provide  for
 payments  for  a  fixed  period  of time or for payments without a fixed
 period of time. If the applicant selects an installment agreement with a
 fixed time period, the applicant may select the term of  the  agreement.
 The  applicant  may switch from an installment agreement without a fixed
 time period to an installment agreement with a  fixed  time  period,  or
 from an installment agreement with a fixed time period to an installment
 agreement without a fixed time period, at any point.
   2.  A  senior  low-income  installment agreement shall provide for the
 payment of both a percentage of taxes and charges that have accrued,  if
 any,  and  a  percentage of taxes and charges that will accrue after the
 date of the installment agreement. The applicant may  elect  to  pay  an
 installment  amount  based  on  zero percent, twenty-five percent, fifty
 percent or seventy-five percent of the annual  taxes  and  charges  that
 have  accrued, if any, and that will accrue. If the applicant selects an
 agreement with a fixed time period, the required payment shall be  based
 on  the  percentage  selected  and  the  term selected. If the applicant
 selects an agreement without a fixed time period, the  required  payment
 shall  be  based  on  the  percentage selected for prospective taxes and
 charges and a partial or full payment of the  percentage  of  taxes  and
 charges  that have accrued, if any. The applicant may adjust the payment
 percentage at any point during the installment agreement,  but  may  not
 make more than one such adjustment during any six-month period.
   m.  Fixed  length income-based installment agreement. 1. At the option
 of the applicant, a  fixed  length  income-based  installment  agreement
 pursuant  to  this  subdivision  may provide for the payment of (a) only
 taxes and charges that have accrued or (b) taxes and charges  that  have
 accrued  and  taxes  and  charges  that will accrue over the next fiscal
 year.  If option (a) is selected, the applicant shall pay all taxes  and
 charges  that become due on the property after the installment agreement
 is entered into in addition to the  payment  schedule  provided  in  the
 installment  agreement.  If  option (b) is selected, the applicant shall
 pay all taxes and charges that will accrue on  the  property  after  the
 installment agreement has been in effect for one year in addition to the
 payment schedule provided in the installment agreement.
   2.  The  annual  payment  amount  required  pursuant to an installment
 agreement described by this subdivision shall be based on  a  percentage
 of  the combined income of all of the property owners for the income tax
 year immediately preceding the initial application for such  installment
 agreement.  The  applicant  may select a percentage of two percent, four
 percent, six percent or eight  percent  of  such  combined  income.  The
 installment  payment  shall be calculated by dividing the annual payment
 S. 8474                            298
 
 amount by twelve or four, depending on whether a  monthly  or  quarterly
 payment  schedule is selected. The term of the agreement shall be calcu-
 lated by dividing the taxes and charges included in the agreement pursu-
 ant  to  paragraph  one  of  this subdivision by the installment payment
 determined by the calculation described in this paragraph.
   3. An applicant may adjust the payment percentage at any point  during
 the  installment  agreement, but may not make more than one such adjust-
 ment during any six-month period.
   n. Extenuating circumstances income-based  installment  agreement.  1.
 An  extenuating  circumstances  income-based installment agreement shall
 provide for the payment, during the  period  of  such  agreement,  of  a
 percentage  of  taxes  and charges that have accrued on the property and
 taxes and charges that accrue after the date of the  installment  agree-
 ment.
   2.  The  annual  payment  amount  required  pursuant to an installment
 agreement described by this subdivision shall be based on  a  percentage
 of  the combined income of all of the property owners for the income tax
 year immediately preceding the initial application  for  an  installment
 agreement.  The  applicant  may select a percentage of two percent, four
 percent, six percent, or eight percent of  such  combined  income.  Such
 installment  payment  shall be calculated by dividing the annual payment
 amount by twelve or four, depending on whether a  monthly  or  quarterly
 payment  schedule  is selected. The installment agreement shall be for a
 term of one year but may be extended on a yearly basis if the department
 determines that the extenuating circumstances continue.
   3. An applicant may adjust the payment percentage at any point  during
 the  installment  agreement, but may not make more than one such adjust-
 ment during any six-month period.
   o. After an applicant has entered into an installment  agreement  with
 the department pursuant to this section, the department shall record the
 entry  of  such  agreement  on  the  automated city register information
 access system. Failure by  the  department  to  record  such  agreement,
 however,  shall  in no manner affect the validity of such agreement, nor
 shall any claim arise or exist against the commissioner  of  finance  or
 any officer or agency of the city by reason of such failure to record.
   p.  All installment agreements executed pursuant to this section on or
 after the effective date of this subdivision shall include:
   1. a statement that if payments required from an applicant pursuant to
 such an agreement are not made for a period of six months,  such  appli-
 cant  shall  be  in  default  of such agreement, and the tax lien or tax
 liens on the subject property may be sold, provided, however, that  such
 default  may  be  cured  upon  such applicant's bringing all installment
 payments and all current charges that are outstanding at the time of the
 default to a current status, which shall include, but not be limited to,
 any outstanding interest and fees, prior to the date  of  the  tax  lien
 sale;
   2.  a notification that if such default is not cured prior to the date
 of the tax lien sale, such property owner shall not be eligible to enter
 into an installment agreement for the subject property for  five  years,
 unless  a  finding  of  extenuating  circumstances  has been made by the
 department pursuant to the process described in paragraph four of subdi-
 vision (e) of section 40-03 of title nineteen of the rules of  the  city
 of New York;
   3.  the definition of extenuating circumstances pursuant to such para-
 graph;
 S. 8474                            299
 
   4. a statement describing the  conditions  under  which  the  property
 owner  may be eligible, after default, to enter into another installment
 agreement in accordance with paragraph three of subdivision  k  of  this
 section; and
   5.  the  date by which the applicant must submit a renewal application
 each year.
   q. Every January thirty-first, the  department  shall  submit  to  the
 speaker  of  the council a report on the usage of the installment agree-
 ments set forth in this section in the prior calendar  year,  including,
 but  not  limited  to  the  following data, disaggregated by installment
 agreement type:
   1. the number of new installment agreements executed;
   2. the number of installment agreements in effect on December  thirty-
 first of each year;
   3. the number of applications for installment agreements received, the
 number of applications not approved, and the reasons for disapproval;
   4. for the senior low-income installment agreements, the number of new
 installment  agreements  executed  at zero percent, twenty-five percent,
 fifty percent and seventy-five percent;
   5. for the fixed length  and  extenuating  circumstances  income-based
 installment   agreements,  the  number  of  new  installment  agreements
 executed at two percent, four percent, six percent or eight percent;
   6. the average amount of property taxes and charges addressed  by  the
 installment agreement;
   7. the number of installment agreements that entered into default, the
 number  of  defaults  that  were cured and the method by which they were
 cured;
   8. the number of  installment  agreements  that  were  terminated,  by
 reason of termination;
   9.  the  number of installment agreements that were renewed, including
 whether such renewal occurred before  or  during  the  six-month  period
 described in paragraph one of subdivision h of this section; and
   10.  the number of installment agreements where the amount of liens on
 the subject property exceeded the applicable percent of the  net  equity
 in such property.
   r.  The department shall publicize the availability of the installment
 agreements set forth in this section so as to maximize public  awareness
 of such agreements.
   §  11-323 Commissioner of finance to conduct sale. The commissioner of
 finance or his or her designee  shall  conduct  the  sales  hereinbefore
 provided  to be made, or the commissioner may, in his or her discretion,
 contract with any other person  to  conduct  competitive  sales  of  tax
 liens.
   §  11-324  Deposits  and  forfeits.  The  commissioner  of finance may
 require from each purchaser of a tax lien or tax liens, in cash or  cash
 equivalent  in  immediately  available  funds  in the discretion of such
 commissioner, a deposit of at least five per cent of the cash portion of
 the sale price of the tax lien or tax liens purchased by him or her,  as
 liquidated damages, on a date determined by the commissioner of finance.
 The balance shall be paid to the commissioner of finance in cash or cash
 equivalent  in  immediately  available funds or such other consideration
 acceptable to the commissioner of finance or any combination thereof, in
 his or her discretion. For purposes of this  chapter  "cash  equivalent"
 shall  mean a cashier's check, bank check, certified check, money order,
 or such other paper instrument as  the  commissioner  of  finance  shall
 prescribe. Such deposit and balance may also be paid by electronic funds
 S. 8474                            300
 
 transfer.  For  purposes  of  this  chapter, "electronic funds transfer"
 shall mean any transfer of funds, other than a transaction originated by
 check, draft or similar paper instrument, which  is  initiated  using  a
 format prescribed by the commissioner of finance. A tax lien certificate
 shall  be  made  and delivered to the purchaser upon payment of the sale
 price. In case any purchaser shall default in any obligation  under  the
 terms  and conditions of the tax lien sale, then the amount deposited by
 the purchaser shall be forfeited to the city, and the tax  lien  or  tax
 liens  upon  the property affected by such purchase may be sold again at
 the discretion of the commissioner of finance pursuant to section 11-319
 of this chapter. All deposits forfeited as aforesaid shall be paid  into
 the general fund.
   §  11-327  Tax  lien  certificates;  operation. A tax lien certificate
 shall operate to transfer and assign the  tax  lien  upon  the  property
 described  therein  for  the  taxes,  assessments,  sewer  rents,  sewer
 surcharges, water rents, any other charges that are made a lien  subject
 to  the  provisions of this chapter, the costs of any notices and adver-
 tisements given pursuant to this chapter, any other charges that are due
 and payable, a surcharge pursuant to section 11-332 of this chapter, and
 interest and penalties thereon.
   § 11-328 Contents of a tax lien certificate. A  tax  lien  certificate
 shall contain a transfer and assignment by the city of the tax lien sold
 to  the purchaser, the date of the sale, the aggregate amount of the tax
 lien so transferred, and the items of taxes, assessments,  sewer  rents,
 sewer  surcharges,  water  rents, any other charges that are made a lien
 subject to the provisions of this chapter, the costs of  any  advertise-
 ments and notices given pursuant to this chapter, any other charges that
 are  due  and  payable,  a  surcharge pursuant to section 11-332 of this
 chapter, and interest and penalties thereon comprising the tax lien, the
 rate of interest which the tax lien certificate will bear, the date when
 the amounts under such tax lien are due pursuant to  section  11-332  of
 this  chapter,  and  a  description  of the property affected by the tax
 lien, which description shall include the designation of  such  property
 on  the  tax map, by its lot number and the number of the block in which
 it is contained, and such other identifying information as  the  commis-
 sioner  of  finance  or his or her designee may deem proper to add.  For
 purposes of this section, the words "date of sale" shall have  the  same
 meaning provided in subdivision (e) section 11-320 of this chapter. Each
 tax lien certificate shall be executed by the commissioner of finance or
 his  or  her  designee  by  manual  or  facsimile signature and shall be
 acknowledged by  the  manual  or  facsimile  signature  of  the  officer
 subscribing  the  same  in  the manner in which a deed is required to be
 acknowledged to be recorded in the county in which the property affected
 is situated. The commissioner of finance  may  designate  an  agent  for
 purposes of authenticating any such signature.
   §  11-330 Record of tax lien certificates. The commissioner of finance
 or his or her designee, shall keep in his or her office a public  record
 of sales of tax liens, and a copy of each tax lien certificate issued by
 such  commissioner  or  his  or  her  designee.  Assignments of tax lien
 certificates duly acknowledged may be filed and recorded in  the  office
 of  the  commissioner  of  finance  or  his  or her designee. A tax lien
 certificate and any assignment  thereof,  duly  acknowledged,  shall  be
 deemed conveyances under article eight of the real property law, and may
 be  recorded  in  the  office  of the recording officer of any county in
 which the real property which it affects is situated. Tax  lien  certif-
 icates  and all assignments thereof shall be recorded by recording offi-
 S. 8474                            301
 
 cers in the same manner as mortgages and assignments thereof, but  with-
 out  payment of tax under article eleven of the tax law. Neither the tax
 lien nor the rights transferred or created by  a  tax  lien  certificate
 shall be impaired by failure of a recording officer to record a tax lien
 certificate  made by the city through the commissioner of finance or his
 or her designee.
   § 11-331 Records to be competent evidence. The record in the office of
 the commissioner of finance or his or  her  designee  of  sales  of  tax
 liens,  of  a  tax lien certificate, and of a copy of a tax lien certif-
 icate, and of an assignment of a tax lien certificate, a record of a tax
 lien certificate in the office of a recording officer, and of an assign-
 ment of a tax lien certificate, duly acknowledged, in the  office  of  a
 recording  officer,  shall  each  be  evidence in any court in the state
 without further proof. A transcript of any  record  enumerated  in  this
 section,  duly  certified,  shall  be evidence in any court in the state
 with like effect as the original instrument of record.
   § 11-332 Rights of purchaser of tax lien. a. Any purchaser  of  a  tax
 lien or tax liens shall stand in the same position as the city and shall
 have all the rights and remedies that the city would have had if the tax
 lien or tax liens had not been sold.
   b.  The aggregate amount of each tax lien transferred pursuant to this
 chapter shall be due and payable one year from the  date  of  the  sale.
 Until  such aggregate amount is fully paid and discharged, the holder of
 the tax lien certificate shall be entitled to receive interest  on  such
 aggregate amount from the date of sale, and semi-annually at the rate of
 interest  applicable  in accordance with section 11-319 of this chapter.
 If such aggregate amount is partially paid, the holder of the  tax  lien
 certificate  shall  be  entitled  to receive interest only on the amount
 that remains unpaid. Notwithstanding the foregoing sentence, the  holder
 of  the  tax  lien certificate shall be entitled to receive and retain a
 surcharge equal to five percent of the  lien  arising  pursuant  to  the
 provisions  of  this  chapter  as  a  result of the nonpayment of taxes,
 assessments, sewer rents,  sewer  surcharges,  water  rents,  any  other
 charges  that are made a lien subject to the provisions of this chapter,
 the costs of any advertisements and notices given pursuant to this chap-
 ter, any other charges that are due and payable, and interest and penal-
 ties thereon. Any amounts due shall be paid directly to  the  holder  of
 the  tax  lien  certificate. At the option of the holder of any tax lien
 certificate the aggregate amount thereof shall become subject  to  fore-
 closure  after  default  in  the  payment of interest for thirty days or
 after default for six months after the date of sale stated  in  the  tax
 lien  certificate  in  accordance with subdivision (d) of section 11-320
 and section 11-328 of this chapter in the payment of any taxes,  assess-
 ments,  sewer  rents,  sewer  surcharges, water rents, any other charges
 that are made a lien subject to the provisions of this chapter,  or  the
 interest  or  penalties thereon which become a lien on or after the date
 of sale of the tax lien transferred by such tax lien certificate. At his
 or her option, the holder of the tax lien certificate  may  satisfy  any
 such  subsequent  tax lien on the same property, and shall, by virtue of
 such satisfaction, be deemed to be in the same position as if he or  she
 were a purchaser of a tax lien certificate for such subsequent tax lien,
 provided,  however,  that such holder shall not be entitled to receive a
 five percent surcharge on such subsequent  tax  lien  pursuant  to  this
 section.  The rate of interest on such subsequent lien shall be the rate
 of interest applicable to tax  lien  certificates  pursuant  to  section
 11-319 of this chapter. The commissioner of finance or his or her desig-
 S. 8474                            302
 
 nee,  at  the  request  of  the purchaser of such subsequent lien, shall
 issue a tax lien certificate for such lien pursuant to  sections  11-327
 and  11-328  of  this  chapter.  Upon  issuance of such certificate, the
 commissioner of finance or his or her designee shall provide such notice
 as is required pursuant to section 11-320(d) of this chapter. Failure to
 provide notice pursuant to this subdivision shall not affect the validi-
 ty  of  any  transfer  of a subsequent tax lien or tax liens pursuant to
 this subdivision. Any person having a legal or  beneficial  interest  in
 property  affected by a tax lien certificate may satisfy the same at any
 time upon payment of the amounts due with interest at the rate  applica-
 ble in accordance with section 11-319 of this chapter. Upon satisfaction
 of the tax lien, the holder thereof shall issue to the person who satis-
 fied  such  tax lien a certificate of discharge, certifying that the tax
 lien has been paid or has been otherwise satisfied, in  such  recordable
 form  as  has been approved by the commissioner of finance. For purposes
 of this section, the words "date of sale" shall have  the  same  meaning
 provided in subdivision (e) of section 11-320 of this chapter.
   §  11-333  Discharge  of  tax  lien.   A tax lien sold pursuant to the
 provisions of this chapter may be discharged by presenting  the  certif-
 icate  of  discharge  issued  by  the holder of the tax lien pursuant to
 section 11-332 of this chapter to the recording officer of the county in
 which the real property that it affects is situated, and  any  recording
 officer  to whom such certificate of discharge is presented shall record
 the same.
   § 11-334 Exemption from taxation. Tax liens and tax lien  certificates
 shall  be  exempt  from  taxation by the state or any local subdivisions
 thereof, except from the taxes imposed by article ten of  the  tax  law.
 The  real  property  affected  by  any tax lien shall not be exempt from
 taxation by reason of this section.
   § 11-335 Foreclosure of tax liens. If the amount of any tax lien which
 shall have been transferred by a tax lien certificate shall not be  paid
 when  under its terms and the provisions of section 11-332 of this chap-
 ter such amount shall be due, the holder of such  tax  lien  certificate
 may  maintain an action in the supreme court to foreclose such tax lien.
 The holder of such tax lien certificate shall notify the commissioner of
 finance or his or her designee in writing whenever he or  she  commences
 such  action  at the time of filing of such action, and shall notify the
 commissioner of finance in writing of the  resolution  of  such  action,
 including  any  settlement  of  such  action, within thirty days of such
 resolution. In an action to foreclose a tax lien any person shall  be  a
 proper  party  of whom the plaintiff alleges that such person has or may
 have or that the plaintiff has reason to believe that such person has or
 may have an interest in or claim upon the property affected by  the  tax
 lien.  A  plaintiff  in  an action to foreclose a tax lien shall recover
 reasonable attorney's fees for maintaining such action. Except as other-
 wise provided in this chapter an action to foreclose a tax lien shall be
 regulated by the provisions of the civil practice law and rules  and  by
 all other provisions of law, and rules of practice applicable to actions
 to foreclose mortgages on real property.  The people of the state of New
 York  or  the  city  of  Staten Island may be made party to an action to
 foreclose a tax lien in the same manner as a natural person.  Where  the
 people  of the state of New York or the city of Staten Island are made a
 party defendant the complaint shall set forth, in addition to the  other
 matters  required  to  be  set  forth by law, detailed facts showing the
 particular nature of the interest in or the lien on such property of the
 people of the state of New York  or  the  city  of  Staten  Island,  and
 S. 8474                            303
 
 detailed  facts  showing the particular nature of the interest in or the
 lien on such property which plaintiff has reason  to  believe  that  the
 people of the state of New York or the city of Staten Island have or may
 have in such property, and the reason for making the people of the state
 of New York or the city of Staten Island a party defendant. Upon failure
 to state such facts the complaint shall be dismissed as to the people of
 the state or the city of Staten Island.
   §  11-336  Pleading  tax lien certificate. Whenever a cause of action,
 defense or counterclaim, is for the foreclosure of a tax lien, or is  in
 any  manner  founded  upon  a  tax  lien  or a tax lien certificate, the
 production in evidence of an instrument executed by the commissioner  of
 finance  or his or her designee in the form prescribed in section 11-328
 of this chapter for a tax lien certificate subscribed by or in behalf of
 the commissioner of finance or his or her designee shall be  presumptive
 evidence that the lien purported to be transferred by such an instrument
 was  a valid and enforceable lien, and that it has been duly assigned to
 the purchaser, and it shall not be necessary to plead or prove any  act,
 proceeding,  notice  or  action, preceding the delivery of such tax lien
 certificate nor to establish the validity of the tax lien transferred by
 such tax lien certificate. If a party or person in interest in any  such
 action  or proceeding claims that a tax lien is irregular or invalid, or
 that there is any defect therein or  that  a  tax  lien  certificate  is
 irregular, invalid or defective, such invalidity, irregularity or defect
 must  be  specifically  pleaded  or  set  forth, and must be established
 affirmatively by the party or person pleading or setting forth the same.
   § 11-337 Judgment upon tax lien. In every action for  the  foreclosure
 of  a  tax  lien,  and in every action or proceeding in which a cause of
 action, defense or counterclaim is in any manner founded upon a tax lien
 or a tax lien certificate, such tax lien certificate and  the  tax  lien
 which  it transfers shall be presumed to be regular and valid and effec-
 tual to transfer to the purchaser named therein a valid and  enforceable
 tax  lien.  Unless  in such an action or proceeding such tax lien or tax
 lien certificate be found to be invalid, they shall be  adjudged  to  be
 enforceable  and valid, for the amount thereof and the interest to which
 the holder may be entitled and a tax lien  transferred  by  a  tax  lien
 certificate  effectual  to transfer such tax lien to the purchaser named
 therein.
   § 11-338 Judgment of foreclosure of tax lien; sale. In  an  action  to
 foreclose  a tax lien, unless the defendants obtain judgment, the plain-
 tiff shall be entitled to a judgment establishing the  validity  of  the
 tax lien so far as the same shall not be adjudged invalid and of the tax
 lien  certificate  and directing the sale of the real, personal or mixed
 property affected thereby, or such part thereof as shall  be  sufficient
 to  discharge  the  tax  lien,  or  such  items  thereof as shall not be
 adjudged invalid together with the expense of the sale, and the costs of
 the action.
   § 11-339 City may purchase at sale. At a sale pursuant to judgment  in
 an  action to foreclose a tax lien or at any sale free of tax liens, the
 city, without authorization other than hereby given,  may  purchase  any
 property that is the subject of the sale.
   §  11-340  Effect of judgment foreclosing tax lien.  Every final judg-
 ment in an action to foreclose a tax lien shall  be  binding  upon,  and
 every  conveyance  upon  a  sale pursuant thereto, shall transfer to and
 vest in the purchaser all the right, title, interest and estate  in  and
 claim  upon  the  real property affected by such judgment, of the plain-
 tiff, each defendant upon whom the summons is served, each person claim-
 S. 8474                            304
 
 ing from, through or under such a defendant by title accruing after  the
 filing  of  notice of pendency of the action or after the entry of judg-
 ment and filing of the  judgment  roll  in  the  proper  county  clerk's
 office,  and each person not in being when the judgment is rendered, who
 afterwards may become entitled to a beneficial interest attaching to, or
 an estate or interest in such real  property  or  any  portion  thereof,
 provided  that  the  person  presumptively  entitled  to such beneficial
 interest, estate or interest is a party to such action or bound by  such
 judgment.  So much of section three hundred seventeen of the civil prac-
 tice  law and rules as requires the court to allow a defendant to defend
 an action after final judgment shall not apply to an action to foreclose
 a tax lien.  Delivery of the possession of real property affected  by  a
 judgment  to  foreclose  a  tax  lien  may  be  compelled  in the manner
 prescribed in section  two  hundred  twenty-one  of  the  real  property
 actions and proceedings law.
   §  11-341  Surplus.  Any  surplus  of  the proceeds of the sale, after
 paying the expenses of the  sale,  and  all  taxes,  assessments,  sewer
 rents,  sewer  surcharges,  water  rents,  any other charges made a lien
 subject to the provisions of this chapter, the costs of  any  advertise-
 ments and notices given pursuant to this chapter, any other charges that
 are  due  and  payable, any surcharge pursuant to section 11-332 of this
 chapter and interest and penalties thereon, including such amounts which
 accrued or became a lien on and after the date of sale of the  tax  lien
 or tax liens and up to and including the date of the sale of the proper-
 ty  in  foreclosure,  and  satisfying the amount of such tax lien or tax
 liens and interest and the costs of the action, must be paid into court,
 for the use of the person or persons entitled thereto. If  any  part  of
 the  surplus  remains  in  court  for the period of three months, and no
 application has been made therefor, the court must, and, if an  applica-
 tion  therefor  is  pending,  the  court  may  direct such surplus to be
 invested at interest, for the benefit of the person or persons  entitled
 thereto, to be paid upon the direction of the court.
   §  11-342  Foreclosed tax lien not arrears.  Any party to an action to
 foreclose a tax lien or any purchaser or any party in interest may  give
 notice  of  such foreclosure to the city collector and after such notice
 the items which constituted the tax lien thus foreclosed  shall  not  be
 entered  by the city collector in any yearly assessment-roll, so long as
 the judgment of foreclosure of such lien remains in force.
   § 11-347 Corporation counsel to protect city in all proceedings relat-
 ing to tax liens. It shall be the duty of  the  corporation  counsel  to
 protect the interest of the city in all matters, actions and proceedings
 relating  to tax liens and tax lien certificates; to intervene on behalf
 of the city or to make the city a party  to  any  action  in  which  the
 corporation  counsel believes it to be to the interest of the city so to
 do, by reason of any matter arising under or relating to any tax lien or
 tax lien certificate, or advertisement of sale of tax liens. The  corpo-
 ration counsel in his or her discretion may represent the purchaser of a
 tax  lien or the holder of a tax lien certificate in any action in which
 the corporation counsel believes it to be in the interest of the city so
 to do, by reason of any matter arising under or relating to any tax lien
 or tax lien certificate, or advertisement of sale of  tax  liens.    All
 costs recovered in any action or proceeding conducted or defended by the
 corporation  counsel  pursuant  to this section shall belong to the city
 and shall be collected, applied and disposed of in the  same  manner  as
 are other costs recovered by the city.
 S. 8474                            305
 
   §  11-349 Lost tax lien certificate; delivery of duplicate in case of.
 Whenever any tax lien certificate given by the commissioner  of  finance
 or  his or her designee, as in this chapter provided, shall be lost, the
 commissioner of finance or his or her designee may receive  evidence  of
 such  loss,  and  on  satisfactory  proof  of  the  fact  may direct the
 execution and delivery of a duplicate to  such  person  or  persons  who
 shall  appear  entitled  thereto,  and  may  also, in the commissioner's
 discretion, require a bond of indemnity to the city.
   § 11-350 Affidavits of publication and mailing of necessary notices to
 be preserved. It shall be the duty of the commissioner of finance or his
 or her designee to procure, preserve and register at the  department  of
 finance, affidavits of the publication and mailing of all the advertise-
 ments  and  notices by this chapter required to be published and mailed,
 and such affidavits shall be presumptive proof of such  publication  and
 mailing in all the courts of this state.
   § 11-353 Cancellation of taxes, assessments, water rents, sewer rents,
 sewer  surcharges,  any  charges  that  are  made  a lien subject to the
 provisions of this chapter, the costs of any advertisements and  notices
 given pursuant to this chapter, any other charges that are due and paya-
 ble,  a surcharge pursuant to section 11-332 of this chapter, and inter-
 est and penalties thereon. Whenever the city  has  heretofore  or  shall
 hereafter become vested with title to property acquired by virtue of tax
 enforcement  foreclosure  proceedings,  or  by deed in lieu thereof, the
 commissioner of finance, or his or her designee, shall cancel all unpaid
 real estate taxes, tax  lien  certificates,  assessments,  water  rents,
 sewer  rents, sewer surcharges, any charges that are made a lien subject
 to the provisions of this chapter, the costs of any  advertisements  and
 notices  given  pursuant to this chapter, any other charges that are due
 and payable, a surcharge pursuant to section 11-332 of this chapter, and
 interest and penalties thereon upon which  the  foreclosure  action  was
 predicated.  Upon  the  sale  of such property and the conveyance of the
 title thereof by the city, the commissioner of finance, or  his  or  her
 designee,  shall cancel all unpaid real estate taxes, assessments, water
 rents, sewer rents, sewer surcharges, any charges that are made  a  lien
 subject  to  the provisions of this chapter, the costs of any advertise-
 ments and notices given pursuant to this chapter, any other charges that
 are due and payable, a surcharge pursuant  to  section  11-332  of  this
 chapter,  and  interest  and  penalties  thereon that shall have accrued
 during the period between the date of the last unpaid  item  upon  which
 the  foreclosure  action  was  predicated  and the date of conveyance of
 title. The commissioner of finance, or his or her designee, shall  enter
 notations of such cancellations in the appropriate records for each such
 parcel of property.
   § 11-354 Additional method to enforce payment of tax liens held by the
 city. (a) Notwithstanding any other provision of law and notwithstanding
 any  omission  to  hold  a  tax lien sale, whenever any tax, assessment,
 sewer rent, sewer surcharge, water rent, any charge that is made a  lien
 subject to the provisions of this chapter or chapter four of this title,
 or  interest and penalties thereon, has been due and unpaid for a period
 of at least one year from the date on which the tax, assessment or other
 legal charge represented thereby became a lien, or in the  case  of  any
 class  one  property  or  any  class  two property that is a residential
 condominium or residential cooperative, as such classes of property  are
 defined  in  subdivision one of section eighteen hundred two of the real
 property tax law, or in the case of  a  multiple  dwelling  owned  by  a
 company  organized  pursuant  to  article  eleven of the private housing
 S. 8474                            306
 
 finance law with the consent and approval of the department  of  housing
 preservation  and development, for a period of at least three years from
 the date on which the tax, assessment or other  legal  charge  became  a
 lien,  the  city,  as owner of a tax lien, may maintain an action in the
 supreme court to foreclose such lien. Such action shall be  governed  by
 the  procedures  set  forth in section 11-335 of this chapter; provided,
 however, that such parcel shall only be sold to the highest  responsible
 bidder. Such purchaser shall be deemed qualified as a responsible bidder
 pursuant to such criteria as are established in rules promulgated by the
 commissioner  of  finance  after  consultation  with the commissioner of
 housing preservation and development.
   (b) At a sale pursuant to a judgment in an action brought pursuant  to
 subdivision  (a)  of  this section to foreclose a tax lien, the city may
 purchase property subject to such lien in accordance with the provisions
 of section 11-339 of this chapter.
   (c) The provisions of this section shall not affect any existing reme-
 dy or procedure for the enforcement or foreclosure of tax liens provided
 for in this code or any other law, but the remedy  provided  herein  for
 foreclosure  of  tax liens shall be in addition to any other remedies or
 procedures provided by any general, special or local law.  Notwithstand-
 ing any other provision of this code, the commissioner of finance  shall
 be  authorized to agree to forebear to commence an in rem action against
 property which has an outstanding and unredeemed  tax  lien  certificate
 previously  sold  by the city and held by a third party pursuant to this
 chapter.
   § 11-355 Reporting. The commissioner of finance shall submit an annual
 report to the council concerning the sale or sales of tax  liens  during
 the  preceding  year pursuant to this chapter. Such report shall include
 the following information regarding such sale or sales: a list of  prop-
 erties  for which a tax lien or tax liens has or have been sold, includ-
 ing identification of the particular tax lien or  tax  liens  sold;  the
 proceeds received from the sale or sales of tax liens; identification of
 the  purchaser  of  and  servicer  for the tax lien or tax liens sold; a
 report of servicer activities during the immediately preceding year; the
 redemption rate for tax liens that have been sold; the delinquency  rate
 for  real  property  taxes  for  the immediately preceding year; and any
 other information pertinent to  the  sale  of  tax  liens  that  may  be
 requested  by the council and which is not made confidential pursuant to
 section 11-208.1 of this code. Upon request by the council,  information
 provided  in  such report shall be arranged by community board. In addi-
 tion to such report, the commissioner of finance shall from time to time
 provide any other information pertinent to the sale of  tax  liens  that
 may  be  requested  by  the  council  and which is not made confidential
 pursuant to section 11-208.1 of the code, including updated  information
 regarding  the  sale or sales of tax liens pursuant to this chapter.  In
 addition to such report, no later than August thirty-first, two thousand
 twenty, the commissioner shall provide to the council a  report  listing
 all  properties  on  which  liens  have been sold during the period from
 January first, two thousand fifteen through December  thirty-first,  two
 thousand  nineteen.  The  report shall indicate, based on records in the
 office of the register, whether a transfer of or  mortgage  recorded  on
 any of such properties has occurred during such period after the sale of
 any tax lien sold during such period.
 
                                 CHAPTER 4
                   TAX LIEN FORECLOSURE BY ACTION IN REM
 S. 8474                            307
 
   §  11-401  Definitions.  Whenever  used in this chapter, the following
 terms shall mean:
   1.  "Tax  lien."  The  lien  arising  as a result of the nonpayment of
 taxes, assessments, sewer rents,  sewer  surcharges,  water  rents,  any
 other  charges  that  are  made a lien subject to the provisions of this
 chapter or chapter three of this title, interest and penalties  thereon,
 and the right of the city to receive such amounts.
   2. "Court." The supreme court.
   3.  "Class."  Any class of real property defined in subdivision one of
 section eighteen hundred two of the  real  property  tax  law,  and  any
 subclassification  of  class two real property where such subclassifica-
 tion is established by rule of the commissioner of  finance  promulgated
 pursuant to this subdivision.
   4.  "Distressed  property."  Any parcel of class one or class two real
 property that is subject to a tax lien or  liens  that  result  from  an
 environmental  control  board  judgment against the owner of such parcel
 for a building code violation with a lien or liens to  value  ratio,  as
 determined  by  the  commissioner  of  finance, equal to or greater than
 twenty-five percent or any parcel of class one or class two real proper-
 ty that is subject to a tax lien or liens with a lien or liens to  value
 ratio, as determined by the commissioner of finance, equal to or greater
 than fifteen percent and that meets one of the following two criteria:
   i. such parcel has an average of five or more hazardous or immediately
 hazardous  violations  of  record  of  the  housing maintenance code per
 dwelling unit; or
   ii. such parcel is subject  to  a  lien  or  liens  for  any  expenses
 incurred  by  the department of housing preservation and development for
 the repair or the elimination of any dangerous  or  unlawful  conditions
 therein, pursuant to section 27-2144 of this code, in an amount equal to
 or greater than one thousand dollars.
   §  11-401.1 Procedures for distressed property. a. The commissioner of
 finance shall, not less than sixty days preceding the date of  the  sale
 of  a tax lien or tax liens, submit to the commissioner of housing pres-
 ervation and development a description by block  and  lot,  or  by  such
 other  identification  as the commissioner of finance may deem appropri-
 ate, of any parcel of class one or class  two  real  property  on  which
 there is a tax lien that may be foreclosed by the city. The commissioner
 of  housing preservation and development shall determine, and direct the
 commissioner of finance, not less than ten days preceding  the  date  of
 the  sale  of  a  tax  lien  or  tax liens, whether any such parcel is a
 distressed property as defined in subdivision four of section 11-401  of
 this  chapter. Any tax lien on a parcel so determined to be a distressed
 property shall not be included in such sale. In connection with a subse-
 quent sale of a tax lien or tax liens, the commissioner of finance  may,
 not less than sixty days preceding the date of the sale, resubmit to the
 commissioner  of  housing  preservation and development a description by
 block and lot, or by such other identification as  the  commissioner  of
 finance  may  deem  appropriate, of any parcel of class one or class two
 real property that was previously determined to be a distressed property
 pursuant to this paragraph and on which there is a tax lien that may  be
 included  in  such  sale.  The  commissioner of housing preservation and
 development shall determine, and direct the commissioner of finance, not
 less than ten days preceding the date of the sale, whether  such  parcel
 remains  a distressed property. If the commissioner of housing preserva-
 tion and development determines that the  parcel  is  not  a  distressed
 property, then the tax lien on the parcel may be included in the sale.
 S. 8474                            308
 
   b.  The commissioner of housing preservation and development may peri-
 odically review whether a parcel of class one or class two real property
 that is subject to subdivision c of this section  or  subdivision  j  of
 section  11-412.1  of this chapter remains a distressed property. If the
 commissioner  determines that the parcel is not a distressed property as
 defined in subdivision four of section 11-401 of this chapter, then  the
 parcel shall not be subject to such subdivisions.
   c.  Any  parcel  so  determined  to  be a distressed property shall be
 subject to an in rem foreclosure  action,  or  in  the  case  where  the
 commissioner  of  finance does not commence such action the commissioner
 of housing preservation and development shall evaluate such  parcel  and
 take  such  action  as  he  or she deems appropriate under the programs,
 existing at the time of such evaluation, that are designed to  encourage
 the rehabilitation and preservation of existing housing, and shall moni-
 tor or cause to be monitored the status of the property. The commission-
 er  of  housing  preservation and development, in his or her discretion,
 shall cause an inspection to be conducted on any parcel so determined to
 be a distressed property. In addition, the commissioner of housing pres-
 ervation and development shall submit to  the  council  a  list  of  all
 parcels  so  determined  to  be a distressed property within thirty days
 from the date such parcels are identified as a distressed property.
   § 11-402 Applicability of procedure of  foreclosure  in  rem.  a.  The
 provisions  of  this chapter shall be applicable only to tax liens owned
 by the city.
   b. The provisions of this chapter shall not affect any existing remedy
 or procedure for the enforcement or foreclosure of  tax  liens  provided
 for  in  this  code or any other law, but the remedy provided herein for
 foreclosure by action in rem shall be in addition to any other  remedies
 or procedures provided by any general, special or local law.
   c.  The provisions of this chapter shall not affect pending actions or
 proceedings, provided, however, that any pending  action  or  proceeding
 for the enforcement or foreclosure of tax liens may be discontinued, and
 a  new action may be instituted pursuant to the provisions of this chap-
 ter, in respect to any such tax lien.
   § 11-402.1 Inapplicability of article eleven of the real property  tax
 law to the enforcement of the collection of delinquent taxes. In accord-
 ance with section six of chapter six hundred two of the laws of nineteen
 hundred  ninety-three and subdivision two of section eleven hundred four
 of the real property tax law, it is hereby provided that the  collection
 of  delinquent  taxes shall continue to be enforced pursuant to chapters
 three and four of title eleven of this code and other related provisions
 of the charter and this code as such chapters three and  four  and  such
 related  provisions  may  from  time to time be amended and that article
 eleven of the real property tax law shall not be applicable to the city.
   § 11-403 Jurisdiction. The supreme court shall  have  jurisdiction  of
 actions authorized by this chapter.
   §  11-404  Foreclosure  by  action in rem. a. Whenever it shall appear
 that a tax lien or tax liens has or have been due and unpaid for a peri-
 od of at least one year from the date on which the  tax,  assessment  or
 other  legal  charge represented thereby became a lien, such tax lien or
 tax liens, except as provided in subdivision b of this section or other-
 wise provided by this chapter, may be summarily foreclosed in the manner
 provided in this chapter, notwithstanding the provisions of any general,
 special or local law and notwithstanding any omission to hold a sale  of
 a  tax lien or tax liens prior to such foreclosure. A bill of arrears or
 any other instrument evidencing such tax lien  or  tax  liens  shall  be
 S. 8474                            309
 
 evidence  of the fact that the tax lien or tax liens represented thereby
 has not or have not been paid to the city or sold by it.
   b. A tax lien on any class one property or any class two property that
 is a residential condominium or residential cooperative, as such classes
 of  property  are defined in subdivision one of section eighteen hundred
 two of the real property tax law, and on any multiple dwelling owned  by
 a  company  organized  pursuant to article eleven of the private housing
 finance law with the consent and approval of the department  of  housing
 preservation  and  development,  shall  not  be foreclosed in the manner
 provided in this chapter until such tax lien has been due and unpaid for
 a period of at least three years from the date on which the tax, assess-
 ment or other legal charge represented thereby became a lien.
   § 11-405 Preparation and filing of lists of delinquent taxes.  a.  The
 commissioner  of  finance  from time to time shall prepare a list, to be
 known as a "list of delinquent taxes", of all parcels,  or  all  parcels
 within  a  particular  class  or  classes,  that are within a particular
 section of a tax map or portion of a section of a tax map  of  the  city
 and on which there are tax liens subject to foreclosure pursuant to this
 chapter, provided, however, that no such portion shall be smaller than a
 block,  as  defined in subdivision d of section 11-204 of subchapter one
 of chapter two of this title. Every  such  list  shall  bear  a  caption
 containing  the  in  rem  action  number  of  the city's tax foreclosure
 proceeding, the section of a tax map or portion of a section  of  a  tax
 map, and where the action covers less than all parcels in a section of a
 tax  map  or  portion of a section of a tax map, the particular class or
 classes, and shall contain a statement of the rate  or  rates  at  which
 interest  and  penalties  will  be  computed  for  the  various liens it
 includes.
   b. Every such list shall set forth the parcels it includes  separately
 and  number  them serially. For each parcel it shall contain (1) a brief
 description sufficient to identify the parcel, including section,  block
 and  lot  numbers,  and  the street and street number, if any, or in the
 absence of such information the parcel or  tract  identification  number
 shown on a tax map or on a map filed in the county clerk's or register's
 office  and  (2)  a statement of the amounts and dates of all unpaid tax
 liens which are subject to foreclosure under this chapter and  of  those
 which have accrued thereafter.
   c.  (1)  The  commissioner of finance may exclude or thereafter remove
 from such list any parcels (i) as to which  questions  the  commissioner
 deems  meritorious have been raised regarding the validity of the liens,
 (ii) as to which all the taxes and other  charges  which  rendered  said
 parcels  eligible  for  inclusion  in said list have been paid, or (iii)
 which are owned by an entity other than a company organized pursuant  to
 article  eleven  of the private housing finance law with the consent and
 approval of the department of housing preservation and  development  and
 which are not owner-occupied residential buildings of not more than five
 residential  units  and  as  to  which  an agreement has been duly made,
 executed and filed with such commissioner for the payment of the  delin-
 quent  taxes, assessments or other legal charges, interest and penalties
 in installments. The first installment shall be paid upon the filing  of
 the  installment  agreement  with  the  commissioner  and shall be in an
 amount of not less  than  fifteen  percent  of  such  delinquent  taxes,
 assessments  or other legal charges, interest and penalties. The remain-
 ing installments, which shall be twice the number of unpaid quarters  of
 real  estate taxes or the equivalent thereof but which shall in no event
 exceed thirty-two in number, shall be payable quarterly on the first day
 S. 8474                            310
 
 of July, October, January and April. For the purposes of calculating the
 number of such remaining installments unpaid  real  estate  taxes  which
 are, on and after July first, nineteen hundred eighty-two, due and paya-
 ble  on an other than quarterly basis shall be deemed to be payable on a
 quarterly basis.
   (2) The commissioner of finance may also exclude or thereafter  remove
 from such list any parcels which are owned by a company organized pursu-
 ant  to  article  eleven  of  the  private  housing finance law with the
 consent and approval of  the  department  of  housing  preservation  and
 development,  and  (i)  as  to  which  an  agreement has been duly made,
 executed and filed with said commissioner for the payment of the  delin-
 quent  taxes,  assessments  or other legal charges incurred prior to the
 ownership of said parcel by said article eleven company, and the  inter-
 est and penalties thereon, in installments. The first installment there-
 of  shall  be paid upon the filing of the installment agreement with the
 commissioner and shall be in an amount of not less than ten  percent  of
 such delinquent taxes, assessments or other legal charges and the inter-
 est  and  penalty  thereon.  The  remaining installments, which shall be
 three times the number of unpaid quarters of real estate  taxes  or  the
 equivalent  thereof  but  which  shall in no event exceed forty-eight in
 number shall be payable quarterly on the first days  of  July,  October,
 January  and  April.  For the purposes of calculating the number of such
 remaining installments unpaid real estate taxes which are, on and  after
 July first, nineteen hundred eighty-two due and payable on an other than
 quarterly basis shall be deemed to be payable on a quarterly basis; and
   (ii)  as  to which an agreement has been duly made, executed and filed
 with said commissioner, for the payment of the delinquent taxes, assess-
 ments or other legal charges incurred after the ownership of said parcel
 by said article eleven company on the same  terms  as  are  provided  in
 paragraph one of this subdivision.
   (3)  The commissioner of finance may also exclude or thereafter remove
 from such list any parcels which are owner-occupied  residential  build-
 ings  of  not  more than five residential units as to which an agreement
 has been duly made, executed and filed with said  commissioner  for  the
 payment of the delinquent taxes, assessments, or other legal charges and
 the  interest and penalties thereon, in installments. The first install-
 ment thereof shall be paid upon the filing of the installment  agreement
 with  the  commissioner  and  shall  be  in  an amount not less than ten
 percent of such delinquent taxes, assessment or other legal charges  and
 the  interest  and  penalty  thereon.  The remaining installments, which
 shall be three times the number of unpaid quarters of real estate  taxes
 or the equivalent thereof but which shall in no event exceed forty-eight
 in  number,  shall be payable quarterly on the first days of July, Octo-
 ber, January and April. For purposes of calculating the number  of  such
 remaining  installments unpaid real estate taxes which are, on and after
 July first, nineteen hundred eighty-two, due and  payable  on  an  other
 than quarterly basis shall be deemed to be payable on a quarterly basis.
   (4)  Notwithstanding  paragraph one, two or three of this subdivision,
 with respect to installment agreements duly made, executed and filed  on
 or after the date on which this paragraph takes effect, the commissioner
 of  finance  may  also  exclude  or thereafter remove from such list any
 parcel that is (i) (A) a residential building containing not  more  than
 five  residential units, (B) a residential condominium unit, (C) a resi-
 dential building held in a cooperative form of ownership, or  (D)  owned
 by  a  company organized pursuant to article eleven of the state private
 housing finance law with the consent and approval of the  department  of
 S. 8474                            311
 
 housing  preservation and development, and (ii) as to which an agreement
 has been duly made, executed and filed with such  commissioner  for  the
 payment of the delinquent taxes, assessments or other legal charges, and
 the  interest and penalties thereon, in installments. The first install-
 ment thereof shall be paid upon the filing of the installment  agreement
 with  the  commissioner and shall be in an amount equal to not less than
 ten percent of the total amount of such delinquent taxes, assessments or
 other legal charges and the interest and penalties thereon. The  remain-
 ing  installments, which shall be three times the number of unpaid quar-
 ters of real estate taxes or the equivalent thereof, but which shall  in
 no  event exceed thirty-two in number, shall be payable quarterly on the
 first days of July, October, January and  April.  For  the  purposes  of
 calculating  the  number  of  such  remaining  installments, unpaid real
 estate taxes that are due and payable on other than  a  quarterly  basis
 shall be deemed to be payable on a quarterly basis.
   (5)  Notwithstanding  paragraph one, two or three of this subdivision,
 with respect to installment agreements duly made, executed and filed  on
 or after the date on which this paragraph takes effect, the commissioner
 of  finance  may  also  exclude  or thereafter remove from such list any
 parcel of class one or class two real  property,  other  than  a  parcel
 described  in  paragraph four of this subdivision, as to which an agree-
 ment has been duly made, executed and filed with such  commissioner  for
 the payment of the delinquent taxes, assessments or other legal charges,
 and  the  interest  and  penalties  thereon,  in installments. The first
 installment thereof shall be paid upon the  filing  of  the  installment
 agreement  with  the commissioner and shall be in an amount equal to not
 less than fifteen percent of the total amount of such delinquent  taxes,
 assessments or other legal charges and the interest and penalties there-
 on.  The  remaining  installments,  which  shall  be twice the number of
 unpaid quarters of real estate taxes  or  the  equivalent  thereof,  but
 which  shall  in  no event exceed thirty-two in number, shall be payable
 quarterly on the first days of July, October, January and April. For the
 purposes of calculating  the  number  of  such  remaining  installments,
 unpaid  real estate taxes that are due and payable on other than a quar-
 terly basis shall be deemed to be payable on a quarterly basis.
   (6) Notwithstanding paragraph one, two or three of  this  subdivision,
 with  respect to installment agreements duly made, executed and filed on
 or after the date on which this paragraph takes effect, the commissioner
 of finance may also exclude or thereafter  remove  from  such  list  any
 parcel  of class three or class four real property as to which an agree-
 ment has been duly made, executed and filed with such  commissioner  for
 the payment of the delinquent taxes, assessments or other legal charges,
 and  the  interest  and  penalties  thereon,  in installments. The first
 installment thereof shall be paid upon the  filing  of  the  installment
 agreement  with  the commissioner and shall be in an amount equal to not
 less than fifteen percent of the total amount of such delinquent  taxes,
 assessments or other legal charges and the interest and penalties there-
 on.  The  remaining  installments,  which  shall  be twice the number of
 unpaid quarters of real estate taxes  or  the  equivalent  thereof,  but
 which  shall in no event exceed twenty in number, shall be payable quar-
 terly on the first days of July, October, January and April.    For  the
 purposes  of  calculating  the  number  of  such remaining installments,
 unpaid real estate taxes that are due and payable on other than a  quar-
 terly basis shall be deemed to be payable on a quarterly basis.
   (7)  A  parcel  for which any such installment agreement or agreements
 have been filed with the commissioner shall be excluded or removed  from
 S. 8474                            312

 the  list  of  delinquent  taxes  before  the commencement of the in rem
 action based upon such list only if the amounts paid  pursuant  to  such
 agreement  exceed the amount required to pay all taxes and charges which
 render said parcel eligible for inclusion in the in rem action and there
 has  been no default in such agreement prior to the commencement of said
 action as to either quarterly installments or current taxes, assessments
 or other legal charges.
   (8) As a condition to entering into any agreement under  this  section
 or  section 11-409 of this chapter, the commissioner shall have received
 from the applicant, an affidavit stating that each tenant located on the
 parcel has been notified by certified mail that an  application  for  an
 installment  agreement will be made and that a copy of a standard agree-
 ment form has been included with such notification. Any false  statement
 in such affidavit shall not be grounds to cancel the agreement or affect
 its validity in any way.
   d.  Two  duplicate  originals thereof, verified by the commissioner of
 finance or a subordinate designated by the commissioner, shall be  filed
 in  the  office  of  the clerk of the county in which the parcels listed
 therein are situated. Such filing shall constitute  and  have  the  same
 force  and effect as the filing and recording in such office of an indi-
 vidual and separate notice of pendency of action and as  the  filing  in
 the supreme court in such county of an individual and separate complaint
 by  the  city  as  to each parcel described in said list, to enforce the
 payment of the delinquent taxes, assessments  or  other  lawful  charges
 which have accumulated and become liens against such parcels.
   e.  Each  county  clerk  with  whom such a list of delinquent taxes is
 filed shall, on the date of said filing, place and  thereafter  maintain
 one duplicate original copy thereof, as separately and permanently bound
 by  the commissioner of finance, adjacent to and together with the block
 index of notices of pendency of action and each county clerk  shall,  on
 the  date  of said filing or as soon thereafter as with due diligence is
 practicable, docket the parcels contained  in  the  list  of  delinquent
 taxes  in said block index of notices of pendency of action, which shall
 constitute due filing, recording and indexing of  the  separate  notices
 constituting said list of delinquent taxes in lieu of any other require-
 ment  under rule sixty-five hundred eleven of the civil practice law and
 rules or otherwise.
   f. The commissioner of finance shall file  a  copy  of  each  list  of
 delinquent  taxes, certified as such copy by him or her or a subordinate
 designated by the commissioner, in the office of the  corporation  coun-
 sel.
   g.  The  validity of any proceeding hereunder shall not be affected by
 any omission or error of the commissioner of  finance  in  including  or
 excluding  parcels  from any such list or in the designation of a street
 or street number or by any other similar omission or error.
   § 11-406 Public notice of foreclosure. a. Upon the filing of a list of
 delinquent taxes in the office of the county clerk, the commissioner  of
 finance forthwith shall cause a notice of foreclosure to be published at
 least  once  a  week  for  six  successive weeks in the City Record and,
 subject to section ninety-one of the judiciary law, in  two  newspapers,
 one  of which may be a law journal, to be designated by the commissioner
 of finance, which are published in and  are  circulated  throughout  the
 county  in which the affected property is located. If there are no news-
 papers published in such county, the commissioner of finance may  desig-
 nate  newspapers published in the city of Staten Island which are circu-
 lated throughout the affected county.
 S. 8474                            313
 
   b. Such notice shall clearly indicate that it is a notice of  foreclo-
 sure of tax liens; the section of a tax map or portion of a section of a
 tax  map  in which the properties subject to foreclosure are located and
 where the area affected by the action includes less than all parcels  in
 a section of a tax map or portion of a section of a tax map, the partic-
 ular  class  or  classes contained therein, and by a general description
 which need not contain measurements and direction; where  and  when  the
 list  of  delinquent taxes was filed; the general nature of the informa-
 tion contained in the list; that the  filing  of  the  list  constitutes
 commencement  of  a  foreclosure action by the city in the supreme court
 for the particular county and a notice of  pendency  of  action  against
 each parcel listed; that such action is against the property only and no
 personal  judgment  will be entered; that the list will be available for
 inspection at the city collector's central office  and  at  the  borough
 office  of  the city collector in which said property is located until a
 specified date at least ten weeks after the date of  first  publication;
 that  until  such  date a parcel may be redeemed by paying all taxes and
 charges contained in said list of delinquent taxes together with  inter-
 est and penalties thereon; that during said period of redemption and for
 an  additional period of twenty days after said last date for redemption
 any person having any interest in or lien upon a parcel on the list  may
 file  with  the  appropriate county clerk and serve upon the corporation
 counsel a verified answer setting forth in detail the full name of  said
 answering  party,  the  nature and amount of his or her interest or lien
 and any legal defense against foreclosure; and that in  the  absence  of
 redemption or answer a judgment of foreclosure may be taken by default.
   c.  On or before the date of the first publication of such notice, the
 commissioner of finance shall cause a copy of the notice to be mailed to
 all owners, mortgagees, lienors or encumbrancers, who may be entitled to
 receive such notice by virtue of any owner's registration or in rem card
 filed in the office of the city collector pursuant to section 11-416  or
 11-417  of  this  chapter.  If such owner's registration or in rem cards
 have not been filed in the office of the city collector then said notice
 shall be mailed to the name and address, if any, appearing in the latest
 annual record of assessed valuations. The commissioner of finance  shall
 cause  to  be inserted with such notice a statement substantially in the
 following form:
   "To the party to whom the enclosed notice is addressed:  You  are  the
 presumptive  owner or lienor of one or more of the parcels mentioned and
 described in the list referred to in the  attached  notice.  Unless  the
 taxes and assessments and all other legal charges are paid, or an answer
 is  interposed;  or an arrangement is made for payment of such taxes and
 assessments and all other legal charges in installments, as provided  by
 statute,  the  ownership of said property will in due course pass to the
 city of Staten Island as provided by the administrative code of the city
 of Staten Island."
   The failure of the commissioner of finance to mail such  notice  shall
 not affect the validity of any proceeding brought pursuant to this chap-
 ter  as to any parcel other than the parcel with respect to which notice
 was not mailed.
   d. The commissioner of finance shall cause a copy of such notice to be
 posted in the office of the  commissioner  of  finance,  in  the  county
 courthouse  of the county in which the property subject to such tax lien
 is situated and at three other conspicuous places in the city  in  which
 the affected properties are located.
 S. 8474                            314
 
   § 11-407 Redemption. a. After the filing of a list of delinquent taxes
 and  until  a date at least ten weeks after the first publication of the
 public notice of foreclosure,  as  determined  by  the  commissioner  of
 finance  and  specified in the said notice, a person claiming to have an
 interest  in  any  parcel in said list may redeem it by paying all taxes
 and charges contained in said list of  delinquent  taxes  together  with
 interest and penalties thereon.
   b.  Upon  such redemption the commissioner of finance shall deliver to
 the corporation counsel a certificate  of  redemption.  The  corporation
 counsel  shall  file  such  certificate  with the clerk of the county in
 which said list was filed.  The filing of such certificate shall consti-
 tute and be deemed a discontinuance of the  in  rem  action  as  to  the
 affected  parcel, and the county clerk shall thereupon note such redemp-
 tion and discontinuance in the copy of  the  list  of  delinquent  taxes
 maintained  by  him or her adjacent to the county clerk's block index of
 notices of pendency  of  action  and  shall  cancel  and  discharge  any
 notations  of  the  filing  of  said list of delinquent taxes as to said
 parcel that may appear in any other books, records, indices and  dockets
 maintained  in  said  clerk's  office. The commissioner of finance shall
 also deliver a duplicate  original  certificate  of  redemption  to  the
 person who has redeemed.
   c.  When  the  time  to redeem in an in rem tax foreclosure action has
 expired, any person claiming to have an interest in a parcel included in
 said action shall have the right to make a late  redemption  payment  to
 the  commissioner of finance. Such late redemption payment shall consist
 of all taxes and charges owing on said parcel, the lawful interest ther-
 eon to the date of payment and a penalty of five percent of said payment
 of taxes, charges and interest, which penalty may not exceed  one  thou-
 sand  dollars  as  to  each parcel on which a late redemption payment is
 being made. Such late redemption payment shall be made  in  cash  or  by
 certified  or  bank  check  and shall be accepted by the commissioner of
 finance at any time after the last day to redeem up to the date on which
 the commissioner is advised by the corporation counsel that the prepara-
 tion of the judgment of foreclosure  in  the  in  rem  action  has  been
 commenced. Upon receipt of such late redemption payment, the commission-
 er  of  finance  shall issue a certificate of withdrawal pursuant to the
 provisions of section 11-413 of this chapter.
   § 11-408 Filing of affidavits. All affidavits of filing,  publication,
 posting, mailing or other acts required by this chapter shall be made by
 the  person  or  persons  performing such acts and shall be filed in the
 office of the county clerk of the county in which the  property  subject
 to such tax lien is situated and shall together with all other documents
 required by this chapter to be filed in the office of such county clerk,
 constitute  and  become  a part of the judgment roll in such foreclosure
 action.
   § 11-409 Severance and trial of issues  where  answer  is  interposed;
 installment agreements authorized after action commenced.  a.  If a duly
 verified  answer  is  served upon the corporation counsel not later than
 twenty days after the last date for redemption, the answering  defendant
 shall  have  the right to a severance of the action, as to any parcel in
 which the defendant has pleaded an interest, upon written demand  there-
 for filed with or made a part of his or her answer.
   b.  When such answer is interposed, the court shall summarily hear and
 determine the issues raised by the complaint  and  answer  in  the  same
 manner as it hears and determines other actions, except as herein other-
 wise provided.  Proof that the taxes which made said property subject to
 S. 8474                            315
 
 foreclosure hereunder together with interest and penalties thereon, were
 paid  before filing of the list of delinquent taxes or that the property
 was not subject to tax shall constitute a complete defense.
   c.  No  counterclaim  may  be  asserted  in an answer interposed in an
 action brought  pursuant  to  this  chapter.  Where  a  counterclaim  is
 asserted  in an in rem answer the city may disregard that portion of the
 answer and shall suffer no legal penalty or  impediment  in  the  prose-
 cution of its in rem action for its failure to reply or respond thereto.
 Where  an  answer contains only a counterclaim and no other defenses the
 city may  proceed  to  judgment  of  foreclosure  against  the  property
 affected without the need for moving against the answer.
   d. When a verified answer alleges a substantial equity over the city's
 lien for taxes, the defendant may demand additional time in which to pay
 the  taxes  and interest or to have the property sold with all taxes and
 interest to be paid out of the proceeds of such sale. Upon such demand a
 defendant shall have the right to an extension of time for such  purpose
 not  in  excess  of six months from the last day to interpose an answer.
 Where a mortgagee or lienor who has interposed such answer  commences  a
 proceeding  to foreclose his or her mortgage or lien and it appears that
 with due diligence such proceeding cannot be concluded in time to  allow
 the  payment  of  taxes within the aforesaid six month period, the court
 may, on application before the end of said six month  period,  authorize
 an  additional  period during which such proceeding may be concluded and
 the taxes, together with interest and penalties, paid.
   e. Where an answer of the type described  in  subdivision  d  of  this
 section  is interposed and taxes are paid within the period set forth in
 such subdivision, the commissioner of finance shall issue a  certificate
 of  withdrawal  as  to  the property on which such payment has been made
 pursuant to the provisions of section 11-413 of this chapter. When taxes
 are not paid within the period  set  forth  in  subdivision  d  of  this
 section, it shall be deemed that there was no equity over the city's tax
 liens  and  the  answer shall be deemed to be without merit. The city in
 that event may proceed to judgment of foreclosure against such  property
 without moving against the answer.
   f.  All  answers  interposed in an action hereunder and all affidavits
 and other papers pertaining to any litigation involving such answers  or
 to  any  proceeding brought pursuant to this chapter involving less than
 an entire action shall bear a  caption  containing  the  in  rem  action
 number  of  the  city's tax foreclosure proceeding, the section of a tax
 map or portion of a section of a tax map affected,  and  if  the  action
 covers less than all parcels in the section of a tax map or portion of a
 section  of  a tax map, the particular class or classes, and the serial,
 section, block and lot numbers of the parcel or parcels in issue.
   g. The corporation counsel, when submitting an in  rem  judgment  roll
 pursuant  to  the provisions of this chapter, may request a severance as
 to any parcel on which an in rem answer or litigation is pending, or  as
 to  which,  before  the  preparation  of  said  in  rem judgment roll is
 commenced, an agreement was duly  made,  executed  and  filed  with  the
 commissioner of finance for the payment of the delinquent taxes, assess-
 ments  or other legal charges and interest and penalties in installments
 as provided in subdivision c of section 11-405 of this chapter and there
 has been no default in such agreement as to  either  quarterly  install-
 ments  or  current taxes, assessments or other legal charges. Where such
 an agreement is entered into subsequent to the last date for  redemption
 specified  in  subdivision  a  of  section 11-407 of this chapter, there
 shall be paid to the commissioner of finance at the time  the  aforesaid
 S. 8474                            316
 
 agreement  is  executed  an amount equal to the penalty which would have
 been payable under subdivision c of section 11-407 of this  chapter  had
 the  person executing the agreement made a late redemption payment. Such
 amount  shall  be in addition to any installment payments required to be
 made under the agreement and shall not  be  credited  against  any  such
 installment  payments.  Where  a  default occurs in such agreement as to
 either quarterly installments or current  taxes,  assessments  or  other
 legal  charges, all payments made under the agreement shall be forfeited
 and the city shall be entitled to acquire the parcel  as  to  which  the
 default occurred. Where such default occurs before the submission of the
 judgment  roll,  the  parcels  as  to which such default occurs shall be
 included in said judgment roll among the parcels to be acquired  by  the
 city. Where such default has occurred as to a parcel severed pursuant to
 this  subdivision,  the  corporation counsel shall cause to be entered a
 supplemental judgment of foreclosure as to such  parcel  immediately  on
 notification  by the commissioner of finance of such default. Where such
 installment agreement is paid in full the commissioner of finance  shall
 discontinue  the  in  rem  action  from which said parcel was severed by
 issuing a certificate of withdrawal as to said parcel  pursuant  to  the
 provisions of section 11-413 of this chapter.
   h.  A  party who has interposed an answer as to any parcel included in
 an in rem tax foreclosure action, or any other party interested in  such
 parcel, shall have the right, at any time prior to the final disposition
 of  a  motion  to  strike said answer, to pay all taxes, assessments and
 other legal charges and interest owing  on  said  parcel.  An  answering
 party  who  makes such payment shall not be required to pay any penalty.
 Where such payment is made by other than an answering  party  after  the
 expiration  of  the  period  of  redemption,  there shall be paid to the
 commissioner of finance an additional amount equal to the penalty  paya-
 ble  under  subdivision  c  of section 11-407 of this chapter. Where all
 delinquent taxes, assessments and  other  legal  charges  together  with
 lawful  interest  thereon  and  penalties, where required, are paid, the
 commissioner of finance shall issue a certificate of  withdrawal  as  to
 said  parcel  pursuant to the provisions of section 11-413 of this chap-
 ter. Said parties may also pay such taxes, assessments and  other  legal
 charges  and  interest by an installment agreement. Where such agreement
 is requested before the preparation of the  aforesaid  in  rem  judgment
 roll  is commenced, the terms of said agreement shall be consistent with
 the provisions of subdivision g or  i  of  this  section,  whichever  is
 applicable. Where such agreement is requested after judgment of foreclo-
 sure has been entered in the in rem action in which the aforesaid answer
 was  interposed,  said  agreement  shall  require a first installment of
 fifty percent of all taxes, assessments  and  other  legal  charges  and
 interest  owing  on  said  parcel, a penalty of five percent of all such
 taxes, assessments and other legal charges and interest,  which  penalty
 may  not  exceed one thousand dollars, and the payment of the balance of
 such taxes, assessments and other legal charges  and  interest  in  four
 equal  quarterly  installments  together with all current taxes, assess-
 ments and other legal  charges  that  accrue  during  such  period.  The
 request of an answering party for an installment agreement shall consti-
 tute  a  withdrawal  of  such  party's  answer. An installment agreement
 requested by an interested party other than the  answering  party  shall
 require  the consent of said answering party which shall also constitute
 a withdrawal of such party's answer. The severance provided for in  this
 section shall be continued during the term of all installment agreements
 entered  into  pursuant  to  the provisions of this subdivision. Where a
 S. 8474                            317
 
 default has occurred as to a parcel severed pursuant  to  this  subdivi-
 sion,  the  corporation counsel shall cause to be entered a supplemental
 judgment of foreclosure as to such parcel immediately on notification by
 the  commissioner  of  finance  of  such default. Where such installment
 agreement is paid in full, the commissioner of finance shall discontinue
 the in rem action from which  said  parcel  was  severed  by  issuing  a
 certificate  of  withdrawal as to said parcel pursuant to the provisions
 of section 11-413 of this chapter.
   i. (1) Notwithstanding subdivision g of this section, this subdivision
 shall apply with respect to installment agreements  made,  executed  and
 filed  with  the  commissioner  of finance on or after the date on which
 this subdivision takes effect. An installment agreement pursuant to this
 subdivision may be made,  executed  and  filed  with  such  commissioner
 during  the period beginning on the date on which an action is commenced
 as provided in subdivision d of section  11-405  of  this  chapter  with
 respect  to  the parcel that is the subject of such agreement and ending
 on the date on which such commissioner is  advised  by  the  corporation
 counsel  that  the preparation of the judgment of foreclosure in such in
 rem action has been commenced. Notwithstanding anything to the contrary,
 and except to the extent provided in paragraph two of this  subdivision,
 the provisions of paragraphs one through six of subdivision c of section
 11-405  of  this  chapter  shall  not apply to any installment agreement
 requested on or after the date on which this  subdivision  takes  effect
 and  on or after the date on which an action is commenced as provided in
 subdivision d of such section 11-405 with respect to the parcel that  is
 the subject of such requested agreement.
   (2)  An  agreement  entered  into  pursuant  to this subdivision shall
 provide for the payment in installments of the delinquent taxes, assess-
 ments and other legal charges, and the interest and  penalties  thereon,
 due  and  owing  as  of  the  date on which such agreement is requested.
 Unless an eligible owner or other interested person requests  an  agree-
 ment  pursuant to the provisions of paragraph three of this subdivision,
 the terms of such agreement with respect to a parcel shall be  the  same
 as  the  terms  that  would be applicable to such parcel under paragraph
 four, five or six, as the case may  be,  of  subdivision  c  of  section
 11-405  of  this  chapter,  except  that,  for purposes of the agreement
 pursuant to this paragraph, the amount of the first installment shall be
 equal to: (i) fifteen percent of the total amount due in the case  of  a
 parcel described in paragraph four of subdivision c of section 11-405 of
 this chapter; (ii) twenty percent of the total amount due in the case of
 a  parcel described in paragraph five of subdivision c of section 11-405
 of this chapter; and (iii) twenty-five percent of the total  amount  due
 in  the  case of a parcel described in paragraph six of subdivision c of
 section 11-405 of this chapter.
   (3) Instead of an agreement pursuant to paragraph two of this subdivi-
 sion, an eligible owner or other interested party may request an  agree-
 ment pursuant to the following provisions:
   (i)  With  respect  to  a  parcel that is owned by a company organized
 pursuant to article eleven of the state private housing finance law with
 the consent and approval of the department of housing  preservation  and
 development,  such  agreement  shall provide for the payment in install-
 ments of the delinquent taxes, assessments and other legal charges,  and
 the  interest  and  penalties  thereon,  due and owing as of the date on
 which such agreement is requested. The first installment  thereof  shall
 be  paid  upon  the filing of the installment agreement with the commis-
 sioner of finance and shall be in an amount at least equal  to,  at  the
 S. 8474                            318
 
 applicant's election, either thirty-five percent or fifty percent of the
 total amount of such delinquent taxes, assessments or other legal charg-
 es  and  the interest and penalties thereon. The remaining installments,
 which  shall be three times the number of unpaid quarters of real estate
 taxes or the equivalent thereof, but which  shall  in  no  event  exceed
 thirty-two  in  number,  shall be payable quarterly on the first days of
 July, October, January and April, together with interest at the rate  or
 rates determined as provided in subparagraph (iv) of this paragraph. For
 the  purposes  of calculating the number of such remaining installments,
 unpaid real estate taxes that are due and payable on other than a  quar-
 terly basis shall be deemed to be payable on a quarterly basis.
   (ii)  With  respect  to  a  parcel,  other  than a parcel described in
 subparagraph (i) of this  paragraph,  that  is  a  residential  building
 containing not more than five residential units, a residential condomin-
 ium  unit or a residential building held in a cooperative form of owner-
 ship, such agreement shall provide for the payment  in  installments  of
 the  delinquent  taxes,  assessments  and  other  legal charges, and the
 interest and penalties thereon, due and owing as of the  date  on  which
 such agreement is requested. The first installment thereof shall be paid
 upon  the  filing  of the installment agreement with the commissioner of
 finance and shall be in an amount at least equal to, at the  applicant's
 election,  either  twenty-five  percent  or  fifty  percent of the total
 amount of such delinquent taxes, assessments or other legal charges  and
 the  interest  and  penalties thereon. The remaining installments, which
 shall be three times the number of unpaid quarters of real estate  taxes
 or  the equivalent thereof, but which shall in no event exceed twenty in
 number, shall be payable quarterly on the first days of  July,  October,
 January and April together with interest at the rate or rates determined
 as  provided in subparagraph (iv) of this paragraph. For the purposes of
 calculating the number  of  such  remaining  installments,  unpaid  real
 estate  taxes  that  are due and payable on other than a quarterly basis
 shall be deemed to be payable on a quarterly basis.
   (iii) With respect to any parcel of class one or class two real  prop-
 erty,  other than a parcel described in subparagraph (i) or (ii) of this
 paragraph, such agreement shall provide for the payment in  installments
 of  the  delinquent  taxes, assessments and other legal charges, and the
 interest and penalties thereon, due and owing as of the  date  on  which
 such agreement is requested. The first installment thereof shall be paid
 upon  the  filing  of the installment agreement with the commissioner of
 finance and shall be in an amount at least equal to, at the  applicant's
 election,  either  thirty-five  percent  or  fifty  percent of the total
 amount of such delinquent taxes, assessments or other legal charges  and
 the  interest  and  penalties thereon. The remaining installments, which
 shall be twice the number of unpaid quarters of real estate taxes or the
 equivalent thereof, but which shall in no event exceed twenty in number,
 shall be payable quarterly on the first days of July,  October,  January
 and  April,  together  with  interest at the rate or rates determined as
 provided in subparagraph (iv) of this paragraph.  For  the  purposes  of
 calculating  the  number  of  such  remaining  installments, unpaid real
 estate taxes that are due and payable on other than  a  quarterly  basis
 shall be deemed to be payable on a quarterly basis.
   (iv) (A) Notwithstanding any higher rate of interest prescribed pursu-
 ant to applicable law, and unless a lower rate of interest is applicable
 to  a  delinquent  amount  owing  on  a parcel that is the subject of an
 agreement pursuant to this paragraph, the interest payable together with
 the remaining installments due under such agreement shall be:
 S. 8474                            319
 
   (I) with respect to an agreement for which a  twenty-five  percent  or
 thirty-five percent down payment was made, calculated at a rate equal to
 the sum of (a) the rate prescribed for the applicable period pursuant to
 paragraph (i) of subdivision e of section 11-224.1 of this title and (b)
 one-half of the difference between such rate and the rate prescribed for
 such  period  pursuant  to  paragraph  (ii)  of subdivision e of section
 11-224.1 of this title; or
   (II) with respect to an agreement  for  which  a  fifty  percent  down
 payment  was made, calculated at a rate equal to the rate prescribed for
 the applicable period pursuant to paragraph  (i)  of  subdivision  e  of
 section 11-224.1 of this title.
   (B)  If  a  default  occurs in any agreement executed pursuant to this
 paragraph as to either quarterly installments or current taxes,  assess-
 ments  or  other  legal  charges, the rates of interest determined under
 this subparagraph shall thereupon cease to be applicable and the commis-
 sioner of finance shall thereafter charge, collect and receive  interest
 in the manner and at the rates otherwise prescribed pursuant to law.
   (4)  The  corporation counsel, when submitting an in rem judgment roll
 pursuant to the provisions of this chapter, may request a  severance  as
 to  any  parcel as to which, before the preparation of said in rem judg-
 ment roll is commenced, an agreement was duly made, executed  and  filed
 with  the  commissioner  of  finance  for  the payment of all delinquent
 taxes, assessments and other legal charges and interest and penalties in
 installments as provided in this subdivision,  and  there  has  been  no
 default in such agreement as to either quarterly installments or current
 taxes,  assessments  or  other legal charges. Where such an agreement is
 entered into subsequent to the last date  for  redemption  specified  in
 subdivision  a of section 11-407 of this chapter, there shall be paid to
 the commissioner of finance at the time such agreements are executed  an
 amount  equal to the penalty that would have been payable under subdivi-
 sion c of section 11-407 of this chapter had the  person  executing  the
 agreement  made a late redemption payment. Such amount shall be in addi-
 tion to any installment payments required to be made under the agreement
 and shall not be credited against any such installment payments. Where a
 default occurs in such agreement as to either quarterly installments  or
 current  taxes,  assessments  or  other legal charges, all payments made
 under the agreement shall be forfeited and the city shall be entitled to
 obtain a judgment hereunder as to the parcel as  to  which  the  default
 occurred. Where such default occurred before the submission of the judg-
 ment roll, the parcels as to which such default occurs shall be included
 in  said  judgment roll amount the parcels to be acquired by the city or
 by a third party. Where such default has occurred as to a parcel severed
 pursuant to this subdivision, the corporation counsel shall cause to  be
 entered  a  supplemental judgment of foreclosure as to such parcel imme-
 diately on notification by the commissioner of finance of such  default.
 Where  such  installment  agreement is paid in full, the commissioner of
 finance shall discontinue the in rem action from which such  parcel  was
 severed  by issuing a certificate of withdrawal as to such parcel pursu-
 ant to the provisions of section 11-413 of this chapter.
   § 11-410 Preference over other actions. a. Any action brought pursuant
 to this chapter shall be given preference  over  all  other  causes  and
 actions.
   b. Actions brought pursuant to this chapter shall take precedence over
 any  proceeding  brought to foreclose a mortgage or other lien involving
 the same property.   A parcel included in a  list  of  delinquent  taxes
 which  is  sold  in  a mortgage foreclosure sale held after said list is
 S. 8474                            320
 
 filed may not be sold subject to taxes even if judgment has not yet been
 entered in the tax foreclosure action. All unpaid taxes and interest and
 penalties thereon must be paid, in  full  or  by  installment  agreement
 pursuant  to the provisions of this chapter, out of the proceeds of such
 sale regardless of whether the  mortgage  foreclosure  lis  pendens  was
 filed  before or after the filing of the tax foreclosure action, regard-
 less of whether any party to the  mortgage  foreclosure  proceeding  has
 interposed an answer in the tax foreclosure action and regardless of any
 terms  to  the  contrary  in  the  judgment  in the mortgage foreclosure
 proceeding.
   § 11-411 Presumption of validity. It shall not be  necessary  for  the
 city to plead or prove the various steps, procedures and notices for the
 assessment  and  levy  of the taxes, assessments or other lawful charges
 against the parcels set forth in the list of delinquent  taxes  and  all
 such  taxes,  assessments  or  other lawful charges and the lien thereof
 shall be presumed to be valid. A defendant alleging  any  jurisdictional
 defect  or invalidity in such taxes, assessments or other lawful charges
 or in the foreclosure thereof must particularly specify in  his  or  her
 answer  such  jurisdictional defect or invalidity and must affirmatively
 establish such  defense.  A  judgment  of  foreclosure  granted  in  any
 proceeding  brought  pursuant  to  this chapter, which contains recitals
 that any acts were done or proceedings had which were necessary to  give
 the  court  jurisdiction or power to grant such judgment of foreclosure,
 shall be presumptive evidence that such  acts  were  duly  performed  or
 proceedings  duly  had,  if such judgment of foreclosure shall have been
 duly entered or filed in the office of the clerk of the county in  which
 the  proceeding  was  pending and wherein such judgment was granted. The
 provisions of this chapter shall apply to and  be  valid  and  effective
 with  respect  to  all  defendants  even  though  one or more of them be
 infants, incompetents, absentees or non-residents of the  state  of  New
 York.
   §  11-412  Final judgment. a. The court shall determine upon proof and
 shall make finding upon such proof whether there has been due compliance
 by the city with the provisions of this chapter.
   b. The court shall make a final judgment  awarding  to  the  city  the
 possession  of  any parcel described in the list of delinquent taxes not
 redeemed or withdrawn as provided in this chapter and  as  to  which  no
 answer is interposed as provided herein. In addition thereto, such judg-
 ment  shall  contain  a  direction  to  the  commissioner  of finance to
 prepare, execute and cause to be recorded a deed conveying to  the  city
 full  and complete title to such lands. Upon the execution of such deed,
 the city shall be seized of an estate in fee  simple  absolute  in  such
 land and all persons, including the state of New York, infants, incompe-
 tents,  absentees  and  non-residents who may have had any right, title,
 interest, claim, lien or equity of redemption  in  or  upon  such  lands
 shall  be barred and forever foreclosed of all such right, title, inter-
 est, claim, lien or equity of redemption, except as  otherwise  provided
 in section 11-424 of this chapter. The appointment and tenure of receiv-
 ers, trustees or any other persons, including administrators under arti-
 cle  seven-A of the real property actions and proceedings law, appointed
 by an order of a court to manage real  property,  shall  terminate  when
 title  to  such property vests in the city pursuant to the provisions of
 this chapter. After such termination, said receivers, trustees or admin-
 istrators shall be accountable to the courts that appointed them for the
 faithful performance of their fiduciary obligations during the  term  of
 their  appointment  and to the city for any rents and income received by
 S. 8474                            321
 
 them for any period subsequent to the date of the vesting  of  title  in
 the city.
   If  the  city  serves  a  tenant in possession of a dwelling unit with
 notice of termination of tenancy on grounds other  than  non-payment  of
 rent,  the acceptance of rent for the first forty-five days after termi-
 nation of tenancy by anyone other than an  employee  of  the  department
 designated by the department to receive such rent shall not be deemed or
 construed  as  a  waiver of the city's right to initiate and prosecute a
 proceeding to terminate the tenancy for good cause.
   c. Every deed given pursuant to the provisions of this  section  shall
 be  presumptive evidence that the action and all proceedings therein and
 all proceedings prior thereto from and including the assessment  of  the
 lands  affected  and  all  notices  required  by law were regular and in
 accordance with all provisions of law relating thereto. After two  years
 from  the  date  of the recording of such deed, the presumption shall be
 conclusive, unless at the time that this subdivision  takes  effect  the
 two year period since the recording of the deed has expired or less than
 six  months of such period of two years remains unexpired, in which case
 the presumption shall become conclusive six months after  this  subdivi-
 sion  takes  effect.  No action to set aside such deed may be maintained
 unless the action is commenced and a notice of pendency of the action is
 filed in the office of the proper county clerk prior to  the  time  that
 the presumption becomes conclusive as aforesaid.
   §  11-412.1  Special procedures relating to final judgment and release
 of class one and class two  real  property.  Notwithstanding  any  other
 provision of law to the contrary:
   a.  The court shall determine upon proof and shall make a finding upon
 such proof whether there has been due compliance by the  city  with  the
 applicable provisions of this chapter.
   b.  (1) The court shall make a final judgment authorizing the award of
 possession of any parcel  of  class  one  or  class  two  real  property
 described  in  the list of delinquent taxes not redeemed or withdrawn as
 provided in this chapter and as to which  no  answer  is  interposed  as
 provided herein, and authorizing the commissioner of finance to prepare,
 execute  and cause to be recorded a deed conveying either to the city or
 to a third party deemed qualified and designated by the commissioner  of
 housing  preservation  and  development  full and complete title to such
 lands. Any such conveyance to a third party shall  be  for  an  existing
 use.
   (2) Such third party shall be deemed qualified and shall be designated
 pursuant to such criteria as are established in rules promulgated by the
 commissioner of housing preservation and development, provided, however,
 that  such  criteria  shall  include  but not be limited to: residential
 management experience;  financial  ability;  rehabilitation  experience;
 ability  to  work with government and community organizations; neighbor-
 hood ties; and that the commissioner shall consider  whether  the  third
 party  is  a  responsible  legal  tenant, not-for-profit organization or
 neighborhood-based-for-profit individual or  organization.  The  commis-
 sioner  shall  not  deem  qualified any third party who has been finally
 adjudicated by a court of competent jurisdiction, within seven years  of
 the  date on which such third party would otherwise be deemed qualified,
 to have violated any section of article one hundred fifty,  one  hundred
 seventy-five,  one  hundred seventy-six, one hundred eighty, one hundred
 eighty-five or two hundred of the penal  law  or  any  similar  laws  of
 another  jurisdiction,  or  who  has  been  suspended  or  debarred from
 contracting with the city or any agency of the city pursuant to  section
 S. 8474                            322
 
 335  of  the  charter during the period of such suspension or debarment.
 The rules promulgated by the commissioner pursuant to this paragraph may
 establish other bases for disqualification of a third party.
   c.  Following  the  expiration  of the four-month period prescribed in
 subdivision d of this section, but not more than eight months after  the
 date  on  which,  pursuant  to  subdivision b of this section, the final
 judgment authorizing the award of possession of a parcel of class one or
 class two real property was entered, the  commissioner  of  finance  may
 execute  a deed, pursuant to subdivision b of this section, with respect
 to such parcel. The owner of said parcel shall continue to have  all  of
 the  rights, liabilities, responsibilities, duties and obligations of an
 owner of such parcel, including, but not limited  to,  maintaining  such
 parcel  in  compliance  with  the housing maintenance, building and fire
 codes, and all other applicable laws, unless and until the  commissioner
 of  finance has prepared and executed a deed conveying to the city or to
 a third party full and complete title to such parcel. Upon the execution
 of such deed, the city or the third party shall be seized of  an  estate
 in fee simple absolute in such land and all persons, including the state
 of  New York, infants, incompetents, absentees and non-residents who may
 have had any right, title, interest, claim, lien or equity of redemption
 in or upon such lands shall be barred and forever foreclosed of all such
 right, title, interest, claim, lien or equity of redemption,  except  as
 otherwise provided in subdivisions e and f of this section. The appoint-
 ment  and  tenure of receivers, trustees or any other persons, including
 administrators under article seven-A of the real  property  actions  and
 proceedings law, appointed by an order of a court to manage real proper-
 ty,  shall  terminate when title to such property vests in the city or a
 third party pursuant to the  provisions  of  this  chapter.  After  such
 termination,   said  receivers,  trustees  or  administrators  shall  be
 accountable to the courts that appointed them for the faithful  perform-
 ance of their fiduciary obligations during the term of their appointment
 and to the city or such third party for any rents and income received by
 them  for  any  period subsequent to the date of the vesting of title in
 the city or such third party.
   If the city serves a tenant in possession  of  a  dwelling  unit  with
 notice  of  termination  of  tenancy on grounds other than nonpayment of
 rent, the acceptance of rent for the first forty-five days after  termi-
 nation  of  tenancy  by  anyone other than an employee of the department
 designated by the department to receive such rent shall not be deemed or
 construed as a waiver of the city's right to initiate  and  prosecute  a
 proceeding to terminate the tenancy for good cause.
   d. Within four months after the date on which, pursuant to subdivision
 b  of  this  section,  the  final  judgment  authorizing  the  award  of
 possession of a parcel of class one  or  class  two  real  property  was
 entered,  any  person  claiming to have an interest in such parcel shall
 have the right to make a payment to the commissioner of finance consist-
 ing of all taxes, assessments and other  legal  charges  owing  on  said
 parcel, the lawful interest thereon to the date of payment and a penalty
 of  five  percent  of said payment of taxes, assessments and other legal
 charges and interest, which penalty may not exceed one thousand dollars.
 Such payment shall be made in cash or by certified or bank check. Within
 such four-month period, such  interested  person  may  also  request  an
 installment  agreement  from the commissioner of finance. Such agreement
 shall require, in addition to full payment of the penalty  specified  in
 this subdivision at the time such agreement is entered into, the payment
 at such time of a first installment equal to fifty percent of all taxes,
 S. 8474                            323
 
 assessments  and  other  legal charges, and the lawful interest thereon,
 then owing on such parcel, and the payment of the balance of such taxes,
 assessments and other legal charges and interest in four equal quarterly
 installments  together  with  all  current  taxes, assessments and other
 legal charges that accrue during such period. Upon receipt of payment in
 full of the amount specified in this subdivision,  the  commissioner  of
 finance  shall direct the corporation counsel to prepare and cause to be
 entered an order discontinuing the in rem tax foreclosure action  as  to
 said  property,  cancelling  the notice of pendency of such action as to
 said property and vacating and setting aside the  final  judgment.  Upon
 the execution of an installment agreement and payment of the amounts due
 at  the time such agreement is executed as provided in this subdivision,
 the commissioner of finance shall  direct  the  corporation  counsel  to
 prepare  and cause to be entered an order vacating and setting aside the
 final judgment. The  entry  of  either  such  order  shall  restore  all
 parties, including owners, mortgagees and any and all lienors, receivers
 and administrators and encumbrancers, to the status they held immediate-
 ly  before  such  final judgment was entered.  Where the commissioner of
 finance approves an  application  requesting  an  installment  agreement
 pursuant  to  this subdivision, the order vacating and setting aside the
 final judgment shall provide that in the event of any default as to  the
 payment  of  either quarterly installments or current taxes, assessments
 or other legal charges during the term of such agreement,  all  payments
 under  said  agreement  shall  be forfeited and the corporation counsel,
 immediately upon notification by the commissioner  of  finance  of  such
 default,  shall  cause  to be entered as to such property a supplemental
 judgment of foreclosure in  the  in  rem  action  which  authorizes  the
 commissioner  of  finance to prepare, execute and cause to be recorded a
 deed conveying either to the city or to a third party full and  complete
 title  to  such lands. Upon the entry of such supplemental judgment, the
 provisions of subdivisions c through i of this section  shall  apply  in
 the  same  manner as such subdivisions would have applied had no payment
 been made nor installment agreement executed during the four-month peri-
 od specified in this subdivision.
   e. 1. If the commissioner of finance has prepared, executed and caused
 to be recorded a deed conveying to the city full and complete title to a
 parcel of class one or class two real property acquired by  in  rem  tax
 foreclosure, the city's interest in such parcel may be released pursuant
 to  this subdivision on the application of any party who has an interest
 in said parcel as either owner, mortgagee, lienor,  or  encumbrancer  at
 the  time  of  the  city's acquisition thereof where such application is
 made at any time up to sixteen months from the date on which the deed by
 which the city acquired title to said parcel was recorded.
   2. Any such application shall be made in writing to  the  commissioner
 of general services and shall be verified. It shall contain the informa-
 tion  required  pursuant  to  paragraph  one of subdivision b of section
 11-424 of this chapter, the documents required by subdivision c of  such
 section,  and  shall  be  accompanied by the fees required by paragraphs
 three and six of subdivision b of such  section.  The  fee  required  by
 paragraph three of subdivision b of section 11-424 of this chapter shall
 not be refundable.
   3. The city's interest in any such parcel shall be released only after
 payment  of  the  sums  of  money  specified in subdivision d of section
 11-424 of this chapter.
   4. The provisions contained in subdivision g of section 11-424 of this
 chapter shall govern such an application, except as follows:
 S. 8474                            324
 
   (a)  where  such  provisions  are  inconsistent  with  the  provisions
 contained in this subdivision, the provisions contained in this subdivi-
 sion shall govern such application; and
   (b)  where  the  in  rem  foreclosure  release  board denies a written
 request for an installment agreement that was filed in  connection  with
 an  application  for release of the city's interest in a parcel of class
 one or class two real property and such  application  was  filed  within
 thirty days of the date of the city's acquisition of the property sought
 to be released, the board may, in its discretion, authorize a release of
 the city's interest, provided that the applicant thereafter pays all the
 amounts  required to be paid pursuant to subdivision d of section 11-424
 of this chapter within thirty  days  of  the  date  on  which  a  letter
 requesting such payment is mailed or delivered to such applicant.
   5.  Upon  receipt  of  all the amounts required to be paid pursuant to
 this subdivision, the commissioner of finance shall  direct  the  corpo-
 ration counsel to prepare and cause to be entered an order discontinuing
 the  in  rem  tax foreclosure action as to said property, cancelling the
 notice of pendency of such action as to said property and  vacating  and
 setting  aside  the  final judgment entered pursuant to subdivision b of
 this section and the deed executed and recorded pursuant to  such  final
 judgment  as to said property. The entry of such order shall restore all
 parties, including owners, mortgagees and any and all lienors, receivers
 and administrators and encumbrancers, to the status they held immediate-
 ly before the final judgment was entered, as if the in rem tax  foreclo-
 sure  had  never  taken place, and shall render said property liable for
 all taxes, deficiencies, management fees and liens  which  shall  accrue
 subsequent  to those paid in order to obtain the release provided for in
 this subdivision, or which were, for whatever reason, omitted  from  the
 payment made to obtain said release.
   f. If the commissioner of finance has prepared, executed and caused to
 be  recorded  a  deed conveying to the city full and complete title to a
 parcel of class one or class two real property acquired by  in  rem  tax
 foreclosure and such parcel is entitled to an exemption under any of the
 provisions  of  article  four of the real property tax law during all or
 part of the period covered by the tax  items  appearing  on  a  list  of
 delinquent  taxes,  the  owner of such parcel may apply for a release of
 the city's interest in such exempt  property  under  the  provisions  of
 subdivision  e  of  this  section during the period of time set forth in
 paragraph one of such subdivision and for an additional period up to ten
 years from the date on which the deed by which the city  acquired  title
 to  said  property  was recorded. The application of such owner shall be
 accompanied by the nonrefundable  fee  required  by  paragraph  four  of
 subdivision  b  of  section 11-424 of this chapter and shall contain, in
 addition to the statements, searches and proofs required by  subdivision
 e of this section, a statement that an exemption under the real property
 tax  law is being claimed. Such application shall also state either that
 it is accompanied by the written certificate of the comptroller  setting
 forth the precise period during which said property, while owned by such
 application,  and  during  the period after the city's acquisition up to
 the date of the certificate if said property was still being used for an
 exempt purpose after said acquisition, was entitled to an exemption  and
 the exact nature and extent of such exemption or that an application for
 such written certificate has been filed with the comptroller. On issuing
 such  written  certificate, the comptroller shall cancel those tax items
 which have accrued during the period covered by the certificate  to  the
 extent  the  applicant  is  entitled to an exemption as set forth in the
 S. 8474                            325
 
 certificate. A release of the city's interest may be authorized only  at
 the  discretion  of  the in rem foreclosure release board and, except as
 otherwise provided in paragraph four of subdivision e of  this  section,
 subject  to  all  the restrictions set forth in subdivision g of section
 11-424 of this chapter. A  release  to  an  exempt  applicant  shall  be
 effected  only after said applicant has paid all of the amounts required
 to be paid by subdivision d of section 11-424 of  this  chapter,  except
 for  those  tax  items  which  have  been canceled, in whole or in part,
 pursuant to the comptroller's certificate, within  thirty  days  of  the
 date  on  which  the letter requesting payment is mailed or delivered to
 the applicant.
   g. If the commissioner of finance has prepared, executed and caused to
 be recorded a deed conveying to the city or to a third  party  full  and
 complete  title  to  a  parcel  of  class one or class two real property
 acquired by in rem tax foreclosure, the provisions contained in subdivi-
 sions f and i of section 11-424 of this chapter for the release of prop-
 erty so acquired shall not be available. If the commissioner of  finance
 has  prepared,  executed and caused to be recorded a deed conveying to a
 third party full and complete title to a parcel of class  one  or  class
 two  real  property  acquired  by in rem tax foreclosure, the provisions
 contained in subdivisions e and f of this section  for  the  release  of
 property so acquired shall not be available.
   h.  Every  deed given pursuant to the provisions of this section shall
 be presumptive evidence that the action and all proceedings therein  and
 all  proceedings  prior thereto from and including the assessment of the
 lands affected and all notices required  by  law  were  regular  and  in
 accordance  with  all  provisions  of  law  relating thereto. After four
 months from the date of entry of  the  final  judgment  authorizing  the
 award of possession of any parcel of class one or class two real proper-
 ty  pursuant to the provisions of this section, the presumption shall be
 conclusive. No action to set aside such deed may  be  maintained  unless
 the  action is commenced and a notice of pendency of the action is filed
 in the office of the property county clerk prior to the  time  that  the
 presumption  becomes  conclusive  as  aforesaid.  Should  any lawsuit or
 proceeding be commenced to set aside a deed conveying to a third party a
 parcel of  class  one  or  class  two  real  property  pursuant  to  the
 provisions  of  this  section, such third party shall send to the corpo-
 ration counsel within ten days of their receipt a  copy  of  any  papers
 served on such third party in such lawsuit or proceeding.
   i. If the commissioner of finance does not execute a deed conveying to
 the  city  or  to  a third party a parcel of class one or class two real
 property within eight months after the entry of final judgment authoriz-
 ing the award of possession of such parcel pursuant to subdivision b  of
 this  section,  the commissioner of finance shall direct the corporation
 counsel to prepare and cause to be entered an order discontinuing the in
 rem foreclosure action as to said  property,  canceling  the  notice  of
 pendency  of  such  action  as to said property and vacating and setting
 aside said final judgment. The entry of such  order  shall  restore  all
 parties, including owners, mortgagees and any and all lienors, receivers
 and administrators and encumbrancers, to the status they held immediate-
 ly before such final judgment was entered.
   j.  If  the  commissioner  of finance directs the corporation counsel,
 pursuant to subdivision i of this section, to prepare and  cause  to  be
 entered  an  order  discontinuing  the  in  rem  foreclosure action with
 respect to a parcel of class one or class two real  property  determined
 to  be  distressed  pursuant  to  section  11-401.1 of this chapter, the
 S. 8474                            326
 
 commissioner of housing preservation and development shall evaluate  the
 parcel  determined  to  be  distressed and take such action as he or she
 deems appropriate under the programs, existing at the time of such eval-
 uation,  that are designed to encourage the rehabilitation and preserva-
 tion of existing housing, and shall monitor or cause to be monitored the
 status of the property. The commissioner  of  housing  preservation  and
 development  shall  maintain  a  register of properties determined to be
 distressed.
   § 11-412.2 Council review of conveyance to a third party. The  commis-
 sioner of finance shall, prior to the execution of a deed conveying full
 and complete title of any parcel of class one or class two real property
 to  a  third party pursuant to subdivision c of section 11-412.1 of this
 chapter, notify the council of the proposed conveyance.   Within  forty-
 five  days of such notification, the council may act by local law disap-
 proving the proposed conveyance. In the event the council does  not  act
 by  local  law  within  such forty-five day period, the council shall be
 deemed to have approved the proposed conveyance. During such  forty-five
 day  period  or,  if the city council acts by local law pursuant to this
 section, during the period of time from the notification of the  council
 to  the presentation to the mayor of such local law and during any addi-
 tional period of time prescribed in  section  37  of  the  charter,  the
 eight-month  period provided in subdivisions c and i of section 11-412.1
 of this chapter shall be tolled.
   § 11-413 Withdrawal of parcels from foreclosure. a.  The  commissioner
 of  finance  may,  prior  to  final  judgment,  withdraw a parcel from a
 proceeding under this chapter for any of the following  reasons,  (1)  a
 question  which the commissioner deems meritorious has been raised as to
 the validity of the tax liens affecting the parcel, (2) the city collec-
 tor has accepted a payment of all taxes and interest which rendered  the
 parcel  subject  to  foreclosure  hereunder  because  the records in the
 commissioner's office indicated that the principal amount of such  taxes
 was exceeded by the principal amount of subsequent taxes which would not
 have  rendered the parcel subject to foreclosure hereunder and which had
 been paid prior to the commencement of said proceeding or (3)  in  cases
 where  the  tax foreclosure action cannot be maintained such as, but not
 limited thereto, where the charges which rendered a  parcel  subject  to
 foreclosure  hereunder  have  been  cancelled  or  were  paid before the
 commencement of the foreclosure proceeding  but  such  payment  was  not
 reported  or  did  not clear for payment until after the commencement of
 said proceeding, or where a name and address  appearing  on  an  owner's
 registration  card or an in rem card filed pursuant to section 11-416 or
 11-417 of this chapter and contained in the files of the city  collector
 did  not  appear in the mailing list used by the commissioner of finance
 for mailing notices of foreclosure in such proceeding.
   b. To effectuate such withdrawal the  commissioner  of  finance  shall
 deliver a certificate of withdrawal to the corporation counsel who shall
 file  it  in  the office of the county clerk in which the list of delin-
 quent taxes was filed.  The filing of such certificate with such  county
 clerk  shall effect a discontinuance of the tax foreclosure action as to
 the affected parcel, and the county  clerk  shall  thereupon  note  such
 withdrawal  and  discontinuance  in  the  copy of the list of delinquent
 taxes maintained by him or her adjacent  to  the  county  clerk's  block
 index  of  notices  of pendency of action and shall cancel and discharge
 any and all notations of the filing of said list of delinquent taxes  as
 to  said parcel that may appear in any other books, records, indices and
 dockets maintained in said clerk's office.
 S. 8474                            327
 
   c. The commissioner of finance shall also deliver a duplicate original
 certificate of withdrawal to the person entitled to such withdrawal.
   d.  The  commissioner of finance shall recite the parcels so withdrawn
 and the reasons for withdrawal in  an  affidavit  of  regularity  to  be
 submitted  by  the  commissioner in each action brought pursuant to this
 chapter.
   e. The commissioner of finance shall issue a certificate of withdrawal
 whenever taxes and interest are paid, cancelled, liquidated or otherwise
 lawfully disposed of as to  any  parcel  which  was  previously  severed
 pursuant  to  section  11-409 of this chapter because an answer or liti-
 gation was pending.
   § 11-414 Right of redemption not diminished. The  period  of  time  in
 which  any  owner  of, or other person having an interest in a parcel of
 property may redeem from a sale of a transfer of tax lien is not  hereby
 diminished  nor shall such period of time be diminished by the commence-
 ment of any action brought pursuant to this chapter.
   § 11-415 Priority of liens. Tax liens shall rank in  priority  as  may
 now, or as may hereafter, be provided by law.
   §  11-416 Owner's registration cards; mailing tax bills and notices to
 registered owners or their designees. a.  The  commissioner  of  finance
 shall  maintain a file of owner's registration cards submitted by owners
 of real property. Each such owner's registration card shall be signed by
 the owner or a duly authorized representative and shall state  the  date
 on which it was filed, the owner's full name and post office address and
 a  description  of  the premises by reference to the section, block, and
 lot numbers on the tax map.
   b. The commissioner of finance shall mail bills for taxes, charges and
 assessments to all owners who have filed owner's registration  cards  as
 herein  provided,  but  the failure of the commissioner of finance so to
 mail such bill shall not invalidate or otherwise affect the tax,  charge
 or assessment represented thereby nor prevent the accruing of any inter-
 est  or penalty imposed for the non-payment thereof, nor prevent or stay
 proceedings under this chapter, nor effect the title of the plaintiff or
 any purchaser under such proceedings.
   c. The commissioner of finance shall also mail notice  of  foreclosure
 and  any  other  process required by this chapter to all owners who have
 filed owner's registration cards whenever the parcels as to  which  such
 cards were filed are included in a list of delinquent taxes filed pursu-
 ant  to  this  chapter. The failure to receive such notice or process as
 herein provided shall not affect the validity of any action or  proceed-
 ing brought pursuant to this chapter.
   d.  An owner who files an owner's registration card may also designate
 thereon the full name and post office address of a mortgagee, lienor  or
 other  person  to  receive  bills and notices. Where such designation is
 made, the commissioner of finance shall not mail any bills  and  notices
 to  the owner but shall mail all bills and notices to the owner's desig-
 nee.
   § 11-417 In rem cards; mailing notices to  other  interested  persons.
 a. The commissioner of finance shall, in addition to the file maintained
 by  him  or  her  pursuant to section 11-416 of this chapter, maintain a
 file of in rem cards submitted by any person having an interest in  real
 property  who  is not entitled to have tax bills mailed to him or her by
 the commissioner of finance, including mortgagees, lienors,  encumbranc-
 ers  and  owners  who  have filed owner's registration cards designating
 someone else to receive bills and notices. Each such in rem  card  shall
 be  signed by the person filing such card or a duly authorized represen-
 S. 8474                            328

 tative, shall contain a description of the premises by reference to  the
 section,  block  and lot numbers on the tax map and shall state the date
 on which said card was filed, the full name and post office  address  of
 the  person  filing said card and the nature of the interest said person
 has in said premises.
   b. The commissioner of finance shall mail a notice of foreclosure  and
 any  other process required by this chapter to each person who has filed
 an in rem card whenever the  parcels  to  which  such  cards  refer  are
 included  in  a list of delinquent taxes filed pursuant to this chapter.
 However, failure to receive such notice or process shall not affect  the
 validity of any proceeding brought pursuant to this chapter.
   §  11-418 Writ of assistance. The city, after acquiring title to prem-
 ises under and pursuant to the terms and  provisions  of  this  chapter,
 shall  be  entitled  to  a  writ  of assistance, with the same force and
 effect as if the city had acquired the property by virtue of a  mortgage
 foreclosure.
   §  11-419  Consolidation of actions. Actions or proceedings pending in
 the courts, or otherwise, to cancel a sale of a tax lien on lands a lien
 upon which is being foreclosed by action under this  chapter,  shall  be
 terminated upon the institution of a foreclosure action pursuant to this
 chapter,  and the rights and remedies of the parties in interest to such
 pending actions or proceedings shall be determined by the court in  such
 foreclosure action.
   §  11-420  Lands held for public use; right of sale. Whenever the city
 shall become vested with the title to lands by virtue of  a  foreclosure
 proceeding  brought  pursuant  to  the  provisions of this chapter, such
 lands shall, unless actually used for other than municipal purposes,  be
 deemed  to  be held by the city for a public use but for a period of not
 more than three years from the date of the final judgment. The  city  is
 hereby  authorized  to sell and convey such lands in the manner provided
 by law for the sale and conveyance of other real property held and owned
 by the city and not otherwise.
   § 11-421 Certificate of sale as evidence. The transfer of tax lien  or
 any  other  written instrument representing a tax lien shall be presump-
 tive evidence in all courts in all proceedings under this chapter by and
 against the purchaser and his or her representatives, heirs and assigns,
 of the truth of the statements therein, of the title of the purchaser to
 the property therein described, and of the regularity  and  validity  of
 all  proceedings  had  in  reference  to the taxes, assessments or other
 legal charges for the nonpayment of which the tax lien was sold and  the
 sale  thereof.  After two years from the issuance of such certificate or
 other written instrument, no evidence shall be admissible in  any  court
 in  a proceeding under this chapter to rebut such presumption unless the
 holder thereof shall have procured such transfer of  tax  lien  or  such
 other  written instrument by fraud or had previous knowledge that it was
 fraudulently made or procured.
   § 11-422 Deed in lieu of foreclosure. The city may when authorized  by
 resolution  of  the  successor agency, officer or employee of the former
 board of estimate and in lieu of prosecuting an action  to  foreclose  a
 tax  lien  on any parcel pursuant to this chapter accept a conveyance of
 the interest of any person having any  right,  title,  interest,  claim,
 lien or equity of redemption in or to such parcel.
   §  11-423  Sales and foreclosures of tax liens. Notwithstanding any of
 the provisions of this chapter the city may continue to sell tax  liens,
 transfer  the  same to purchasers and become the purchaser at such sales
 of tax liens in the manner provided by this title.
 S. 8474                            329
 
   § 11-424 Application to the city for release of property  acquired  by
 in  rem tax foreclosure. a. (1) The city's interest in property acquired
 by in rem tax foreclosure may be released pursuant to  this  section  on
 the  application  of  any  party who had an interest in said property as
 either  owner,  mortgagee,  lienor  or  encumbrancer  at the time of the
 city's acquisition thereof where such application is made at any time up
 to two years from the date on which the deed by which the city  acquired
 title to said property was recorded.
   (2)  Notwithstanding  any  inconsistent  provision of paragraph one of
 this subdivision to  the  contrary,  the  city's  interest  in  property
 acquired  by  in  rem  tax  foreclosure may be released pursuant to this
 section upon application of any party who had an interest in said  prop-
 erty  as  either owner, mortgagee, lienor or encumbrancer at the time of
 the city's acquisition thereof where such application is made more  than
 two  years  after  the date on which the deed by which the city acquired
 title to said property was recorded provided such application is author-
 ized by the council as hereinafter provided.  An  application  for  such
 release  and  the documents required by subdivision c of this section in
 support thereof shall be filed with the department of citywide  adminis-
 trative  services  in  the  manner  provided  in  subdivision  b of this
 section. The department of citywide administrative services  shall  give
 the  council  written  notice  of the receipt of each such filing. After
 review and approval of the application by the corporation counsel as  to
 form and eligibility of the applicant, the department of citywide admin-
 istrative  services  shall send a copy of such application to the in rem
 foreclosure release board and to  the  council.  Upon  receipt  of  such
 application,  the in rem foreclosure release board shall take no further
 action on such application unless the council adopts a resolution within
 one hundred twenty days following the first stated meeting of the  coun-
 cil  after receipt of such application authorizing the board to consider
 such application. If the council fails to adopt a resolution within such
 one hundred twenty-day period, the  council  shall  be  deemed  to  have
 denied  its  authorization for the board to consider such application. A
 resolution of the council pursuant to this paragraph shall describe  the
 property  for which release is sought by borough, tax map, block and lot
 number and shall specify that release of the  city's  interest  in  such
 property  is  subject  to the approval of the in rem foreclosure release
 board and to all the conditions  and  restrictions  set  forth  in  this
 section.
   b. 1. Any such application shall be made in writing to the commission-
 er  of  citywide administrative services and shall be verified. It shall
 contain the name and address of the applicant and shall state  the  date
 on  which  and the in rem action by which the city acquired title to the
 property sought to be released. It shall also contain a statement speci-
 fying the nature of the applicant's interest in the property and a  full
 description  of  the  instrument  from  which  the  applicant's interest
 derives including the date of execution,  the  date  and  place  of  the
 recording  or  entry  of said instrument and the parties thereto. In the
 event the applicant's interest arises by reason of the death of a  prior
 owner,  mortgagee,  lienor  or  encumbrancer, then the application shall
 also state the applicant's  relationship  to  said  decedent  and  shall
 include  whatever  additional  information may be necessary to prove the
 applicant's right to make such application.
   2. A fee of two hundred seventy-five dollars  shall  be  paid  on  the
 submission of any such application which is subject to the provisions of
 subdivision f of this section, except that the fee for any such applica-
 S. 8474                            330
 
 tion  for the release of property improved by a one or two-family dwell-
 ing shall be one hundred dollars.
   3. A fee of five hundred fifty dollars shall be paid on the submission
 of  any  such application which is subject to the provisions of subdivi-
 sion g of this section, except that the fee for any such application for
 the release of property improved by a one or two-family  dwelling  shall
 be one hundred dollars.
   4.  A  fee  of  two  hundred seventy-five dollars shall be paid on the
 submission of any such application which is subject to the provisions of
 subdivision h of this section within four months from the date on  which
 the  deed  by  which the city acquired title to the subject property was
 recorded, and a fee of five hundred and fifty dollars shall be  paid  on
 the  submission  of  any  such  application  which  is  subject  to  the
 provisions of such subdivision not within four months  from  such  date;
 except  that  the  fee  for any such application which is subject to the
 provisions of such subdivision for the release of property improved by a
 one or two-family dwelling shall be one hundred dollars.
   5. The fees payable pursuant to paragraphs two, three and four of this
 subdivision shall not be refundable.
   6. In addition to the fees specified in paragraphs two, three and four
 of this subdivision, there shall be paid on the submission of any appli-
 cation which is subject to this section an amount at least equal to  the
 lesser  of nine hundred dollars or the sum specified in paragraph one of
 subdivision d of this section, which amount shall not be refundable, but
 shall be applied in reduction of the sum specified in paragraph  one  of
 subdivision  d  of  this  section;  provided, however, that if a release
 requires the authorization of the in rem foreclosure release board,  and
 such  authorization  is  not  given,  such  additional  amount  shall be
 refunded to the applicant.
   c. Each application shall be supported by the certified search of  the
 city  register or by an official letter, certificate or certified search
 of any title insurance or abstract company, organized and doing business
 under the laws of this state. Such supporting instruments  shall  recite
 the  recording data both as to the deed by which the city acquired title
 to the parcel sought to be released and the instrument  from  which  the
 applicant's interest derives. In the event the applicant's interest does
 not appear of record but is derived by the death of an owner, mortgagee,
 lienor  or  encumbrancer  of  record, then the application shall also be
 supported by the affidavit of  the  applicant  or  other  person  having
 information thereof, or by the duly written certificate or certification
 of  the  county  clerk or the clerk of any surrogate's or other court of
 record, or by any other instrument or document required  by  the  corpo-
 ration counsel to substantiate the applicant's right to file such appli-
 cation in compliance with the provisions of this section.
   d.  The  city's  interest  shall be released only after payment, as to
 each parcel to be released, of the following sums of money:
   1. The principal amount due on all unpaid  taxes,  assessments,  water
 charges  and  sewer  rents appearing on the list of delinquent taxes and
 accruing thereafter together with interest at the rate or rates provided
 by law.
   2. Five percent of the amount paid pursuant to the preceding paragraph
 but not exceeding one thousand dollars for each parcel.
   3. Any deficiency which may result to the city after all payments made
 by it for the repair, maintenance, and  operation  of  the  lands,  real
 estate or real property shall have been charged or debited in the appro-
 priate accounts of the city and all rents, license fees and other moneys
 S. 8474                            331
 
 collected  by  the  city as a result of its operation of the said lands,
 real estate or real property shall have been credited in such  accounts.
 Any  contract  for  repair, maintenance, management or operation made by
 the city on which it shall be liable, although payment thereon shall not
 have  been  made,  shall be deemed a charge or debit to such accounts as
 though payment had been made. The amounts paid and collected by the city
 as shown in its accounts  and  the  necessity  for  making  the  several
 payments and contracts to be charged as herein provided shall be conclu-
 sive upon the applicant. Where a deficiency under this subdivision shall
 be  created  or  increased  by the failure of the city to collect rents,
 license fees or other moneys to which the city may have  been  entitled,
 the  right to collect or to bring action for the same shall be assigned,
 transferred and set over to the applicant by an instrument in writing.
   4. Any and all costs and disbursements which shall have  been  awarded
 to  the city or to which it may have become entitled by operation of law
 or which it may have paid or become liable  for  payment  in  connection
 with any litigation between it and the applicant or any person having an
 estate  or  interest  in  the  lands, real estate or real property to be
 released resulting directly or indirectly from the foreclosure by action
 in rem of the delinquent taxes affecting said lands, real estate or real
 property.
   5. A reasonable monthly fee to be determined by the city, through  the
 department  of citywide administrative services, for management services
 and operations of the lands, real estate or real property  by  the  city
 prior to the release of said lands, real estate or property.
   6.  The  city,  through  the  department  of  citywide  administrative
 services, shall  also  require  as  additional  consideration  for  such
 release,  the  payment  of all arrears on mortgages held by the city and
 all liens accruing to it by operation of law including but  not  limited
 to relocation and emergency repair liens.
   e.  The  corporation  counsel  shall  effect the release of the city's
 interest in property acquired by in rem tax foreclosure, as provided for
 in this section, by preparing and causing to be entered an order discon-
 tinuing the in rem tax foreclosure action as to said  property,  cancel-
 ling  the  notice  of  pendency  of  such action as to said property and
 vacating and setting aside the in rem judgment of  foreclosure  and  the
 deed  executed  and recorded pursuant to such judgment of foreclosure as
 to said property. The entry of such order  shall  restore  all  parties,
 including  owners,  mortgagees  and  any  and all lienors, receivers and
 administrators and encumbrancers, to the status they held  at  the  time
 the  city acquired title to said property, as if the in rem tax foreclo-
 sure had never taken place, and shall render said  property  liable  for
 all  taxes,  deficiencies,  management fees and liens which shall accrue
 subsequent to those paid in order to obtain the release provided for  in
 this  section,  or  which  were,  for  whatever reason, omitted from the
 payment made to obtain said release.
   f. If an application pursuant  to  this  section,  and  the  documents
 required  by subdivision c of this section in support thereof, are filed
 within four months after the date  of  the  city's  acquisition  of  the
 subject property, said application shall be granted providing the corpo-
 ration  counsel  approves  the  application  as  to form, timeliness and
 eligibility of the applicant and providing the applicant  has  paid  all
 amounts  required  to  be  paid  by subdivision d of this section within
 thirty days of the date on which a letter requesting applicant  to  make
 such payment is mailed or delivered to the applicant. The city shall not
 sell  or  assign  any property acquired by in rem tax foreclosure within
 S. 8474                            332
 
 four months of said acquisition but this provision shall not prevent the
 city from authorizing condemnation of such  property  or  vesting  title
 thereto  in  a condemnation proceeding during said four month period. In
 the  event  an application pursuant to this section is filed within four
 months of the city's acquisition by in rem tax foreclosure and title  to
 the  subject  property  vests in condemnation before the city's interest
 therein has been released by the vacate order provided for  herein,  the
 applicant  shall be entitled to the condemnation award for such property
 without the entry of such vacate order, providing the corporation  coun-
 sel  has  approved  the  application as aforesaid and providing that the
 amounts specified in subdivision d of this section,  if  not  previously
 paid,  are deducted from said condemnation award, with taxes apportioned
 to the date of the condemnation title vesting.
   g. If an application for a release of the city's interest in  property
 acquired by in rem tax foreclosure, and the documents required by subdi-
 vision  c of this section in support thereof, have been filed within the
 time allowed in paragraph one of subdivision a of this section, but more
 than four months after the date of  the  city's  acquisition  or  if  an
 application  for such release has been authorized by a resolution of the
 council pursuant to paragraph two of subdivision a of this  section  and
 such  application  and  the  documents required by subdivision c of this
 section in support thereof have  been  filed,  the  in  rem  foreclosure
 release  board  may,  in  its  discretion,  authorize the release of the
 city's interest in said property pursuant to this section, provided that
 the application has been approved by the corporation counsel as to form,
 timeliness and eligibility of the applicant and provided that  the  city
 has  not  sold  or  otherwise  disposed  of  said property and provided,
 further, that said property has not been condemned or  assigned  to  any
 agency  of  the  city and is not the subject of contemplated use for any
 capital or urban renewal project of the city.  The  corporation  counsel
 shall  effect such discretionary release only where the applicant, after
 the board's authorization of the  release,  has  paid  all  the  amounts
 required  to be paid by subdivision d of this section within thirty days
 of the date on which a letter requesting  the  applicant  to  make  such
 payment  is mailed or delivered to the applicant. The in rem foreclosure
 release board may also, in its discretion, authorize a  release  of  the
 city's  interest  in  such  property,  pursuant to the above provisions,
 whenever an application for such release, approved as to  form,  timeli-
 ness  and  eligibility by the corporation counsel, has been filed at any
 time during the period allowed in subdivision a of this section in which
 the applicant has requested an installment agreement of the commissioner
 of citywide administrative services  for  the  payment  of  the  amounts
 required  to be paid by subdivision d of this section provided that said
 commissioner has approved such request.  The  commissioner  of  citywide
 administrative  services  shall  not approve any such request unless the
 applicant shall have given notice  by  certified  mail  to  each  tenant
 located  on the parcel, of the request and shall have given such commis-
 sioner an affidavit stating that such notice has been  provided,  within
 thirty  days  after  the  request. Any false statement in such affidavit
 shall not in any way affect the validity of the  agreement,  be  grounds
 for  its  cancellation  or  in  any way affect the release of the city's
 interest in the parcel. Such agreement shall  require,  in  addition  to
 full  payment of the amounts due under paragraphs two, three, four, five
 and six of subdivision d of this section, a first installment  of  fifty
 percent of the amount due under paragraph one of said subdivision d with
 the  balance  of said amount to be paid in four equal quarterly install-
 S. 8474                            333
 
 ments together with all current taxes, assessments or other legal charg-
 es that accrue during such period; provided, however, that: (i) whenever
 a request for an installment agreement is made of  the  commissioner  of
 citywide  administrative  services  by  a  company organized pursuant to
 article eleven of the private housing finance law with the  consent  and
 approval  of  the  department of housing preservation and development or
 for a parcel which is an owner-occupied residential building of not more
 than five residential units, the commissioner of citywide administrative
 services may, as to that portion of the amounts due under paragraph  one
 of  subdivision d of this section which became due prior to the acquisi-
 tion by the article eleven company of its interest in the  property  and
 as  to  the  amount  due  under  paragraph  one of subdivision d of this
 section in the case  of  such  an  owner-occupied  building,  approve  a
 reduction  of  such  first  installment  to  an amount not less than ten
 percent of the amount due under paragraph one of subdivision d  of  this
 section  and  an increase in the number of the following equal quarterly
 installments to a number which shall be equal to three times the  number
 of  unpaid  quarters  of real estate taxes or the equivalent thereof but
 which shall in no event exceed  forty-eight,  and  (ii)  notwithstanding
 clause  (i)  of  this  paragraph,  whenever  an installment agreement is
 requested on or after the date on which this clause  takes  effect  with
 respect  to  a  parcel that, immediately prior to the city's acquisition
 thereof by in rem tax foreclosure, was  owned  by  a  company  organized
 pursuant to article eleven of the state private housing finance law with
 the  consent  and approval of the department of housing preservation and
 development, or with respect to a parcel that is a residential  building
 containing not more than five residential units, a residential condomin-
 ium  unit or a residential building held in a cooperative form of owner-
 ship, the commissioner of general services may, as  to  the  amount  due
 under  paragraph  one  of  subdivision  d  of  this  section, approve an
 installment agreement containing the  terms  relating  to  the  required
 percentage  payment for the first installment and the required number of
 subsequent quarterly installments, that  would  be  applicable  to  such
 parcel  under paragraph two (but without regard to any reference therein
 to paragraph three) of subdivision i of section 11-409 of this  chapter.
 For purposes of calculating the number of such following equal quarterly
 installments,  unpaid  real estate taxes or the equivalent which are, on
 and after July first, nineteen hundred eighty-two, due and payable on an
 other than quarterly basis shall be deemed to be payable on a  quarterly
 basis.  Where the in rem foreclosure release board denies an application
 requesting an installment agreement the board shall authorize a  release
 of  the city's interest, provided that the applicant thereafter pays all
 the amounts required to be paid by subdivision d of this section  within
 thirty  days  of  the  date on which a letter requesting such payment is
 mailed or delivered to the applicant only when said application and  the
 documents  required  by subdivision c of this section in support thereof
 were filed within thirty days of the date of the city's  acquisition  of
 the  property  sought  to  be  released.    Where the in rem foreclosure
 release board denies an application requesting an installment  agreement
 which  was  filed  more  than  thirty  days after the date of the city's
 acquisition, the board may, in its discretion, authorize  a  release  of
 the city's interest, provided that the applicant thereafter pays all the
 amounts  required  to  be  paid  by subdivision d of this section within
 thirty days of the date on which a letter  requesting  such  payment  is
 mailed  or  delivered  to  the applicant.   Where the in rem foreclosure
 release board approves an application requesting an  installment  agree-
 S. 8474                            334
 
 ment,  the order releasing the city's interest shall provide that in the
 event of any default as to the payment of either quarterly  installments
 or  current taxes, assessments or other legal charges during the term of
 such  agreement,  as  set  forth in the board's resolution, all payments
 made under said agreement shall be forfeited and the city shall be enti-
 tled to reacquire the property  so  released.  The  corporation  counsel
 shall  effect  such  reacquisition  by  causing to be entered as to such
 property a supplemental judgment of foreclosure in the in rem action  by
 which  said property was originally acquired immediately on notification
 by the commissioner of finance of such default.
   h. An owner of property entitled to an  exemption  under  any  of  the
 provisions  of  article  four of the real property tax law during all or
 part of the period covered by the tax  items  appearing  on  a  list  of
 delinquent  taxes may apply for a release of the city's interest in such
 exempt property under the provisions of this section during the  periods
 of  time  set  forth herein and for an additional period up to ten years
 from the date of the city's acquisition of said property by in rem fore-
 closure. The application of such owner shall contain, in addition to the
 statements, searches and proofs required by this  section,  a  statement
 that an exemption under the real property tax law is being claimed. Such
 application  shall also state either that it is accompanied by the writ-
 ten certificate of the comptroller  setting  forth  the  precise  period
 during  which  said  property, while owned by such applicant, and during
 the period after the city's acquisition up to the date  of  the  certif-
 icate  if said property was still being used for an exempt purpose after
 said acquisition, was entitled to an exemption and the exact nature  and
 extent of such exemption or that an application for such written certif-
 icate  has  been  filed  with  the  comptroller. On issuing such written
 certificate, the comptroller shall cancel those  tax  items  which  have
 accrued  during  the period covered by the certificate to the extent the
 applicant is entitled to an exemption as set forth in  the  certificate.
 Where  an  application by an exempt owner is filed more than four months
 after the date of the city's acquisition  of  the  subject  property,  a
 release  of  the city's interest may be issued only at the discretion of
 the in rem foreclosure release board and subject to all the restrictions
 set forth in subdivision g of this  section.  A  release  to  an  exempt
 applicant  shall  be effected only after said applicant has paid all the
 amounts required to be paid by subdivision d of this section, except for
 those tax items which have been cancelled, in whole or in part, pursuant
 to the comptroller's certificate, within thirty  days  of  the  date  on
 which  a  letter requesting payment is mailed or delivered to the appli-
 cant.
   i. The corporation counsel shall also effect the release of the city's
 interest in property acquired by in rem foreclosure, as provided for  in
 this action, whenever the commissioner of finance shall accept as to any
 parcel  so acquired, the payment provided for in paragraph two of subdi-
 vision a of section 11-413 of this chapter. Said commissioner may accept
 such payment at any time within four months of the date  of  the  city's
 acquisition and may further, subject to the approval of the in rem fore-
 closure  release  board,  accept such payment at any time more than four
 months after the date of the city's acquisition but less than two  years
 from the date on which the city's deed was recorded providing said prop-
 erty  has  not  been  sold  or  otherwise  disposed  of nor condemned or
 assigned to any agency of the city and is not  the  subject  of  contem-
 plated use of any capital or urban renewal project of the city.
 S. 8474                            335
 
   §  11-424.1 In rem foreclosure release board. There shall be an in rem
 foreclosure release board consisting of the mayor, the  speaker  of  the
 city  council,  the  borough  president, the corporation counsel and the
 commissioner of finance. Members of the board may, by written  authority
 filed  with  the board and with the city clerk, appoint delegates to act
 on their behalf as members of the board. The board shall have the power,
 acting by resolution, to authorize the release of the city's interest in
 property acquired by in rem tax foreclosure in accordance with  sections
 11-412.1  and  11-424  of  the  code  based upon a determination, in its
 discretion, that such release would be in  the  best  interests  of  the
 city.  The  board shall act after a meeting at which the public has been
 provided an opportunity to comment on the proposed action. A  resolution
 of the board authorizing a release of the city's interest in any proper-
 ty  shall  be  adopted only upon the affirmative vote of not less than a
 majority of all the members of the board. The  board  may  consider  any
 information it deems relevant to a determination. The board shall not be
 required to state the reasons for its determination.
   §  11-425  Agreements  for  payment of delinquent taxes and charges in
 installments. a. During the period  beginning  on  May  ninth,  nineteen
 hundred  seventy-seven  and  ending  on June thirtieth, nineteen hundred
 seventy-seven, the commissioner of finance or, when so specified herein-
 after, the commissioner of general services,  shall  be  authorized  and
 empowered  to  make  and  execute  agreements  in  the circumstances and
 subject to the terms, conditions  and  limitations  set  forth  in  this
 section;  provided,  however,  that  if  the commissioner of finance or,
 where applicable, the commissioner of general services determines in his
 or her sole discretion that good cause exists, he or she  may  make  and
 execute  such  agreements  during  an additional period ending not later
 than July thirty-first, nineteen hundred seventy-seven.
   b. (1) Whenever it shall appear that a tax lien on a parcel  has  been
 due  and  unpaid  for  a  period of at least six months from the date on
 which the tax, assessment or  other  legal  charge  represented  thereby
 became  a  lien, the commissioner of finance may enter into an agreement
 with the owner of such parcel or other person claiming to have an inter-
 est therein providing for the payment of such delinquent taxes,  assess-
 ments or other legal charges and interest and penalties in installments,
 the  first  of  which shall be equal to at least fifteen percent of such
 arrears and shall be payable upon the execution of such agreement.  Each
 remaining  installment  shall be equal to at least an amount produced by
 dividing the balance of such arrears by a factor determined by multiply-
 ing the number of quarters of  such  arrears  by  two  hundred  percent;
 provided,  however,  in no event shall such factor be in excess of thir-
 ty-two. Each such remaining installment shall be  payable  quarterly  on
 the first of July, October, January and April.
   (2) If an agreement authorized by paragraph one of this subdivision is
 executed  prior  to  the  time  the commissioner of finance files in the
 office of the county clerk a list of delinquent taxes covering the  city
 or  portion  of  the  city  in which the subject parcel is located, such
 parcel shall be excluded from such list of delinquent  taxes,  provided,
 at the time such list is filed, there is no default in the agreement and
 all  current taxes, assessments or other legal charges have been paid as
 they became due or within the period of grace provided by  law.  In  the
 event  of  any  default  in  the agreement or any failure to make timely
 payment of any current item, the parcel shall, if  then  delinquent  for
 the  applicable  period  specified in section 11-404 of this chapter, be
 eligible for inclusion in any list of delinquent taxes thereafter filed.
 S. 8474                            336
 
   (3) If an in rem foreclosure action has  been  commenced  against  any
 parcel  prior  to May ninth, nineteen hundred seventy-seven, the commis-
 sioner of finance may, notwithstanding the provisions of paragraph three
 of subdivision a of section 11-413 of this chapter, enter into an agree-
 ment  authorized  and  described  in  the  foregoing  provisions of this
 section with respect to such parcel. However, if such  an  agreement  is
 entered  into  subsequent  to  the last date for redemption specified in
 subdivision a of section 11-407 of this chapter, there shall be paid  to
 the  commissioner  of  finance at the time said agreement is executed an
 amount equal to the penalty which would have been payable under subdivi-
 sion c of section 11-407 of this chapter had the  person  executing  the
 agreement  made a late redemption payment. Such amount shall be in addi-
 tion to any installment payments required to be made under the agreement
 and shall not be credited against any  such  installment  payments.  Any
 parcel  which is the subject of an agreement made pursuant to this para-
 graph may, prior to  final  judgment,  be  withdrawn  from  the  action,
 provided  there  has  been  no  default  in  the agreement, and provided
 further that all current taxes, assessments or other legal  charges  are
 paid when they become due or within the period of grace provided by law.
 Such  withdrawal shall be effected by the commissioner of finance in the
 manner provided in section 11-413 of this chapter.
   (4) Any person who, prior to May ninth, nineteen hundred  seventy-sev-
 en,  has  made,  executed  and filed with the commissioner of finance an
 agreement pursuant to the provisions of paragraph three of subdivision a
 of section 11-413 of this chapter, shall be permitted to  make  applica-
 tion  to  the  commissioner  of  finance  for the purpose of having such
 agreement  cancelled  and  a  new  agreement  executed  as   hereinabove
 provided.
   If  an  agreement executed prior to May ninth, nineteen hundred seven-
 ty-seven is not cancelled as herein provided, any installments  due  and
 payable  under  such  agreement on or after July first, nineteen hundred
 seventy-seven shall be subject to interest  at  the  rate  specified  in
 paragraph five of this subdivision, but only if, as of July first, nine-
 teen hundred seventy-seven, there is no default in the agreement and all
 current  taxes, assessments or other legal charges have been paid within
 the time allowed by law. Such rate of interest shall  be  calculated  in
 the  manner  and shall be subject to all the conditions provided in said
 paragraph five.
   (5) When an agreement has been entered into pursuant to this  subdivi-
 sion,  the  commissioner  of finance shall, notwithstanding the rates of
 interest prescribed in section 11-224, 11-312 or 11-313 of  this  title,
 charge,  collect  and  receive  interest  on the arrears due and payable
 under such agreement, to be calculated at the rate of seven percent  per
 annum  from  July  first,  nineteen hundred seventy-seven to the date of
 payment of each installment. Any interest accrued or accruing  prior  to
 July  first, nineteen hundred seventy-seven shall not be affected by the
 provisions of this  paragraph,  but  shall  be  charged,  collected  and
 received  in  the  manner  and at the rates specified in section 11-224,
 11-312 or 11-313 of this title. The seven percent rate of interest spec-
 ified in this paragraph shall be applicable only  if  (i)  there  is  no
 default  in  the agreement entered into as provided in this section, and
 (ii) all current taxes, assessments or other legal charges are  paid  as
 they  become  due  or within the period of grace provided by law. In the
 event of any default or failure to make timely payment  of  any  current
 item,  the  seven  percent  rate of interest specified in this paragraph
 shall thereupon cease to be applicable and the commissioner  of  finance
 S. 8474                            337
 
 shall  thereafter charge, collect and receive interest in the manner and
 at the rates otherwise specified in this title.
   (6)  In addition to the terms and conditions required by the preceding
 paragraphs of this subdivision to be included in  agreements  authorized
 by  this  section,  the  commissioner  of  finance  may  in  his  or her
 discretion include in such agreements such additional terms  and  condi-
 tions, not inconsistent with this section, as he or she determines to be
 necessary in order to properly carry out the provisions of this section.
 The  commissioner  may  also  adopt such rules and regulations as may be
 necessary to carry out the provisions of this section.
   c. (1) If, pursuant to the provisions of section 11-424 of this  chap-
 ter,  an  application  for  the release of property acquired by the city
 through in rem tax foreclosure is  made  within  the  four-month  period
 specified  in  subdivision  f  of  section  11-424  of this chapter, and
 provided such application is made during the period specified in  subdi-
 vision  a  of this section, the provisions of this subdivision shall, at
 the election of the applicant, apply with respect  to  such  application
 and the release sought thereby.
   (2)  At  the  time of filing the application for release, an applicant
 who elects to have the provisions of this subdivision apply  to  him  or
 her,  shall  pay  to  the  city the amounts specified in paragraphs two,
 three and four of subdivision d of section 11-424 of this  chapter,  for
 this  purpose,  the  amount  specified in paragraph two thereof shall be
 deemed to be the amount which would have been required to be paid there-
 under had this section not been in effect. Concurrent with the making of
 such payment, the applicant shall  enter  into  an  agreement  with  the
 commissioner  of  general  services  providing  for  the  payment of all
 current taxes, assessments or other legal charges  on  the  property  as
 they  become  due  or  within  the grace period provided by law, and, in
 addition, providing for the payment of the amount specified in paragraph
 one of subdivision d of section 11-424 of this chapter in  installments,
 the  first  of  which  shall be equal to at least twenty-five percent of
 such amount and shall be payable upon the execution of  such  agreement.
 The  balance  of  such amount shall be payable in twelve equal quarterly
 installments, each of which shall be paid  quarterly  on  the  first  of
 July, October, January and April.
   (3)  Pending approval by the corporation counsel of an application for
 release as to form, timeliness and eligibility  of  the  applicant,  all
 payments  made  pursuant  to  the  preceding  paragraph shall be held in
 escrow; in the event the corporation counsel  disapproves  the  applica-
 tion,  such  payments shall be returned to the applicant, and the agree-
 ment executed by the applicant shall thereupon be cancelled.
   (4) In the case of any agreement made and executed pursuant  to  para-
 graph two hereof, interest on any installment due and payable thereunder
 shall,  notwithstanding  the  rates  of  interest  prescribed in section
 11-224, 11-312 or 11-313  of  this  title,  be  charged,  collected  and
 received  at  the rate of seven percent per annum from July first, nine-
 teen hundred seventy-seven to the date of payment of  each  installment.
 Any  interest  accrued or accruing prior to July first, nineteen hundred
 seventy-seven shall not be affected by the provisions of this paragraph,
 but shall be charged, collected and received in the manner  and  at  the
 rates  specified  in section 11-224, 11-312 or 11-313 of this title. The
 seven percent rate of interest specified  in  this  paragraph  shall  be
 applicable only if (i) there is no default in the agreement entered into
 as provided in this subdivision, and (ii) all current taxes, assessments
 S. 8474                            338
 
 or  other legal charges are paid as they become due or within the period
 of grace provided by law.
   (5)  No  release  for which application has been made pursuant to this
 subdivision shall be granted until the final payment under the agreement
 herein provided is received by the city.  Upon  receipt  of  such  final
 payment  by the city the corporation counsel shall effect the release in
 the manner provided in section 11-424 of this chapter. In the  event  of
 any  default in an agreement executed as provided in this subdivision or
 any failure to pay current taxes, assessments or other legal charges  as
 they  become due or within the grace period provided by law, such agree-
 ment shall thereupon become void, the release process  shall  be  termi-
 nated, and all payments theretofore made shall be forfeited to the city.
   (6)  In addition to the terms and conditions required by the preceding
 paragraphs of this subdivision to be included in  agreements  authorized
 thereby,  the  commissioner  of  general  services  may  in  his  or her
 discretion include in such agreements such additional terms  and  condi-
 tions,  not  inconsistent  with  this  subdivision,  as the commissioner
 determines to be necessary in order to properly carry out the provisions
 hereof.  The commissioner of general services may also adopt such  rules
 and  regulations as may be necessary to carry out the provisions of this
 subdivision.
   § 11-426 Agreements for payment of delinquent  taxes  and  charges  in
 installments.  a.  During the period beginning on December second, nine-
 teen hundred seventy-seven and ending on  March  thirty-first,  nineteen
 hundred  seventy-eight,  the commissioner of finance, or, when so speci-
 fied hereinafter, the commissioner of general services, shall be author-
 ized and empowered to make and execute agreements in  the  circumstances
 and  subject  to the terms, conditions and limitations set forth in this
 section.
   b. (1) Whenever it shall appear that a tax lien on a parcel  has  been
 due  and  unpaid  for  a  period of at least six months from the date on
 which the tax, assessment or  other  legal  charge  represented  thereby
 became  a  lien, the commissioner of finance may enter into an agreement
 with the owner of such parcel or other person claiming to have an inter-
 est therein providing for the payment of such delinquent taxes,  assess-
 ments or other legal charges and interest and penalties in installments,
 the  first  of  which shall be equal to at least fifteen percent of such
 arrears and shall be payable upon the execution of such agreement.  Each
 remaining  installment  shall be equal to at least an amount produced by
 dividing the balance of such arrears by a factor determined by multiply-
 ing the number of quarters of such arrears by two hundred percent. In no
 event, however, shall the factor referred to in the  preceding  sentence
 be  in  excess  of  thirty-two. Each such remaining installment shall be
 payable quarterly on the first of July, October, January and April.
   (2) If an agreement authorized by paragraph one of this subdivision is
 executed prior to the time the commissioner  of  finance  files  in  the
 office  of the county clerk a list of delinquent taxes covering the city
 or portion of the city in which the  subject  parcel  is  located,  such
 parcel  shall  be excluded from such list of delinquent taxes, provided,
 at the time such list is filed, there is no default in the agreement and
 all current taxes, assessments or other legal charges have been paid  as
 they  became  due or within the period of grace provided by law.  In the
 event of any default in the agreement or  any  failure  to  make  timely
 payment  of  any  current item, the parcel shall, if then delinquent for
 the applicable period specified in section 11-404 of  this  chapter,  be
 eligible for inclusion in any list of delinquent taxes thereafter filed.
 S. 8474                            339
 
   (3)  If  an  in  rem foreclosure action has been commenced against any
 parcel prior to December second,  nineteen  hundred  seventy-seven,  the
 commissioner of finance may, notwithstanding the provisions of paragraph
 three  of subdivision a of section 11-413 of this chapter, enter into an
 agreement  authorized  and described in the foregoing provisions of this
 section with respect to such parcel. However, if such  an  agreement  is
 entered  into  subsequent  to  the last date for redemption specified in
 subdivision a of section 11-407 of this chapter, there shall be paid  to
 the  commissioner  of  finance at the time said agreement is executed an
 amount equal to the penalty which would have been payable under subdivi-
 sion c of section 11-407 of this chapter had the  person  executing  the
 agreement  made a late redemption payment. Such amount shall be in addi-
 tion to any installment payments required to be made under the agreement
 and shall not be credited against any  such  installment  payments.  Any
 parcel  which is the subject of an agreement made pursuant to this para-
 graph may, prior to  final  judgment,  be  withdrawn  from  the  action,
 provided  there  has  been  no  default  in  the agreement, and provided
 further that all current taxes, assessments or other legal  charges  are
 paid when they become due or within the period of grace provided by law.
 Such  withdrawal shall be effected by the commissioner of finance in the
 manner provided in section 11-413 of this chapter.
   (4) Any person who, prior to December second, nineteen hundred  seven-
 ty-seven,  has made, executed and filed with the commissioner of finance
 an agreement pursuant to the provisions of paragraph three  of  subdivi-
 sion  a  of  section  11-413 of this chapter, shall be permitted to make
 application to the commissioner of finance for  the  purpose  of  having
 such  agreement  cancelled  and  a new agreement executed as hereinabove
 provided.
   If an agreement executed prior to December  second,  nineteen  hundred
 seventy-seven  is not cancelled as herein provided, any installments due
 and payable under such agreement  on  or  after  April  first,  nineteen
 hundred seventy-eight shall be subject to interest at the rate specified
 in  paragraph  five of this subdivision, but only if, as of April first,
 nineteen hundred seventy-eight, there is no default in the agreement and
 all current taxes, assessments or other legal  charges  have  been  paid
 within  the  time  allowed by law. Such rate of interest shall be calcu-
 lated in the manner and shall be subject to all the conditions  provided
 in said paragraph five.
   (5)  When an agreement has been entered into pursuant to this subdivi-
 sion, the commissioner of finance shall, notwithstanding  the  rates  of
 interest  prescribed  in section 11-224, 11-312 or 11-313 of this title,
 charge, collect and receive interest on  the  arrears  due  and  payable
 under  such  agreement to be calculated at the rate of seven percent per
 annum from April first, nineteen hundred seventy-eight to  the  date  of
 payment  of each installment.  Any interest accrued or accruing prior to
 April first, nineteen hundred seventy-eight shall not be affected by the
 provisions of this  paragraph,  but  shall  be  charged,  collected  and
 received  in  the  manner  and at the rates specified in section 11-224,
 11-312 or 11-313 of this title. The seven percent rate of interest spec-
 ified in this paragraph shall be applicable only  if  (i)  there  is  no
 default  in  the agreement entered into as provided in this section, and
 (ii) all current taxes, assessments or other legal charges are  paid  as
 they  become  due or within the period of grace provided by law.  In the
 event of any default or failure to make timely payment  of  any  current
 item,  the  seven  percent  rate of interest specified in this paragraph
 shall thereupon cease to be applicable and the commissioner  of  finance
 S. 8474                            340
 
 shall  thereafter charge, collect and receive interest in the manner and
 at the rates otherwise specified in this title.
   (6)  In addition to the terms and conditions required by this subdivi-
 sion to be included  in  agreements  authorized  by  this  section,  the
 commissioner  of  finance may, in his or her discretion, include in such
 agreements such additional terms and conditions, not  inconsistent  with
 this  section,  as such commissioner determines to be necessary in order
 to properly carry out the provisions of this section.  The  commissioner
 of finance may also adopt such rules and regulations as may be necessary
 to carry out the provisions of this section.
   c.  (1) If, pursuant to the provisions of section 11-424 of this chap-
 ter, an application for the release of property  acquired  by  the  city
 through  in  rem  tax  foreclosure  is made within the four-month period
 specified in subdivision f  of  section  11-424  of  this  chapter,  and
 provided  such application is made during the period specified in subdi-
 vision a of this section, the following provisions of  this  subdivision
 shall,  at  the  election  of  the applicant, apply with respect to such
 application and the release sought thereby.
   (2) At the time of filing the application for  release,  an  applicant
 who  elects  to  have the provisions of this subdivision apply to him or
 her, shall pay to the city the  amounts  specified  in  paragraphs  two,
 three  and  four of subdivision d of section 11-424 of this chapter, for
 this purpose, the amount specified in such paragraph two shall be deemed
 to be the amount which would have been required to  be  paid  thereunder
 had  this section not been in effect. Concurrent with the making of such
 payment, the applicant shall enter into an agreement  with  the  commis-
 sioner  of  general  services  providing  for the payment of all current
 taxes, assessments or other legal charges on the property as they become
 due or within the grace  period  provided  by  law,  and,  in  addition,
 providing  for  the  payment of the amount specified in paragraph one of
 subdivision d of section 11-424 of this  chapter  in  installments,  the
 first  of  which  shall be equal to at least twenty-five percent of such
 amount and shall be payable upon the execution of such agreement.    The
 balance  of  such  amount  shall  be  payable  in twelve equal quarterly
 installments, each of which shall be paid  quarterly  on  the  first  of
 July, October, January and April.
   (3)  Pending approval by the corporation counsel of an application for
 release as to form, timeliness and eligibility  of  the  applicant,  all
 payments  made  pursuant  to  the  preceding  paragraph shall be held in
 escrow; in the event the corporation counsel  disapproves  the  applica-
 tion,  such  payments shall be returned to the applicant, and the agree-
 ment executed by him or her shall thereupon be cancelled.
   (4) In the case of any agreement made and executed  pursuant  to  such
 paragraph  two,  interest  on any installment due and payable thereunder
 shall, notwithstanding the  rates  of  interest  prescribed  in  section
 11-224,  11-312  or  11-313  of  this  title,  be charged, collected and
 received at the rate of seven percent per annum from April first,  nine-
 teen  hundred  seventy-eight to the date of payment of each installment.
 Any interest accrued or accruing prior to April first, nineteen  hundred
 seventy-eight shall not be affected by the provisions of this paragraph,
 but  shall  be  charged, collected and received in the manner and at the
 rates specified in section 11-224, 11-312 or 11-313 of this  title.  The
 seven  percent  rate  of  interest  specified in this paragraph shall be
 applicable only if (i) there is no default in the agreement entered into
 as provided in this subdivision, and (ii) all current taxes, assessments
 S. 8474                            341
 
 or other legal charges are paid as they become due or within the  period
 of grace provided by law.
   (5)  No  release  for which application has been made pursuant to this
 subdivision shall be granted until the final payment under the agreement
 herein provided is received by the city.  Upon  receipt  of  such  final
 payment  by the city the corporation counsel shall effect the release in
 the manner provided in section 11-424 of this chapter. In the  event  of
 any  default in an agreement executed as provided in this subdivision or
 any failure to pay current taxes, assessments or other legal charges  as
 they  become due or within the grace period provided by law, such agree-
 ment shall thereupon become void, the release process  shall  be  termi-
 nated, and all payments theretofore made shall be forfeited to the city.
   (6)  In addition to the terms and conditions required by this subdivi-
 sion to be included in agreements authorized thereby,  the  commissioner
 of  general  services  may,  in  his  or her discretion, include in such
 agreements such additional terms and conditions, not  inconsistent  with
 this  subdivision,  as  the  commissioner  determines to be necessary in
 order to properly carry out the provisions hereof. The  commissioner  of
 general  services  may  also  adopt such rules and regulations as may be
 necessary to carry out the provisions of this subdivision.
   § 11-427 Agreements for payment of delinquent  taxes  and  charges  in
 installments.  a.  During the period beginning September first, nineteen
 hundred seventy-eight and ending December thirty-first, nineteen hundred
 seventy-eight, the commissioner of finance, or, when so specified  here-
 inafter,  the  commissioner of general services, shall be authorized and
 empowered to make  and  execute  agreements  in  the  circumstances  and
 subject  to  the  terms,  conditions  and  limitations set forth in this
 section; provided, however, that if  the  commissioner  of  finance  or,
 where  applicable,  the  commissioner of general services, determines in
 his or her sole discretion that good cause exists, he or  she  may  make
 and execute such agreements during an additional period ending not later
 than January thirty-first, nineteen hundred seventy-nine.
   b.  (1)  (i)  Whenever it shall appear that a tax lien on a parcel has
 been due and unpaid for a period of at least six months from the date on
 which the tax, assessment or  other  legal  charge  represented  thereby
 became  a  lien, the commissioner of finance may enter into an agreement
 with the owner of such parcel or other person claiming to have an inter-
 est therein providing for the payment of such delinquent taxes,  assess-
 ments or other legal charges and interest and penalties in installments,
 the  first  of  which shall be equal to at least fifteen percent of such
 arrears and shall be payable upon the execution of such agreement.  Each
 remaining  installment  shall be equal to at least an amount produced by
 dividing the balance of such arrears by a factor determined by multiply-
 ing the number of quarters of such arrears by two.
   (ii) In no event, however, shall the factor referred  to  in  subpara-
 graph  (i)  of  this  paragraph  be  in  excess of thirty-two. Each such
 remaining installment shall be payable quarterly on the first  of  July,
 October, January and April.
   (2) If an agreement authorized by paragraph one of this subdivision is
 executed  prior  to  the  time  the commissioner of finance files in the
 office of the county clerk a list of delinquent taxes covering the  city
 or  portion  of  the  city  in which the subject parcel is located, such
 parcel shall be excluded from such list of delinquent  taxes,  provided,
 at the time such list is filed, there is no default in the agreement and
 all  current taxes, assessments or other legal charges were paid as they
 became due or within the period of grace provided by law. In  the  event
 S. 8474                            342
 
 of any default in the agreement or any failure to make timely payment of
 any  current item, the parcel shall, if then delinquent for the applica-
 ble period specified in section 11-404 of this chapter, be eligible  for
 inclusion in any list of delinquent taxes thereafter filed.
   (3)  If  an  in  rem foreclosure action has been commenced against any
 parcel prior to September first,  nineteen  hundred  seventy-eight,  the
 commissioner of finance may, notwithstanding the provisions of paragraph
 three  of subdivision a of section 11-413 of this chapter, enter into an
 agreement authorized and described in the foregoing provisions  of  this
 section  with  respect  to such parcel. However, if such an agreement is
 entered into subsequent to the last date  for  redemption  specified  in
 subdivision  a of section 11-407 of this chapter, there shall be paid to
 the commissioner of finance at the time said agreement  is  executed  an
 amount equal to the penalty which would have been payable under subdivi-
 sion  c  of  section 11-407 of this chapter had the person executing the
 agreement made a late redemption payment. Such amount shall be in  addi-
 tion to any installment payments required to be made under the agreement
 and  shall  not  be  credited against any such installment payments. Any
 parcel which is the subject of an agreement made pursuant to this  para-
 graph  may,  prior  to  final  judgment,  be  withdrawn from the action,
 provided there has been  no  default  in  the  agreement,  and  provided
 further  that  all current taxes, assessments or other legal charges are
 paid when they become due or within the period of grace provided by law.
 Such withdrawal shall be effected by the commissioner of finance in  the
 manner provided in section 11-413 of this chapter.
   (4)  Any person who, prior to September first, nineteen hundred seven-
 ty-eight, has made, executed and filed with the commissioner of  finance
 an  agreement  pursuant to the provisions of paragraph three of subdivi-
 sion a of section 11-413 of this chapter, shall  be  permitted  to  make
 application  to  the  commissioner  of finance for the purpose of having
 such agreement cancelled and a new  agreement  executed  as  hereinabove
 provided.
   If  an  agreement  executed prior to September first, nineteen hundred
 seventy-eight is not cancelled as herein provided, any installments  due
 and  payable  under  such agreement on or after February first, nineteen
 hundred seventy-nine shall be subject to interest at the rate  specified
 in paragraph six of this subdivision, but only if, as of February first,
 nineteen  hundred seventy-nine, there is no default in the agreement and
 all current taxes, assessments or other legal  charges  have  been  paid
 within  the  time  allowed by law. Such rate of interest shall be calcu-
 lated in the manner and shall be subject to all the conditions  provided
 in paragraph six of this subdivision.
   (5)  Notwithstanding  the preceding paragraphs of this subdivision, no
 owner of, or other person claiming to have an interest  in,  any  parcel
 shall  be  eligible  to enter into an agreement authorized by such para-
 graphs where such parcel was included in an in  rem  foreclosure  action
 but  was  severed  therefrom  pursuant to the judgment of foreclosure in
 such action because an answer was still pending as to such  parcel.  The
 commissioner of finance may, however, on notice to the corporation coun-
 sel,  enter into an agreement with such owner or other interested person
 providing for the payment of all current  taxes,  assessments  or  other
 legal charges on the parcel as they become due or within the grace peri-
 od  provided  by  law,  and,  in  addition, providing for payment of the
 amount of all delinquent taxes, assessments or other legal  charges  and
 interest  due  as of the date the agreement is executed in installments,
 the first of which shall be equal to at  least  twenty-five  percent  of
 S. 8474                            343
 
 such  amount  and shall be payable upon the execution of such agreement,
 and the balance of which shall be  payable  in  twelve  equal  quarterly
 installments, each of which shall be paid on the first of July, October,
 January  and April. In addition, there shall be paid to the commissioner
 of finance at the time such agreement is executed  a  penalty  equal  to
 five percent of the amount of the delinquent taxes, assessments or other
 legal  charges  and  interest due as of the date of the agreement, which
 penalty shall not exceed five hundred dollars.  Any installments due and
 payable on or after February first, nineteen hundred seventy-nine  under
 an agreement described in this paragraph shall be subject to interest at
 the rate specified in paragraph six of this subdivision, but only if, as
 of February first, nineteen hundred seventy-nine, there is no default in
 the  agreement and all current taxes, assessments or other legal charges
 have been paid within the time allowed by law.  Such  rate  of  interest
 shall be calculated in the manner and shall be subject to all the condi-
 tions provided in paragraph six of this subdivision.
   Upon  receipt  of  the  final  payment due under an agreement executed
 pursuant to this paragraph, the commissioner of finance shall discontin-
 ue the in rem action pending with respect to the  parcel  which  is  the
 subject  of  such agreement, and shall cancel the lis pendens pertaining
 thereto by issuing a  certificate  of  withdrawal  pursuant  to  section
 11-413 of this chapter. In the event of any default in such agreement or
 any  failure to pay current taxes, assessments or other legal charges as
 they become due or within the grace period provided by law, such  agree-
 ment and the answer which was the basis for the severance of the subject
 parcel from the in rem action shall both be deemed null and void and the
 city  shall  be  entitled to acquire title to such parcel by entry of an
 appropriate supplemental judgment of foreclosure in such in  rem  action
 without further notice to the answering party.
   (6)  When an agreement has been entered into pursuant to this subdivi-
 sion, the commissioner of finance shall, notwithstanding  the  rates  of
 interest  prescribed  in section 11-224, 11-312 or 11-313 of this title,
 charge, collect and receive interest on  the  arrears  due  and  payable
 under  such agreement, to be calculated at the rate of seven percent per
 annum from February first, nineteen hundred seventy-nine to the date  of
 payment  of  each installment. Any interest accrued or accruing prior to
 February first, nineteen hundred seventy-nine shall not be  affected  by
 the  provisions  of  this paragraph, but shall be charged, collected and
 received in the manner and at the rates  specified  in  section  11-224,
 11-312 or 11-313 of this title. The seven percent rate of interest spec-
 ified  in  this  paragraph  shall  be applicable only if (i) there is no
 default in the agreement entered into as provided in this  section,  and
 (ii)  all  current taxes, assessments or other legal charges are paid as
 they become due or within the period of grace provided by  law.  In  the
 event  of  any  default or failure to make timely payment of any current
 item, the seven percent rate of interest  specified  in  this  paragraph
 shall  thereupon  cease to be applicable and the commissioner of finance
 shall thereafter charge, collect and receive interest in the manner  and
 at the rates otherwise specified in this chapter.
   (7)  In addition to the terms and conditions required by this subdivi-
 sion to be included  in  agreements  authorized  by  this  section,  the
 commissioner  of  finance may, in his or her discretion, include in such
 agreements such additional terms and conditions, not  inconsistent  with
 this section, as the commissioner determines to be necessary in order to
 properly  carry out the provisions of this section. The commissioner may
 S. 8474                            344
 
 also adopt such rules and regulations as may be necessary to  carry  out
 the provisions of this section.
   c.  (1) If, pursuant to the provisions of section 11-424 of this chap-
 ter, an application for the release of property  acquired  by  the  city
 through  in  rem  tax  foreclosure  has been filed within the four-month
 period specified in subdivision f of such  section,  and  the  sixty-day
 period for payment referred to in such subdivision has not expired prior
 to  the  commencement  of  the period specified in subdivision a of this
 section, the provisions of this subdivision shall, at  the  election  of
 the  applicant,  apply  with respect to such application and the release
 sought thereby, provided notice of such election is given to the commis-
 sioner of general services during the period specified in subdivision  a
 of  this  section, but in no event later than the last day of the sixty-
 day period referred to in subdivision f of section 11-424 of this  chap-
 ter.
   (2) An applicant who elects to have the provisions of this subdivision
 apply  to  him  or  her,  shall, at the time such applicant notifies the
 commissioner of general services of his or her election, pay to the city
 the amounts specified in paragraphs two, three and four of subdivision d
 of section 11-424 of this chapter; for this purpose, the  amount  speci-
 fied  in  paragraph  two  thereof shall be deemed to be the amount which
 would have been required to be paid thereunder had this section not been
 in effect. Concurrent with the making of  such  payment,  the  applicant
 shall  enter into an agreement with the commissioner of general services
 providing for the payment of all current  taxes,  assessments  or  other
 legal  charges  on  the  property as they become due or within the grace
 period provided by law, and, in addition, providing for the  payment  of
 the amount specified in paragraph one of subdivision d of section 11-424
 of this chapter in installments, the first of which shall be equal to at
 least  twenty-five  percent of such amount and shall be payable upon the
 execution of such agreement. The balance of such amount shall be payable
 in twelve equal quarterly installments, each  of  which  shall  be  paid
 quarterly on the first of July, October, January and April.
   (3)  Pending approval by the corporation counsel of an application for
 release as to form, timeliness and eligibility  of  the  applicant,  all
 payments  made  pursuant to paragraph three of this subdivision shall be
 held in escrow; in the event the  corporation  counsel  disapproves  the
 application,  such  payments shall be returned to the applicant, and the
 agreement executed by him or her shall thereupon be cancelled.
   (4) In the case of any agreement made and executed pursuant  to  para-
 graph two of this subdivision, interest on any installment due and paya-
 ble  thereunder  shall, notwithstanding the rates of interest prescribed
 in section 11-224, 11-312 or 11-313 of this title, be charged, collected
 and received at the rate of seven percent per annum from February first,
 nineteen hundred seventy-nine to the date of payment  of  each  install-
 ment. Any interest accrued or accruing prior to February first, nineteen
 hundred  seventy-nine  shall  not  be affected by the provisions of this
 paragraph, but shall be charged, collected and received  in  the  manner
 and  at  the rates specified in section 11-224, 11-312 or 11-313 of this
 title. The seven percent rate of interest specified  in  this  paragraph
 shall  be  applicable  only  if (i) there is no default in the agreement
 entered into as provided in  this  subdivision,  and  (ii)  all  current
 taxes, assessments or other legal charges are paid as they become due or
 within the period of grace provided by law.
   (5)  No release for which application has been made pursuant to subdi-
 vision f of section 11-424 of this chapter shall be  granted  until  the
 S. 8474                            345
 
 final  payment  under  the  agreement herein provided is received by the
 city. Upon receipt of such final payment by  the  city  the  corporation
 counsel  shall  effect  the  release  in  the manner provided in section
 11-424  of  this  chapter.  In  the event of any default in an agreement
 executed as provided in this subdivision or any failure to  pay  current
 taxes,  assessments  or other legal charges as they become due or within
 the grace period provided by law, such agreement shall thereupon  become
 void,  the release process shall be terminated and all payments thereto-
 fore made shall be forfeited to the city.
   (6) In addition to the terms and conditions required by this  subdivi-
 sion  to  be included in agreements authorized thereby, the commissioner
 of general services may, in his  or  her  discretion,  include  in  such
 agreements  such  additional terms and conditions, not inconsistent with
 this subdivision, as the commissioner  determines  to  be  necessary  in
 order  to  properly carry out the provisions hereof. The commissioner of
 general services may also adopt such rules and  regulations  as  may  be
 necessary to carry out the provisions of this subdivision.
   §  11-428  Disposition  of proceeds of sales of properties acquired by
 city through tax enforcement foreclosure proceedings.  The  proceeds  of
 the  sale  of real property acquired through tax enforcement foreclosure
 proceedings, or by deed in lieu thereof, including  subsequent  receipts
 in  diminution of purchase money mortgages accepted at the time of sale,
 shall be applied as follows:
   a. The amount of the unpaid real estate  taxes  accrued  against  such
 property from the first of January or the first of July, whichever first
 immediately  precedes  the date on which title vested in the city to the
 date of conveyance of title by the city, without interest  or  penalties
 thereon, shall be credited to the tax deficiency account.
   b. The balance, if any, remaining after deduction of the amount speci-
 fied  in  paragraph  a  hereof, shall be paid into the funds hereinafter
 specified in the following order:
   1. A sum equal to the amount  of  the  unpaid  assessments  for  local
 improvements  accrued  against such property at the date of commencement
 of the foreclosure proceeding and up to the date of conveyance of  title
 by  the  city, without interest or penalties thereon, shall be paid into
 the appropriate assessment funds.
   2. A sum equal to the amount of unpaid sewer rents, including interest
 and penalties thereon, accrued against such  property  at  the  date  of
 commencement  of  the  foreclosure  proceedings  and  up  to the date of
 conveyance of title by the city shall be paid into the sewer fund.
   3. The amount of the brokerage fee and other expenses expended by  the
 city in connection with such sale shall be paid into the fund or code to
 which such fee was charged.
   4.  The  balance  of  such  proceeds,  if any, and the interest on any
 purchase money mortgage accepted by the city at the time  of  such  sale
 shall  be paid into the general fund. In the event that any part of such
 balance is represented by bonds and mortgages, such bonds and  mortgages
 may be deposited in the tax appropriation and general fund stabilization
 reserve  fund  and  a sum equal to the amount of the cash represented by
 such bonds and mortgages shall in such event be transferred from the tax
 appropriation and general fund stabilization reserve fund to the general
 fund.
 
                                 CHAPTER 5
                  CITY UNINCORPORATED BUSINESS INCOME TAX
 S. 8474                            346
 
   § 11-501 Meaning of terms. (a) General. Unless a different meaning  is
 clearly  required,  any  term  used  in this chapter shall have the same
 meaning as when used in a comparable context in the laws of  the  United
 States relating to federal income taxes, and any reference in this chap-
 ter  to  the  laws of the United States shall mean the provisions of the
 internal revenue code of nineteen  hundred  fifty-four,  and  amendments
 thereto,  and other provisions of the laws of the United States relating
 to federal income taxes, as the same are included in this chapter as  an
 appendix  or  as included by reference to an appendix of another chapter
 enacted by the same law as enacts this chapter. (The  quotation  of  the
 aforesaid  laws  of the United States is intended to make them a part of
 this chapter and  to  avoid  constitutional  uncertainties  which  might
 result if such laws were merely incorporated by reference. The quotation
 of  a provision of the federal internal revenue code or of any other law
 of the United States shall not necessarily mean that it is applicable to
 or has relevance to this chapter.)
   (b) "State", "this state" or "the state" when  used  in  this  chapter
 shall mean the state of New York.
   (c)  "Local  income  taxes",  when  used in this chapter shall mean an
 income tax imposed by a political subdivision of a state.
   (d) "Commissioner of finance" when used in this chapter shall mean the
 commissioner of finance of the city.
   (e) "Department of finance" when used in this chapter shall  mean  the
 department of finance of the city.
   (f)  "Tax  appeals  tribunal" when used in this chapter shall mean the
 tax appeals tribunal established by section one hundred  sixty-eight  of
 the  charter  of the preceding municipality as it existed January first,
 two thousand nine.
   (g) "Unincorporated business entire net  income"  when  used  in  this
 chapter  shall  mean  the  excess  of  the unincorporated business gross
 income of an unincorporated business over  its  unincorporated  business
 deductions.
   (h)  "Investment capital" when used in this chapter shall mean invest-
 ments of the unincorporated business in stocks, bonds and other  securi-
 ties,  corporate  and governmental (excluding governmental stocks, bonds
 and other securities the interest or  dividends  from  which  are  fully
 exempt  from  tax  under  this chapter, other than any such governmental
 stock, bond or other security which is sold  or  otherwise  disposed  of
 during the taxable year in a transaction which results in a gain or loss
 which is included in computing unincorporated business entire net income
 for  the  taxable  year),  not held for sale to customers in the regular
 course of business, provided, however, that in  the  discretion  of  the
 commissioner of finance, there shall be deducted from investment capital
 any  liabilities  of  the  unincorporated business which are directly or
 indirectly attributable to investment capital.
   (i) "Investment income" when used in this chapter shall  mean  income,
 gains  and  losses  from  investment  capital, to the extent included in
 computing unincorporated  business  entire  net  income,  less,  in  the
 discretion  of  the commissioner of finance, any deductions allowable in
 computing unincorporated business entire net income which  are  directly
 or  indirectly  attributable to investment capital or investment income,
 provided, however, that in no case shall investment income exceed  unin-
 corporated business entire net income.
   (j) "Business capital" when used in this chapter shall mean all assets
 of  the  unincorporated  business  other  than  investment capital, less
 liabilities of the unincorporated business not deducted from  investment
 S. 8474                            347

 capital,  except  that  cash  on hand and on deposit shall be treated as
 investment capital or as business capital as the taxpayer may elect.
   (k)  "Business income" when used in this chapter shall mean unincorpo-
 rated business entire net income minus investment income.
   (l) "Dealer" when used in this chapter shall  mean  an  individual  or
 unincorporated  entity  that  (A)  holds or disposes of property that is
 stock in trade of the taxpayer, inventory or is otherwise held for  sale
 to customers in the ordinary course of the taxpayer's trade or business,
 or  (B) regularly offers to enter into, assume, offset, assign or other-
 wise terminate positions in property  with  customers  in  the  ordinary
 course  of the taxpayer's trade or business, provided, however, an indi-
 vidual or unincorporated entity shall not be treated as a  dealer  based
 solely  on  such individual's or entity's ownership of an interest in an
 entity that is a dealer, and provided, further, that  an  unincorporated
 entity shall not be treated as a dealer based solely on the ownership by
 a dealer of an interest in that unincorporated entity.
   (m) "Unincorporated entity" when used in this chapter shall include an
 entity  classified  as  a  partnership  for  federal income tax purposes
 regardless of whether the entity is formed as a corporation, joint-stock
 company, joint-stock association, body  corporate  or  body  politic  or
 whether  the  entity  is  organized under a federal or state statute, or
 under a statute of a federally recognized Indian tribe, or under a stat-
 ute of a country other than the United States that describes  or  refers
 to the entity as incorporated.
   §  11-502 Unincorporated business defined.  (a) General. An unincorpo-
 rated business means  any  trade,  business,  profession  or  occupation
 conducted, engaged in or being liquidated by an individual or unincorpo-
 rated  entity,  including  a  partnership, a fiduciary, a corporation in
 liquidation or an unincorporated  entity  that  has  made  the  election
 permitted  under  paragraph  (b) of subdivision one of section 11-602 of
 this title (but only for the period during which  such  election  is  in
 effect),  but  not including any entity subject to tax under chapter six
 of this title and not including any entity doing an  insurance  business
 as  a  member  of the New York insurance exchange described in paragraph
 one of subsection (b) of section six thousand two  hundred  one  of  the
 insurance  law.  Unincorporated  businesses subject to tax under a local
 law of the city imposing a tax on utilities shall not be subject to  tax
 under  this  chapter; provided, however, that unincorporated businesses,
 other than (1) utility businesses subject  to  the  supervision  of  the
 state  department  of public service and (2) for taxable years beginning
 on or after August first, two thousand  two,  utilities  as  defined  in
 subdivision  six  of section 11-1101 of this title, which are subject to
 tax under a local law of the city imposing a tax on vendors  of  utility
 services  shall  be subject to tax under this chapter on that percentage
 of their entire net income allocable to the city under section 11-508 of
 this chapter which their receipts other than those  taxable  under  such
 local law taxing vendors of utility services is of their total receipts.
 If an individual or an unincorporated entity carries on wholly or partly
 in  the  city two or more unincorporated businesses, all such businesses
 shall be treated as one unincorporated business for the purposes of this
 chapter. For purposes of this chapter, an unincorporated entity shall be
 treated as carrying on any trade,  business,  profession  or  occupation
 carried  on  in whole or in part in the city by any other unincorporated
 entity in which the first unincorporated entity owns  an  interest,  and
 the  ownership  by  an  unincorporated  entity of an interest in another
 unincorporated entity that is  not  carrying  on  any  trade,  business,
 S. 8474                            348
 
 profession,  or  occupation in whole or in part in the city shall not be
 deemed the conduct of an unincorporated business by the first unincorpo-
 rated entity.  Notwithstanding anything to the contrary in the preceding
 sentence,  for  taxable  years  beginning  on or after August first, two
 thousand two, an unincorporated business that is a partner in a partner-
 ship subject to tax under a local law of the  city  imposing  a  tax  on
 utilities,  as  defined  in  subdivision  six of section 11-1101 of this
 title, shall not be considered to be carrying on  the  trade,  business,
 profession or occupation carried on by such partnership.
   (b) Services as employee. The performance of services by an individual
 as  an  employee or as an officer or director of a corporation, society,
 association, or political entity, or as a fiduciary, shall not be deemed
 an unincorporated business, unless such services constitute  part  of  a
 business regularly carried on by such individual.
   (c)  Purchase and sale for own account. (1) Definitions. (A) Property.
 For purposes of this subdivision, property shall mean real and  personal
 property,  including  but not limited to, property qualifying as invest-
 ment capital within the meaning of subdivision (h) of section 11-501  of
 this chapter, other stocks, notes, bonds, debentures, or other evidences
 of  indebtedness,  interest rate, currency, or equity notional principal
 contracts, foreign currencies, interests  in,  or  derivative  financial
 instruments  (including  options,  forward  or  futures contracts, short
 positions, and similar financial instruments) in any property  described
 above, and any commodity traded on or subject to the rules of a board of
 trade  or  commodity  exchange,  provided,  however,  property shall not
 include: (i) debt instruments issued  by  the  taxpayer;  (ii)  accounts
 receivable  held  by  a  factor;  (iii) property held as stock in trade,
 inventory or otherwise held for sale to customers in the ordinary course
 of the taxpayer's trade or business; (iv) debt instruments  acquired  in
 the  ordinary  course  of  the  taxpayer's  trade  or business for funds
 loaned, services rendered or for the sale, rental or other  transfer  of
 property  by  the taxpayer; (v) interests in unincorporated entities; or
 (vi) positions  in  property  described  above  entered  into,  assumed,
 offset,  assigned  or  terminated by a dealer with respect to such posi-
 tions in property.
   (B) Investor. For purposes of this subdivision, a  taxpayer  shall  be
 treated as acquiring, holding or disposing of an interest in an unincor-
 porated  entity  as  an investor if: (i) the unincorporated entity meets
 the requirements of subparagraph (B) of paragraph four of this  subdivi-
 sion  and  the  taxpayer  does  not receive a distributive share of such
 entity's income, gain, loss, deduction, credit and basis from a business
 carried on in whole or in part in the city that  is  materially  greater
 than  its  distributive  share  of  any other item of income, gain, loss
 deduction, credit or basis of such entity; or (ii) with respect  to  any
 other  unincorporated  entity, the taxpayer is neither a general partner
 nor authorized under the entity's  governing  instrument  to  manage  or
 participate in, nor managing, nor participating in, the day-to-day busi-
 ness of the unincorporated entity.
   (2)  An  individual or other unincorporated entity, except a dealer as
 defined in subdivision (1) of section 11-501 of this chapter, shall  not
 be  deemed engaged in an unincorporated business solely by reason of (A)
 the purchase, holding and sale for his, her or its own account of  prop-
 erty,  as  defined  in  paragraph  one of this subdivision, or the entry
 into, assumption, offset, assignment, or other termination of a position
 in any property so defined, or both, (B)  the  acquisition,  holding  or
 disposition,  other  than in the ordinary course of a trade or business,
 S. 8474                            349
 
 of interests in unincorporated entities  engaged  solely  in  activities
 described  in subparagraph (A), (B) or (C) of this paragraph, or (C) any
 combination of the activities described in subparagraphs (A) and (B)  of
 this  paragraph  and  any  other activity not otherwise constituting the
 conduct of an unincorporated business subject to the tax imposed by this
 chapter, but this paragraph shall not apply if the unincorporated entity
 is taxable as a corporation for federal income tax purposes.
   (3) Notwithstanding anything to the contrary, the receipt by an  indi-
 vidual or other unincorporated entity of twenty-five thousand dollars or
 less  of  gross  receipts  during  the  taxable year (determined without
 regard to any deductions) from  an  unincorporated  business  wholly  or
 partly  carried  on within the city by such individual or unincorporated
 entity shall not cause such individual or other unincorporated entity to
 be treated as not engaged solely in the activities described in subpara-
 graph (A), (B) or (C) of paragraph two of this subdivision.
   (4) (A) If a taxpayer that is an unincorporated  entity  is  primarily
 engaged  in  (i) activities described in subparagraph (A), (B) or (C) of
 paragraph two of this subdivision, or (ii) the acquisition,  holding  or
 disposition,  other  than in the ordinary course of a trade or business,
 of interests as an investor in unincorporated entities carrying  on  any
 unincorporated  business  in  whole or in part in the city, or both, the
 activities described in subparagraph (A), (B), or (C) of  paragraph  two
 of  this subdivision carried on by the taxpayer or by any unincorporated
 entity primarily engaged in the activities described in  clause  (i)  or
 (ii)  of  this subparagraph in which the taxpayer owns an interest shall
 not be deemed an unincorporated business carried on by the taxpayer.
   (B) For purposes of subparagraph (A) of this paragraph, an  unincorpo-
 rated  entity  will  be  treated  as  primarily  engaged  in  activities
 described in clause (i) or (ii) of subparagraph (A) of  this  paragraph,
 or  both, if at least ninety percent of the value of its total assets is
 represented by assets described in subparagraph (C) of this paragraph.
   (C) For  purposes  of  subparagraph  (B)  of  this  paragraph,  assets
 described in this subparagraph include:
   (i) property as defined in paragraph one of this subdivision;
   (ii) interests in unincorporated entities not carrying on any unincor-
 porated business in whole or in part in the city; and
   (iii)  interests  in unincorporated entities carrying on an unincorpo-
 rated business in whole or in part in the city held by the  taxpayer  as
 an investor, as defined in paragraph one of this subdivision.
   (D)  For purposes of determining whether a taxpayer meets the require-
 ments of subparagraph  (B)  of  this  paragraph,  the  value  of  assets
 described  in  subparagraph  (C)  of this paragraph shall be the average
 monthly gross value of the assets of the taxpayer. For purposes of  this
 paragraph,  the  value  of  assets  of the taxpayer that consist of real
 property or marketable securities shall be the fair market value thereof
 and the value of assets other than real property or  marketable  securi-
 ties  shall  be  the value thereof shown on the books and records of the
 taxpayer in accordance with generally accepted accounting principles. In
 case it shall appear to the commissioner of  finance  that  the  use  of
 gross  value in determining whether the requirements of subparagraph (B)
 of this paragraph are  met,  improperly  or  inaccurately  reflects  the
 taxpayer's primary activities, the commissioner of finance is authorized
 in  his or her discretion and in such manner as he or she may determine,
 to reduce the gross  value  of  the  taxpayer's  assets  by  liabilities
 attributable thereto or to eliminate assets, so as to properly and accu-
 rately reflect the taxpayer's primary activities.
 S. 8474                            350

   (d) Holding, leasing or managing real property. An owner of real prop-
 erty, a lessee or a fiduciary shall not be deemed engaged in an unincor-
 porated  business  solely by reason of holding, leasing or managing real
 property. If an owner of real property or lessee or fiduciary (except  a
 dealer  holding  real  property  primarily  for sale to customers in the
 ordinary course of his or her trade or business) who is holding, leasing
 or managing real property is also carrying on an unincorporated business
 in whole or in part in the city,  whether  or  not  such  unincorporated
 business  is carried on at or is connected with such real property, such
 holding, leasing or managing of real property shall  not  be  deemed  an
 unincorporated business if, and only to the extent that, such real prop-
 erty  is  held,  leased  or  managed for the purpose of producing rental
 income from such real property or gain upon the sale or  other  disposi-
 tion  of  such  real  property.  For  purposes  of this subdivision, the
 conduct by such owner, lessee or fiduciary, at such real property, of  a
 trade,  business,  profession  or occupation, including, but not limited
 to, a garage, restaurant, laundry or health club, shall be deemed to  be
 an  incident  to the holding, leasing or managing of such real property,
 and shall not be deemed the conduct of an  unincorporated  business,  if
 such  trade,  business, profession or occupation is conducted solely for
 the benefit of tenants at such real property, as an  incidental  service
 to  such  tenants,  and  is not open or available to the general public,
 provided, however, if any such owner, lessee  or  fiduciary  operates  a
 garage, parking lot or other similar facility at such real property that
 is  open  or  available to the general public, the provision by any such
 owner, lessee or fiduciary of the service of parking, garaging or  stor-
 ing  of motor vehicles on a monthly or longer term basis shall be deemed
 to be an incident to the holding, leasing or managing of such real prop-
 erty, and shall not be deemed the conduct of an unincorporated  business
 if,  and  only  to the extent that, such monthly or longer term parking,
 garaging or storing service is provided to tenants at such real property
 as an incidental service to such tenants. If an owner, lessee or fiduci-
 ary holding, leasing or managing real property  operates  at  such  real
 property a garage, parking lot or other similar facility that is open or
 available  to  the  public,  each  such owner, lessee or fiduciary shall
 file, together with and as a part of the returns required under  section
 11-514 of this chapter, a report or schedule for each such garage, park-
 ing  lot  or other similar facility, or in the discretion of the commis-
 sioner, make a separate entry on such returns, identifying the  specific
 location  and address, license number and licensed capacity of each such
 garage, parking lot or other similar facility, and  shall  include  such
 additional information, data and other matters relating to the provision
 of  such  monthly or longer term parking, garaging or storing service to
 tenants as shall be prescribed by the commissioner of  finance.  If  the
 separate  information  required  to  be reported by any owner, lessee or
 fiduciary holding, leasing or managing real  property  for  any  garage,
 parking lot or other similar facility at such real property that is open
 or  available  to  the  public  is not contained in the returns required
 under section 11-514 of this chapter, or in any amended returns, in  any
 material  respect, the provision of parking, garaging or storing service
 to tenants at such real property shall be deemed the conduct of an unin-
 corporated business and not incident to the holding, leasing or managing
 of such real property.
   (e) Sales representative.  An individual, other than one who maintains
 an office or who employs one or more assistants or who  otherwise  regu-
 larly  carries on a business, shall not be deemed engaged in an unincor-
 S. 8474                            351
 
 porated business solely by reason of selling goods,  wares,  merchandise
 or  insurance for more than one enterprise.  For purposes of this subdi-
 vision, space utilized solely for the display of merchandise and/or  for
 the  maintenance  and  storage of records normally used in the course of
 business shall not be deemed an office, and the employment  of  clerical
 and secretarial assistance shall not be deemed the employment of assist-
 ants.
   (f)  Exempt trusts and organizations.  A trust or other unincorporated
 organization which by reason of its purposes  or  activities  is  exempt
 from  federal  income tax shall not be deemed an unincorporated business
 regardless of whether subject to federal income tax on  unrelated  busi-
 ness taxable income.
   §  11-503  Imposition of tax.  (a) General.  A tax at the rate of four
 percent is hereby imposed for each taxable year, beginning with  taxable
 years  ending  after  January  first, nineteen hundred sixty-six, on the
 unincorporated business taxable income of every unincorporated  business
 wholly or partly carried on within the city.  This tax shall be in addi-
 tion to any other taxes imposed.
   (b)  Credit  against  tax.  (1)  For each taxable year beginning after
 nineteen hundred eighty-six but before nineteen hundred ninety-six:
   (A) if the tax computed under subdivision (a) of this section  is  six
 hundred dollars or less, a credit shall be allowed for the entire amount
 of such tax;
   (B)  if the tax computed under subdivision (a) of this section exceeds
 six hundred dollars but is less than eight  hundred  dollars,  a  credit
 shall  be  allowed in the amount determined by multiplying such tax by a
 fraction the numerator of which  is  eight  hundred  dollars  minus  the
 amount  of such tax and the denominator of which is two hundred dollars;
 or
   (C) if the tax computed under subdivision (a) of this section is eight
 hundred dollars or more, no credit shall be allowed.
   (2) For each taxable year beginning in nineteen hundred ninety-six:
   (A) if the tax computed under subdivision (a) of this section is eight
 hundred dollars or less, a credit shall be allowed for the entire amount
 of such tax;
   (B) if the tax computed under subdivision (a) of this section  exceeds
 eight  hundred  dollars  but is less than one thousand dollars, a credit
 shall be allowed in the amount determined by multiplying such tax  by  a
 fraction the numerator of which is one thousand dollars minus the amount
 of such tax and the denominator of which is two hundred dollars; or
   (C)  if  the tax computed under subdivision (a) of this section is one
 thousand dollars or more, no credit shall be allowed.
   (3) For each taxable year beginning after nineteen hundred  ninety-six
 but before two thousand nine:
   (A)  if  the tax computed under subdivision (a) of this section is one
 thousand eight hundred dollars or less, a credit shall  be  allowed  for
 the entire amount of such tax;
   (B)  if the tax computed under subdivision (a) of this section exceeds
 one thousand eight hundred dollars but is less than three  thousand  two
 hundred  dollars,  a credit shall be allowed in the amount determined by
 multiplying such tax by a fraction the numerator of which is three thou-
 sand two hundred dollars minus the amount of such tax and the  denomina-
 tor of which is one thousand four hundred dollars; or
   (C) if the tax computed under subdivision (a) of this section is three
 thousand two hundred dollars or more, no credit shall be allowed.
   (3-a) For each taxable year beginning after two thousand eight:
 S. 8474                            352

   (A) if the tax computed under subdivision (a) of this section is three
 thousand four hundred dollars or less, a credit shall be allowed for the
 entire amount of such tax;
   (B)  if the tax computed under subdivision (a) of this section exceeds
 three thousand four hundred dollars but is less than five thousand  four
 hundred  dollars,  a credit shall be allowed in the amount determined by
 multiplying such tax by a fraction the numerator of which is five  thou-
 sand four hundred dollars minus the amount of such tax and the denomina-
 tor of which is two thousand dollars; or
   (C)  if the tax computed under subdivision (a) of this section is five
 thousand four hundred dollars or more, no credit shall be allowed.
   (4) If separate partnerships, joint ventures or  other  unincorporated
 entities  have  substantially the same partners or members, each of such
 partners or members has substantially the same interest in each of  such
 partnerships,  joint ventures or other unincorporated entities, and such
 partnerships,  joint  ventures  or  other  unincorporated  entities  are
 engaged  in substantially the same business or businesses or in substan-
 tially related businesses, all of such partnerships, joint  ventures  or
 other  unincorporated  entities  shall  be treated as one unincorporated
 business for purposes of this subdivision. The provisions of this  para-
 graph  shall not be construed to limit or affect the meaning or applica-
 tion of any other provision of this chapter.
   (5) Notwithstanding anything to the  contrary,  the  credit  allowable
 under  this subdivision shall be taken prior to any other credit allowed
 by this section.
   (c) Credit relating to stock transfer tax.   (1) In  addition  to  any
 other credit permitted under this section, a taxpayer shall be allowed a
 credit, to be credited or refunded in the manner hereinafter provided in
 this  subdivision,  against  the  tax  imposed by this chapter after the
 allowance of any other credit under this section.   The amount  of  such
 credit shall be fifty percent of the tax incurred in market making tran-
 sactions  under  the provisions of article twelve of the tax law on such
 transactions subject to such tax occurring on and  after  August  first,
 nineteen hundred seventy-six and paid by such taxpayer, except when such
 tax  shall have been paid pursuant to section two hundred seventy-nine-a
 of the tax law.
   (2) For purposes of this subdivision:
   a. the term "taxpayer" shall mean any unincorporated business  subject
 to  tax  under this chapter registered with the United States securities
 and exchange commission in accordance with  subsection  (b)  of  section
 fifteen  of the securities exchange act of nineteen hundred thirty-four,
 as amended, and acting as a dealer in a transaction described in subpar-
 agraph b of this paragraph, and
   b. the term "market making transaction"  shall  mean  any  transaction
 involving  a  sale,  including  a  short  sale, by a dealer of shares or
 certificates subject to the tax imposed by article  twelve  of  the  tax
 law, provided such shares or certificates are sold:
   (i) as stock in trade or inventory or as property held for sale in the
 ordinary  course  of such dealer's trade or business including transfers
 which are part of an underwriting,
   (ii) in (a) a bona fide arbitrage transaction; (b) a bona  fide  hedge
 transaction  involving  a  long or short position in any equity security
 and a long or short position in  a  security  entitling  the  holder  to
 acquire  or  sell  such  equity security; or (c) a risk arbitrage trans-
 action in connection with a merger, acquisition,  tender  offer,  recap-
 italization, reorganization, or similar transaction, or
 S. 8474                            353
 
   (iii) to offset a transaction made in error.
   Provided,  however, that, except as to subclause (c) of clause (ii) of
 subparagraph b of this paragraph, the term "market  making  transaction"
 shall  not include any sale of shares or certificates identified in such
 dealer's records as a security held for investment within the meaning of
 section twelve hundred thirty-six of the internal revenue code.
   (3) The credit allowed under this subdivision  for  any  taxable  year
 shall  be deemed to be an overpayment of tax by the taxpayer to be cred-
 ited or refunded in accordance with the provisions of section 11-526  of
 this  chapter,  except  as  otherwise  provided  in  subdivision  (g) of
 sections 11-512 and 11-514 of this chapter; provided, however, that  the
 provisions  of  this  chapter notwithstanding, the amount to be refunded
 pursuant to this subdivision shall not be paid prior to the first day of
 the eighth month following the  close  of  the  taxable  year,  and  the
 provisions of subdivision (c) of section 11-528 of this chapter notwith-
 standing,  interest  shall be allowed and paid on the overpayment of the
 credit under this subdivision from the first day of the  eleventh  month
 following  the  close of the taxable year, or three months after a claim
 for the credit or refund provided  for  in  this  subdivision  has  been
 filed, whichever is later.
   (4)    Provided, however, that the credit provided under this subdivi-
 sion shall be allowed only to the  extent  that  the  amount  of  credit
 allowable   with   respect  to  market  making  transactions  under  the
 provisions  of  this  subdivision  (determined  without  regard  to  the
 provisions  of  this  paragraph)  exceeds  fifty  percent of all rebates
 (provided for under the provisions of section two  hundred  eighty-a  of
 article  twelve  of  the tax law) allowed for such taxes incurred in the
 same market making transactions with respect  to  which  the  credit  is
 determined.    No  credit  shall  be allowed under this subdivision with
 respect to any tax incurred in market making transactions  occurring  on
 or after October first, nineteen hundred eighty-one.
   (d)  Credit relating to certain sales and compensating use taxes.  (1)
 In addition to the credits allowed by subdivisions (b) and (c)  of  this
 section, a taxpayer shall be allowed a credit against the tax imposed by
 this  chapter  to  be  credited  or  refunded  in the manner hereinafter
 provided in this section. The amount of such credit shall be the  excess
 of (A) the amount of sales and compensating use taxes imposed by section
 eleven  hundred  seven of the tax law during the taxpayer's taxable year
 which became legally due on or after and  was  paid  on  or  after  July
 first, nineteen hundred seventy-seven, less any credit or refund of such
 taxes,  with respect to the purchase or use by the taxpayer of machinery
 or equipment for use or consumption directly and  predominantly  in  the
 production  of  tangible  personal property, gas, electricity, refriger-
 ation or steam  for  sale,  by  manufacturing,  processing,  generating,
 assembling,  refining, mining or extracting, or telephone central office
 equipment or station apparatus or comparable telegraph equipment for use
 directly and predominantly in receiving at destination or initiating and
 switching telephone or telegraph communication, but not including  parts
 with  a  useful  life  of  one year or less or tools or supplies used in
 connection with such machinery, equipment  or  apparatus  over  (B)  the
 amount  of  any credit for such sales and compensating use taxes allowed
 or allowable against the taxes imposed by subchapter two of chapter  six
 of  this  title, for any periods embraced within the taxable year of the
 taxpayer under this chapter.
   (2)  The credit allowed under this section for any taxable year  shall
 be  deemed to be an overpayment of tax by the taxpayer to be credited or
 S. 8474                            354
 
 refunded, without interest, in accordance with the provisions of section
 11-526 of this chapter.
   (3)  Where the taxpayer receives a refund or credit of any tax imposed
 under section eleven hundred seven of the tax law for which the taxpayer
 had  claimed  a  credit  under the provisions of this section in a prior
 taxable year, the amount of such tax refund or credit shall be added  to
 the  tax imposed by this section, and such amount shall be subtracted in
 computing unincorporated business taxable income for the taxable year.
   (e)  Credit relating to the annual increase in certain payments  to  a
 landlord  by  a taxpayer relocating industrial and commercial employment
 opportunities.  (1)  In addition to any other  credit  allowed  by  this
 section, a taxpayer shall be allowed a credit against the tax imposed by
 this chapter to be credited or refunded, without interest, in the manner
 hereinafter provided in this section.
   (A)  Where a taxpayer shall have relocated to the city from a location
 outside  the  state, and by such relocation shall have created a minimum
 of one hundred industrial or commercial  employment  opportunities,  and
 where  such  taxpayer  shall  have  entered into a written lease for the
 relocation premises, the terms of  which  lease  provide  for  increased
 additional  payments to the landlord which are based solely and directly
 upon any increase or addition in real estate taxes imposed on the leased
 premises, the taxpayer upon approval and certification by the industrial
 and commercial incentive board as hereinafter provided shall be entitled
 to a credit against the tax imposed by this chapter.  The amount of such
 credit shall be:  An amount equal to the annual increased payments actu-
 ally made by the taxpayer to the landlord which are solely and  directly
 attributable  to  an increase or addition to the real estate tax imposed
 upon the leased premises.   Such credit shall be  allowed  only  to  the
 extent  that  the  taxpayer  has  not otherwise claimed said amount as a
 deduction against the tax imposed by this chapter.
   The industrial and commercial incentive board in approving and  certi-
 fying  to  the  qualifications of the taxpayer to receive the tax credit
 provided for herein shall first determine that the applicant has met the
 requirements of this section, and further, that the granting of the  tax
 credit  to  the  applicant  is in the "public interest."  In determining
 that the granting of the tax credit is in the public interest, the board
 shall make affirmative findings that:  the granting of the tax credit to
 the applicant will not effect an undue  hardship  on  similar  taxpayers
 already located within the city; the existence of this tax incentive has
 been  instrumental  in bringing about the relocation of the applicant to
 the city; and the granting of the tax credit will  foster  the  economic
 recovery and economic development of the city.
   The  tax  credit,  if  approved  and  certified  by the industrial and
 commercial incentive board, must be utilized annually  by  the  taxpayer
 for  the  length  of the term of the lease or for a period not to exceed
 ten years from the date of relocation, whichever period is shorter.
   (B)  Definitions:  When used in this section, "Employment opportunity"
 means the creation of a full time position of gainful employment for  an
 industrial or commercial employee and the actual hiring of such employee
 for the said position.
   "Industrial employee" means one engaged in the manufacture or assembl-
 ing of tangible goods or the processing of raw materials.
   "Commercial  employee"  means  one  engaged  in the buying, selling or
 otherwise providing of goods or services other than on a retail basis.
   "Retail" means the selling or otherwise  disposing  or  furnishing  of
 tangible goods or services directly to the ultimate user or consumer.
 S. 8474                            355
 
   "Full  time  position" means the hiring of an industrial or commercial
 employee in a position of gainful employment where the number  of  hours
 worked  by  such employee is not less than thirty hours during any given
 week.
   "Industrial  and  commercial  incentive board" means the board created
 pursuant to subchapter two of chapter two of this title.
   (2) The credit allowed under this section for any taxable  year  shall
 be  deemed to be an overpayment of tax by the taxpayer to be credited or
 refunded, without interest, in accordance with the provisions of section
 11-526 of this chapter.
   (f) Credit relating to certain expenses involved in the cost of  relo-
 cating  industrial  and  commercial employment opportunities.   (1)   In
 addition to any other credit allowed by this section, a  taxpayer  shall
 be  allowed a credit against the tax imposed by this chapter to be cred-
 ited or refunded in the manner hereinafter  provided  in  this  section.
 The amount of such credit shall be:
   (A)  A maximum of three hundred dollars for each commercial employment
 and a maximum of five hundred dollars  for  each  industrial  employment
 opportunity  relocated  to the city from an area outside the state. Such
 credit shall be allowed to a taxpayer who relocates  a  minimum  of  ten
 employment opportunities. The credit shall be allowed against employment
 opportunity relocation costs incurred by the taxpayer. Such credit shall
 be  allowed  only  to  the  extent  that  the taxpayer has not claimed a
 deduction for allowable employment  opportunity  relocation  costs.  The
 credit  allowed  hereunder  may  be taken by the taxpayer in whole or in
 part in the year in which the employment  opportunity  is  relocated  by
 such  taxpayer  or  either  of  the  two  years  succeeding  such event;
 provided, however, that no credit shall be allowed under  this  subdivi-
 sion  to a taxpayer for industrial employment opportunities relocated to
 premises (i) that are within an  industrial  business  zone  established
 pursuant to section 22-626 of the code of the preceding municipality and
 (ii) for which a binding contract to purchase or lease was first entered
 into by the taxpayer on or after July first, two thousand five.
   The commissioner of finance is empowered to promulgate rules and regu-
 lations and to prescribe the form of application to be used.
   (B)  Definitions:  When used in this section, "Employment Opportunity"
 means the creation of a full time position of gainful employment for  an
 industrial or commercial employee and the actual hiring of such employee
 for the said position.
   "Industrial Employee" means one engaged in the manufacture or assembl-
 ing of tangible goods or the processing of raw materials.
   "Commercial  Employee"  means  one  engaged  in the buying, selling or
 otherwise providing of goods or services other than on a retail basis.
   "Retail" means the selling or otherwise disposing  of  tangible  goods
 directly to the ultimate user or consumer.
   "Full  Time  Position" means the hiring of an industrial or commercial
 employee in a position of gainful employment where the number  of  hours
 worked  by  such employee is not less than thirty hours during any given
 work week.
   "Employment Opportunity Relocation Costs" means the costs incurred  by
 the  taxpayer  in  moving  furniture, files, papers and office equipment
 into the city from a location outside the state; the costs  incurred  by
 the  taxpayer in the moving from a location outside the state; the costs
 of  installation  of  telephones  and  other  communications   equipment
 required  as  a  result  of  the  relocation to the city from a location
 outside the state; the cost incurred in the purchase of office furniture
 S. 8474                            356
 
 and fixtures required as a result of the relocation to the city  from  a
 location  outside  the state; and the cost of renovation of the premises
 to be occupied as a result of the  relocation  provided,  however,  that
 such renovation costs shall be allowable only to the extent that they do
 not exceed seventy-five cents per square foot of the total area utilized
 by the taxpayer in the occupied premises.
   (2)  The  credit allowed under this section for any taxable year shall
 be deemed to be an overpayment of tax by the taxpayer to be credited  or
 refunded  without interest, in accordance with the provisions of section
 11-526 of this chapter.
   (i) Relocation and employment assistance credit. (1)  In  addition  to
 any  other  credit allowed by this section, a taxpayer that has obtained
 the certifications required by chapter six-B of title twenty-two of  the
 code of the preceding municipality shall be allowed a credit against the
 tax  imposed  by  this  chapter.  The  amount of the credit shall be the
 amount determined by multiplying five hundred dollars or, in the case of
 a taxpayer that has obtained pursuant to chapter  six-B  of  such  title
 twenty-two  a certification of eligibility dated on or after July first,
 nineteen hundred ninety-five, one thousand dollars or, in the case of an
 eligible business that has obtained pursuant to chapter  six-B  of  such
 title  twenty-two  a certification of eligibility dated on or after July
 first, two thousand, for a relocation to eligible premises located with-
 in a revitalization area defined in subdivision (n) of section 22-621 of
 the code of the preceding municipality, three thousand dollars,  by  the
 number of eligible aggregate employment shares maintained by the taxpay-
 er  during the taxable year with respect to particular premises to which
 the taxpayer has relocated; provided, however, with respect to  a  relo-
 cation  for  which  no  application  for a certificate of eligibility is
 submitted prior to July first, two thousand three, to eligible  premises
 that  are  not  within  a revitalization area, if the date of such relo-
 cation as determined pursuant to subdivision (j) of  section  22-621  of
 the  code  of  the preceding municipality is before July first, nineteen
 hundred ninety-five, the amount to be multiplied by the number of eligi-
 ble aggregate employment shares shall be five hundred dollars, and  with
 respect  to  a  relocation for which no application for a certificate of
 eligibility is submitted prior to July first,  two  thousand  three,  to
 eligible  premises that are within a revitalization area, if the date of
 such relocation as  determined  pursuant  to  subdivision  (j)  of  such
 section  is  before July first, nineteen hundred ninety-five, the amount
 to be multiplied by the number of eligible aggregate  employment  shares
 shall  be  five  hundred  dollars, and if the date of such relocation as
 determined pursuant to subdivision (j) of such section is  on  or  after
 July  first,  nineteen  hundred  ninety-five, and before July first, two
 thousand, one thousand dollars; provided, however, that no credit  shall
 be  allowed for the relocation of any retail activity or hotel services;
 provided, further, that no credit shall be allowed under  this  subdivi-
 sion  to  any  taxpayer  that has elected pursuant to subdivision (d) of
 section 22-622 of the code of the preceding municipality  to  take  such
 credit against a gross receipts tax imposed under chapter eleven of this
 title;  and  provided  that in the case of an eligible business that has
 obtained pursuant to chapter six-B  of  such  title  twenty-two  certif-
 ications of eligibility for more than one relocation, the portion of the
 total amount of eligible aggregate employment shares to be multiplied by
 the  dollar  amount  specified  in  this paragraph for each such certif-
 ication of a relocation shall be the number of total attributed eligible
 aggregate employment shares determined with respect to  such  relocation
 S. 8474                            357
 
 pursuant to subdivision (o) of section 22-621 of the code of the preced-
 ing municipality.  For purposes of this subdivision, the terms "eligible
 aggregate  employment  shares," "relocate," "retail activity" and "hotel
 services" shall have the meanings ascribed by section 22-621 of the code
 of the preceding municipality.
   (2) The credit allowed under this subdivision with respect to eligible
 aggregate  employment shares maintained with respect to particular prem-
 ises to which the taxpayer has relocated shall be allowed for the  first
 taxable  year during which such eligible aggregate employment shares are
 maintained with respect to such premises  and  for  any  of  the  twelve
 succeeding  taxable  years  during  which  eligible aggregate employment
 shares are maintained with respect to such premises; provided  that  the
 credit  allowed  for the twelfth succeeding taxable year shall be calcu-
 lated by multiplying the number of eligible aggregate employment  shares
 maintained with respect to such premises in the twelfth succeeding taxa-
 ble  year  by the lesser of one and a fraction the numerator of which is
 such number of days in the taxable year of relocation less the number of
 days the eligible business maintained employment shares in the  eligible
 premises  in the taxable year of relocation and the denominator of which
 is the number of days in such twelfth  succeeding  taxable  year  during
 which  such  eligible  aggregate  employment  shares are maintained with
 respect to such premises. Except as provided in paragraph four  of  this
 subdivision,  if  the amount of the credit allowable under this subdivi-
 sion for any taxable year exceeds the tax imposed  for  such  year,  the
 excess may be carried over, in order, to the five immediately succeeding
 taxable  years  and,  to  the  extent  not previously deductible, may be
 deducted from the taxpayer's tax for such years.
   (3) The credit allowable under  this  subdivision  shall  be  deducted
 after  the  credits allowed by subdivisions (b) and (j) of this section,
 but prior to the deduction of any other credit allowed by this section.
   (4) In the case of a taxpayer that has  obtained  a  certification  of
 eligibility pursuant to chapter six-B of title twenty-two of the code of
 the  preceding  municipality  dated on or after July first, two thousand
 for a relocation to eligible premises located within the  revitalization
 area  defined  in  subdivision  (n) of section 22-621 of the code of the
 preceding municipality, the credits allowed under this  subdivision,  or
 in the case of a taxpayer that has relocated more than once, the portion
 of such credits attributed to such certification of eligibility pursuant
 to  paragraph  one  of this subdivision, against the tax imposed by this
 chapter for the taxable year of such relocation and for the four taxable
 years immediately succeeding the taxable year of such relocation,  shall
 be  deemed  to  be overpayments of tax by the taxpayer to be credited or
 refunded, without interest, in accordance with the provisions of section
 11-526 of this chapter. For such taxable years, such credits or portions
 thereof may  not  be  carried  over  to  any  succeeding  taxable  year;
 provided, however, that this paragraph shall not apply to any relocation
 for  which  an  application  for  a certification of eligibility was not
 submitted prior to July first, two thousand three, unless  the  date  of
 such relocation is on or after July first, two thousand.
   (j)  (1)  If  a partner in an unincorporated business is taxable under
 this chapter and is required to include in unincorporated business taxa-
 ble income his, her or its distributive share of income, gain, loss  and
 deductions  of,  or  guaranteed payments from, such unincorporated busi-
 ness, such partner shall be allowed a credit against the tax imposed  by
 this  chapter  equal to the lesser of the amounts determined in subpara-
 graphs (A) and (B) of this paragraph:
 S. 8474                            358
 
   (A) The amount determined in this subparagraph is the product  of  (i)
 the  sum  of  (I)  the tax imposed by this chapter on the unincorporated
 business for its taxable year ending within or with the taxable year  of
 the  partner and paid by the unincorporated business and (II) the amount
 of any credit or credits taken by the unincorporated business under this
 section  (except  the credit allowed by subdivision (b) of this section)
 for its taxable year ending within or with the taxable year of the part-
 ner, to the extent that such credits do not reduce  such  unincorporated
 business's  tax  below zero, and (ii) a fraction, the numerator of which
 is the net total of the partner's distributive share  of  income,  gain,
 loss and deductions of, and guaranteed payments from, the unincorporated
 business for such taxable year, and the denominator of which is the sum,
 for  such  taxable year, of the net total distributive shares of income,
 gain, loss and deductions of, and guaranteed payments to,  all  partners
 in  the  unincorporated  business  for  whom or which such net total, as
 separately determined for each partner, is greater than zero.
   (B) The amount determined  in  this  subparagraph  is  the  difference
 between  (i) the tax computed pursuant to this chapter on the unincorpo-
 rated business taxable income of the partner, without allowance  of  any
 credits  allowed  by  this section, and (ii) the tax so computed, deter-
 mined as if the partner had no such  distributive  share  or  guaranteed
 payments with respect to the unincorporated business, provided, however,
 that  the  amounts computed in clauses (i) and (ii) of this subparagraph
 shall be computed with the following modifications:
   (I) such amounts shall be computed without  taking  into  account  any
 carryforward or carryback by the partner of a net operating loss;
   (II)  if, prior to taking into account any distributive share or guar-
 anteed payments from any unincorporated business or  any  net  operating
 loss  carryforward  or  carryback,  the  unincorporated business taxable
 income of the partner is less than zero,  such  unincorporated  business
 taxable income shall be treated as zero; and
   (III)  if such partner's net total distributive share of income, gain,
 loss and deductions of, and guaranteed payments from, any unincorporated
 business is less than zero, such net total shall be treated as zero. The
 amount determined in this subparagraph shall not be less than zero.
   (2) (A) Notwithstanding anything to the contrary in paragraph  one  of
 this subdivision, the credit or the sum of the credits that may be taken
 by  a  partner for a taxable year under this subdivision with respect to
 an unincorporated business or unincorporated businesses in which he, she
 or it is a partner shall not exceed the tax imposed on the unincorporat-
 ed business taxable income of such partner under this chapter  for  such
 taxable year reduced by the credit allowed under subdivision (b) of this
 section.  If  the credit allowed under paragraph one of this subdivision
 or the sum of such credits exceeds such tax as so reduced, the amount of
 the excess may be carried forward, in order, to each of the seven  imme-
 diately  succeeding  taxable  years  and,  to  the extent not previously
 taken, shall be allowed as a credit in each of such years, provided, the
 credit determined for the taxable  year  under  paragraph  one  of  this
 subdivision  shall be taken before taking any credit carryforward pursu-
 ant to this paragraph and the credit carryforward  attributable  to  the
 earliest taxable year shall be taken before taking a credit carryforward
 attributable to a subsequent taxable year.
   (B)  Notwithstanding  anything  to the contrary in subparagraph (A) of
 this paragraph, in the case of a partner  which  is  a  partnership,  no
 credit  carryforward  to any taxable year shall be allowed unless one or
 more of the partners therein  during  such  taxable  year  were  persons
 S. 8474                            359
 
 having  a  proportionate  interest  or  interests, amounting to at least
 eighty percent of all such interests,  in  the  unincorporated  business
 gross  income  and unincorporated business deductions of the partnership
 which  was  allowed  the  credit for which a carryforward is claimed. In
 such event, the carryforward allowable on account of such  credit  shall
 not  exceed the percentage of the amount otherwise allowable, determined
 by dividing (i) the sum of the proportionate interests in the unincorpo-
 rated business gross income and unincorporated  business  deductions  of
 the  partnership,  for  the year to which the credit is carried forward,
 attributable to such partners, by (ii) the  sum  of  such  proportionate
 interests  owned  by  all  partners for such taxable year. The amount by
 which the carryforward otherwise allowable exceeds the amount  allowable
 pursuant  to  this subparagraph shall not be a carryforward to any other
 taxable year.
   (3) The credit allowed under this subdivision shall not be allowed  to
 a  partner in an unincorporated business with respect to any tax paid by
 the unincorporated business under this  chapter  for  any  taxable  year
 beginning before July first, nineteen hundred ninety-four.
   (4)  Notwithstanding  anything  to  the contrary, the credit allowable
 under this subdivision shall be taken after the credit allowed by subdi-
 vision (b) of this section is taken, but before any other credit allowed
 by this section is taken.
   (5) The commissioner of finance of the city  of  Staten  Island  shall
 convene a working group, consisting of representatives of the department
 of  finance of the city of Staten Island and representatives of affected
 industries, and other persons the  commissioner  deems  appropriate,  to
 study the treatment under the unincorporated business tax of income from
 investment  and  real  estate  activities  and  the impact of the credit
 permitted by this subdivision, including but not limited to cases  where
 interests  in  a taxpayer are held by another taxpayer subject to tax on
 unincorporated business taxable income and the first taxpayer  is  enti-
 tled  to  claim  a  deduction for a net operating loss carryover and the
 second is not entitled to a corresponding deduction with the result,  in
 certain  cases, that the net income allocated to the second taxpayer may
 be subject to an effective rate of tax in excess of the rate imposed  by
 this  chapter.  In  addition, the working group shall also study the tax
 treatment of parking garages which are open or available to the  general
 public  and which also provide available space to tenants. In conducting
 such study, such working group shall take into account such  factors  as
 economic  development,  tax administration and other goals of tax policy
 and shall consider alternatives  that  would  reduce  disincentives  for
 investing  in corporations and other entities engaged in business in the
 city of Staten Island, such as exempting income from  investment  activ-
 ities  from  the  tax  on  unincorporated  business  taxable income. The
 commissioner shall prepare a report based on the  deliberations  of  the
 working  group  on  or  before April fifteenth, nineteen hundred ninety-
 five.
   (k) Credit relating to certain sales and  compensating  use  taxes  on
 certain  services.  (1)  In addition to any other credit allowed by this
 section, a taxpayer shall be allowed a credit against the tax imposed by
 this chapter to be  credited  or  refunded  in  the  manner  hereinafter
 provided  in  this subdivision. The amount of such credit shall be equal
 to the amount of sales and compensating use  taxes  imposed  by  section
 eleven  hundred seven of the tax law during the taxpayer's taxable year,
 and the amount of any interest imposed in  connection  therewith,  which
 was  paid  after  January  first, nineteen hundred ninety-five, less any
 S. 8474                            360
 
 credit or refund of such taxes (or such interest), with respect  to  the
 purchase or use by the taxpayer of the services described in subdivision
 (b) of section eleven hundred five-b of the tax law.
   (2)  The  credit  allowed  under this subdivision for any taxable year
 shall be deemed to be an overpayment of tax by the taxpayer to be  cred-
 ited or refunded, without interest, in accordance with the provisions of
 section 11-526 of this chapter.
   (3)  Where the taxpayer receives a refund or credit of any tax imposed
 under section eleven hundred seven of the tax law, or  of  any  interest
 imposed  in  connection  therewith, for which the taxpayer had claimed a
 credit under this subdivision in a prior taxable  year,  the  amount  of
 such  tax,  or such interest, refund or credit shall be added to the tax
 imposed by this chapter, and such amount shall be subtracted in  comput-
 ing unincorporated business taxable income for the taxable year.
   (l)  Lower  Manhattan relocation and employment assistance credit. (1)
 In addition to any other credit allowed by this section, a taxpayer that
 has obtained the certifications required by chapter six-C of title twen-
 ty-two of the code of the preceding  municipality  shall  be  allowed  a
 credit against the tax imposed by this chapter. The amount of the credit
 shall  be the amount determined by multiplying three thousand dollars by
 the number of eligible aggregate employment  shares  maintained  by  the
 taxpayer  during  the  taxable year with respect to eligible premises to
 which the taxpayer has relocated;  provided,  however,  that  no  credit
 shall  be  allowed  for  the  relocation of any retail activity or hotel
 services; provided, further, that no credit shall be allowed under  this
 subdivision to any taxpayer that has elected pursuant to subdivision (d)
 of section 22-624 of the code of the preceding municipality to take such
 credit against a gross receipts tax imposed under chapter eleven of this
 title.  For  purposes of this subdivision, the terms "eligible aggregate
 employment shares", "eligible premises", "relocate",  "retail  activity"
 and  "hotel services" shall have the meanings ascribed by section 22-623
 of the code of the preceding municipality.
   (2) The credit allowed under this subdivision with respect to eligible
 aggregate employment shares maintained with respect to eligible premises
 to which the taxpayer has relocated shall be  allowed  for  the  taxable
 year  of  the  relocation  and  for any of the twelve succeeding taxable
 years during which eligible aggregate employment shares  are  maintained
 with  respect to eligible premises; provided that the credit allowed for
 the twelfth succeeding taxable year shall be calculated  by  multiplying
 the  number  of  eligible  aggregate  employment  shares maintained with
 respect to eligible premises in the twelfth succeeding taxable  year  by
 the  lesser  of one and a fraction the numerator of which is such number
 of days in the taxable year of relocation less the number  of  days  the
 taxpayer  maintained employment shares in eligible premises in the taxa-
 ble year of relocation and the denominator of which  is  the  number  of
 days  in such twelfth succeeding taxable year during which such eligible
 aggregate employment shares are maintained with respect  to  such  prem-
 ises.
   (3)  Except  as provided in paragraph four of this subdivision, if the
 amount of the credit allowable under this subdivision  for  any  taxable
 year  exceeds  the  tax imposed for such year, the excess may be carried
 over, in order, to the five immediately succeeding taxable years and, to
 the extent not previously deductible, may be deducted from  the  taxpay-
 er's tax for such years.
   (4)  The  credits  allowed  under  this  subdivision,  against the tax
 imposed by this chapter for the taxable year of the relocation  and  for
 S. 8474                            361
 
 the  four  taxable years immediately succeeding the taxable year of such
 relocation, shall be deemed to be overpayments of tax by the taxpayer to
 be credited or  refunded,  without  interest,  in  accordance  with  the
 provisions  of  section  11-526 of this chapter. For such taxable years,
 such credits or portions thereof may not be carried over to any succeed-
 ing taxable year.
   (5) The credit allowable under  this  subdivision  shall  be  deducted
 after  the  credits  allowed  by  subdivisions  (b), (i) and (j) of this
 section, but prior to the deduction of any other credit allowed by  this
 section.
   (n)  Industrial business zone tax credit. (1) For taxable years begin-
 ning on or after January first, two thousand six,  in  addition  to  any
 other  credit  allowed  by this section, an eligible business that first
 enters into a binding contract on or after July first, two thousand five
 to purchase or lease eligible premises to which it  relocates  shall  be
 allowed  a one-time credit against the tax imposed by this chapter to be
 credited or refunded in the manner hereinafter provided in this subdivi-
 sion. The amount of such credit shall be one thousand dollars per  full-
 time  employee;  provided, however, that the amount of such credit shall
 not exceed the lesser of actual relocation costs or one hundred thousand
 dollars.
   (2) When used in this subdivision, the following terms shall have  the
 following meanings:
   "Eligible business" means any business subject to tax under this chap-
 ter  that  (A)  has  been conducting substantial business operations and
 engaging primarily in industrial and manufacturing activities at one  or
 more  locations within the city of Staten Island or outside the state of
 New York continuously during the  twenty-four  consecutive  full  months
 immediately preceding relocation, (B) has leased the premises from which
 it relocates continuously during the twenty-four consecutive full months
 immediately  preceding  relocation,  (C)  first  enters  into  a binding
 contract on or after July first, two thousand five to purchase or  lease
 eligible  premises to which such business will relocate, and (D) will be
 engaged primarily in industrial and  manufacturing  activities  at  such
 eligible premises.
   "Eligible  premises"  means premises located entirely within an indus-
 trial business zone. For any eligible business, an  industrial  business
 zone  tax  credit  shall  not  be  granted with respect to more than one
 eligible premises.
   "Full-time employee" means (A) one person  gainfully  employed  in  an
 eligible  premises  by  an  eligible  business where the number of hours
 required to be worked by such person is not less than thirty-five  hours
 per  week; or (B) two persons gainfully employed in an eligible premises
 by an eligible business where the number of hours required to be  worked
 by  each  such  person is more than fifteen hours per week but less than
 thirty-five hours per week.
   "Industrial business zone" means an area within  the  city  of  Staten
 Island established pursuant to section 22-626 of the code of the preced-
 ing municipality.
   "Industrial  business zone tax credit" means a credit, as provided for
 in this subdivision, against a tax imposed under this chapter.
   "Industrial and manufacturing activities" means  activities  involving
 the  assembly of goods to create a different article, or the processing,
 fabrication, or packaging of goods. Industrial and manufacturing  activ-
 ities shall not include waste management or utility services.
 S. 8474                            362
 
   "Relocation"  means  the  physical  relocation of furniture, fixtures,
 equipment, machinery and supplies directly to an eligible premises, from
 one or more locations of an eligible business, including  at  least  one
 location at which such business conducts substantial business operations
 and  engages  primarily  in industrial and manufacturing activities. For
 purposes of this subdivision, the date of relocation shall  be  (A)  the
 date of the completion of the relocation to the eligible premises or (B)
 ninety  days  from  the  commencement  of the relocation to the eligible
 premises, whichever is earlier.
   "Relocation costs" means costs incurred  in  the  relocation  of  such
 furniture,  fixtures,  equipment, machinery and supplies, including, but
 not limited to, the cost of dismantling and reassembling  equipment  and
 the cost of floor preparation necessary for the reassembly of the equip-
 ment.  Relocation  costs shall include only such costs that are incurred
 during the ninety-day period immediately following the  commencement  of
 the  relocation  to  an  eligible  premises.  Relocation costs shall not
 include any costs  for  structural  or  capital  improvements  or  items
 purchased in connection with the relocation.
   (3)  The  credit  allowed  under this subdivision for any taxable year
 shall be deemed to be an overpayment of tax by the taxpayer to be  cred-
 ited  or refunded without interest, in accordance with the provisions of
 section 11-526 of this chapter.
   (4) The number of full-time employees for the purposes of  calculating
 an  industrial  business  zone tax credit shall be the average number of
 full-time employees, calculated on  a  weekly  basis,  employed  in  the
 eligible  premises by the eligible business in the fifty-two week period
 immediately following relocation.
   (5) The credit allowed under this subdivision must  be  taken  by  the
 taxpayer in the taxable year in which such fifty-two week period ends.
   (6)  For  the purposes of calculating entire net income in the taxable
 year that an industrial business zone tax credit is allowed, a  taxpayer
 must  add  back the amount of the credit allowed under this subdivision,
 to the extent of any relocation costs deducted in  the  current  taxable
 year or a prior taxable year in calculating federal taxable income.
   (7) The credit allowed under this subdivision shall not be granted for
 an  eligible  business for more than one relocation. Notwithstanding the
 foregoing, an industrial business zone tax  credit  allowed  under  this
 subdivision shall not be granted if the eligible business receives bene-
 fits  pursuant to chapter six-B or six-C of title twenty-two of the code
 of the preceding municipality, through a grant program  administered  by
 the  business  relocation  assistance corporation, or through the Staten
 Island city printers relocation fund grant.
   (8) The commissioner of finance is authorized to promulgate rules  and
 regulations  and to prescribe forms necessary to effectuate the purposes
 of this subdivision.
   The commissioner of finance is empowered to promulgate rules and regu-
 lations and to prescribe the form of application to be used.
   (B) Definitions:  When used in this section, "Employment  Opportunity"
 means  the creation of a full time position of gainful employment for an
 industrial or commercial employee and the actual hiring of such employee
 for the said position.
   "Industrial Employee" means one engaged in the manufacture or assembl-
 ing of tangible goods or the processing of raw materials.
   "Commercial Employee" means one engaged  in  the  buying,  selling  or
 otherwise providing of goods or services other than on a retail basis.
 S. 8474                            363
 
   "Retail"  means  the  selling or otherwise disposing of tangible goods
 directly to the ultimate user or consumer.
   "Full  Time  Position" means the hiring of an industrial or commercial
 employee in a position of gainful employment where the number  of  hours
 worked  by  such employee is not less than thirty hours during any given
 work week.
   "Employment Opportunity Relocation Costs" means the costs incurred  by
 the  taxpayer  in  moving  furniture, files, papers and office equipment
 into the city from a location outside the state; the costs  incurred  by
 the  taxpayer in the moving from a location outside the state; the costs
 of  installation  of  telephones  and  other  communications   equipment
 required  as  a  result  of  the  relocation to the city from a location
 outside the state; the cost incurred in the purchase of office furniture
 and fixtures required as a result of the relocation to the city  from  a
 location  outside  the state; and the cost of renovation of the premises
 to be occupied as a result of the  relocation  provided,  however,  that
 such renovation costs shall be allowable only to the extent that they do
 not exceed seventy-five cents per square foot of the total area utilized
 by the taxpayer in the occupied premises.
   (2)   The credit allowed under this section for any taxable year shall
 be deemed to be an overpayment of tax by the taxpayer to be credited  or
 refunded  without interest, in accordance with the provisions of section
 11-526 of this chapter.
   (o) Biotechnology credit. (a)(1) A taxpayer that is a qualified emerg-
 ing technology company, engages in biotechnologies, and meets the eligi-
 bility requirements of this  subdivision,  shall  be  allowed  a  credit
 against  the  tax imposed by this subchapter. The amount of credit shall
 be equal to the sum of the amounts  specified  in  subparagraphs  three,
 four  and five of this paragraph, subject to the limitations in subpara-
 graph seven of this paragraph and paragraph (b) of this subdivision. For
 the purposes of this subdivision, "qualified emerging technology  compa-
 ny"  shall mean a company located in city: (A) whose primary products or
 services are classified as emerging technologies and whose total  annual
 product sales are ten million dollars or less; or (B) a company that has
 research  and development activities in city and whose ratio of research
 and development funds to net sales equals or exceeds the  average  ratio
 for  all  surveyed  companies  classified  as determined by the National
 Science Foundation in the most recent published results from its  Survey
 of Industry Research and Development, or any comparable successor survey
 as  determined  by  the department, and whose total annual product sales
 are ten million dollars or less. For the purposes of  this  subdivision,
 the  definition  of  research and development funds shall be the same as
 that used by the  National  Science  Foundation  in  the  aforementioned
 survey.    For the purposes of this subdivision, "biotechnologies" shall
 mean the technologies involving the scientific  manipulation  of  living
 organisms,  especially at the molecular and/or the sub-molecular genetic
 level, to produce products conducive to improving the lives  and  health
 of  plants, animals, and humans; and the associated scientific research,
 pharmacological, mechanical, and computational applications and services
 connected with these improvements. Activities included with such  appli-
 cations  and  services shall include, but not be limited to, alternative
 mRNA splicing, DNA sequence amplification, antigenetic switching bioaug-
 mentation, bioenrichment, bioremediation, chromosome walking, cytogenet-
 ic engineering, DNA diagnosis, fingerprinting, and sequencing,  electro-
 poration,    gene    translocation,   genetic   mapping,   site-directed
 S. 8474                            364
 
 mutagenesis, bio-transduction, bio-mechanical and  bio-electrical  engi-
 neering, and bio-informatics.
   (2) An eligible taxpayer shall (A) have no more than one hundred full-
 time  employees,  of which at least seventy-five percent are employed in
 the city, (B) have a ratio of research  and  development  funds  to  net
 sales,  as referred to in section thirty-one hundred two-e of the public
 authorities law, which equals or exceeds six percent during the calendar
 year ending with or within the taxable year  for  which  the  credit  is
 claimed,  and  (C) have gross revenues, along with the gross revenues of
 its "affiliates" and "related  members"  not  exceeding  twenty  million
 dollars  for  the  calendar year immediately preceding the calendar year
 ending with or within the taxable year for which the credit is  claimed.
 For  the  purposes  of  this  subdivision, "affiliates" shall mean those
 corporations that are members of the same affiliated group,  as  defined
 in  section  fifteen  hundred  four of the internal revenue code, as the
 taxpayer. For the purposes of this subdivision, "related members"  shall
 mean a person, corporation, or other entity, including an entity that is
 treated  as  a partnership or other pass-through vehicle for purposes of
 federal taxation, whether  such  person,  corporation  or  entity  is  a
 taxpayer or not, where one such person, corporation or entity, or set of
 related  persons,  corporations or entities, directly or indirectly owns
 or controls a controlling interest in another  entity.  Such  entity  or
 entities may include all taxpayers under chapters six, eleven and seven-
 teen  of  this  title,  and subchapters two and three of this chapter. A
 controlling interest shall mean, in the case of  a  corporation,  either
 thirty percent or more of the total combined voting power of all classes
 of  stock of such corporation, or thirty percent or more of the capital,
 profits or beneficial interest in such voting stock of such corporation;
 and in the case of a partnership, association, trust  or  other  entity,
 thirty percent or more of the capital, profits or beneficial interest in
 such partnership, association, trust or other entity.
   (3)  An  eligible  taxpayer shall be allowed a credit for eighteen per
 centum of the cost or other basis for federal  income  tax  purposes  of
 research  and  development  property that is acquired by the taxpayer by
 purchase as defined in section 179(d) of the internal revenue  code  and
 placed  in service during the calendar year that ends with or within the
 taxable year for which the credit is claimed. Provided, however, for the
 purposes of this paragraph only, an eligible taxpayer shall be allowed a
 credit for such percentage of the (A) cost or other  basis  for  federal
 income  tax  purposes  for property used in the testing or inspection of
 materials and products, (B) the costs or expenses associated with quali-
 ty control of the research and development, (C) fees for use of  sophis-
 ticated technology facilities and processes, (D) fees for the production
 or  eventual commercial distribution of materials and products resulting
 from the activities of an eligible taxpayer as long as  such  activities
 fall  under  activities relating to biotechnologies. The costs, expenses
 and other amounts for which a credit is allowed and claimed  under  this
 paragraph  shall  not  be  used  in  the calculation of any other credit
 allowed under this subchapter. For the  purposes  of  this  subdivision,
 "research and development property" shall mean property that is used for
 purposes  of  research and development in the experimental or laboratory
 sense. Such purposes shall not be deemed to include the ordinary testing
 or inspection of materials or products for quality  control,  efficiency
 surveys,  management studies, consumer surveys, advertising, promotions,
 or research in connection with literary, historical or similar projects.
 S. 8474                            365
 
   (4) An eligible taxpayer shall be allowed a credit for nine per centum
 of qualified research expenses paid or incurred by the taxpayer  in  the
 calendar year ending with or within the taxable year for which the cred-
 it is claimed. For the purposes of this subdivision, "qualified research
 expenses"  shall  mean  expenses  associated  with in-house research and
 processes, and costs associated with the dissemination of the results of
 the products that directly result from  such  research  and  development
 activities;  provided, however, that such costs shall not include adver-
 tising or promotion through media. In addition,  costs  associated  with
 the  preparation of patent applications, patent application filing fees,
 patent research fees, patent examinations fees,  patent  post  allowance
 fees,  patent  maintenance fees, and grant application expenses and fees
 shall qualify as qualified research expenses. In no case shall the cred-
 it allowed under this paragraph apply to expenses for litigation or  the
 challenge  of  another  entity's  intellectual  property  rights, or for
 contract expenses involving outside paid consultants.
   (5) An eligible taxpayer shall be allowed a credit for qualified high-
 technology training expenditures as described in this paragraph paid  or
 incurred  by  the  taxpayer  during  the calendar year that ends with or
 within the taxable year for which the credit is claimed.
   (A) The amount of credit shall be one hundred percent of the  training
 expenses  described  in subparagraph (C) of this paragraph, subject to a
 limitation of no more than four thousand dollars per employee per calen-
 dar year for such training expenses.
   (B) Qualified high-technology  training  shall  include  a  course  or
 courses taken and satisfactorily completed by an employee of the taxpay-
 er at an accredited, degree granting post-secondary college or universi-
 ty  in  city  that (i) directly relates to biotechnology activities, and
 (ii) is intended to upgrade, retrain  or  improve  the  productivity  or
 theoretical  awareness  of  the  employee.  Such  course  or courses may
 include, but are not limited to, instruction  or  research  relating  to
 techniques,  meta,  macro,  or  micro-theoretical or practical knowledge
 bases or frontiers, or ethical concerns related to such activities. Such
 course or courses shall  not  include  classes  in  the  disciplines  of
 management,  accounting  or the law or any class designed to fulfill the
 discipline specific requirements of a degree program at  the  associate,
 baccalaureate,  graduate  or  professional  level  of these disciplines.
 Satisfactory completion of a course or courses shall  mean  the  earning
 and  granting  of  credit  or  equivalent unit, with the attainment of a
 grade of "B" or higher in a graduate level course or courses, a grade of
 "C" or higher in an undergraduate level courses or courses, or a similar
 measure of competency for a course that is not measured according  to  a
 standard grade formula.
   (C)  Qualified  high-technology  training  expenditures  shall include
 expenses for tuition and mandatory fees, software required by the insti-
 tution, fees for textbooks or other literature required by the  institu-
 tion  offering  the course or courses, minus applicable scholarships and
 tuition or fee waivers not granted by the taxpayer or any affiliates  of
 the  taxpayer,  that  are  paid or reimbursed by the taxpayer. Qualified
 high-technology expenditures do not include  room  and  board,  computer
 hardware or software not specifically assigned for such course or cours-
 es,  late-charges,  fines or membership dues and similar expenses.  Such
 qualified expenditures shall not be eligible for the credit provided  by
 this section unless the employee for whom the expenditures are disbursed
 is continuously employed by the taxpayer in a full-time, full-year posi-
 tion  primarily  located  at  a qualified site during the period of such
 S. 8474                            366

 coursework and lasting through at least one hundred  eighty  days  after
 the  satisfactory  completion  of the qualifying course-work.  Qualified
 high-technology training expenditures shall  not  include  expenses  for
 in-house  or shared training outside of a city higher education institu-
 tion or the use of  consultants  outside  of  credit  granting  courses,
 whether such consultants function inside of such higher education insti-
 tution or not.
   (D) If a taxpayer relocates from an academic business incubator facil-
 ity  partnered  with  an accredited post-secondary education institution
 located within city, which provides space and business support  services
 to  taxpayers,  to another site, the credit provided in this subdivision
 shall be allowed for all expenditures referenced in subparagraph (C)  of
 this paragraph paid or incurred in the two preceding calendar years that
 the  taxpayer was located in such an incubator facility for employees of
 the taxpayer who also relocate from said incubator facility to such city
 site and are employed and primarily located by  the  taxpayer  in  city.
 Such  expenditures  in  the  two  preceding  years shall be added to the
 amounts otherwise qualifying for the credit provided by this subdivision
 that were paid or incurred in the calendar year that the taxpayer  relo-
 cates  from  such  a  facility. Such expenditures shall include expenses
 paid for an eligible employee who is a full-time, full-year employee  of
 said  taxpayer during the calendar year that the taxpayer relocated from
 an  incubator  facility  notwithstanding  (i)  that  such  employee  was
 employed full or part-time as an officer, staff-person or paid intern of
 the  taxpayer  when such taxpayer was located at such incubator facility
 or (ii) that such employee  was  not  continuously  employed  when  such
 taxpayer  was  located  at the incubator facility during the one hundred
 eighty day period referred to in subparagraph  (C)  of  this  paragraph,
 provided  such employee received wages or equivalent income for at least
 seven hundred fifty hours during any twenty-four month period  when  the
 taxpayer  was located at the incubator facility. Such expenditures shall
 include payments made to such employee after the taxpayer has  relocated
 from  the incubator facility for qualified expenditures if such payments
 are made to reimburse an employee for expenditures paid by the  employee
 during  such  two  preceding years. The credit provided under this para-
 graph shall be allowed in any taxable year that the  taxpayer  qualifies
 as an eligible taxpayer.
   (E)  For  purposes  of this subdivision the term "academic year" shall
 mean the annual period  of  sessions  of  a  post-secondary  college  or
 university.
   (F)  For the purposes of this subdivision the term "academic incubator
 facility" shall mean a  facility  providing  low-cost  space,  technical
 assistance,  support  services  and educational opportunities, including
 but not limited to central services  provided  by  the  manager  of  the
 facility  to  the tenants of the facility, to an entity located in city.
 Such entity's primary activity must  be  in  biotechnologies,  and  such
 entity must be in the formative stage of development. The academic incu-
 bator facility and the entity must act in partnership with an accredited
 post-secondary  college or university located in city. An academic incu-
 bator facility's mission shall be to promote job creation, entrepreneur-
 ship, technology transfer, and provide  support  services  to  incubator
 tenants,  including,  but  not limited to, business planning, management
 assistance, financial-packaging, linkages  to  financing  services,  and
 coordinating with other sources of assistance.
   (6)  An eligible taxpayer may claim credits under this subdivision for
 three consecutive years. In no case shall the  credit  allowed  by  this
 S. 8474                            367
 
 subdivision  to a taxpayer exceed two hundred fifty thousand dollars per
 calendar year for eligible expenditures made during such calendar year.
   (7)  The  credit  allowed  under this subdivision for any taxable year
 shall not reduce the tax due for such  year  to  less  than  the  amount
 computed  in  subdivision (a) of this section. Provided, however, if the
 amount of credit allowed under this subdivision  for  any  taxable  year
 reduces  the  tax to such amount, any amount of credit not deductible in
 such taxable year shall be treated as an overpayment of tax to be  cred-
 ited  or refunded in accordance with the provisions of section 11-526 of
 this chapter; provided, however, that notwithstanding the provisions  of
 section 11-528 of this chapter, no interest shall be paid thereon.
   (8)  The  credit  allowed under this subdivision shall only be allowed
 for taxable years beginning on or after January first, two thousand  ten
 and before January first, two thousand nineteen.
   (b)(1)  The  percentage of the credit allowed to a taxpayer under this
 subdivision in any calendar year shall be:
   (A) If the average number of  individuals  employed  full  time  by  a
 taxpayer  in  the city during the calendar year that ends with or within
 the taxable year which the credit is claimed is  at  least  one  hundred
 five  percent  of  the  taxpayer's  base  year  employment,  one hundred
 percent, except that in no case shall  the  credit  allowed  under  this
 clause  exceed  two  hundred  fifty  thousand dollars per calendar year.
 Provided, however, the increase in base year employment shall not  apply
 to  a  taxpayer  allowed  a  credit  under this subdivision that was (I)
 located outside of the city, (II) not doing business, or (III)  did  not
 have any employees, in the year preceding the first year that the credit
 is  claimed. Any such taxpayer shall be eligible for one hundred percent
 of the credit for the first calendar year that ends with or  within  the
 taxable year for which the credit is claimed, provided that such taxpay-
 er  locates  in  the  city,  begins  doing business in the city or hires
 employees in the city during such calendar year and is otherwise  eligi-
 ble for the credit pursuant to the provisions of this subdivision.
   (B)  If  the  average  number  of  individuals employed full time by a
 taxpayer in the city during the calendar year that ends with  or  within
 the  taxable  year  for  which  the  credit  is claimed is less than one
 hundred five percent of  the  taxpayer's  base  year  employment,  fifty
 percent,  except  that  in  no  case shall the credit allowed under this
 clause exceed one hundred twenty  five  thousand  dollars  per  calendar
 year. In the case of an entity located in city receiving space and busi-
 ness  support services by an academic incubator facility, if the average
 number of individuals employed full time by  such  entity  in  the  city
 during the calendar year in which the credit allowed under this subdivi-
 sion  is claimed is less than one hundred five percent of the taxpayer's
 base year employment, the credit shall be zero.
   (2) For the purposes of this subdivision, "base year employment" means
 the average number of individuals employed full-time by the taxpayer  in
 the city in the year preceding the first calendar year that ends with or
 within the taxable year for which the credit is claimed.
   (3)  For  the purposes of this subdivision, average number of individ-
 uals employed full-time shall be computed by adding the number  of  such
 individuals  employed  by the taxpayer at the end of each quarter during
 each calendar year or other applicable period and dividing  the  sum  so
 obtained  by  the number of such quarters occurring within such calendar
 year or other applicable period.
   (4) Notwithstanding anything contained in this section to the  contra-
 ry, the credit provided by this subdivision shall be allowed against the
 S. 8474                            368
 
 taxes authorized by this chapter for the taxable year after reduction by
 all other credits permitted by this chapter.
   (p)  Beer  production credit. (1) A taxpayer subject to tax under this
 chapter, that is registered as a distributor under article  eighteen  of
 the tax law, and that produces sixty million or fewer gallons of beer in
 this  state  in  the taxable year, shall be allowed a credit against the
 tax imposed by this chapter in the amount specified in paragraph two  of
 this subdivision. Provided, however, that no credit shall be allowed for
 any  beer  produced  in  excess of fifteen million five hundred thousand
 gallons in the taxable year. Notwithstanding anything in this  title  to
 the  contrary,  if a partnership is allowed a credit under this subdivi-
 sion, a taxpayer that is a partner in  such  partnership  shall  not  be
 allowed  a  credit  under  this  subdivision  for  any taxable year that
 includes the last day of the taxable year for which the  partnership  is
 allowed such credit.
   (2)  The  amount  of the credit per taxpayer per taxable year for each
 gallon of beer produced in the city on or after January first, two thou-
 sand seventeen shall be determined as follows:
   (i) for the first five hundred thousand gallons of  beer  produced  in
 the  city  in  the taxable year, the credit shall equal twelve cents per
 gallon; and
   (ii) for each gallon of beer produced in the city in the taxable  year
 in excess of five hundred thousand gallons, the credit shall equal three
 and eighty-six one hundredths cents per gallon. The credit allowed under
 this subdivision for any taxable year shall be treated as an overpayment
 of  tax  to be credited or refunded in accordance with the provisions of
 section 11-526 of this chapter; provided, however, that  notwithstanding
 the  provisions  of section 11-528 of this chapter, no interest shall be
 paid thereon.
   (q) Credit for the provision of child care. In addition to  any  other
 credit  allowed  under  this section, a taxpayer whose application for a
 credit authorized by section 11-144 of this title has been  approved  by
 the  department  of  finance  shall  be allowed a credit against the tax
 imposed by this chapter. The amount of the credit shall be determined as
 provided in such section. To the extent the amount of the credit allowed
 by this subdivision exceeds the amount of tax due pursuant to this chap-
 ter, as calculated without such credit,  such  excess  amount  shall  be
 treated  as  an overpayment of tax to be credited or refunded in accord-
 ance with the provisions of section 11-526 of  this  chapter,  provided,
 however, that notwithstanding the requirements of section 11-528 of this
 chapter to the contrary, no interest shall be paid thereon.
   §  11-504    Taxable years to which tax applies; tax for taxable years
 beginning prior to and ending  after  January  first,  nineteen  hundred
 sixty-six.    (a)  General.    The tax imposed by section 11-503 of this
 chapter, with any modification permitted  by  subdivision  (b)  of  this
 section,  is  imposed for each taxable year beginning with taxable years
 ending on or after January first, nineteen hundred sixty-six.
   (b) Alternate methods for determining tax for taxable years ending  on
 or after January first, nineteen hundred sixty-six.  (1) The tax for any
 taxable  year  ending on or after January first, nineteen hundred sixty-
 six and before December thirty-first, nineteen hundred sixty-six,  shall
 be  an amount equal to the tax which would have been imposed had section
 11-503 of this chapter been in  effect  for  the  entire  taxable  year,
 multiplied  by  the number of months, or major portions thereof, in such
 taxable year which occur after December thirty-first,  nineteen  hundred
 S. 8474                            369
 
 sixty-five and divided by the number of months, or major portions there-
 of, in such taxable year.
   (2)  In  lieu  of the method of computation of tax prescribed in para-
 graph one of this  subdivision,  if  the  taxpayer  maintained  adequate
 records  for  the portion of any taxable year ending on or after January
 first, nineteen hundred sixty-six,  and  before  December  thirty-first,
 nineteen  hundred  sixty-six, which falls within the calendar year nine-
 teen hundred sixty-six, the tax for such taxable year at the election of
 the taxpayer may be computed on the basis of the unincorporated business
 taxable income which the taxpayer would have  reported  had  he  or  she
 filed  a  federal income tax return for a taxable year beginning January
 first, nineteen hundred sixty-six and ending  with  the  close  of  such
 taxable  year  ending  before  December  thirty-first,  nineteen hundred
 sixty-six.  Such taxable year beginning January first, nineteen  hundred
 sixty-six  and  ending  before  December  thirty-first, nineteen hundred
 sixty-six shall be deemed, unless clearly indicated otherwise, to be the
 taxable year of the taxpayer.  For purposes of this paragraph, the unin-
 corporated business exemptions allowable under section  11-510  of  this
 chapter, the credit allowable under subdivision (b) of section 11-503 of
 this  chapter  and any net operating loss deduction as modified pursuant
 to subdivision (b) of section 11-507  of  this  chapter  shall  each  be
 reduced  by  the  same part of such exemptions, credit, or net operating
 loss deduction, as the case may be, as the number of  months,  or  major
 portions  thereof,  in  the taxable year occurring before January first,
 nineteen hundred sixty-six is of the number of months, or major portions
 thereof, in such taxable year.  Except as provided in paragraph two, the
 tax for  such  period  ending  before  December  thirty-first,  nineteen
 hundred  sixty-six,  shall  be  computed  in  accordance  with the other
 provisions of this chapter.
   § 11-505  Unincorporated business taxable income.  The  unincorporated
 business  taxable  income  of  an  unincorporated  business shall be the
 excess of its unincorporated business entire net income allocated to the
 city, less the amount of:
   (1) Its deductions under section 11-509 of this chapter not subject to
 allocation; and
   (2) Its unincorporated business exemptions  under  section  11-510  of
 this chapter.
   §  11-506  Unincorporated  business  gross  income.   (a) (1) General.
 Unincorporated business gross income of an unincorporated business means
 the sum of the items of income and gain of  the  business,  of  whatever
 kind and in whatever form paid, includible in gross income for the taxa-
 ble year for federal income tax purposes, including income and gain from
 any  property employed in the business, or from liquidation of the busi-
 ness, or from collection of installment obligations of the business,  or
 from  the  sale  or  other disposition by an unincorporated entity of an
 interest in another unincorporated entity if  and  to  the  extent  such
 income or gain is attributable to a trade, business, profession or occu-
 pation carried on in whole or in part in the city by such other unincor-
 porated entity, with the modifications specified in this section.
   (2)  The  character of a partner's distributive share of gross income,
 gains, losses and deductions of an unincorporated entity shall be deter-
 mined as if such gross income, gains, losses and deductions  were  real-
 ized  directly  by  such  partner  regardless of how the interest in the
 unincorporated  entity  was  acquired  and  regardless  of  whether  the
 distributive share is proportionate to the partner's capital interest in
 the  unincorporated  entity, provided, however, this paragraph shall not
 S. 8474                            370
 
 apply to payments to a partner treated as occurring between the unincor-
 porated entity and one who is not a partner under section seven  hundred
 seven  of  the  internal revenue code, and provided, further, this para-
 graph shall not affect the determination of whether gross income, gains,
 losses  or deductions of an unincorporated entity are subject to the tax
 imposed by this chapter as realized from an unincorporated business.
   (b) Modifications increasing federal  gross  income.  There  shall  be
 added  to  federal  gross  income  of  the  business the following items
 attributable to the business:
   (1) Interest income on obligations of any state other than this state,
 or of a political subdivision of any such other state unless created  by
 compact or agreement to which this state is a party.
   (2)  Interest  or  dividend income on obligations or securities of any
 authority, commission, or instrumentality of the  United  States,  which
 the  laws  of  the  United States exempt from federal income tax but not
 from state or local income taxes.
   (3) In the case of a taxpayer who has exercised the election permitted
 by subdivision (b) of section 11-509 of this chapter, if the property to
 which such election relates was sold or otherwise disposed of during the
 taxable year, the amount required by such subdivision  to  be  added  to
 federal gross income.
   (4) The entire amount allowable as an exclusion or deduction for stock
 transfer  taxes  imposed by article twelve of the tax law in determining
 federal gross income but only to the extent that such taxes are incurred
 and paid in market making transactions.
   (5) The amount allowed as an exclusion or deduction for sales and  use
 taxes  imposed  by section eleven hundred seven of the tax law in deter-
 mining federal gross income but only such portion of such  exclusion  or
 deduction  which  is  not  in excess of the amount of the credit allowed
 pursuant to subdivision (d) of section 11-503 of this chapter.
   (6) The amount allowed as an exclusion or deduction as rent in  deter-
 mining  federal  gross income but only such portion of such exclusion or
 deduction which is not in excess of the amount  of  the  credit  allowed
 pursuant to subdivision (e) of section 11-503 of this chapter.
   (7)  The  amount  allowed  as an exclusion or deduction in determining
 federal gross  income  but  only  such  portion  of  such  exclusion  or
 deduction  which  is  not  in excess of the amount of the credit allowed
 pursuant to subdivision (f) of section 11-503 of this chapter.
   (8) For taxable years beginning after December thirty-first,  nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass  commuting vehicle described in subparagraph (D) of paragraph eight
 of subsection (f) of section one hundred  sixty-eight  of  the  internal
 revenue  code, relating to qualified mass commuting vehicles, any amount
 which would properly be includible for federal income tax  purposes  had
 the  taxpayer not made the election permitted pursuant to such paragraph
 eight as it was in effect for agreements entered into prior  to  January
 first, nineteen hundred eighty-four.
   (9)  Upon  the  disposition  of  property  to which subdivision (o) of
 section 11-507 of this chapter applies, the amount, if any, by which the
 aggregate of the amounts described in such subdivision fifteen attribut-
 able to such property exceeds the aggregate of the amounts described  in
 subdivision  (n)  of section 11-507 of this chapter attributable to such
 property.
   (10) The amount allowed as an exclusion or deduction for sales and use
 taxes imposed by section eleven hundred seven of the tax law  in  deter-
 mining  federal gross income, but only such portion of such exclusion or
 S. 8474                            371
 
 deduction which is not in excess of the amount  of  the  credit  allowed
 pursuant to subdivision (g) of section 11-503 of this chapter.
   (12) The amount allowed as an exclusion or deduction for sales and use
 taxes imposed by section eleven hundred seven of the tax law, or for any
 interest  imposed  in connection therewith, in determining federal gross
 income, but only such portion of such exclusion or  deduction  which  is
 not  in  excess of the amount of the credit allowed pursuant to subdivi-
 sion (k) of section 11-503 of this chapter.
   (13) Notwithstanding any  other  provision  of  this  chapter  to  the
 contrary, the amount allowed as an exclusion or deduction in determining
 federal  gross  income of any loss, including but not limited to, losses
 from notional principal contracts, losses, other than as a dealer,  from
 the  holding,  sale, disposition, assumption, offset or termination of a
 position in, property, as defined in paragraph one of subdivision (c) of
 section 11-502 of this chapter, or other  substantially  similar  losses
 from  ordinary  and routine trading or investment activity to the extent
 determined by the commissioner of finance, realized in  connection  with
 activities  described  in  paragraph  two  of subdivision (c) of section
 11-502 of this chapter if, and to the extent that, such  activities  are
 not  deemed an unincorporated business carried on by the taxpayer pursu-
 ant to the provisions of subdivision (c) of section 11-502 of this chap-
 ter.
   (14) Notwithstanding any  other  provision  of  this  chapter  to  the
 contrary,  in  the  case  of a taxpayer that is an unincorporated entity
 described in subparagraph (B) of paragraph four of  subdivision  (c)  of
 section  11-502  of  this chapter, the amount allowed as an exclusion or
 deduction in determining federal gross income of any loss realized  from
 the  sale  or other disposition of an interest in another unincorporated
 entity if, and to the extent that, such loss is attributable  to  activ-
 ities  of  such other unincorporated entity not deemed an unincorporated
 business carried on by the taxpayer pursuant to the provisions of subdi-
 vision (c) of section 11-502 of this chapter.
   (15) Notwithstanding any  other  provision  of  this  chapter  to  the
 contrary, the amount allowed as an exclusion or deduction in determining
 federal  gross  income of any loss realized from the holding, leasing or
 managing of real property if, and to  the  extent  that,  such  holding,
 leasing  or  managing  of  real property is not deemed an unincorporated
 business carried on by the taxpayer pursuant to the provisions of subdi-
 vision (d) of section 11-502 of this chapter.
   (16) Notwithstanding any  other  provision  of  this  chapter  to  the
 contrary, the amount allowed as an exclusion or deduction in determining
 federal  gross  income  of  any  loss  realized from the provision by an
 owner, lessee or fiduciary holding, leasing or managing real property of
 the service of parking, garaging or  storing  of  motor  vehicles  on  a
 monthly or longer term basis to tenants at such real property if, and to
 the  extent  that, the provision of such services to such tenants is not
 deemed an unincorporated business carried on by the taxpayer pursuant to
 the provisions of subdivision (d) of section 11-502 of this chapter.
   (17) For taxable years beginning in  two  thousand  nineteen  and  two
 thousand  twenty,  the  amount  of  the increase in the federal interest
 deduction allowed pursuant to section 163(j)(10) of the internal revenue
 code.
   (18) Notwithstanding any  other  provision  of  this  chapter  to  the
 contrary, for taxable years beginning before January first, two thousand
 twenty-one,  the  amount  of  increase  in the federal deduction allowed
 S. 8474                            372
 
 pursuant to any amendment to section 461(l) of the internal revenue code
 made after March first, two thousand twenty.
   (c)  Modifications  reducing  federal  gross  income.  There  shall be
 subtracted from federal gross income of the business the following items
 attributable to the business:
   (1) Interest income on  obligations  of  the  United  States  and  its
 possessions  to the extent includible in gross income for federal income
 tax purposes;
   (2) Interest or dividend income on obligations or  securities  of  any
 authority,  commission  or  instrumentality  of the United States to the
 extent includible in gross income for federal income  tax  purposes  but
 exempt  from  state  or  local income taxes under the laws of the United
 States;
   (3) Interest or dividend income on obligations or  securities  to  the
 extent  exempt  from income tax under the laws of the city or this state
 authorizing the issuance of such obligations or securities but  includi-
 ble in gross income for federal income tax purposes;
   (3-a)  Fifty  percent  of  dividends to the extent includible in gross
 income for federal income tax purposes and not  subtracted  under  para-
 graph  two  or  three of this subdivision, provided, however, that there
 shall be no subtraction pursuant to this paragraph for any portion of  a
 dividend  from stock with respect to which a dividend deduction would be
 disallowed by subsection (c) of section two  hundred  forty-six  of  the
 internal revenue code if the unincorporated business were a corporation;
   (4) The amount of any refund or credit for overpayment of income taxes
 imposed by the city, this state or any other taxing jurisdiction, or the
 tax imposed by article thirteen-A of the tax law, to the extent properly
 included in gross income for federal tax purposes;
   (5) With respect to gain derived from the sale or other disposition of
 any  property  acquired  prior to January first, nineteen hundred sixty-
 six, except property described in subsections one and  four  of  section
 twelve  hundred  twenty-one of the internal revenue code, the difference
 between:
   (a) the amount of gain included in federal gross income  with  respect
 to each such property, and
   (b)  the  amount  of  gain,  if  smaller  than the amount described in
 subparagraph (a) of this paragraph, that would be  included  in  federal
 gross  income with respect to each such property if the federal adjusted
 basis of such property on the date of the sale or other disposition  had
 been  equal  to its fair market value on January first, nineteen hundred
 sixty-six, or the date of its sale or other disposition prior to January
 first, nineteen hundred sixty-six, plus  or  minus  all  adjustments  to
 basis made with respect to such property for federal income tax purposes
 for  periods  on  and  after  January first, nineteen hundred sixty-six;
 provided, however, that the total modification provided by this subpara-
 graph shall not exceed the taxpayer's net gain from the  sale  or  other
 disposition of all such property.
   (6)  For taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, any  amount
 properly  includible  in  federal  gross income solely as a result of an
 election made pursuant to the provisions of such paragraph eight  as  it
 was  in effect for agreements entered into prior to January first, nine-
 teen hundred eighty-four.
 S. 8474                            373
 
   (7) Upon the disposition of  property  to  which  subdivision  (o)  of
 section 11-507 of this chapter applies, the amount, if any, by which the
 aggregate  of the amounts described in subdivision (n) of section 11-507
 of this chapter attributable to such property exceeds the  aggregate  of
 the amounts described in subdivision (o) of section 11-507 of this chap-
 ter attributable to such property.
   (8) Notwithstanding any other provision of this chapter to the contra-
 ry,  the amount of any income or gain, to the extent includible in gross
 income for federal income tax purposes, realized from the holding, leas-
 ing or managing of real property if, and to the extent that, such  hold-
 ing, leasing or managing of real property is not deemed an unincorporat-
 ed  business  carried  on  by the taxpayer pursuant to the provisions of
 subdivision (d) of section 11-502 of this chapter.
   (9) Notwithstanding any other provision of this chapter to the contra-
 ry, the amount of any income or gain, to the extent includible in  gross
 income  for  federal  income tax purposes, including but not limited to,
 dividends, interest, payments with respect to securities  loans,  income
 from  notional principal contracts, or income and gains, other than as a
 dealer, from the  holding,  sale,  disposition,  assumption,  offset  or
 termination  of  a position in, property, as defined in paragraph one of
 subdivision (c) of section 11-502 of this chapter, or other substantial-
 ly similar income from ordinary and routine trading or investment activ-
 ity to the extent determined by the commissioner of finance, realized in
 connection with activities described in paragraph two of subdivision (c)
 of section 11-502 of this chapter if,  and  to  the  extent  that,  such
 activities  are  not deemed an unincorporated business carried on by the
 taxpayer pursuant to the provisions of subdivision (c) of section 11-502
 of this chapter.
   (10) Notwithstanding any  other  provision  of  this  chapter  to  the
 contrary,  in  the  case  of a taxpayer that is an unincorporated entity
 described in subparagraph (B) of paragraph four of  subdivision  (c)  of
 section 11-502 of this chapter, the amount of any income or gain, to the
 extent includible in gross income for federal income tax purposes, real-
 ized  from the sale or other disposition of an interest in another unin-
 corporated entity if, and to the extent that, such  income  or  gain  is
 attributable  to  activities  of  such  other  unincorporated entity not
 deemed an unincorporated business carried on by the taxpayer pursuant to
 the provisions of subdivision (c) of section 11-502 of this chapter.
   (11) Notwithstanding any  other  provision  of  this  chapter  to  the
 contrary,  the amount of any income or gain, to the extent includible in
 gross  income  for  federal  income  tax  purposes,  realized  from  the
 provision  by an owner, lessee or fiduciary holding, leasing or managing
 real property of the service of parking, garaging or  storing  of  motor
 vehicles on a monthly or longer term basis to tenants at such real prop-
 erty  if, and to the extent that, the provision of such services to such
 tenants is  not  deemed  an  unincorporated  business  pursuant  to  the
 provisions of subdivision (d) of section 11-502 of this chapter.
   (12)  The  amount  of  any  grant received through either the COVID-19
 pandemic small business recovery  grant  program,  pursuant  to  section
 sixteen-ff  of  the New York state urban development corporation act, or
 the small business resilience grant program administered by the  depart-
 ment of small business services, to the extent the amount of either such
 grant is included in federal taxable income.
   (d) Upon the disposition of property to which subdivisions (t) and (u)
 of  section 11-507 of this chapter apply, the amount of any gain or loss
 S. 8474                            374
 
 includible in entire net income shall be adjusted to reflect the modifi-
 cations provided in such subdivisions attributable to such property.
   (e)  Related  members  expense add back.  (1) Definitions. (A) Related
 member.  "Related member" means a related person as defined in  subpara-
 graph  (c)  of paragraph three of subsection (b) of section four hundred
 sixty-five of the internal revenue code,  except  that  "fifty  percent"
 shall be substituted for "ten percent".
   (B)  Effective  rate  of tax. "Effective rate of tax" means, as to any
 city, the maximum statutory rate of tax imposed by the city on or  meas-
 ured  by  a  related member's net income multiplied by the apportionment
 percentage, if any, applicable to the related member under the  laws  of
 said  jurisdiction.  For purposes of this definition, the effective rate
 of tax as to any city is zero where the related member's net income  tax
 liability  in said city is reported on a combined or consolidated return
 including both the taxpayer and the related member  where  the  reported
 transactions  between the taxpayer and the related member are eliminated
 or offset. Also, for purposes of this  definition,  when  computing  the
 effective  rate of tax for a city in which a related member's net income
 is eliminated or offset by  a  credit  or  similar  adjustment  that  is
 dependent  upon the related member either maintaining or managing intan-
 gible property or collecting interest income in such city,  the  maximum
 statutory rate of tax imposed by such city shall be decreased to reflect
 the  statutory  rate of tax that applies to the related member as effec-
 tively reduced by such credit or similar adjustment.
   (C) Royalty payments. Royalty payments are payments directly connected
 to the acquisition, use, maintenance  or  management,  ownership,  sale,
 exchange,  or any other disposition of licenses, trademarks, copyrights,
 trade names, trade dress, service  marks,  mask  works,  trade  secrets,
 patents  and  any other similar types of intangible assets as determined
 by the commissioner of finance, and include amounts allowable as  inter-
 est  deductions  under  section  one hundred sixty-three of the internal
 revenue code to the extent such amounts are directly or indirectly  for,
 related  to  or  in connection with the acquisition, use, maintenance or
 management, ownership, sale, exchange or disposition of such  intangible
 assets.
   (D)  Valid  business  purpose. A valid business purpose is one or more
 business purposes, other than the avoidance or  reduction  of  taxation,
 which alone or in combination constitute the primary motivation for some
 business  activity or transaction, which activity or transaction changes
 in a meaningful way, apart from tax effects, the  economic  position  of
 the taxpayer. The economic position of the taxpayer includes an increase
 in  the  market share of the taxpayer, or the entry by the taxpayer into
 new business markets.
   (2) Royalty expense add backs. (A) For the purpose of computing  unin-
 corporated  business entire net income, a taxpayer must add back royalty
 payments directly or indirectly paid, accrued, or incurred in connection
 with one or more direct  or  indirect  transactions  with  one  or  more
 related  members  during  the  taxable  year to the extent deductible in
 calculating federal taxable income.
   (B) Exceptions. (i) The adjustment required in this subdivision  shall
 not apply to the portion of the royalty payment that the taxpayer estab-
 lishes,  by  clear  and  convincing evidence of the type and in the form
 specified by the commissioner of finance, meets  all  of  the  following
 requirements:  (I) the related member was subject to tax in this city or
 another city within the United States or a foreign nation or some combi-
 nation thereof on a tax base that included  the  royalty  payment  paid,
 S. 8474                            375
 
 accrued  or incurred by the taxpayer; (II) the related member during the
 same taxable year directly or indirectly paid, accrued or incurred  such
 portion  to  a person that is not a related member; and (III) the trans-
 action  giving  rise to the royalty payment between the taxpayer and the
 related member was undertaken for a valid business purpose.
   (ii) The adjustment required in this subdivision shall  not  apply  if
 the  taxpayer  establishes, by clear and convincing evidence of the type
 and in the form specified by the commissioner of finance, that: (I)  the
 related  member  was  subject to tax on or measured by its net income in
 this city or another city within the United States, or some  combination
 thereof;  (II)  the  tax  base for said tax included the royalty payment
 paid, accrued or incurred by  the  taxpayer;  and  (III)  the  aggregate
 effective  rate  of tax applied to the related member in those jurisdic-
 tions is no less than eighty percent of the statutory rate of  tax  that
 applied  to  the  taxpayer  under section 11-503 of this chapter for the
 taxable year.
   (iii) The adjustment required in this subdivision shall not  apply  if
 the  taxpayer  establishes, by clear and convincing evidence of the type
 and in the form specified by the commissioner of finance, that: (I)  the
 royalty payment was paid, accrued or incurred to a related member organ-
 ized  under the laws of a country other than the United States; (II) the
 related member's income from the transaction was subject to a comprehen-
 sive income tax treaty between such country and the United States; (III)
 the related member was subject to tax in a foreign nation on a tax  base
 that  included  the  royalty  payment  paid,  accrued or incurred by the
 taxpayer; (IV) the related member's  income  from  the  transaction  was
 taxed in such country at an effective rate of tax at least equal to that
 imposed  by  this city; and (V) the royalty payment was paid, accrued or
 incurred pursuant to a transaction that was undertaken for a valid busi-
 ness purpose and using terms that reflect an arm's length relationship.
   (iv) The adjustment required in this subdivision shall  not  apply  if
 the  taxpayer  and  the  commissioner of finance agree in writing to the
 application or use  of  alternative  adjustments  or  computations.  The
 commissioner  of  finance  may,  in  his or her discretion, agree to the
 application or use of alternative adjustments or computations when he or
 she concludes that in the absence of such agreement the  income  of  the
 taxpayer would not be properly reflected.
   (f) Upon the disposition of property to which subdivisions (w) and (x)
 of  section 11-507 of this chapter apply, the amount of any gain or loss
 includible in unincorporated business gross income shall be adjusted  to
 reflect  the modifications provided in such subdivisions attributable to
 such property.
   § 11-507 Unincorporated business deductions. The unincorporated  busi-
 ness  deductions  of  an unincorporated business means the items of loss
 and deduction directly connected with or incurred in the conduct of  the
 business,  which  are  allowable for federal income tax purposes for the
 taxable year, including losses and deductions connected with any proper-
 ty employed in the business, with the following modifications:
   (a) A deduction shall be allowed for charitable contributions  of  the
 unincorporated  business, to the extent that such contributions would be
 deductible for federal income tax purposes if made by a corporation, but
 not in excess of five per centum of the amount by which  the  unincorpo-
 rated  business  gross  income exceeds the sum of (A) the unincorporated
 business deductions computed without the benefit of  any  deduction  for
 charitable contributions and (B) the deduction allowed under subdivision
 S. 8474                            376
 
 (b)  of  section 11-509 of this chapter, where the election permitted by
 such subdivision has been exercised.
   (b) (1) A deduction shall be allowed for net operating losses incurred
 by  the  unincorporated  business, except as otherwise provided by para-
 graph two of this subdivision, in an amount computed in the same  manner
 as the net operating loss deduction which would be allowed for the taxa-
 ble  year for federal income tax purposes if the unincorporated business
 were an individual taxpayer, but determined solely by reference  to  the
 unincorporated   business   gross  income  and  unincorporated  business
 deductions, allocated to  the  city,  of  the  unincorporated  business;
 provided, however, that such net operating loss deduction which would be
 allowed  for  the taxable year for federal income tax purposes shall for
 purposes of this paragraph be determined as if the unincorporated  busi-
 ness  had  elected under section one hundred seventy-two of the internal
 revenue code to relinquish the entire carryback period with  respect  to
 net  operating  losses,  except  with  respect to the first ten thousand
 dollars of each of such losses, sustained during  taxable  years  ending
 after June thirtieth, nineteen hundred eighty-nine. Such deduction shall
 not  include  any  net  operating loss sustained during any taxable year
 beginning prior to January first, nineteen hundred sixty-six and for the
 purposes of this paragraph a net  operating  loss  shall  be  determined
 without  regard to any deductions allowed pursuant to subdivision (b) of
 section 11-509 of this chapter and any net operating loss for a  taxable
 year  beginning in nineteen hundred eighty-one shall be computed without
 regard to the deduction allowed with respect to recovery property  under
 section one hundred sixty-eight of the internal revenue code; in lieu of
 such  deduction,  a taxpayer shall be allowed for such taxable year with
 respect to such property  the  depreciation  deduction  allowable  under
 section  one  hundred  sixty-seven of such internal revenue code as such
 section was in full force and effect on December thirty-first,  nineteen
 hundred eighty.
   (2)  In  the case of a partnership, no net operating loss carryback or
 carryover to any taxable year shall be allowed unless one or more of the
 partners during such taxable year were persons  having  a  proportionate
 interest  or interests, amounting to at least eighty percent of all such
 interests, in the unincorporated business gross income and unincorporat-
 ed business deductions of the partnership which sustained the  loss  for
 which  a carryback or carryover is claimed. In such event, the carryback
 or carryover allowable on account of such  loss  shall  not  exceed  the
 percentage of the amount otherwise allowable, determined by dividing (A)
 the  sum  of  the proportionate interests in the unincorporated business
 gross income and unincorporated business deductions of the  partnership,
 for  the year to which the loss is carried back or carried over, attrib-
 utable to such partners, by (B) the sum of such proportionate  interests
 owned  by  all  partners  for such taxable year. The amount by which the
 carryback or carryover otherwise allowable exceeds the amount  allowable
 pursuant to the preceding sentence shall not be a carryback or carryover
 to any other taxable year.
   (3) Notwithstanding any other provision of this chapter to the contra-
 ry, for taxable years beginning before January first, two thousand twen-
 ty-one, any amendment to section one hundred seventy-two of the internal
 revenue code made after March first, two thousand twenty shall not apply
 to this chapter.
   (c)  No  deduction  shall  be  allowed,  except as provided in section
 11-509 of this chapter for amounts paid or incurred to a  proprietor  or
 partner for services or for use of capital.
 S. 8474                            377
 
   (d)  No  deduction  shall  be  allowed for income taxes imposed by the
 city, this state or any other taxing jurisdiction, or the tax imposed by
 article thirteen-A of the tax law.
   (e)  No  deduction  shall  be allowed for (A) interest on indebtedness
 incurred or continued to purchase or carry obligations or securities the
 interest on which is exempt from tax under this  chapter;  (B)  expenses
 paid  or incurred for the production or collection of such income or the
 management,  conservation  or  maintenance  of  property  held  for  the
 production  of  such  income; or (C) the amortizable bond premium on any
 bond the interest income from which is so exempt.
   (f) No deduction shall be allowed in respect  of  the  excess  of  net
 long-term  capital  gain  over  net short-term capital loss, but capital
 losses incurred in the unincorporated business shall be treated as ordi-
 nary losses and shall be allowed in full.
   (g) In the case of a taxpayer who has exercised the election permitted
 by subdivision (b) of section 11-509 of this chapter, no deduction shall
 be allowed for expenditures with reference to the property to which such
 election relates, or  for  depreciation  of  such  property,  except  as
 permitted by said subdivision.
   (h)  A  deduction  shall  be  allowed, to the extent not allowable for
 federal income tax purposes, for (A) interest on  indebtedness  incurred
 or continued to purchase or carry obligations or securities the interest
 on  which  is  subject to tax under this chapter but exempt from federal
 income tax; (B) ordinary and necessary expenses paid or incurred  during
 the  taxable year for the production or collection of such income or the
 management,  conservation  or  maintenance  of  property  held  for  the
 production  of such income; and (C) the amortizable bond premium for the
 taxable year on any bond the interest on which is subject to  tax  under
 this chapter but exempt from federal income tax.
   (i)  At the election of the taxpayer, a deduction shall be allowed for
 expenditures  paid  or  incurred  during  the  taxable  year   for   the
 construction,  reconstruction,  erection  or  improvement  of industrial
 waste treatment facilities and air pollution control facilities.
   (1) (A) The term "industrial waste treatment  facilities"  shall  mean
 facilities  for the treatment, neutralization or stabilization of indus-
 trial waste, as the  term  "industrial  waste"  is  defined  in  section
 17-0105  of the environmental conservation law, from a point immediately
 preceding the point of such treatment, neutralization  or  stabilization
 to  the point of disposal, including the necessary pumping and transmit-
 ting facilities, but excluding such facilities installed for the primary
 purpose of salvaging materials which are  usable  in  the  manufacturing
 process or are marketable.
   (B)  The term "air pollution control facilities" shall mean facilities
 which remove, reduce, or render less noxious  air  contaminants  emitted
 from  an  air  contamination  source, as the terms "air contaminant" and
 "air contamination source" are defined in section 19-0107 of  the  envi-
 ronmental conservation law, from a point immediately preceding the point
 of  such  removal,  reduction  or rendering to the point of discharge of
 air, meeting emission standards as  established  by  the  air  pollution
 control  board,  but excluding such facilities installed for the primary
 purpose of salvaging materials which are  usable  in  the  manufacturing
 process  or are marketable and excluding those facilities which rely for
 their efficacy on dilution, dispersion or assimilation  of  air  contam-
 inants in the ambient air after emission.
   (2)  However, such deduction shall be allowed only (A) with respect to
 tangible property which is depreciable, pursuant to section one  hundred
 S. 8474                            378
 
 sixty-seven of the internal revenue code, having a situs in the city and
 used  in  the  taxpayer's  trade  or  business, the construction, recon-
 struction, erection or improvement of which, in the case  of  industrial
 waste  treatment  facilities,  is  initiated  on or after January first,
 nineteen hundred sixty-six, and only for expenditures paid  or  incurred
 prior  to  January first, nineteen hundred seventy-two, or which, in the
 case of air pollution control facilities, is initiated on or after Janu-
 ary first, nineteen hundred sixty-six, and
   (B) on condition that such facilities have been certified by the state
 commissioner of environmental conservation  or  his  or  her  designated
 representative, in the same manner as provided in either section 17-0707
 or  19-0309  of  the  environmental  conservation law, as applicable, as
 complying with the provision of the environmental conservation law,  the
 sanitary  code  and  regulations, permits or orders promulgated pursuant
 thereto, and
   (C) on condition that for the taxable year and all succeeding  taxable
 years,  no  deduction  for  such expenditures or for depreciation of the
 same property allowed for federal income tax purposes shall  be  allowed
 under  this chapter, except to the extent that the basis of the property
 may be attributable to factors other than such expenditures, or in  case
 a  deduction  is allowable pursuant to this subdivision, for only a part
 of such expenditures, on condition that any deduction allowed for feder-
 al income tax purposes for such expenditures or for depreciation of  the
 same  property  be  proportionately  reduced in computing unincorporated
 business deductions for the taxable  year  and  all  succeeding  taxable
 years, and
   (D)  where  the  election  provided  for in subdivision (b) of section
 11-509 of this chapter has not been exercised in  respect  to  the  same
 property.
   (3)  (A)  If  expenditures in respect to an industrial waste treatment
 facility or an air pollution control  facility  have  been  deducted  as
 provided herein and if within ten years from the end of the taxable year
 in which such deduction was allowed such property or any part thereof is
 used  for the primary purpose of salvaging materials which are usable in
 the manufacturing process or are marketable, the taxpayer  shall  report
 such change of use in its return for the first taxable year during which
 it occurs, and the commissioner of finance may recompute the tax for the
 year  or years for which such deduction was allowed and any carryback or
 carryover year, and may assess any additional tax  resulting  from  such
 recomputation  within  the  time fixed by paragraph eight of subdivision
 (c) of section 11-523 of this chapter.
   (B) If a deduction is allowed as herein provided for expenditures paid
 or incurred during any taxable year on the basis of a temporary  certif-
 icate of compliance issued pursuant to the public health law, and if the
 taxpayer  fails  to  obtain  a  permanent certificate of compliance upon
 completion of the  facilities  with  respect  to  which  such  temporary
 certificate  was  issued,  the taxpayer shall report such failure in its
 report for the taxable year during which such facilities are  completed,
 and  the  commissioner  of finance may recompute the tax for the year or
 years for which such deduction was allowed and any carryback  or  carry-
 over  year, and may assess any additional tax resulting from such recom-
 putation within the time fixed by paragraph eight of subdivision (c)  of
 section 11-523 of this chapter.
   (4)  In  any  taxable year when property is sold or otherwise disposed
 of, with respect to which a deduction has been allowed pursuant to  this
 subdivision,  such  deduction  shall be disregarded in computing gain or
 S. 8474                            379
 
 loss, and the gain or loss on the sale  or  other  disposition  of  such
 property  shall  be  the  gain  or loss allowable for federal income tax
 purposes for such taxable year.
   (j)  In  the case of mines, oil and gas wells and other natural depos-
 its, no deduction of any allowance for percentage depletion pursuant  to
 section  six  hundred  thirteen or section six hundred thirteen A of the
 internal revenue code of nineteen hundred fifty-four, as amended,  shall
 be  allowed.  However,  an  allowance for depletion with respect to such
 property shall be deductible in the  amount  which  would  be  allowable
 under  section  six hundred eleven of such internal revenue code if such
 deduction were computed without reference to such  section  six  hundred
 thirteen or section six hundred thirteen A of such code. With respect to
 the  computation  of  depletion  pursuant to this section, the basis for
 such computation for taxable years beginning in nineteen hundred  seven-
 ty-two  shall  be  the  federal basis. For subsequent taxable years, the
 basis of such computation shall be reduced only by the deduction for the
 allowance for depletion deductible pursuant  to  this  section.  In  any
 taxable  year  when  any such property is sold or otherwise disposed of,
 with respect to which a deduction has  been  allowed  pursuant  to  this
 subdivision,  the  gain or loss thereon entering into the computation of
 federal taxable income shall be disregarded in computing  unincorporated
 business  taxable  income and there shall be added to or subtracted from
 federal gross income, so modified, the gain or loss upon  such  sale  or
 other  disposition.  In  computing  such  gain or loss, the basis of the
 property sold or disposed of shall be adjusted to reflect the  deduction
 allowed with respect to such property pursuant to this subdivision.
   (k)  A  deduction shall be allowed for that portion of wages and sala-
 ries paid or incurred for the taxable year for which a deduction is  not
 allowed  pursuant  to  the provisions of section two hundred eighty-C of
 the internal revenue code.
   (l) For taxable years beginning after December thirty-first,  nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass  commuting vehicle described in subparagraph (D) of paragraph eight
 of subsection (f) of section one hundred  sixty-eight  of  the  internal
 revenue code, relating to qualified mass commuting vehicles, a deduction
 shall  be  allowed for any amount which the taxpayer could have excluded
 for purposes of this chapter had it not made the election  provided  for
 in  such paragraph eight as it was in effect for agreements entered into
 prior to January first, nineteen hundred eighty-four.
   (m) For taxable years beginning after December thirty-first,  nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass  commuting vehicle described in subparagraph (D) of paragraph eight
 of subsection (f) of section one hundred  sixty-eight  of  the  internal
 revenue   code,  relating  to  qualified  mass  commuting  vehicles,  no
 deduction shall be allowed for any amount deductible for federal  income
 tax  purposes  solely  as  a  result of an election made pursuant to the
 provisions of such paragraph eight as it was in  effect  for  agreements
 entered into prior to January first, nineteen hundred eighty-four.
   (n)  In the case of property placed in service in taxable years begin-
 ning before nineteen hundred ninety-four, for  taxable  years  beginning
 after  December  thirty-first,  nineteen hundred eighty-one, except with
 respect to property subject to the provisions  of  section  two  hundred
 eighty-F  of  the  internal  revenue  code  and  property subject to the
 provisions of section one hundred sixty-eight of  the  internal  revenue
 code which is placed in service in this state in taxable years beginning
 after  December thirty-first, nineteen hundred eighty-four, no deduction
 S. 8474                            380
 
 shall be allowed for the amount  allowable  as  a  deduction  determined
 under section one hundred sixty-eight of the internal revenue code.
   (o)  In the case of property placed in service in taxable years begin-
 ning before nineteen hundred ninety-four, for  taxable  years  beginning
 after  December  thirty-first,  nineteen hundred eighty-one, except with
 respect to property subject to the provisions  of  section  two  hundred
 eighty-F  of  the  internal  revenue  code  and  property subject to the
 provisions of section one hundred sixty-eight of  the  internal  revenue
 code which is placed in service in this state in taxable years beginning
 after  December thirty-first, nineteen hundred eighty-four, and provided
 a deduction has not been disallowed pursuant to subdivision (m) of  this
 section,  a  taxpayer shall be allowed with respect to property which is
 subject to the provisions of section  one  hundred  sixty-eight  of  the
 internal revenue code the depreciation deduction allowable under section
 one  hundred  sixty-seven  of  the internal revenue code as such section
 would have applied to property placed in  service  on  December  thirty-
 first, nineteen hundred eighty.
   (p) Notwithstanding any other provision of this chapter to the contra-
 ry,  no  deduction  shall  be  allowed for interest, depreciation or any
 other expense directly or indirectly attributable to the holding,  leas-
 ing  or managing of real property or to income or gain therefrom if, and
 to the extent that, such holding, leasing or managing of  real  property
 is  not  deemed  an  unincorporated  business carried on by the taxpayer
 pursuant to the provisions of subdivision (d) of section 11-502 of  this
 chapter.
   (q) Notwithstanding any other provision of this chapter to the contra-
 ry, no deduction shall be allowed for any expenses directly or indirect-
 ly  attributable to activities described in paragraph two of subdivision
 (c) of section 11-502 of this chapter if, and to the extent  that,  such
 activities  are  not deemed an unincorporated business carried on by the
 taxpayer pursuant to the provisions of subdivision (c) of section 11-502
 of this chapter.
   (r) Notwithstanding any other provision of this chapter to the contra-
 ry, in the case of a taxpayer that is an unincorporated entity described
 in subparagraph (B) of paragraph four  of  subdivision  (c)  of  section
 11-502  of this chapter, no deduction shall be allowed for any losses or
 expenses directly or indirectly attributable to the sale or other dispo-
 sition of an interest in another unincorporated entity if,  and  to  the
 extent  that,  such losses or expenses are attributable to activities of
 such other unincorporated entity not deemed an  unincorporated  business
 carried on by the taxpayer pursuant to the provisions of subdivision (c)
 of section 11-502 of this chapter.
   (s) Notwithstanding any other provision of this chapter to the contra-
 ry,  no  deduction  shall  be  allowed for interest, depreciation or any
 other expense directly or indirectly attributable to the provision by an
 owner, lessee or fiduciary holding, leasing or managing real property of
 the service of parking, garaging or  storing  of  motor  vehicles  on  a
 monthly or longer term basis to tenants at such real property if, and to
 the  extent  that, the provision of such services to such tenants is not
 deemed an unincorporated business pursuant to the provisions of subdivi-
 sion (d) of section 11-502 of this chapter.
   (t) For taxable years ending after September tenth, two thousand  one,
 in  the  case  of  qualified  property  described  in  paragraph  two of
 subsection k of section one hundred sixty-eight of the internal  revenue
 code,  other  than qualified New York Liberty Zone property described in
 paragraph two of subsection b of  section  fourteen  hundred  L  of  the
 S. 8474                            381
 
 internal  revenue code, without regard to clause (i) of subparagraph (C)
 of such paragraph, no deduction shall be allowed for the  amount  allow-
 able  as a deduction under section one hundred sixty-seven of the inter-
 nal revenue code.
   (u)  For taxable years ending after September tenth, two thousand one,
 in the  case  of  qualified  property  described  in  paragraph  two  of
 subsection  k of section one hundred sixty-eight of the internal revenue
 code other than qualified New York Liberty Zone  property  described  in
 paragraph  two  of  subsection  b  of  section fourteen hundred L of the
 internal revenue code, without regard to clause (i) of subparagraph  (C)
 of  such  paragraph,  a  deduction shall be allowed with respect to such
 property equal to the depreciation deduction allowable under section one
 hundred sixty-seven of the internal revenue code as such  section  would
 have  applied  to  such property had it been acquired by the taxpayer on
 September tenth, two thousand one, provided, however, that  for  taxable
 years  beginning  on  or  after January first, two thousand four, in the
 case of a passenger motor vehicle or a sport utility vehicle subject  to
 the  provisions of subdivision (w) of this section, the limitation under
 clause (i) of subparagraph (A) of paragraph one of  subdivision  (a)  of
 section  two hundred eighty-F of the internal revenue code applicable to
 the amount allowed as a deduction under this paragraph shall  be  deter-
 mined  as  of  the date such vehicle was placed in service and not as of
 September tenth, two thousand one.
   (v) For taxable years beginning on or after January first,  two  thou-
 sand  four,  in the case of a taxpayer that is not an eligible farmer as
 defined in subsection (n) of section six hundred six of the tax law,  no
 deduction  shall  be  allowed  for  the amounts allowable as a deduction
 under sections one hundred seventy-nine, one hundred sixty-seven and one
 hundred sixty-eight of the internal revenue code with respect to a sport
 utility vehicle that is not a passenger automobile as defined  in  para-
 graph  five  of  subsection  (d)  of section two hundred eighty-F of the
 internal revenue code.
   (w) For taxable years beginning on or after January first,  two  thou-
 sand  four,  in the case of a taxpayer that is not an eligible farmer as
 defined in subsection (n) of section six hundred six of the tax  law,  a
 deduction  shall be allowed with respect to a sport utility vehicle that
 is not a passenger automobile as defined in paragraph five of subsection
 (d) of section two hundred eighty-F of the internal revenue  code  equal
 to  the  amounts  allowable  as  a  deduction under sections one hundred
 seventy-nine, one hundred sixty-seven and one hundred sixty-eight of the
 internal revenue code, determined as if such sport utility vehicle  were
 a passenger automobile as defined in such paragraph five.
   §  11-508  Allocation to the city. (a) General; allocation of business
 income. If an unincorporated business is  carried  on  both  within  and
 without the city, as determined under regulations of the commissioner of
 finance, there shall be allocated to the city, in the manner provided in
 subdivision  (b),  (c)  or  (d)  of  this  section, a fair and equitable
 portion of its business income. For taxable years beginning before  July
 first,  nineteen  hundred ninety-six, if the unincorporated business has
 no regular place of business outside the  city,  all  of  such  business
 income shall be allocated to the city.
   (b)  (1)  Allocation  by taxpayer's books. For taxable years beginning
 before January first, two thousand five, the portion  allocable  to  the
 city  may  be  determined  from the books of the business if the methods
 used in keeping such books are approved by the commissioner  of  finance
 as fairly and equitably reflecting the income from the city.
 S. 8474                            382
 
   (2)(i)  If  a taxpayer determines the portion of business income to be
 allocated to the city using the method prescribed in  paragraph  one  of
 this  subdivision on a timely filed original return with respect to each
 of the two taxable years, each of which must consist of  twelve  months,
 immediately  preceding the taxpayer's first taxable year beginning on or
 after January first, two thousand five, the taxpayer may make a one-time
 election to continue to use that method for taxable years  beginning  on
 or  after January first, two thousand five and before January first, two
 thousand twelve. Such  election  shall  be  made  by  using  the  method
 prescribed  in  paragraph  one of this subdivision on an original timely
 filed return with respect to the first  taxable  year  beginning  on  or
 after  January  first,  two  thousand five and before January first, two
 thousand six. Such election may not be made, or if made, shall be deemed
 revoked as of the beginning of the taxable year if, for  either  of  the
 two  taxable  years immediately preceding the year in which the election
 is made, the commissioner of finance has determined the methods used  in
 keeping  such  books do not fairly and equitably reflect the income from
 the city.
   (ii) (A) A taxpayer that has made the election provided for in subpar-
 agraph (i) of this paragraph may revoke it  by  filing  an  original  or
 amended  return  using  an  allocation  method permitted by this section
 other than the method prescribed in paragraph one  of  this  subdivision
 unless  the commissioner of finance has determined that such method does
 not fairly and equitably reflect the income from the city.
   (B) The election provided for in subparagraph (i)  of  this  paragraph
 shall  be deemed to have been revoked as of the beginning of the taxable
 year if, for any taxable year during which the election is  intended  to
 be  in effect, the commissioner of finance has determined that the meth-
 ods used in keeping the taxpayer's books do  not  fairly  and  equitably
 reflect the income from the city.
   (C)  In the case of a taxpayer that is a partnership or other unincor-
 porated entity, the election provided for in subparagraph  (i)  of  this
 paragraph  shall  be  deemed to have been revoked as of the beginning of
 the taxable year unless one or more of  the  persons  having  a  propor-
 tionate  interest  or interests, amounting to more than fifty percent of
 all such interests, in  the  taxpayer's  unincorporated  business  gross
 income and unincorporated business deductions for such taxable year were
 persons  having a proportionate interest or interests, amounting to more
 than fifty percent of all such interests, in the  taxpayer's  unincorpo-
 rated  business  gross  income and unincorporated business deductions at
 the end of the taxpayer's last taxable  year  beginning  before  January
 first,  two thousand five. For purposes of this clause, a transfer of an
 ownership interest in unincorporated business gross income or unincorpo-
 rated business deductions upon the death of a partner or owner  to  such
 deceased  partner's or owner's estate shall be disregarded but transfers
 by such decedent's estate shall not be disregarded.
   (D) Once the election provided for in subparagraph (i) of  this  para-
 graph  has been revoked by the taxpayer pursuant to clause (A) or deemed
 revoked pursuant to clauses (B) or (C) of this subparagraph, the taxpay-
 er shall be barred from using the method prescribed in paragraph one  of
 this  subdivision  for  the  taxable year in which the election has been
 revoked or deemed revoked and any subsequent taxable year.
   (c) Allocation by formula. If subdivision (b) does not  apply  to  the
 taxpayer,  the  portion  allocable  to  the  city shall be determined by
 multiplying (A)  the  business  income  by  (B)  a  business  allocation
 percentage  to be determined by adding together the percentages computed
 S. 8474                            383
 
 under paragraphs one, two and three of this  subdivision,  and  dividing
 the  result  by  the  number of percentages; provided, however, that for
 taxable years beginning on or after July first, nineteen  hundred  nine-
 ty-six,  a  taxpayer  that  is a "manufacturing business," as defined in
 subdivision (g) of this section, may determine its  business  allocation
 percentage as provided in such subdivision (g):
   (1)  Property  percentage. The percentage computed by dividing (A) the
 average of the value, at the beginning and end of the taxable  year,  of
 real  and  tangible  personal property connected with the unincorporated
 business and located within the city, by (B) the average of  the  value,
 at  the  beginning and end of the taxable year, of all real and tangible
 personal property connected with the unincorporated business and located
 both within and without the city. For this purpose,  for  taxable  years
 beginning  before  January first, two thousand five, real property shall
 include real property rented to the  unincorporated  business  and,  for
 this  purpose,  for  taxable years beginning on and after January first,
 two thousand five, real and tangible  personal  property  shall  include
 real  and  tangible personal property rented to the unincorporated busi-
 ness and the value of such real and tangible personal property rented to
 the unincorporated business shall mean the product of (i) eight and (ii)
 the gross rents payable for the rental of such property during the taxa-
 ble year.
   (2) Payroll percentage. The percentage computed by  dividing  (A)  the
 total  wages,  salaries  and other personal service compensation paid or
 incurred during the taxable year to employees  in  connection  with  the
 unincorporated  business carried on within the city, by (B) the total of
 all wages, salaries and other  personal  service  compensation  paid  or
 incurred  during  the  taxable  year to employees in connection with the
 unincorporated business carried on both within and without the city.
   (3) Gross income percentage. The percentage computed by  dividing  (A)
 the gross sales or charges for services performed by or through an agen-
 cy  located  within  the  city,  by  (B) the total of all gross sales or
 charges for services performed within and without the city. The sales or
 charges to be allocated to the city shall include all  sales  negotiated
 or  consummated,  and  charges  for  services performed, by an employee,
 agent, agency or independent contractor chiefly situated  at,  connected
 by contract or otherwise with, or sent out from, offices of the unincor-
 porated business, or other agencies, situated within the city; provided,
 however,  that for taxable years beginning on or after July first, nine-
 teen hundred ninety-six, sales of tangible personal property  shall  not
 be  allocated  to  the  city as provided in this paragraph, but shall be
 allocated to the city only where shipments are made to points within the
 city, and provided, further, that:
   (A) for taxable years beginning on or after July first,  two  thousand
 five,  for  taxpayers having gross receipts for the taxable year, deter-
 mined without regard to any deductions, of less than one  hundred  thou-
 sand  dollars,  charges for services performed shall be allocated to the
 city to the extent that the services are performed within the city;
   (B) for taxable years beginning on or after July first,  two  thousand
 six,  for  taxpayers  having gross receipts for the taxable year, deter-
 mined without regard to any deductions, of less than three hundred thou-
 sand dollars, charges for services performed shall be allocated  to  the
 city to the extent that the services are performed within the city; and
   (C)  for  taxable years beginning on or after July first, two thousand
 seven, for all other taxpayers, charges for services performed shall  be
 S. 8474                            384
 
 allocated  to  the  city  to  the extent that the services are performed
 within the city.
   (d)  Other allocation methods. The portion allocable to the city shall
 be determined in accordance with rules and regulations  of  the  commis-
 sioner of finance if it shall appear to the commissioner of finance that
 the income from the city is not fairly and equitably reflected under the
 provisions of either subdivision (b) or subdivision (c) of this section.
   (e)  Special  rules  for  real  estate. Income and deductions from the
 rental of real property, and gain and loss from the  sale,  exchange  or
 other  disposition  of real property, shall not be subject to allocation
 under subdivision (b), (c), or (d) of this section, but shall be consid-
 ered as entirely derived from or connected with the  state,  other  than
 this  state,  in  which such property is located or, if such property is
 located in this state, the political subdivision thereof. To the  extent
 that  anything in this subdivision is inconsistent with any provision of
 subdivision (d) of section 11-502, subdivision (c) of section 11-506  or
 subdivision  (p)  of  section  11-507 of this chapter, the provisions of
 such subdivisions shall take precedence  over  the  provisions  of  this
 subdivision.
   (e-1) Special rules for publishers and broadcasters. (1) Notwithstand-
 ing  anything  in  paragraph three of subdivision (c) of this section to
 the contrary and except as provided in paragraph four of  this  subdivi-
 sion,  in  the  case of a taxpayer engaged in the business of publishing
 newspapers or periodicals, there shall be allocated  to  the  city,  for
 purposes  of  such  paragraph  three,  the  gross  sales  or charges for
 services  arising  from  sales  of  subscriptions  to,  and  advertising
 contained  in,  such  newspapers or periodicals, to the extent that such
 newspapers or periodicals are delivered to points within the city.
   (2) Notwithstanding anything in paragraph three of subdivision (c)  of
 this section to the contrary and except as provided in paragraph four of
 this  subdivision,  in the case of a taxpayer engaged in the business of
 broadcasting radio or television programs, whether  through  the  public
 airwaves  or by cable, direct or indirect satellite transmission, or any
 other means of transmission, there shall be allocated to the  city,  for
 purposes of such paragraph three, a portion of the gross sales or charg-
 es  for services arising from the sale of subscriptions to such programs
 or from the broadcasting of such programs and of commercial messages  in
 connection  therewith,  such  portion  to be determined according to the
 number of listeners or viewers within and without the city.
   (3) Notwithstanding anything in this section, other  than  subdivision
 (e)  of this section, to the contrary, in the case of a taxpayer that is
 substantially engaged, in the aggregate, in any combination of the busi-
 nesses referred to in paragraphs one, two and four of this  subdivision,
 the portion of business income allocable to the city shall be determined
 in accordance with the provisions of subdivision (c) of this section, as
 modified by paragraphs one, two and four of this subdivision, unless the
 commissioner  of  finance  determines  that the business income from the
 city is not fairly and equitably reflected under the provisions of  such
 subdivision  (c),  in  which  event the provisions of subdivision (d) of
 this section shall apply in determining the portion of  business  income
 allocable  to  the  city  and  the provisions of subdivision (b) of this
 section shall not apply. For purposes of this  subdivision,  a  taxpayer
 shall  be deemed to be substantially engaged in a business or businesses
 referred to in such paragraphs one and two if more than ten  percent  of
 the  taxpayer's  gross receipts for the taxable year are attributable to
 such business or businesses.
 S. 8474                            385
 
   (4) Notwithstanding anything in paragraph one or two of this  subdivi-
 sion  to  the  contrary, for taxable years beginning on or after January
 first, two thousand two, in the case of a taxpayer engaged in the  busi-
 ness  of  publishing newspapers or periodicals, or broadcasting radio or
 television  programs,  whether  through the public airwaves or by cable,
 direct or indirect satellite transmission, or any other means of  trans-
 mission, there shall be allocated to the city, for purposes of paragraph
 three  of subdivision (c) of this section, the gross sales or charges to
 subscribers located in the city for subscriptions  to  such  newspapers,
 periodicals,  or  program  services.  For  purposes of this paragraph, a
 subscriber shall be deemed located in the city if, in the case of  news-
 papers  and  periodicals,  the  mailing  address for the subscription is
 within the city and, in  the  case  of  program  services,  the  billing
 address  for  the  subscription is within the city. For purposes of this
 clause, "subscriber" shall mean a  member  of  the  general  public  who
 receives  such  newspapers, periodicals or program services and does not
 further distribute them.
   (e-2) Rules for receipts from certain services  to  investment  compa-
 nies.    (1)  For taxable years beginning on or after January first, two
 thousand one, for purposes of paragraph three of subdivision (c) of this
 section, the portion of receipts received  from  an  investment  company
 arising  from  the  sale  of  management, administration or distribution
 services to such investment company determined in accordance with  para-
 graph  two  of  this  subdivision shall be deemed to arise from services
 performed within the city, such portion referred to herein as the Staten
 Island city portion.
   (2) The Staten Island city portion shall be the product of  the  total
 of  such  receipts  from  the  sale of such services and a fraction. The
 numerator of that fraction is the sum of  the  monthly  percentages,  as
 defined  hereinafter, determined for each month of the investment compa-
 ny's taxable year for federal income tax  purposes  which  taxable  year
 ends  within  the  taxable year of the taxpayer, but excluding any month
 during which the investment  company  had  no  outstanding  shares.  The
 monthly  percentage  for  each  such month is determined by dividing the
 number of shares in the investment company which are owned on  the  last
 day  of  the month by shareholders that are domiciled in the city by the
 total number of shares in the investment  company  outstanding  on  that
 date.  The  denominator  of  the  fraction is the number of such monthly
 percentages.
   (3)(A) For purposes of this subdivision the term  "domicile",  in  the
 case  of an individual shall have the meaning ascribed to it under chap-
 ter seventeen of this title; an estate or trust is domiciled in the city
 if it is a city resident estate or trust as defined in  paragraph  three
 of  subdivision  (b)  of  section  11-1705 of the code of the proceeding
 municipality; a business entity is domiciled in the city if the location
 of the actual seat of management or control is in the city. It shall  be
 presumed  that the domicile of a shareholder, with respect to any month,
 is his, her or its mailing address on  the  records  of  the  investment
 company as of the last day of such month.
   (B)  For  purposes  of this subdivision, the term "investment company"
 means a regulated  investment  company,  as  defined  in  section  eight
 hundred  fifty-one  of  the  internal revenue code, and a partnership to
 which subdivision (a) of section seven thousand seven  hundred  four  of
 the  internal  revenue  code  applies,  by  virtue of paragraph three of
 subdivision (c) of section seven thousand seven  hundred  four  of  such
 code,  and  that  meets  the  requirements of subdivision (b) of section
 S. 8474                            386
 
 eight hundred fifty-one of such code.  The provisions of  this  subpara-
 graph  shall  be  applied  to  the  taxable  year for federal income tax
 purposes of the business  entity  that  is  asserted  to  constitute  an
 investment company that ends within the taxable year of the taxpayer.
   (C)  For  purposes  of  this  subdivision,  the term "receipts from an
 investment company" includes amounts received directly from  an  invest-
 ment  company  as well as amounts received from the shareholders in such
 investment company in their capacity as such.
   (D) For purposes of this subdivision, the term  "management  services"
 means  the  rendering  of  investment  advice  to an investment company,
 making determinations as to when sales and purchases of  securities  are
 to  be  made  on  behalf  of  an  investment  company, or the selling or
 purchasing of securities constituting assets of an  investment  company,
 and  related  activities, but only where such activity or activities are
 performed pursuant to a contract with  the  investment  company  entered
 into  pursuant  to  subdivision  (a)  of  section fifteen of the federal
 investment company act of nineteen hundred forty, as amended.
   (E) For purposes of this subdivision, the term "distribution services"
 means the services of advertising, servicing investor accounts,  includ-
 ing  redemptions,  marketing  shares  or selling shares of an investment
 company, but, in the case of advertising, servicing  investor  accounts,
 including  redemptions,  or marketing shares, only where such service is
 performed by a person who is, or was, in the case of a closed end compa-
 ny, also engaged in the service of selling such shares. In the  case  of
 an  open  end  company, such service of selling shares must be performed
 pursuant to a contract entered  into  pursuant  to  subdivision  (b)  of
 section  fifteen  of  the  federal  investment  company  act of nineteen
 hundred forty, as amended.
   (F)  For  purposes  of  this  subdivision,  the  term  "administration
 services"  includes  clerical, accounting, bookkeeping, data processing,
 internal auditing, legal and tax services performed  for  an  investment
 company  but only if the provider of such service or services during the
 taxable year in which such service  or  services  are  sold  also  sells
 management  or distribution services, as defined in this subdivision, to
 such investment company.
   (e-3) Rules for receipts for services performed by registered  securi-
 ties or commodities brokers or dealers.  (1) For taxable years beginning
 after  two  thousand  eight, in the case of a taxpayer which is a regis-
 tered securities or commodities broker or dealer, for purposes of  para-
 graph  three  of subdivision (c) of this section, the receipts specified
 in subparagraphs (A) through (G) of this paragraph shall  be  deemed  to
 arise from services performed within the city to the extent set forth in
 such subparagraphs.
   (A)  Receipts  constituting  brokerage  commissions  derived  from the
 execution of securities or commodities purchase or sales orders for  the
 accounts  of  customers shall be deemed to arise from services performed
 at the mailing address in the records of the taxpayer  of  the  customer
 who is responsible for paying such commissions.
   (B)  Receipts constituting margin interest earned on behalf of broker-
 age accounts shall be deemed to arise from  services  performed  at  the
 mailing  address  in  the records of the taxpayer of the customer who is
 responsible for paying such margin interest.
   (C) Gross income, including any accrued interest  or  dividends,  from
 principal  transactions  for  the  purchase  or  sale  of stocks, bonds,
 foreign exchange and other securities or commodities, including  futures
 and  forward contracts, options and other types of securities or commod-
 S. 8474                            387
 
 ities derivatives contracts, shall be  deemed  to  arise  from  services
 performed within the city either (i) to the extent that production cred-
 its are awarded to branches, offices or employees of the taxpayer within
 the  city  as  a  result  of  such principal transactions or (ii) if the
 taxpayer so elects, to the extent that  the  gross  proceeds  from  such
 principal  transactions,  determined  without  deduction  for  any  cost
 incurred by the taxpayer to acquire the securities or  commodities,  are
 generated  from  sales  of securities or commodities to customers within
 the city based upon the mailing  addresses  of  such  customers  in  the
 records  of  the  taxpayer. For purposes of clause (ii) of this subpara-
 graph, the taxpayer shall separately calculate such  gross  income  from
 principal transactions by type of security or commodity. For purposes of
 this  subparagraph,  gross  income  from principal transactions shall be
 determined after the deduction of any cost incurred by the  taxpayer  to
 acquire the securities or commodities. For purposes of this subdivision,
 the  term  "production  credits"  means  credits granted pursuant to the
 internal accounting system used by the taxpayer to measure the amount of
 revenue that should be awarded to  a  particular  branch  or  office  or
 employee  of  the  taxpayer  which  is  based,  at least in part, on the
 branch's, the office's or the  employee's  particular  activities.  Upon
 request,  the  taxpayer shall be required to furnish a detailed explana-
 tion of such internal accounting system to the department.
   (D) (i) Receipts constituting fees earned by the taxpayer for advisory
 services to a customer in connection with the underwriting of securities
 for such customer, such customer being the entity which is contemplating
 issuing or is issuing securities, or fees earned  by  the  taxpayer  for
 managing  an  underwriting  shall  be  deemed  to  arise  from  services
 performed at the mailing address in the records of the taxpayer of  such
 customer who is responsible for paying such fees.
   (ii)  Receipts  constituting  the primary spread or selling concession
 from underwritten securities shall be  deemed  to  arise  from  services
 performed  within  the  city  to  the extent that production credits are
 awarded to branches, offices or employees of  the  taxpayer  within  the
 city as a result of the sale of the underwritten securities.
   (iii) The term "primary spread" means the difference between the price
 paid  by the taxpayer to the issuer of the securities being marketed and
 the price received from the subsequent sale of the underwritten  securi-
 ties  at  the initial public offering price, less any selling concession
 and any fees paid to the taxpayer for advisory services or any manager's
 fees, if such fees are not paid by the customer to  the  taxpayer  sepa-
 rately.  The term "public offering price" means the price agreed upon by
 the taxpayer and the issuer at which the securities are to be offered to
 the public. The term "selling concession" means the amount paid  to  the
 taxpayer  for  participating in the underwriting of a security where the
 taxpayer is not the lead underwriter.
   (E) Receipts constituting interest earned by the taxpayer on loans and
 advances made by the taxpayer to an entity affiliated with the  taxpayer
 shall  be deemed to arise from services performed at the principal place
 of business of such affiliated entity. For  purposes  of  this  subpara-
 graph,  an  entity  shall  be considered affiliated with the taxpayer if
 such entity and the taxpayer have eighty percent or more  common  direct
 or indirect, actual or beneficial ownership.
   (F)  Receipts constituting account maintenance fees shall be deemed to
 arise from services performed at the mailing address in the  records  of
 the  taxpayer of the customer who is responsible for paying such account
 maintenance fees.
 S. 8474                            388
 
   (G) Receipts constituting fees for management  or  advisory  services,
 including  fees  for advisory services in relation to merger or acquisi-
 tion activities, but excluding fees paid for services described in para-
 graph one of subdivision (e-2) of this section, shall be deemed to arise
 from  services  performed  at  the mailing address in the records of the
 taxpayer of the customer who is responsible for paying such fees.
   (2) For purposes of this subdivision, the term "securities" shall have
 the same meaning as in paragraph two of subdivision (c) of section  four
 hundred  seventy-five of the internal revenue code and the term "commod-
 ities" shall have the same meaning as in paragraph  two  of  subdivision
 (e)  of section four hundred seventy-five of such code. The term "regis-
 tered securities or commodities broker or  dealer"  means  a  broker  or
 dealer  registered  as such by the securities and exchange commission or
 the commodities futures trading commission, and  shall  include  an  OTC
 derivatives  dealer  as  defined under regulations of the securities and
 exchange commission at title seventeen, part two hundred forty,  section
 3b-12 of the code of federal regulations (17 CFR 240.3b-12).
   (3)  If  the taxpayer receives any of the receipts enumerated in para-
 graph one of this subdivision as a result of a securities  correspondent
 relationship  such  taxpayer  has  with another registered securities or
 commodities broker or dealer with the taxpayer acting in this  relation-
 ship  as  the clearing firm, such receipts shall be deemed to arise from
 services performed within the city to the extent set forth  in  each  of
 the  subparagraphs  in  paragraph one of this subdivision. The amount of
 such receipts shall exclude the amount the taxpayer is required  to  pay
 to  the  correspondent  firm for such correspondent relationship. If the
 taxpayer receives any of the receipts enumerated  in  paragraph  one  of
 this  subdivision as a result of a securities correspondent relationship
 such taxpayer has with  another  registered  securities  or  commodities
 broker  or  dealer  with the taxpayer acting in this relationship as the
 introducing firm, such receipts shall be deemed to arise  from  services
 performed within the city to the extent set forth in each of the subpar-
 agraphs in paragraph one of this subdivision.
   (4)  If,  for  purposes of subparagraph (A), (B), (F), or (G) of para-
 graph one of this subdivision, and clause (i)  of  subparagraph  (C)  of
 paragraph  one  of  this  subdivision,  the  taxpayer is unable from its
 records to determine the mailing address of the customer,  the  receipts
 described  in  any of such subparagraphs and such clause shall be deemed
 to arise from services performed at the branch or office of the taxpayer
 that generates the transaction for  the  customer  that  generated  such
 receipts.
   (f)  Allocation  of investment income. (1) The investment income of an
 unincorporated business shall be allocated to the  city  by  multiplying
 such  investment  income  by  an  investment allocation percentage to be
 determined as follows:
   (A) multiply the amount of its investment  capital  invested  in  each
 stock,  bond  or  other  security,  other  than governmental securities,
 during the period covered by  its  return  by  the  issuer's  allocation
 percentage, determined as provided in paragraph two of this subdivision,
 of the issuer or obligor thereof:
   (B) add together the products so obtained; and
   (C)  divide the sum so obtained by the total of its investment capital
 invested during such period in stocks, bonds and other securities;
 provided, however, that in case any investment capital  is  invested  in
 any  stock,  bond  or other security during only a portion of the period
 covered by the return, only such portion of such capital shall be  taken
 S. 8474                            389
 
 into  account;  and  provided,  further, that if a taxpayer's investment
 allocation percentage is zero, interest received on bank accounts  shall
 be  allocated  in  the manner provided in subdivision (b), (c) or (d) of
 this section.
   (2)  (A)  In  the  case  of  an issuer or obligor subject to tax under
 subchapter two or three-A of chapter six of this title,  or  subject  to
 tax  as  a  utility  corporation under chapter eleven of this title, the
 issuer's allocation percentage shall be the percentage of the  appropri-
 ate  measure  which  is  required to be allocated within the city on the
 report or reports, if any, required of the issuer or obligor under chap-
 ter six or eleven of this title for the preceding year. The  appropriate
 measure  referred  to  in  this subparagraph shall be: in the case of an
 issuer or obligor subject to subchapter  two  of  chapter  six  of  this
 title,  entire  capital; and in the case of an issuer or obligor subject
 to chapter eleven of this title as a utility corporation, gross income.
   (B) In the case of an issuer or obligor subject to tax under part four
 of subchapter three of chapter six of this  title,  the  issuer's  allo-
 cation percentage shall be determined as follows:
   (i)  In  the case of a banking corporation described in paragraphs one
 through eight of subdivision (a) of section 11-640 of this  title  which
 is  organized  under  the  laws  of the United States, this state or any
 other state of the United States,  the  issuer's  allocation  percentage
 shall  be  its  alternative  entire net income allocation percentage, as
 defined in subdivision (c) of section 11-642  of  this  title,  for  the
 preceding year. In the case of such a banking corporation whose alterna-
 tive  entire  net  income  for the preceding year is derived exclusively
 from business carried  on  within  the  city,  its  issuer's  allocation
 percentage shall be one hundred percent.
   (ii)  In  the case of a banking corporation described in paragraph two
 of subdivision (a) of section 11-640 of this title  which  is  organized
 under  the  laws of a country other than the United States, the issuer's
 allocation percentage shall be determined by  dividing  (I)  the  amount
 described in clause (i) of subparagraph (A) of paragraph two of subdivi-
 sion  (a) of section 11-642 of this title with respect to such issuer or
 obligor for the preceding year, by (II) the gross income of such  issuer
 or  obligor  from  all sources within and without the United States, for
 such preceding year, whether or not included in alternative  entire  net
 income for such year.
   (iii)  In the case of an issuer or obligor described in paragraph nine
 of subdivision (a) or in paragraph two of  subdivision  (d)  of  section
 11-640 of this title, the issuer's allocation percentage shall be deter-
 mined  by  dividing  the  portion of the entire capital of the issuer or
 obligor allocable to the city for the preceding year by the entire capi-
 tal, wherever located, of the issuer or obligor for the preceding year.
   (C) Provided, however, that if a report or reports for  the  preceding
 year  are  not filed, or if filed do not contain information which would
 permit the determination of such issuer's  allocation  percentage,  then
 the  issuer's  allocation percentage to be used shall, at the discretion
 of the commissioner of finance, be either (i)  the  issuer's  allocation
 percentage derived from the most recently filed report or reports of the
 issuer  or  obligor or (ii) a percentage calculated, by the commissioner
 of finance, reasonably to indicate the degree of  economic  presence  in
 the city of the issuer or obligor during the preceding year.
   (3)  For  purposes  of  this  subdivision, investment capital shall be
 determined by taking the average value  of  the  gross  assets  included
 therein,   less   liabilities   deductible  therefrom  pursuant  to  the
 S. 8474                            390
 
 provisions of subdivision (h) of section 11-501  of  this  chapter.  The
 value  of  investment  capital  which  consists of marketable securities
 shall be the fair market value thereof and the value of investment capi-
 tal other than marketable securities shall be the value thereof shown on
 the  books and records of the unincorporated business in accordance with
 generally accepted accounting principles.
   (g) Special rules for manufacturing businesses. (1) For taxable  years
 beginning on or after July first, nineteen hundred ninety-six and before
 January  first,  two thousand eleven, a manufacturing business may elect
 to determine its business allocation percentage by adding  together  the
 percentages  determined  under paragraphs one, two and three of subdivi-
 sion (c) of this section and  an  additional  percentage  equal  to  the
 percentage  determined  under paragraph three of subdivision (c) of this
 section, and dividing the result by the number of percentages  so  added
 together.
   (2)  An election under this subdivision must be made on a timely filed
 (determined with regard to extensions granted) original return  for  the
 taxable year. Once made for a taxable year, such election shall be irre-
 vocable for that taxable year. A separate election must be made for each
 taxable  year.  A  manufacturing  business  that  has  failed to make an
 election as provided in this paragraph shall be  required  to  determine
 its  business  allocation percentage without regard to the provisions of
 this subdivision. Notwithstanding anything  in  this  paragraph  to  the
 contrary,  the  commissioner of finance may permit a manufacturing busi-
 ness to make or revoke an election under  this  subdivision,  upon  such
 terms  and  conditions  as  the  commissioner  may  prescribe, where the
 commissioner determines that such permission should be  granted  in  the
 interests  of  fairness  and  equity  due  to  a change in circumstances
 resulting from an audit adjustment.
   (3) As used in this subdivision,  the  term  "manufacturing  business"
 means  an unincorporated business primarily engaged in the manufacturing
 and sale thereof of tangible personal property; and the  term  "manufac-
 turing"  includes  the  process,  including  the assembly process (i) of
 working raw materials into wares suitable for use or  (ii)  which  gives
 new  shapes,  new  qualities or new combinations to matter which already
 has gone through some artificial  process,  by  the  use  of  machinery,
 tools,  appliances  and other similar equipment. An unincorporated busi-
 ness shall be deemed to be primarily engaged in the activities described
 in the preceding sentence if  more  than  fifty  percent  of  its  gross
 receipts for the taxable year are attributable to such activities.
   (h)  Notwithstanding  subdivision  (d)  of  this  section, if it shall
 appear to the commissioner of finance that any  business  or  investment
 allocation percentage determined pursuant to this section does not prop-
 erly  reflect the activity, business, or income of a taxpayer within the
 city, the commissioner of finance shall be  authorized  in  his  or  her
 discretion,  in  the case of a business allocation percentage, to adjust
 it by (1) excluding one or more of the factors  therein;  (2)  including
 one or more factors, such as expenses, purchases, contract values, minus
 subcontract  values;  (3) excluding one or more assets in computing such
 allocation percentage, provided the income therefrom is also excluded in
 determining unincorporated business entire net income, or (4) any  other
 similar or different method calculated to effect a fair and proper allo-
 cation  of  the  income  reasonably attributable to the city, and in the
 case of an investment allocation percentage, to adjust it  by  excluding
 one  or  more  assets  in computing such percentage; provided the income
 therefrom is also excluded in determining unincorporated business entire
 S. 8474                            391

 net income. The commissioner of finance from time to time shall  publish
 all  rulings  of general public interest with respect to any application
 of the provisions of this subdivision.
   (i)  Notwithstanding  subdivision  (c) of this section, but subject to
 subdivision (g) of this  section,  the  business  allocation  percentage
 shall be computed in the manner set forth in this subdivision.
   (1)  For  taxable  years  beginning in two thousand nine, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (A) the product of thirty percent and the percentage determined  under
 paragraph one of subdivision (c) of this section,
   (B)  the product of thirty percent and the percentage determined under
 paragraph two of subdivision (c) of this section, and
   (C) the product of forty percent and the percentage  determined  under
 paragraph three of subdivision (c) of this section.
   (2)  For  taxable  years  beginning  in two thousand ten, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (A) the product of twenty-seven percent and the percentage  determined
 under paragraph one of subdivision (c) of this section,
   (B)  the product of twenty-seven percent and the percentage determined
 under paragraph two of subdivision (c) of this section, and
   (C) the product of forty-six percent  and  the  percentage  determined
 under paragraph three of subdivision (c) of this section.
   (3)  For  taxable years beginning in two thousand eleven, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (A) the product of twenty-three and one-half percent and the  percent-
 age determined under paragraph one of subdivision (c) of this section,
   (B)  the product of twenty-three and one-half percent and the percent-
 age determined under paragraph two of subdivision (c) of  this  section,
 and
   (C)  the  product of fifty-three percent and the percentage determined
 under paragraph three of subdivision (c) of this section.
   (4) For taxable years beginning in two thousand twelve,  the  business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (A)  the product of twenty percent and the percentage determined under
 paragraph one of subdivision (c) of this section,
   (B) the product of twenty percent and the percentage determined  under
 paragraph two of subdivision (c) of this section, and
   (C)  the  product of sixty percent and the percentage determined under
 paragraph three of subdivision (c) of this section.
   (5) For taxable years beginning in two thousand thirteen, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (A) the product of sixteen and one-half  percent  and  the  percentage
 determined under paragraph one of subdivision (c) of this section,
   (B)  the  product  of  sixteen and one-half percent and the percentage
 determined under paragraph two of subdivision (c) of this section, and
   (C) the product of sixty-seven percent and the  percentage  determined
 under paragraph three of subdivision (c) of this section.
   (6) For taxable years beginning in two thousand fourteen, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
 S. 8474                            392

   (A)  the  product  of thirteen and one-half percent and the percentage
 determined under paragraph one of subdivision (c) of this section,
   (B)  the  product  of thirteen and one-half percent and the percentage
 determined under paragraph two of subdivision (c) of this section, and
   (C) the product of seventy-three percent and the percentage determined
 under paragraph three of subdivision (c) of this section.
   (7) For taxable years beginning in two thousand fifteen, the  business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (A)  the  product  of  ten percent and the percentage determined under
 paragraph one of subdivision (c) of this section,
   (B) the product of ten percent and  the  percentage  determined  under
 paragraph two of subdivision (c) of this section, and
   (C)  the product of eighty percent and the percentage determined under
 paragraph three of subdivision (c) of this section.
   (8) For taxable years beginning in two thousand sixteen, the  business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (A)  the product of six and one-half percent and the percentage deter-
 mined under paragraph one of subdivision (c) of this section,
   (B) the product of six and one-half percent and the percentage  deter-
 mined under paragraph two of subdivision (c) of this section, and
   (C)  the product of eighty-seven percent and the percentage determined
 under paragraph three of subdivision (c) of this section.
   (9) For taxable years beginning in two thousand seventeen,  the  busi-
 ness  allocation  percentage  shall be determined by adding together the
 following percentages:
   (A) the product of three  and  one-half  percent  and  the  percentage
 determined under paragraph one of subdivision (c) of this section,
   (B)  the  product  of  three  and  one-half percent and the percentage
 determined under paragraph two of subdivision (c) of this section, and
   (C) the product of ninety-three percent and the percentage  determined
 under paragraph three of subdivision (c) of this section.
   (10)  For  taxable  years  beginning after two thousand seventeen, the
 business allocation percentage shall be the percentage determined  under
 paragraph three of subdivision (c) of this section.
   (11)  The  commissioner  shall promulgate rules necessary to implement
 the provisions of this subdivision under such circumstances where any of
 the percentages to be determined under paragraph one, two  or  three  of
 subdivision (c) of this section cannot be determined because the taxpay-
 er  has  no  property,  payroll or gross receipts from sales or services
 within or without the city.
   § 11-509   Deductions not subject to allocation.    (a)  In  computing
 unincorporated  business taxable income, there shall be allowed, without
 allocation under section 11-508 of this chapter, deductions for  reason-
 able  compensation for taxable years beginning before January first, two
 thousand seven, not in excess of five thousand dollars, and for  taxable
 years  beginning  on  or after January first, two thousand seven, not in
 excess of ten thousand dollars, for personal services of the  proprietor
 and  each  partner  actively engaged in the unincorporated business, but
 the aggregate of such deductions shall not exceed twenty per  centum  of
 the  unincorporated business taxable income computed without the benefit
 of any deductions under this subdivision or the unincorporated  business
 exemptions under section 11-510 of this chapter.
   (b) Subject to the conditions provided in paragraphs three and four of
 this  subdivision  at  the  election of the taxpayer there shall also be
 S. 8474                            393
 
 allowed, without allocation under section 11-508 of this chapter, either
 or both of the items set forth in paragraphs one and two of this  subdi-
 vision,  except that only one of the items shall be allowed with respect
 to any one item of property.
   (1)  Depreciation  with  respect  to any property such as described in
 paragraphs three or four of this subdivision, and subject to the  condi-
 tions  provided  therein,  not  exceeding twice the depreciation allowed
 with respect to the same property for federal income tax purposes.  Such
 deduction  shall  be allowed only upon condition that no deduction shall
 be allowed pursuant to section 11-507 of this chapter  for  depreciation
 of  the  same property, and the total of all deductions allowed pursuant
 to this paragraph in any taxable year or years with respect to any prop-
 erty shall not exceed its cost or other basis and, in  the  case  of  an
 unincorporated  business  carried  on both within and without this city,
 with respect to property described in paragraph four  of  this  subdivi-
 sion,  such total shall not exceed its cost or other basis multiplied by
 (A) the percentage of the excess of the taxpayer's unincorporated  busi-
 ness  gross income over its unincorporated business deductions allocated
 to this city, or (B) the percentage of the  taxpayer's  business  income
 allocated  to this city, whichever is applicable, which percentage shall
 be determined under section 11-508 of this chapter for  the  first  year
 such depreciation is deducted.
   (2)  Expenditures  paid  or  incurred  during the taxable year for the
 construction, reconstruction, erection or acquisition  of  any  property
 such  as  described  in paragraph three or four of this subdivision, and
 subject to the conditions provided therein, which is used or to be  used
 for purposes of research or development in the experimental or laborato-
 ry  sense.  Such  purposes  shall  not be deemed to include the ordinary
 testing or inspection of materials  or  products  for  quality  control,
 efficiency  surveys,  management studies, consumer surveys, advertising,
 promotions or research in connection with literary, historical or  simi-
 lar projects. Such deduction shall be allowed only on condition that, in
 the  case of an unincorporated business carried on both within and with-
 out this city, with respect to property described in paragraph  four  of
 this subdivision, such deduction does not exceed the expenditures multi-
 plied  by  (A) the percentage of the excess of the taxpayer's unincorpo-
 rated business gross income over its unincorporated business  deductions
 allocated to this city, or (B) the percentage of the taxpayer's business
 income allocated to this city, whichever is applicable, which percentage
 shall  be  determined under section 11-508 of this chapter for the first
 year such depreciation is deducted, and that, for the taxable  year  and
 all  succeeding taxable years, no deduction shall be allowed pursuant to
 section 11-507 of this chapter on account of  such  expenditures  or  on
 account  of depreciation of the same property, except to the extent that
 its basis may be attributable to factors other than  such  expenditures,
 or  in case a deduction is allowable pursuant to this paragraph for only
 a part of such expenditures, on condition that any  deduction  allowable
 for  federal  income  tax purposes on account of such expenditures or on
 account of depreciation of the same property  shall  be  proportionately
 reduced  in  determining  the  deductions  allowable pursuant to section
 11-507 of this chapter for the taxable year and all  succeeding  taxable
 years. With respect to property which is used or to be used for research
 and  development  only  in part, or during only part of its useful life,
 the deduction allowable pursuant to this paragraph shall be limited to a
 proportionate part of the expenditures relating thereto. If a  deduction
 shall  have  been  allowed pursuant to this paragraph for all or part of
 S. 8474                            394
 
 such expenditures with respect to any property,  and  such  property  is
 used  for  purposes  other  than  research  and development to a greater
 extent than originally reported, the taxpayer shall report such  use  in
 the taxpayer's return for the first taxable year during which it occurs,
 and  the  commissioner  of finance may recompute the tax for the year or
 years for which such deduction was allowed, and  may  assess  any  addi-
 tional  tax  resulting  from such recomputation within the time fixed by
 subdivision (c) of section 11-523 of this chapter.
   (3)  For purposes of this paragraph, such deduction shall  be  allowed
 only  with respect to tangible property which is depreciable pursuant to
 section one hundred sixty-seven of the internal revenue code,  having  a
 situs  in  the  city  and  used in the taxpayer's trade or business, (A)
 constructed, reconstructed or erected after December thirty-first, nine-
 teen hundred sixty-five, pursuant to a contract which was, on or  before
 December  thirty-first,  nineteen  hundred sixty-seven, and at all times
 thereafter,  binding  on  the  taxpayer  or,  property,   the   physical
 construction,  reconstruction  or  erection  of which began on or before
 December thirty-first, nineteen hundred sixty-seven or which began after
 such date pursuant to an order placed  on  or  before  December  thirty-
 first,  nineteen hundred sixty-seven, and then only with respect to that
 portion of the basis thereof or the expenditure relating  thereto  which
 is   properly  attributable  to  such  construction,  reconstruction  or
 erection after December thirty-first, nineteen  hundred  sixty-five,  or
 (B)  acquired  after December thirty-first, nineteen hundred sixty-five,
 pursuant to a contract which was, on or  before  December  thirty-first,
 nineteen  hundred  sixty-seven,  and at all times thereafter, binding on
 the taxpayer or pursuant to an order placed on or before December  thir-
 ty-first,  nineteen  hundred  sixty-seven,  by  purchase  as  defined in
 section one hundred seventy-nine (d) of the internal  revenue  code,  if
 the original use of such property commenced with the taxpayer, commenced
 in  the city and commenced after December thirty-first, nineteen hundred
 sixty-five or  (C)  acquired,  constructed,  reconstructed,  or  erected
 subsequent  to  December  thirty-first, nineteen hundred sixty-seven, if
 such acquisition, construction, reconstruction or erection  is  pursuant
 to  a plan of the taxpayer which was in existence December thirty-first,
 nineteen hundred sixty-seven and not thereafter substantially  modified,
 and  such  acquisition,  construction,  reconstruction or erection would
 qualify under the rules in paragraph four, five or six of subsection (h)
 of section forty-eight of the internal revenue code provided all  refer-
 ences  in  such paragraphs four, five and six to the dates October nine,
 nineteen hundred sixty-six, and October ten, nineteen hundred sixty-six,
 shall be read as December thirty-first, nineteen hundred sixty-seven.  A
 taxpayer shall be allowed a deduction under subparagraph (A), (B) or (C)
 of this paragraph only if the tangible property shall  be  delivered  or
 the  construction,  reconstruction  or erection shall be completed on or
 before December thirty-first, nineteen hundred sixty-nine, except in the
 case of tangible property which is acquired, constructed,  reconstructed
 or erected pursuant to a contract which was, on or before December thir-
 ty-first,  nineteen  hundred  sixty-seven,  and at all times thereafter,
 binding on the taxpayer.  However, for any taxable year beginning on  or
 after  January first, nineteen hundred sixty-eight, a taxpayer shall not
 be allowed a deduction under paragraph  one  of  this  subdivision  with
 respect  to  tangible  personal  property  leased to any other person or
 corporation, provided, any contract or agreement to lease or rent or for
 a license to use such property  shall  be  considered  a  lease.    With
 respect  to property which a taxpayer uses for purposes other than leas-
 S. 8474                            395
 
 ing for part of a taxable year and leases for a part of a taxable  year,
 a  deduction  under  paragraph  one  of this subdivision may be taken in
 proportion to the part of the year such property is used by the  taxpay-
 er.
   (4)  For  purposes of this paragraph, such deductions shall be allowed
 only with respect to tangible property which is depreciable pursuant  to
 section  one  hundred sixty-seven of the internal revenue code, having a
 situs in this city and used in the taxpayer's trade or business, (A) the
 construction, reconstruction, or erection of which  is  completed  after
 December  thirty-first, nineteen hundred sixty-seven, and then only with
 respect to that portion of the basis thereof or the expenditures  relat-
 ing  thereto which is properly attributable to such construction, recon-
 struction or erection  after  December  thirty-first,  nineteen  hundred
 sixty-three,  or  (B)  acquired  after  December  thirty-first, nineteen
 hundred sixty-seven, by purchase  as  defined  in  section  one  hundred
 seventy-nine  (d)  of  the internal revenue code, if the original use of
 such property commenced with the taxpayer, commenced in  this  city  and
 commenced  after  December  thirty-first,  nineteen  hundred sixty-five.
 Provided, however, a deduction under paragraph one of  this  subdivision
 shall  be  allowed  with respect to property described in this paragraph
 only on condition that such property shall be principally  used  by  the
 taxpayer in the production of goods by manufacturing; processing; assem-
 bling; refining; mining; extracting; farming; agriculture; horticulture;
 floriculture; viticulture or commercial fishing, provided, manufacturing
 shall  mean the process of working raw materials into wares suitable for
 use or which gives new shapes, new  qualities  or  new  combinations  to
 matter which already has gone through some artificial process by the use
 of  machinery, tools, appliances, and other similar equipment.  Property
 used in the production of goods shall include  machinery,  equipment  or
 other  tangible  property  which  is  principally used in the repair and
 service of other machinery, equipment or other  tangible  property  used
 principally  in the production of goods and shall include all facilities
 used in the manufacturing operation, including storage of material to be
 used in manufacturing and of the products that are manufactured.  At the
 option of the taxpayer, air and water pollution control facilities which
 qualify for elective deductions under subdivision (i) of section  11-507
 of  this  chapter  may  be  treated,  for purposes of this paragraph, as
 tangible property principally used in the production of goods  by  manu-
 facturing;  processing;  assembling; refining; mining; extracting; farm-
 ing; agriculture; horticulture; floriculture; viticulture or  commercial
 fishing, in which event, a deduction shall not be allowed under subdivi-
 sion  (i)  of  section 11-507 of this chapter.  However, for any taxable
 year beginning on or after January first, nineteen hundred  sixty-eight,
 a  taxpayer shall not be allowed a deduction under paragraph one of this
 subdivision with respect to tangible personal  property  leased  to  any
 other  person  or  corporation,  provided,  any contract or agreement to
 lease or rent or for a license to use such property shall be  considered
 a  lease.    With respect to property which a taxpayer uses for purposes
 other than leasing for part of a taxable year and leases for a part of a
 taxable year, a deduction  under  paragraph  one  shall  be  allowed  in
 proportion  to the part of the year such property is used by the taxpay-
 er.
   (5) If the deductions allowable for any taxable year pursuant to  this
 subdivision   exceed  the  taxpayer's  unincorporated  business  taxable
 income, determined without the allowance of such deductions, the  excess
 may  be  carried  over to the following taxable year or years and may be
 S. 8474                            396
 
 deducted, without allocation under section 11-508 of  this  chapter,  in
 computing unincorporated business taxable income for such year or years.
   (6)  In  any  taxable year when property is sold or otherwise disposed
 of, with respect to which a deduction has been allowed pursuant to para-
 graph one or two of this subdivision, the basis of such  property  shall
 be adjusted to reflect the deductions so allowed, and if the basis as so
 adjusted  is  lower  than  the  adjusted  basis of the same property for
 federal income tax purposes, there  shall  be  added  to  federal  gross
 income the amount of the difference between such adjusted bases.
   § 11-510  Unincorporated business exemptions.  In computing unincorpo-
 rated  business  taxable  income,  there shall be allowed, without allo-
 cation under section 11-508 of this chapter:
   (a) an unincorporated business exemption  of  five  thousand  dollars,
 prorated  for taxable years of less than twelve months under regulations
 of the commissioner of finance;
   (b) if a partner in an unincorporated business is taxable  under  this
 chapter  or under any local law imposed pursuant to section one of chap-
 ter seven hundred seventy-two of the laws of nineteen hundred sixty-six,
 an exemption for the amount of the partner's proportionate  interest  in
 the  excess  of  the  unincorporated  business  gross  income  over  the
 deductions allowed under sections 11-507 and 11-509 of this chapter, but
 this exemption shall be limited to the amount which is included  in  the
 partner's  unincorporated business taxable income allocable to the city,
 or included in a corporate partner's net income allocable to  the  city,
 provided,  however,  no such exemption shall be allowed to an unincorpo-
 rated business for any  taxable  year  of  the  unincorporated  business
 beginning after June thirtieth, nineteen hundred ninety-four.
   §  11-511  Declarations  of estimated tax. (a) Requirement of declara-
 tion.  Except as provided in subdivision  (j)  of  this  section,  every
 unincorporated  business  shall  make a declaration of its estimated tax
 for the taxable year, containing such information as the commissioner of
 finance may prescribe by regulations or instruction, if: (1) for taxable
 years beginning after nineteen hundred eighty-six  but  before  nineteen
 hundred  ninety-six,  its  unincorporated  business  taxable  income can
 reasonably be expected to exceed fifteen thousand dollars; (2) for taxa-
 ble years beginning in nineteen hundred ninety-six,  its  unincorporated
 business  taxable  income  can  reasonably  be expected to exceed twenty
 thousand dollars; (3) for taxable years beginning after nineteen hundred
 ninety-six but before two thousand nine, its estimated tax  can  reason-
 ably  be  expected to exceed one thousand eight hundred dollars; and (4)
 for taxable years beginning after two thousand eight, its estimated  tax
 can  reasonably  be  expected  to  exceed  three  thousand  four hundred
 dollars.
   (b) Definition of estimated tax.  The term "estimated tax"  means  the
 amount  which  an  unincorporated business estimates to be its tax under
 this chapter for the taxable year, less the amount which it estimates to
 be the sum of any credits allowable against the tax other than the cred-
 it allowable under subdivision (c) of section 11-503 of this chapter.
   (c) Time for filing declaration.   Except as hereinafter  provided,  a
 declaration  of estimated tax required under this section shall be filed
 on or before April fifteenth of the taxable year provided, however, that
 if the requirements of subdivision (a) of this section are first met:
   (1) after April first and before June second of the taxable year,  the
 declaration shall be filed on or before June fifteenth, or
   (2)  after June first and before September second of the taxable year,
 the declaration shall be filed on or before September fifteenth, or
 S. 8474                            397
 
   (3) after September first of the taxable year, the  declaration  shall
 be filed on or before January fifteenth of the succeeding year.
   (d) Filing of declarations on or before January fifteenth.
   (1)  A  declaration  of  estimated  tax  by an unincorporated business
 having an estimated unincorporated business taxable income from farming,
 including oyster farming, for the taxable year which is  at  least  two-
 thirds of its total estimated unincorporated business taxable income for
 the taxable year may be filed at any time on or before January fifteenth
 of the succeeding year.
   (2)  For taxable years beginning before nineteen hundred ninety-seven,
 a declaration of estimated tax under this section of  forty  dollars  or
 less  for the taxable year may be filed at any time on or before January
 fifteenth of the succeeding year under regulations of  the  commissioner
 of finance.
   (e) Amendments of declaration.  An unincorporated business may amend a
 declaration under regulations of the commissioner of finance.
   (f)  Return  as  declaration  or amendment.   If on or before February
 fifteenth of the succeeding  taxable  year  an  unincorporated  business
 subject  to  the  estimated  tax  requirements of this section files its
 return for the taxable year for which the declaration is  required,  and
 pays  on  or before such date the full amount of the tax shown to be due
 on the return:
   (1) such return shall be considered as its declaration if no  declara-
 tion  was required to be filed during the taxable year, but is otherwise
 required to be filed on or before January fifteenth  of  the  succeeding
 year, and
   (2)  such  return  shall  be  considered as the amendment permitted by
 subdivision (e) of this  section  to  be  filed  on  or  before  January
 fifteenth  if  the tax shown on the return is greater than the estimated
 tax shown in a declaration previously made.
   (g) Fiscal year.  This section shall apply to  a  taxable  year  other
 than  a  calendar  year by the substitution of the months of such fiscal
 year for the corresponding months specified in this section.
   (h) Short taxable year.   An unincorporated business  subject  to  the
 estimated  tax requirements of this section and having a taxable year of
 less than twelve months shall make  a  declaration  in  accordance  with
 regulations of the commissioner of finance.
   (i)  Declaration  of  unincorporated  business under a disability. The
 declaration of estimated tax for an  unincorporated  business  which  is
 unable  to  make a declaration for any reason shall be made and filed by
 the committee, fiduciary or other person charged with the  care  of  the
 property  of  such  unincorporated  business,  other  than a receiver in
 possession of only a part of such  property,  or  by  his  or  her  duly
 authorized agent.
   (j)  Declaration of estimated tax for taxable years beginning prior to
 July thirteenth, nineteen hundred sixty-six. Notwithstanding subdivision
 (c) of this section, no declaration of estimated tax required by  subdi-
 vision  (a) of this section need be filed until September twelfth, nine-
 teen hundred sixty-six.
   §  11-512  Payments of estimated tax.  (a) General.  The estimated tax
 with respect to which  a  declaration  is  required  shall  be  paid  as
 follows:
   (1)  If  the  declaration is filed on or before April fifteenth of the
 taxable year, the estimated tax shall be paid  in  four  equal  install-
 ments.  The first installment shall be paid at the time of the filing of
 the  declaration, and the second, third and fourth installments shall be
 S. 8474                            398
 
 paid on the following June fifteenth, September fifteenth,  and  January
 fifteenth, respectively.
   (2)  If  the  declaration is filed after April fifteenth and not after
 June fifteenth of the taxable year, and is not required to be  filed  on
 or  before  April fifteenth of the taxable year, the estimated tax shall
 be paid in three equal installments.   The first  installment  shall  be
 paid  at  the  time of the filing of the declaration, and the second and
 third installments shall be paid on the  following  September  fifteenth
 and January fifteenth, respectively.
   (3)  If  the  declaration  is filed after June fifteenth and not after
 September fifteenth of the taxable year, and is not required to be filed
 on or before June fifteenth of the taxable year, the estimated tax shall
 be paid in two equal installments.  The first installment shall be  paid
 at  the  time  of the filing of the declaration, and the second shall be
 paid on the following January fifteenth.
   (4) If the declaration is filed after September fifteenth of the taxa-
 ble year, and is not  required  to  be  filed  on  or  before  September
 fifteenth  of  the taxable year, the estimated tax shall be paid in full
 at the time of the filing of the declaration.
   (5) If the declaration is filed after the time prescribed therefor, or
 after the expiration of any extension of time therefor, paragraphs  two,
 three  and  four of this subdivision shall not apply, and there shall be
 paid at the time of such filing all installments of estimated tax  paya-
 ble at or before such time, and the remaining installments shall be paid
 at the times at which, and in the amounts in which, they would have been
 payable if the declaration had been filed when due.
   (b)  Amendments  of  declaration. If any amendment of a declaration is
 filed, the remaining installments, if any, shall be ratably increased or
 decreased, as the case may be, to reflect any increase  or  decrease  in
 the  estimated  tax by reason of such amendment, and if any amendment is
 made after September fifteenth of the taxable year, any increase in  the
 estimated tax by reason thereof shall be paid at the time of making such
 amendment.
   (c)  Application  to short taxable year. This section shall apply to a
 taxable year of less than twelve months in accordance  with  regulations
 of the commissioner of finance.
   (d)  Fiscal  year.    This section shall apply to a taxable year other
 than a calendar year by the substitution of the months  of  such  fiscal
 year for the corresponding months specified in this section.
   (e) Installments paid in advance. An unincorporated business may elect
 to pay any installment of its estimated tax prior to the date prescribed
 for the payment thereof.
   (f)  Cross reference. For unincorporated businesses with taxable years
 beginning prior to July  thirteenth,  nineteen  hundred  sixty-six,  see
 subdivision (j) of section 11-511 of this chapter.
   (g)  Taxpayers with credit relating to stock transfer tax. The portion
 of an overpayment attributable to a credit allowable pursuant to  subdi-
 vision (c) of section 11-503 of this chapter may not be credited against
 any payment due under this section.
   §  11-513  Accounting periods and methods. (a)  Accounting periods.  A
 taxpayer's  taxable  year  under  this  chapter shall be the same as the
 taxpayer's taxable year for federal income tax purposes.
   (b) Accounting methods.  A taxpayer's method of accounting under  this
 chapter  shall  be  the  same as the taxpayer's method of accounting for
 federal income tax purposes.  In the absence of any method of accounting
 for federal income tax purposes, unincorporated business taxable  income
 S. 8474                            399
 
 shall be computed under such method as in the opinion of the commission-
 er of finance clearly reflects income.
   (c)  Change of accounting period or method.  (1) If a taxpayer's taxa-
 ble year or method of accounting  is  changed  for  federal  income  tax
 purposes,  the taxable year or method of accounting for purposes of this
 chapter shall be similarly changed.
   (2) If a taxpayer's method of accounting is changed, other  than  from
 an  accrual  to  an installment method, any additional tax which results
 from adjustments determined to be necessary  solely  by  reason  of  the
 change  shall not be greater than if such adjustments were ratably allo-
 cated and included for the taxable year of the change and the  preceding
 taxable  years,  not  in  excess  of two, beginning after January first,
 nineteen hundred sixty-six, during which the taxpayer used the method of
 accounting from which the change is made.
   (3) If a taxpayer's  method of accounting is changed from  an  accrual
 to an installment method, any additional tax for the year of such change
 of  method  and  for  any  subsequent year, which is attributable to the
 receipt of installment payments properly accrued in a prior year,  shall
 be reduced by the portion of tax for any prior taxable year attributable
 to  the  accrual  of such installment payments, in accordance with regu-
 lations of the commissioner of finance.
   §  11-514  Returns, payment of tax.  (a) General.   An  unincorporated
 business  income  tax return shall be made and filed, and the balance of
 any tax shown on the  face  of  such  return,  not  previously  paid  as
 installments of estimated tax, shall be paid, on or before the fifteenth
 day  of  the  fourth month following the close of a taxable year, except
 that in the case of an unincorporated business classified as a  partner-
 ship  for  federal  income  tax  purposes, such return shall be made and
 filed and such balance shall be paid on or before the fifteenth  day  of
 the  third month following the close of a taxable year for taxable years
 beginning on or after January first, two thousand  sixteen,  by  or  for
 every:
   (1)  unincorporated  business, for taxable years beginning after nine-
 teen hundred eighty-six but before nineteen hundred ninety-seven, having
 unincorporated business gross income, determined for  purposes  of  this
 subdivision without any deduction for the cost of goods sold or services
 performed,  of  more  than ten thousand dollars, or having any amount of
 unincorporated business taxable income;
   (2) partnership, for taxable years beginning  after  nineteen  hundred
 ninety-six,  having unincorporated business gross income, determined for
 purposes of this subdivision without any deduction for the cost of goods
 sold or services performed, of more than twenty-five  thousand  dollars,
 or  having  unincorporated  business taxable income of more than fifteen
 thousand dollars;
   (3) unincorporated business other  than  a  partnership,  for  taxable
 years beginning after nineteen hundred ninety-six, having unincorporated
 business gross income, determined for purposes of this subdivision with-
 out  any  deduction for the cost of goods sold or services performed, of
 more than seventy-five thousand dollars, or having unincorporated  busi-
 ness taxable income of more than thirty-five thousand dollars; and
   (4)  unincorporated  business,  for  taxable years beginning after two
 thousand eight, having unincorporated business gross income,  determined
 for  purposes  of this subdivision without any deduction for the cost of
 goods sold or services performed,  of  more  than  ninety-five  thousand
 dollars.
 S. 8474                            400
 
   (b)  Decedents.  The  return for any deceased individual shall be made
 and filed by his or her executor, administrator, or other person charged
 with his or her property.  If a final return of  a  decedent  is  for  a
 fractional  part  of  a  year,  the due date of such return shall be the
 fifteenth  day  of  the  fourth month following the close of the twelve-
 month period which began with the first day of such fractional  part  of
 the year.
   (c)  Individuals under a disability.  The return for an individual who
 is unable to make a return by reason of  minority  or  other  disability
 shall  be made and filed by such individual's guardian, committee, fidu-
 ciary or other person charged with the care of  his  or  her  person  or
 property,  other  than a receiver in possession of only a part of his or
 her property, or by such individual's duly authorized agent.
   (d) Estates and trusts.  The return for an estate or  trust  shall  be
 made and filed by the fiduciary.
   (e) Joint fiduciaries.  If two or more fiduciaries are acting jointly,
 the return may be made by any one of them.
   (f)  Returns  for taxable years ending prior to December thirty-first,
 nineteen hundred sixty-six.  With respect to taxable years ending  prior
 to  December  thirty-first,  nineteen  hundred  sixty-six,  the  returns
 required to be made and filed pursuant to this section shall be made and
 filed on or before the fifteenth day of the fourth month  following  the
 close  of  such  taxable  year  or  September  twelfth, nineteen hundred
 sixty-six, whichever is later.
   (g) Taxpayers with credit relating to stock transfer tax.  Subdivision
 (a) of this section shall apply to a taxpayer which has  a  right  to  a
 credit  pursuant  to  subdivision (c) of section 11-503 of this chapter,
 except that the tax, or balance thereof, payable to the commissioner  of
 finance in full pursuant to subdivision (a) of this section, at the time
 the report is required to be filed, shall be calculated and paid at such
 time  as if the credit provided for in subdivision (c) of section 11-503
 of this chapter were not allowed.
   § 11-515  Time and place for filing returns and paying tax.  A  person
 required  to  make  and  file a return under this chapter shall, without
 assessment, notice or demand, pay any tax due thereon to the commission-
 er of finance on or before the date fixed for filing such return, deter-
 mined without regard to any extension of time  for  filing  the  return.
 The  commissioner of finance shall prescribe by regulation the place for
 filing any return, declaration, statement, or  other  document  required
 pursuant to this chapter and for payment of any tax.
   §  11-516    Signing of returns and other documents. (a) General.  Any
 return, declaration, statement or other document  required  to  be  made
 pursuant  to this chapter shall be signed in accordance with regulations
 or instructions prescribed by the commissioner of  finance.    The  fact
 that an individual's name is signed to a return, declaration, statement,
 or  other  document, shall be prima facie evidence for all purposes that
 the return, declaration, statement or other document was actually signed
 by such individual.
   (b) Partnerships.  Any return, statement or other document required of
 a partnership shall be signed by one or more partners.  The fact that  a
 partner's  name  is  signed  to  a return, statement, or other document,
 shall be prima facie evidence for all  purposes  that  such  partner  is
 authorized to sign on behalf of the partnership.
   (c)  Certifications.  The making or filing of any return, declaration,
 statement or other document or copy thereof required to be made or filed
 pursuant to this chapter, including a copy of a  federal  return,  shall
 S. 8474                            401
 
 constitute  a  certification by the person making or filing such return,
 declaration, statement or other document or copy thereof that the state-
 ments contained therein are true and that any copy filed is a true copy.
   §  11-517    Extensions  of time.   (a) General.   The commissioner of
 finance may grant a reasonable extension of time for payment of  tax  or
 estimated  tax,  or  any installment, or for filing any return, declara-
 tion, statement, or other document required pursuant to this chapter, on
 such terms and conditions as it may require.  Except for a taxpayer  who
 is  outside  the United States, no such extension for filing any return,
 declaration, statement or other document, shall exceed six months.
   (b) Furnishing of security.  If any extension of time is  granted  for
 payment  of  any  amount of tax, the commissioner of finance may require
 the taxpayer to furnish a bond  or  other  security  in  an  amount  not
 exceeding  twice  the amount for which the extension of time for payment
 is granted, on such terms and conditions as the commissioner of  finance
 may require.
   § 11-518  Requirements concerning returns, notices, records and state-
 ments.    (a) General.   The commissioner of finance may prescribe regu-
 lations as to the keeping of records, the content and forms  of  returns
 and  statements,  and the filing of copies of federal income tax returns
 and determinations.  The commissioner of finance may require any person,
 by regulation or notice served upon such person, to make  such  returns,
 render  such  statements,  or  keep such records, as the commissioner of
 finance may deem sufficient to show whether or not such person is liable
 under this chapter for tax or for collection of tax.
   (b) Notice of qualification as receiver, etc.  Every receiver, trustee
 in bankruptcy, assignee for benefit of creditors, or other like  fiduci-
 ary shall give notice of his or her qualification as such to the commis-
 sioner of finance, as may be required by regulation.
   §  11-519    Report  of  change  in  federal or New York state taxable
 income.  If the amount of a taxpayer's federal or New York state taxable
 income reported on his or her federal or New York state income  tax  for
 any  taxable  year is changed or corrected by the United States internal
 revenue service or the New York state tax commission or other  competent
 authority,  or as the result of a renegotiation of a contract or subcon-
 tract with the United States or the state of New York, or if a taxpayer,
 pursuant to subsection (d) of section sixty-two hundred thirteen of  the
 internal  revenue  code, executes a notice of waiver of the restrictions
 provided in subsection (a) of said section, or if a  taxpayer,  pursuant
 to  subsection  (f)  of  section  six hundred eighty-one of the tax law,
 executes a notice or waiver of the restrictions provided  in  subsection
 (c)  of  such  section  of  the  tax law, the taxpayer shall report such
 change or correction in federal or New York state taxable income or such
 execution of such notice of waiver and the changes or corrections of the
 taxpayer's federal or New York state  taxable  income  on  which  it  is
 based,  within ninety days after the final determination of such change,
 correction, or renegotiation, or such execution of such notice of  waiv-
 er,  or  as otherwise required by the commissioner of finance, and shall
 concede the accuracy of such determination or state wherein it is  erro-
 neous.   Any taxpayer filing an amended federal or New York state income
 tax return shall also file within  ninety  days  thereafter  an  amended
 return  under  this  chapter,  and  shall  give  such information as the
 commissioner of finance may require.  The commissioner of finance may by
 regulation prescribe such exceptions to the requirements of this section
 as the commissioner deems appropriate.
 S. 8474                            402
 
   § 11-519.1 Report of change of state sales and  compensating  use  tax
 liability.  Where the state tax commission changes or corrects a taxpay-
 er's sales and compensating  use  tax  liability  with  respect  to  the
 purchase or use of items for which a sales or compensating use tax cred-
 it  against  the  tax  imposed by this chapter was claimed, the taxpayer
 shall report such change or correction to the  commissioner  of  finance
 within  ninety  days  of  the  final  determination  of  such  change or
 correction, or as required by the commissioner  of  finance,  and  shall
 concede  the accuracy of such determination or state wherein it is erro-
 neous. Any taxpayer filing an amended return or report relating  to  the
 purchase  or use of such items shall also file within ninety days there-
 after a copy of such amended return or report with the  commissioner  of
 finance.
   §   11-520   Change of election.  Any election expressly authorized by
 this chapter, other than the election authorized by  section  11-506  of
 this chapter, may be changed on such terms and conditions as the commis-
 sioner of finance may prescribe by regulation.
   §  11-521  Notice of deficiency. (a) General. If upon examination of a
 taxpayer's return under this chapter the commissioner of finance  deter-
 mines  that  there  is  a deficiency of income tax, the commissioner may
 mail a notice of deficiency to the taxpayer. If a taxpayer fails to file
 a return required under this chapter, the  commissioner  of  finance  is
 authorized to estimate the taxpayer's city unincorporated business taxa-
 ble  income  and tax thereon, from any information in the commissioner's
 possession, and to mail a notice of deficiency to the taxpayer. A notice
 of deficiency shall be mailed by certified or  registered  mail  to  the
 taxpayer  at his or her last known address in or out of the city. If the
 taxpayer is deceased or under a legal disability, a notice of deficiency
 may be mailed to his or her last known address in or out  of  the  city,
 unless  the commissioner of finance has received notice of the existence
 of a fiduciary relationship with respect to the taxpayer.
   (b) Notice of deficiency as assessment. After  ninety  days  from  the
 mailing of a notice of deficiency or, if the commissioner of finance has
 established  a conciliation procedure pursuant to section 11-124 of this
 title and the  taxpayer  has  requested  a  conciliation  conference  in
 accordance  therewith, after ninety days from the mailing of the concil-
 iation decision or the date of the commissioner's  confirmation  of  the
 discontinuance  of  the conciliation proceeding, such notice shall be an
 assessment of the amount of tax specified  therein,  together  with  the
 interest,  additions  to tax and penalties stated in such notice, except
 only for any such tax or other amounts as  to  which  the  taxpayer  has
 within  such  ninety  day  period  filed with the tax appeals tribunal a
 petition under section 11-529 of this chapter. If the  notice  of  defi-
 ciency  or conciliation decision is addressed to a person outside of the
 United States, such period shall be one hundred fifty  days  instead  of
 ninety days.
   (c) Restrictions on assessment and levy. No assessment of a deficiency
 in  tax  and  no levy or proceeding in court for its collection shall be
 made, begun or prosecuted,  except  as  otherwise  provided  in  section
 11-534  of this chapter, until a notice of deficiency has been mailed to
 the taxpayer, nor until the expiration of the time for filing a petition
 with the tax appeals tribunal contesting such notice, nor, if a petition
 with respect to the taxable year has been both served upon  the  commis-
 sioner  of  finance  and  filed with the tax appeals tribunal, until the
 decision of the tax appeals tribunal has become final. For exception  in
 S. 8474                            403
 
 the case of judicial review of the decision of the tax appeals tribunal,
 see subdivision (c) of section 11-530 of this chapter.
   (d)  Exceptions  for  mathematical  errors.  If  a  mathematical error
 appears on a return, including an overstatement of the  amount  paid  as
 estimated  tax,  the  commissioner  of finance shall notify the taxpayer
 that an amount of tax in excess of that shown upon the  return  is  due,
 and that such excess has been assessed.
   Such  notice shall not be considered as a notice of deficiency for the
 purposes of this section, subdivision (f)  of  section  11-527  of  this
 chapter,  limiting  credits or refunds after petition to the tax appeals
 tribunal, or subdivision (b) of section 11-529 of this chapter,  author-
 izing  the filing of a petition with the tax appeals tribunal based on a
 notice of deficiency, nor shall such assessment or collection be prohib-
 ited by the provisions of subdivision (c) of this section.
   (e) Exception where change in federal or New York state taxable income
 is not reported.
   (1) If the taxpayer fails to comply with section 11-519 of this  chap-
 ter in not reporting a change or correction increasing or decreasing the
 taxpayer's  federal  or New York state taxable income as reported on the
 taxpayer's federal or New York state return or in not reporting a change
 or correction which is treated in the same manner as if it were a  defi-
 ciency  for  federal  or  New  York  state income tax purposes or in not
 filing an amended return or in not reporting the execution of  a  notice
 of  waiver  described  in  such section, instead of the mode and time of
 assessment provided for in subdivision (b) of this section, the  commis-
 sioner  of  finance  may  assess a deficiency based upon such changed or
 corrected federal or New York state taxable income  by  mailing  to  the
 taxpayer  a  notice  of  additional tax due specifying the amount of the
 deficiency, and such deficiency, together with the  interest,  additions
 to  tax and penalties stated in such notice, shall be deemed assessed on
 the date such notice is mailed unless within thirty days after the mail-
 ing of such notice a report of the federal or New York state  change  or
 correction  or  an  amended  return,  where  such return was required by
 section 11-519 of this chapter, is  filed  accompanied  by  a  statement
 showing  wherein  such  federal or New York state determination and such
 notice of additional tax due are erroneous.
   (2) Such notice shall not be considered as a notice of deficiency  for
 the  purposes of this section, subdivision (f) of section 11-527 of this
 chapter, limiting credits or refunds after petition to the  tax  appeals
 tribunal,  or subdivision (b) of section 11-529 of this chapter, author-
 izing the filing of a petition with the tax appeals tribunal based on  a
 notice of deficiency, nor shall such assessment or collection thereof be
 prohibited by the provisions of subdivision (c) of this section.
   (3)  If the taxpayer is deceased or under a legal disability, a notice
 of additional tax due may be mailed to his or her last known address  in
 or  out  of  the  city,  unless the commissioner of finance has received
 notice of the existence of a fiduciary relationship with respect to  the
 taxpayer.
   (f) Waiver of restrictions. The taxpayer shall at any time, whether or
 not  a notice of deficiency has been issued, have the right to waive the
 restrictions on assessment and collection of the whole or  any  part  of
 the deficiency by a signed notice in writing filed with the commissioner
 of finance.
   (g)  Deficiency  defined.  For  purposes of this chapter, a deficiency
 means the amount of the tax imposed by this chapter, less (i) the amount
 shown as the tax upon the taxpayer's return, whether the return was made
 S. 8474                            404
 
 or the tax computed by the taxpayer or by the commissioner  of  finance,
 and  less,  (ii)  the  amounts previously assessed, or collected without
 assessment, as a deficiency and plus (iii) the amount  of  any  rebates.
 For  the purpose of this definition, the tax imposed by this chapter and
 the tax shown on the return shall both be determined without  regard  to
 payments  on  account of estimated tax; and a rebate means so much of an
 abatement, credit, refund or other repayment, whether or not  erroneous,
 made  on  the  ground that the amounts entering into the definition of a
 deficiency showed a balance in favor of the taxpayer.
   (h) Exception where change or correction of sales and compensating use
 tax liability is not reported. (1) If a taxpayer fails  to  comply  with
 section 11-519.1 of this chapter in not reporting a change or correction
 of  his or her sales and compensating use tax liability or in not filing
 a copy of an amended return or report relating to his or her  sales  and
 compensating  use tax liability, instead of the mode and time of assess-
 ment provided for in subdivision (b) of this section,  the  commissioner
 of  finance may assess a deficiency based upon such changed or corrected
 sales and compensating use tax liability, as  same  relates  to  credits
 claimed  under this chapter by mailing to the taxpayer a notice of addi-
 tional tax due specifying the amount of the deficiency, and  such  defi-
 ciency, together with the interest, additions to tax and penalties stat-
 ed  in  such notice, shall be deemed assessed on the date such notice is
 mailed unless within thirty days after the  mailing  of  such  notice  a
 report  of the state change or correction or a copy of an amended return
 or report, where such copy was required  by  section  11-519.1  of  this
 chapter,  is  filed  accompanied by a statement showing where such state
 determination and such notice of additional tax due are erroneous.
   (2) Such notice shall not be considered as a notice of deficiency  for
 the  purposes of this section, subdivision (f) of section 11-527 of this
 chapter, limiting credits or refunds after petition to the  tax  appeals
 tribunal,  or subdivision (b) of section 11-529 of this chapter, author-
 izing the filing of a petition with the tax appeals tribunal based on  a
 notice of deficiency, nor shall such assessment or the collection there-
 of be prohibited by the provisions of subdivision (c) of this section.
   (3)  If the taxpayer is deceased or under a legal disability, a notice
 of additional tax due may be mailed to his or her last known address  in
 or  out of the city, and such notice shall be sufficient for purposes of
 this chapter. If the commissioner of finance has received notice that  a
 person  is  acting  for  the taxpayer in a fiduciary capacity, a copy of
 such notice shall also be mailed to the fiduciary named in such notice.
   § 11-522 Assessment. (a) Assessment date. The amount of  tax  which  a
 return  shows  to be due, or the amount of tax which a return would have
 shown to be due but for a mathematical error,  shall  be  deemed  to  be
 assessed  on  the  date  of  filing of the return, including any amended
 return showing an increase of tax. In the  case  of  a  return  properly
 filed  without  computation of tax, the tax computed by the commissioner
 of finance shall be deemed to be assessed on the date on  which  payment
 is  due.  If  a  notice of deficiency has been mailed, the amount of the
 deficiency shall be deemed to be  assessed  on  the  date  specified  in
 subdivision (b) of section 11-521 of this chapter if no petition is both
 served  on  the  commissioner  of finance and filed with the tax appeals
 tribunal, or if a petition is filed, then upon the date when a  decision
 of  the  tax  appeals tribunal establishing the amount of the deficiency
 becomes final.
   If an amended return or report filed pursuant  to  section  11-519  of
 this  chapter  concedes  the  accuracy  of  a  federal or New York state
 S. 8474                            405

 adjustment, change or correction, any deficiency in tax under this chap-
 ter resulting therefrom shall be deemed to be assessed on  the  date  of
 filing such report or amended return, and such assessment shall be time-
 ly notwithstanding section 11-523 of this chapter.
   If  a  report  or  amended  return or report filed pursuant to section
 11-519.1 of this chapter concedes the accuracy  of  a  state  change  or
 correction  of  sales and compensating use tax liability, any deficiency
 in tax under this chapter resulting therefrom shall be  deemed  assessed
 on  the  date of filing such report, and such assessment shall be timely
 notwithstanding section 11-523 of this chapter.
   If a notice of additional tax due, as prescribed in subdivision (e) of
 section 11-521 of this chapter has been mailed, the amount of the  defi-
 ciency  shall  be  deemed  to  be assessed on the date specified in such
 subdivision unless within thirty days after the mailing of such notice a
 report of the federal or New York  state  change  or  correction  or  an
 amended return, where such return was required by section 11-519 of this
 chapter is filed accompanied by a statement showing wherein such federal
 or  New  York  state determination and such notice of additional tax due
 are erroneous.
   If a notice of additional tax due, as prescribed in subdivision (h) of
 section 11-521 of this chapter, has been mailed, the amount of the defi-
 ciency shall be deemed to be assessed on  the  date  specified  in  such
 subdivision unless within thirty days after the mailing of such notice a
 report of the state change or correction, or a copy of an amended return
 or  report,  where  such  copy  was required by section 11-519.1 of this
 chapter, is filed accompanied by a statement showing wherein such  state
 determination and such notice of additional tax due are erroneous.
   Any  amount  paid  as a tax or in respect of a tax, other than amounts
 paid as estimated income tax, shall be deemed to be  assessed  upon  the
 date of receipt of payment, notwithstanding any other provisions.
   (b) Other assessment powers. If the mode or time for the assessment of
 any  tax  under  this  chapter, including interest, additions to tax and
 assessable penalties, is not otherwise provided for, the commissioner of
 finance may establish the same by regulations.
   (c) Estimated income tax. No unpaid  amount  of  estimated  tax  under
 section one hundred sixteen shall be assessed.
   (d)  Supplemental  assessment. The commissioner of finance may, at any
 time within the period prescribed for assessment,  make  a  supplemental
 assessment,  subject to the provisions of section 11-521 of this chapter
 where applicable, whenever it is  ascertained  that  any  assessment  is
 imperfect or incomplete in any material respect.
   (e)  Cross-reference.  For assessment in case of jeopardy, see section
 11-534 of this chapter.
   § 11-523  Limitations on assessment. (a) General.  Except as otherwise
 provided in this section, any tax under this chapter shall  be  assessed
 within  three  years  after  the  return  was filed, whether or not such
 return was filed on or after the date prescribed.
   (b) Time return deemed filed.  For purposes of this section  a  return
 of  tax  filed  before  the last day prescribed by law or by regulations
 promulgated pursuant to law for the filing thereof, shall be  deemed  to
 be filed on such last day.
   (c)  Exceptions.  (1) Assessment at any time.  The tax may be assessed
 at any time if:
   (A) no return is filed,
   (B) a false or fraudulent return is filed with intent to evade tax,
 S. 8474                            406
 
   (C) the taxpayer fails to comply with section 11-519 of  this  chapter
 in  not  reporting  a  change or correction increasing or decreasing the
 taxpayer's federal or New York state taxable income as reported  on  the
 taxpayer's federal or New York state income tax return, or the execution
 of  a  notice  of  waiver  and the changes or corrections on which it is
 based or in not reporting a change or correction which is treated in the
 same manner as if it were a deficiency for federal  or  New  York  state
 income tax purposes, or in not filing an amended return, or
   (D)  the  taxpayer  fails to file a report or amended return or report
 required under section 11-519.1 of this chapter, in respect of a  change
 or  correction  of sales and compensating use tax liability, relating to
 the purchase or use of items for which a sales or compensating  use  tax
 credit against the tax imposed by this chapter was claimed.
   (2)  Extension by agreement.  Where, before the expiration of the time
 prescribed in this section for the assessment of tax, both  the  commis-
 sioner  of  finance  and  the  taxpayer have consented in writing to its
 assessment after such time, the tax may be assessed at any time prior to
 the expiration of the period agreed upon.  The period so agreed upon may
 be extended by subsequent agreements in writing made before the  expira-
 tion of the period previously agreed upon.
   (3)  Report  of changed or corrected federal or New York state income.
 If the taxpayer shall, pursuant  to  section  11-519  of  this  chapter,
 report  a  change  or correction or file an amended return increasing or
 decreasing federal or New  York  state  taxable  income  or  report  the
 execution of a notice of waiver and the changes and corrections on which
 it  is  based,  or  a  change or correction which is treated in the same
 manner as if it were a deficiency for federal or New York  state  income
 tax  purposes,  the assessment, if not deemed to have been made upon the
 filing of the report or amended return, may be made at any  time  within
 two  years after such report or amended return was filed.  The amount of
 such assessment of tax shall not exceed the amount of  the  increase  in
 city  tax  attributable  to  such  federal  or  New York state change or
 correction.  The provisions of this paragraph shall not affect the  time
 within  which  or  the  amount  for which an assessment may otherwise be
 made.
   (4) Deficiency attributable to net operating loss  carryback.    If  a
 deficiency  is  attributable to the application to the taxpayer of a net
 operating loss carryback, it may be assessed at any time  that  a  defi-
 ciency for the taxable year of the loss may be assessed.
   (5)  Recovery  of  erroneous  refund.    An  erroneous refund shall be
 considered an underpayment of tax on the date made, and an assessment of
 a deficiency arising out of an erroneous refund may be made at any  time
 within  two years from the making of the refund, except that the assess-
 ment may be made within five years from the making of the refund  if  it
 appears that any part of the refund was induced by fraud or misrepresen-
 tation of a material fact.
   (6)  Request  for  prompt  assessment.   If a return is required for a
 decedent or for his or her estate during the period  of  administration,
 the  tax  shall be assessed within eighteen months after written request
 therefor, made after the return is filed, by the executor, administrator
 or other person representing the estate of such decedent, but  not  more
 than  three  years  after  the  return  was  filed,  except as otherwise
 provided in this subdivision and subdivision (d) of this section.
   (7) Report on use  of  certain  property.    Under  the  circumstances
 described  in paragraph two of subdivision (b) of section 11-509 of this
 chapter, the tax may be assessed within three years after the filing  of
 S. 8474                            407
 
 a  return  reporting that property has been used for purposes other than
 research and development to a greater extent than originally reported.
   (8)  Report    concerning waste treatment facility.  Under the circum-
 stances described in paragraph (i) of section 11-507  of  this  chapter,
 the  tax  may  be  assessed  within  three years after the filing of the
 return containing the information required by such paragraph.
   (9) Report of changed or corrected  sales  and  compensating  use  tax
 liability.  If  the  taxpayer files a report or amended return or report
 required under section 11-519.1 of this chapter, in respect of a  change
 or  correction  of sales and compensating use tax liability, the assess-
 ment, if not deemed to have been made upon the filing of the report, may
 be made at any time within two years after such report or amended return
 or report was filed. The amount of such  assessment  of  tax  shall  not
 exceed the amount of the increase in city tax attributable to such state
 change  or correction. The provisions of this paragraph shall not affect
 the time within which or the amount for which an assessment  may  other-
 wise be made.
   (d) Omission of income on return.  The tax may be assessed at any time
 within six years after the return was filed if (1) a taxpayer omits from
 his  or her city unincorporated business gross income an amount properly
 includible therein which is in excess of twenty-five per centum  of  the
 amount  of  city  unincorporated  business  gross  income  stated in the
 return, or (2) an estate or trust omits income from  its  return  in  an
 amount  in  excess of twenty-five percent of its income determined as if
 it were an individual.
   For purposes of this subdivision there shall not be taken into account
 any amount which is omitted in the return if such amount is disclosed in
 the return, or in a statement  attached  to  the  return,  in  a  manner
 adequate to apprise the commissioner of finance of the nature and amount
 of such item.
   (e) Suspension of running of period of limitation.  The running of the
 period  of  limitations  on  assessment  or  collection  of tax or other
 amount, or of a transferee's liability, shall, after the  mailing  of  a
 notice  of  deficiency,  be  suspended  for  the period during which the
 commissioner of finance is prohibited under subdivision (c)  of  section
 11-521  of this chapter from making the assessment or from collecting by
 levy.
   § 11-524  Interest on underpayment. (a) General.  If any amount of tax
 is not paid on or before the last date prescribed in  this  chapter  for
 payment,  interest  on  such  amount at the underpayment rate set by the
 commissioner of finance pursuant to section 11-537 of this chapter,  or,
 if  no  rate is set, at the rate of seven and one-half percent per annum
 shall be paid for the period from such  last  date  to  the  date  paid,
 whether  or not any extension of time for payment was granted.  Interest
 under this subdivision shall not be paid if the amount thereof  is  less
 than one dollar.
   (b)  Exception  as  to estimated tax.  This section shall not apply to
 any failure to pay estimated tax under section 11-512 of this chapter.
   (c) Exception for mathematical error.  No interest shall be imposed on
 any underpayment of tax due solely to mathematical error if the taxpayer
 files a return within the time prescribed in this chapter, including any
 extension of time, and pays the  amount  of  underpayment  within  three
 months after the due date of such return, as it may be extended.
   (d)   Suspension  of  interest  on  deficiencies.    If  a  waiver  of
 restrictions on assessment of a deficiency has been filed by the taxpay-
 er, and if notice and demand by the commissioner of finance for  payment
 S. 8474                            408
 
 of  such  deficiency  is not made within thirty days after the filing of
 such waiver, interest shall not be imposed on such  deficiency  for  the
 period  beginning  immediately  after such thirtieth day and ending with
 the date of notice and demand.
   (e)  Tax  reduced by carryback.   If the amount of tax for any taxable
 year is reduced by reason of a carryback of a net operating  loss,  such
 reduction in tax shall not affect the computation of interest under this
 section  for the period ending with the filing date for the taxable year
 in which the net operating loss arises. Such filing date shall be deter-
 mined without regard to extensions of time to file.
   (f) Interest treated as tax.   Interest under this  section  shall  be
 paid upon notice and demand and shall be assessed, collected and paid in
 the  same  manner  as  tax.    Any  reference in this chapter to the tax
 imposed by this chapter shall  be  deemed  also  to  refer  to  interest
 imposed by this section on such tax.
   (g)  Interest  on  penalties  or additions to tax.   Interest shall be
 imposed under subdivision (a) of this section in respect of any assessa-
 ble penalty or addition to tax only if such assessable penalty or  addi-
 tion  to tax is not paid within ten days from the date of the notice and
 demand therefor under subdivision (b) of section 11-532 of this chapter,
 and in such case interest shall be imposed only for the period from such
 date of the notice and demand to the date of payment.
   (h) Payment within ten days after notice and demand.   If  notice  and
 demand  is  made  for  payment  of  any  amount under subdivision (b) of
 section 11-532 of this chapter, and if such amount is  paid  within  ten
 days  after  the  date  of  such  notice and demand, interest under this
 section on the amount so paid shall not be imposed for the period  after
 the date of such notice and demand.
   (i)  Limitation  on  assessment  and collection.   Interest prescribed
 under this section may be assessed and collected at any time during  the
 period  within  which  the  tax  or  other amount to which such interest
 relates may be assessed and collected, respectively.
   (j) Interest on erroneous refund.  Any portion of tax or other  amount
 which  has  been  erroneously  refunded, and which is recoverable by the
 commissioner of finance, shall bear interest at  the  underpayment  rate
 set  by  the  commissioner of finance pursuant to section 11-537 of this
 chapter, or, if no rate is set,  at  the  rate  of  seven  and  one-half
 percent  per  annum from the date of the payment of the refund, but only
 if it appears that any part of the refund was  induced  by  fraud  or  a
 misrepresentation of a material fact.
   (k)  Satisfaction by credits.  If any portion of a tax is satisfied by
 credit of an overpayment, then no interest shall be imposed  under  this
 section  on  the  portion  of the tax so satisfied for any period during
 which, if the credit had not been made, interest would have been  allow-
 able with respect to such overpayment.
   §  11-525    Additions  to tax and civil penalties. (a) (1) Failure to
 file tax return. (A) In case of failure to file a tax return under  this
 chapter  on or before the prescribed date, determined with regard to any
 extension of time for filing, unless it is shown that  such  failure  is
 due  to  reasonable cause and not due to willful neglect, there shall be
 added to the amount required to be shown as  tax  on  such  return  five
 percent  of  the  amount of such tax if the failure is for not more than
 one month, with an additional five percent for each additional month  or
 fraction  thereof  during  which  such  failure continues, not exceeding
 twenty-five percent in the aggregate.
 S. 8474                            409
 
   (B) In the case of a failure to file a tax return within sixty days of
 the date prescribed for filing of such return, determined with regard to
 any extension of time for filing, unless it is shown that  such  failure
 is  due to reasonable cause and not due to willful neglect, the addition
 to  tax  under subparagraph (A) of this paragraph shall not be less than
 the lesser of one hundred dollars or one hundred percent of  the  amount
 required to be shown as tax on such return.
   (C)  For  purposes of this paragraph, the amount of tax required to be
 shown on the return shall be reduced by the amount of any  part  of  the
 tax  which  is  paid on or before the date prescribed for payment of the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2) Failure to pay tax shown on return. In case of failure to pay  the
 amounts shown as tax on any return required to be filed under this chap-
 ter  on  or  before  the  prescribed date, determined with regard to any
 extension of time for payment, unless it is shown that such  failure  is
 due  to  reasonable cause and not due to willful neglect, there shall be
 added to the amount shown as tax on such return one-half of one  percent
 of the amount of such tax if the failure is not for more than one month,
 with  an additional one-half of one percent for each additional month or
 fraction thereof during which  such  failure  continues,  not  exceeding
 twenty-five  percent  in the aggregate. For the purpose of computing the
 addition for any month, the amount of tax shown on the return  shall  be
 reduced  by the amount of any part of the tax which is paid on or before
 the beginning of such month and by the amount of any credit against  the
 tax  which may be claimed upon the return. If the amount of tax required
 to be shown on a return is less than the amount shown  as  tax  on  such
 return,  this  paragraph  shall  be  applied  by substituting such lower
 amount.
   (3) Failure to pay tax required to be shown  on  return.  In  case  of
 failure  to pay any amount in respect of any tax required to be shown on
 a return required to be filed under this chapter which is not so  shown,
 including  an  assessment  made  pursuant  to subdivision (a) of section
 11-522 of this chapter, within ten days of the  date  of  a  notice  and
 demand  therefor, unless it is shown that such failure is due to reason-
 able cause and not due to willful neglect, there shall be added  to  the
 amount  of  tax stated in such notice and demand one-half of one percent
 of such tax if the failure is not for more than one month, with an addi-
 tional one-half of one percent for each  additional  month  or  fraction
 thereof  during  which such failure continues, not exceeding twenty-five
 percent in the aggregate. For the purpose of computing the addition  for
 any  month,  the  amount of tax stated in the notice and demand shall be
 reduced by the amount of any part of the tax which is  paid  before  the
 beginning of such month.
   (4)  Limitations  on  additions.  (A)  With  respect to any return the
 amount of the addition under paragraph one of this subdivision shall  be
 reduced by the amount of the addition under paragraph two of this subdi-
 vision  for any month to which an addition applies under both paragraphs
 one and two of this subdivision. In any case described  in  subparagraph
 (B)  of  paragraph  one  of this subdivision, the amount of the addition
 under such paragraph one shall not be reduced below the amount  provided
 in such subparagraph.
   (B)  With  respect  to  any return, the maximum amount of the addition
 permitted under paragraph three of this subdivision shall be reduced  by
 the  amount  of  the  addition  under paragraph one of this subdivision,
 determined without regard to subparagraph (B)  of  such  paragraph  one,
 S. 8474                            410
 
 which is attributable to the tax for which the notice and demand is made
 and which is not paid within ten days of such notice and demand.
   (b)  Deficiency  due to negligence. (1) If any part of a deficiency is
 due to negligence or intentional disregard of this chapter or  rules  or
 regulations  hereunder,  but  without  intent to defraud, there shall be
 added to the tax an amount equal to five percent of the deficiency.
   (2) There shall be added to the tax, in addition to the amount  deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under subdivision (a) of section  11-524
 with  respect  to  the portion of the deficiency described in such para-
 graph one which is attributable to the negligence or intentional  disre-
 gard  referred to in such paragraph one, for the period beginning on the
 last date prescribed by law for payment of such  deficiency,  determined
 without  regard  to any extension, and ending on the date of the assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
   (3) If any payment is shown on a return made by a payor  with  respect
 to  dividends,  patronage dividends and interest under subsection (a) of
 section six thousand forty-two, subsection (a) of section  six  thousand
 forty-four  or  subsection (a) of section six thousand forty-nine of the
 internal revenue code of nineteen hundred fifty-four, respectively,  and
 the payee fails to include any portion of such payment in unincorporated
 business  gross  income,  as that term is defined in section 11-506, any
 portion of a deficiency attributable to such failure shall  be  treated,
 for purposes of this subdivision, as due to negligence in the absence of
 clear and convincing evidence to the contrary. If any addition to tax is
 imposed  under  this subdivision by reason of this paragraph, the amount
 of the addition to tax imposed by  paragraph  one  of  this  subdivision
 shall  be five percent of the portion of the deficiency which is attrib-
 utable to the failure described in this paragraph.
   (c) Failure to file declaration or underpayment of estimated  tax.  If
 any  taxpayer  fails  to file a declaration of estimated tax or fails to
 pay all or any part of an installment of  estimated  tax,  the  taxpayer
 shall  be  deemed  to  have made an underpayment of estimated tax. There
 shall be added to the tax for the taxable year an amount at  the  under-
 payment  rate  set  by  the  commissioner of finance pursuant to section
 11-537 of this chapter, or, if no rate is set, at the rate of seven  and
 one-half  percent  per annum upon the amount of the underpayment for the
 period of the underpayment but not  beyond  the  fifteenth  day  of  the
 fourth  month following the close of the taxable year. The amount of the
 underpayment shall be the excess of the amount of the installment  which
 would  be  required to be paid if the estimated tax were equal to ninety
 percent of the tax shown on the return for the taxable year,  or  if  no
 return  was  filed,  ninety  percent  of the tax for such year, over the
 amount, if any, of the installment  paid  on  or  before  the  last  day
 prescribed  for  such  payment. No underpayment shall be deemed to exist
 with respect to a declaration or installment otherwise due on  or  after
 the  taxpayer's  death. In any case in which there would be no underpay-
 ment if this subdivision were applied by substituting  "eighty  percent"
 for  "ninety percent" where it appears in this subdivision, the addition
 to tax under this subdivision shall be equal to seventy-five percent  of
 the amount otherwise determined under this subdivision.
   (d) Exception to addition for underpayment of estimated tax. The addi-
 tion  to  tax  under subdivision (c) of this section with respect to any
 underpayment of any installment shall not be imposed if the total amount
 of all payments of estimated  tax  made  on  or  before  the  last  date
 S. 8474                            411

 prescribed  for the payment of such installment equals or exceeds which-
 ever of the following is the lesser:
   (1)  The amount which would have been required to be paid on or before
 such date if the estimated tax were whichever of the  following  is  the
 least:
   (A)  The  tax  shown  on  the return of the taxpayer for the preceding
 taxable year, if a return showing a liability for tax was filed  by  the
 taxpayer  for  the  preceding taxable year and such preceding year was a
 taxable year of twelve months, or
   (B) An amount equal to the tax computed, at the  rates  applicable  to
 the  taxable  year, but otherwise on the basis of the facts shown on the
 taxpayer's return for, and the law applicable to, the preceding  taxable
 year, or
   (C)  An amount equal to ninety percent of the tax for the taxable year
 computed by placing on an annualized basis the  unincorporated  business
 taxable  income  for  the  months  in the taxable year ending before the
 month in which the installment is required to be paid. For  purposes  of
 this  subparagraph,  the unincorporated business taxable income shall be
 placed on an annualized basis by:
   (i) multiplying by twelve, or, in the case of a taxable year  of  less
 than  twelve months, the number of months in the taxable year, the unin-
 corporated business taxable income for the months in  the  taxable  year
 ending before the month in which the installment is required to be paid,
 and
   (ii)  dividing  the  resulting  amount  by the number of months in the
 taxable year ending before the month  in  which  such  installment  date
 falls, or
   (D)(i) If the base period percentage for any six consecutive months of
 the  taxable  year equals or exceeds seventy percent, an amount equal to
 ninety percent of the tax determined in the following manner:
   (I) take the unincorporated business taxable  income  for  all  months
 during the taxable year preceding the filing month,
   (II)  divide  such amount by the base period percentage for all months
 during the taxable year preceding the filing month,
   (III) determine the tax on the amounts determined under subclause (II)
 of this clause, and
   (IV) multiply the tax determined under subclause (III) of this  clause
 by the base period percentage for the filing month and all months during
 the taxable year preceding the filing month.
   (ii) For purposes of clause (i) of this subparagraph:
   (I)  the  base period percentage for any period of months shall be the
 average percent which the unincorporated business taxable income for the
 corresponding months in each of the three preceding years bears  to  the
 unincorporated  business  taxable income for the three preceding taxable
 years. The commissioner of finance may by regulations  provide  for  the
 determination  of the base period percentage in the case of new unincor-
 porated businesses and other similar circumstances, and
   (II) the term "filing month" means the month in which the  installment
 is required to be paid;
   (2)  An  amount  equal  to  ninety percent of the tax computed, at the
 rates applicable to the taxable year, on the basis of the  actual  unin-
 corporated  business  taxable  income for the months in the taxable year
 ending before the month in which the installment is required to be paid.
   (e)(1) Except as  provided  in  paragraph  two  of  this  subdivision,
 subparagraphs  (A)  and  (B) of paragraph one of subdivision (d) of this
 section shall not apply in the case of any taxpayer which had unincorpo-
 S. 8474                            412
 
 rated business taxable income, or the portion thereof  allocated  within
 the city, of one million dollars or more for any taxable year during the
 three taxable years immediately preceding the taxable year involved.
   (2)  The  amount  treated as the estimated tax under subparagraphs (A)
 and (B) of paragraph one of subdivision (d) of this section shall in  no
 event  be  less than seventy-five percent of the tax shown on the return
 for the taxable year beginning in nineteen hundred eighty-three  or,  if
 no return was filed, seventy-five percent of the tax for such year.
   (f) Deficiency due to fraud. (1) If any part of a deficiency is due to
 fraud,  there  shall be added to the tax an amount equal to two times of
 the deficiency.
   (2) The addition to tax under this subdivision shall be in lieu of any
 other addition to tax imposed by subdivision (a) or (b) of this section.
   (g) Additional penalty. Any taxpayer who with fraudulent intent  shall
 fail  to  pay any tax, or to make, render, sign or certify any return or
 declaration of estimated tax, or to supply any  information  within  the
 time  required  by or under this chapter shall be liable to a penalty of
 not more than one thousand dollars, in addition  to  any  other  amounts
 required  under  this  chapter, to be imposed, assessed and collected by
 the commissioner of finance. The commissioner of finance shall have  the
 power,  in  his  or  her  discretion, to waive, reduce or compromise any
 penalty under this subdivision.
   (h) Additions treated as tax.  The  additions  to  tax  and  penalties
 provided  by this section shall be paid upon notice and demand and shall
 be assessed, collected and paid in the same manner  as  taxes,  and  any
 reference  in  this chapter to tax or tax imposed by this chapter, shall
 be deemed also to refer to the additions to tax and  penalties  provided
 by  this section. For purposes of section 11-521, this subdivision shall
 not apply to:
   (1) any addition to tax under subdivision (a) of this  section  except
 as to that portion attributable to a deficiency;
   (2) any addition to tax under subdivision (c) of this section; and
   (3)  any  additional  penalties under subdivisions (g) and (k) of this
 section.
   (i) Determination of deficiency. For purposes of subdivisions (b)  and
 (c)  of  this section, the amounts shown as the tax by the taxpayer upon
 his or her return shall be taken into account in determining the  amount
 of  the  deficiency  only if such return was filed on or before the last
 day prescribed for the filing of such return, determined with regard  to
 any extension of time for such filing.
   (j) Substantial understatement of liability. If there is a substantial
 understatement  of tax for any taxable year, there shall be added to the
 tax an amount equal to ten percent of the  amount  of  any  underpayment
 attributable  to  such understatement. For purposes of this subdivision,
 there is a substantial understatement of tax for any taxable year if the
 amount of the understatement for the taxable year exceeds the greater of
 ten percent of the tax required to be shown on the return for the  taxa-
 ble  year,  or  five thousand dollars. For purposes of the this subdivi-
 sion, the term "understatement" means the excess of the  amount  of  the
 tax  required  to  be shown on the return for the taxable year, over the
 amount of the tax imposed which is shown on the return, reduced  by  any
 rebate,  within the meaning of subdivision (g) of section 11-521 of this
 chapter.  The amount of such understatement shall  be  reduced  by  that
 portion of the understatement which is attributable to the tax treatment
 of any item by the taxpayer if there is or was substantial authority for
 such  treatment,  or  any  item with respect to which the relevant facts
 S. 8474                            413
 
 affecting the item's tax  treatment  are  adequately  disclosed  in  the
 return  or  in  a  statement attached to the return. The commissioner of
 finance may waive all or any part of the addition  to  tax  provided  by
 this  subdivision on a showing by the taxpayer that there was reasonable
 cause for the understatement, or part thereof,  and  that  the  taxpayer
 acted in good faith.
   (k)  Aiding or assisting in the giving of fraudulent returns, reports,
 statements or other documents. (1) Any person who, with the intent  that
 tax  be evaded, shall, for a fee or other compensation or as an incident
 to the performance of other services  for  which  such  person  receives
 compensation, aid or assist in, or procure, counsel, or advise the prep-
 aration  or presentation under, or in connection with any matter arising
 under this chapter of any  return,  report,  declaration,  statement  or
 other  document  which is fraudulent or false as to any material matter,
 or supply any false or  fraudulent  information,  whether  or  not  such
 falsity  or fraud is with the knowledge or consent of the person author-
 ized or required to present such return, report, declaration,  statement
 or  other  document  shall  pay  a  penalty  not  exceeding ten thousand
 dollars.
   (2) For purposes of  paragraph  one  of  this  subdivision,  the  term
 "procures"  includes ordering, or otherwise causing, a subordinate to do
 an act, and knowing of, and not attempting to prevent, participation  by
 a  subordinate in an act. The term "subordinate" means any other person,
 whether or not a member, employee, or agent of  the  taxpayer  involved,
 over whose activities the person has direction, supervision, or control.
   (3)  For  purposes  of  paragraph  one  of  this subdivision, a person
 furnishing typing, reproducing,  or  other  mechanical  assistance  with
 respect  to  a document shall not be treated as having aided or assisted
 in the preparation of such document by reason of such assistance.
   (4) The penalty imposed by this subdivision shall be  in  addition  to
 any other penalty provided by law.
   (l)  False or fraudulent document penalty. Any taxpayer that submits a
 false or fraudulent document to the department shall  be  subject  to  a
 penalty  of  one hundred dollars per document submitted, or five hundred
 dollars per tax return submitted. Such penalty shall be in  addition  to
 any other penalty or addition provided by law.
   §  11-526    Overpayment.   (a) General.  The commissioner of finance,
 within the applicable period of limitations, may credit  an  overpayment
 of tax and interest on such overpayment against any liability in respect
 of  any  tax  imposed by this title, on the person who made overpayment,
 and the balance shall be refunded.  Such credit of an overpayment  shall
 be  applied  before such overpayment, or any portion thereof, is paid to
 the state commissioner of taxation and finance pursuant to  section  one
 hundred seventy-one-m of the tax law.
   (b)  Credits  against estimated tax.   The commissioner of finance may
 prescribe regulations providing for the crediting against the  estimated
 tax  for  any taxable year of the amount determined to be an overpayment
 of the tax for a preceding taxable year.  If any overpayment of  tax  is
 so  claimed as a credit against estimated tax for the succeeding taxable
 year, such amount shall be considered as a payment of the  tax  for  the
 succeeding  taxable  year,  whether  or  not  claimed as a credit in the
 declaration of estimated tax for such succeeding taxable  year,  and  no
 claim  for credit or refund of such overpayment shall be allowed for the
 taxable year for which the overpayment arises.
 S. 8474                            414
 
   (c) Rule where no tax liability.  If there is no tax liability  for  a
 period  in  respect of which an amount is paid as tax, such amount shall
 be considered an overpayment.
   (d)  Assessment and collection after limitation period.  If any amount
 of income tax is assessed or collected after the expiration of the peri-
 od of limitations properly applicable  thereto,  such  amount  shall  be
 considered an overpayment.
   (e)  Notwithstanding  any provision of law in article fifty-two of the
 civil practice law and rules to the contrary,  the  procedures  for  the
 enforcement  of  money  judgments  shall  not apply to the department of
 finance, or to any officer or employee of the department of finance,  as
 a garnishee, with respect to any amount of money to be refunded or cred-
 ited to a taxpayer under this chapter.
   § 11-527 Limitation on credit or refund. (a) General. Claim for credit
 or refund of an overpayment of tax shall be filed by the taxpayer within
 three  years  from  the  time the return was filed or two years from the
 time the tax was paid, whichever of such periods expires the  later,  or
 if no return was filed, within two years from the time the tax was paid.
 If  the  claim  is filed within the three year period, the amount of the
 credit or refund shall not exceed the portion of the tax paid within the
 three years immediately preceding the filing of the claim plus the peri-
 od of any extension of time for filing the return.  If the claim is  not
 filed  within  the  three  year period, but is filed within the two year
 period, the amount of the credit or refund shall not exceed the  portion
 of the tax paid during the two years immediately preceding the filing of
 the  claim. Except as otherwise provided in this section, if no claim is
 filed, the amount of a credit or refund  shall  not  exceed  the  amount
 which would be allowable if a claim had been filed on the date the cred-
 it or refund is allowed.
   (b)  Extension  of  time  by  agreement.  If  an  agreement  under the
 provisions of paragraph two of subdivision (c) of section 11-523 of this
 chapter, extending the period for assessment  of  income  tax,  is  made
 within  the period prescribed in subdivision (a) of this section for the
 filing of a claim for credit or refund the period for filing a claim for
 credit or refund, or for making credit or refund  if  no  claims  filed,
 shall  not expire prior to six months after the expiration of the period
 within which an assessment may be made pursuant to the agreement or  any
 extension thereof.  The amount of such credit or refund shall not exceed
 the  portion  of  the  tax paid after the execution of the agreement and
 before the filing of the claim or the making of the credit or refund, as
 the case may be, plus the portion of the  tax  paid  within  the  period
 which  would  be  applicable  under subdivision (a) of this section if a
 claim had been filed on the date the agreement was executed.
   (c) Notice of change or correction of federal or New York state  taxa-
 ble  income. If a taxpayer is required by section 11-519 of this chapter
 to report a change or correction in federal or New  York  state  taxable
 income  reported  on the taxpayer's federal or New York state income tax
 return, or to report a change or correction which is treated in the same
 manner as if it were an overpayment for federal or New York state income
 tax purposes, or to file an amended  return  with  the  commissioner  of
 finance,  claim for credit or refund of any resulting overpayment of tax
 shall be filed by the taxpayer within two years from the time the notice
 of such change or correction or such amended return was required  to  be
 filed  with the commissioner of finance. If the report or amended return
 required by section 11-519 of this chapter is not filed within the nine-
 ty day period therein specified, no interest shall  be  payable  on  any
 S. 8474                            415
 
 claim for credit or refund of the overpayment attributable to the feder-
 al  or New York state change or correction. The amount of such credit or
 refund shall not exceed the amount of the reduction in tax  attributable
 to such federal or New York state change, correction or items amended on
 the taxpayer's amended federal or New York state income tax return. This
 subdivision  shall  not  affect  the time within which or the amount for
 which a claim for credit or refund may be filed apart from this subdivi-
 sion.
   (d) Overpayment attributable to net operating loss carryback. A  claim
 for  credit or refund of so much of an overpayment as is attributable to
 the application to the taxpayer of a net operating loss carryback  shall
 be  filed  within  three  years from the time the return was due for the
 taxable year of the loss, or within the period prescribed in subdivision
 (b) of this section in respect of such taxable year, or within the peri-
 od prescribed in subdivision (c) of this section,  where  applicable  in
 respect  of  the taxable year to which the net operating loss is carried
 back, whichever expires the latest.
   (e) Failure to file claim  within  prescribed  period.  No  credit  or
 refund  shall  be allowed or made, except as provided in subdivision (f)
 of this section or subdivision (d) of section  11-530  of  this  chapter
 after the expiration of the applicable period of limitation specified in
 this chapter unless a claim for credit or refund is filed by the taxpay-
 er  within  such  period.  Any  later credit shall be void and any later
 refund erroneous. No period of limitations specified in  any  other  law
 shall  apply  to the recovery by a taxpayer of moneys paid in respect of
 taxes under this chapter.
   (f) Effect of petition to tax appeals tribunal. If a notice  of  defi-
 ciency  for a taxable year has been mailed to the taxpayer under section
 11-521 of this chapter and if the taxpayer files a timely petition  with
 the  tax  appeals tribunal under section 11-529 of this chapter, the tax
 appeals tribunal may determine that the taxpayer has made an overpayment
 for such year, whether or not it also determines a deficiency  for  such
 year.    No  separate  claim for credit or refund for such year shall be
 filed, and no credit or refund for such year shall be allowed  or  made,
 except:
   (1)  as  to  overpayments  determined by a decision of the tax appeals
 tribunal which has become final;
   (2) as to any amount collected in excess  of  an  amount  computed  in
 accordance  with  the  decision  of  the  tax appeals tribunal which has
 become final;
   (3) as to any amount collected after the period of limitation upon the
 making of levy for collection has expired; and
   (4) as to any amount claimed as a result of  a  change  or  correction
 described in subdivision (c) of this section.
   (g)  Limit  on  amount  of credit or refund. The amount of overpayment
 determined under subdivision (f) of this section shall, when  the  deci-
 sion  of  the  tax  appeals  tribunal  has  become final, be credited or
 refunded in accordance with subdivision (a) of section  11-526  of  this
 chapter  and  shall  not  exceed the amount of tax which the tax appeals
 tribunal determines as part of its decision was paid:
   (1) after the mailing of the notice of deficiency, or
   (2) within the period which would be applicable under subdivision (a),
 (b) or (c) of this section, if on the date of the mailing of the  notice
 of  deficiency a claim has been filed, whether or not filed, stating the
 grounds upon which the tax appeals tribunal finds that there is an over-
 payment.
 S. 8474                            416
 
   (h) Early return. For purposes  of  this  section,  any  return  filed
 before  the  last day prescribed for the filing thereof shall be consid-
 ered as filed on such last day, determined without regard to any  exten-
 sion of time granted the taxpayer.
   (i)  Prepaid  tax.  For  purposes of this section, any tax paid by the
 taxpayer before the last day prescribed for its payment and  any  amount
 paid by the taxpayer as estimated tax for a taxable year shall be deemed
 to  have  been  paid  by the taxpayer on the fifteenth day of the fourth
 month following the close of his or her taxable  year  with  respect  to
 which such amount constitutes a credit or payment, except that for taxa-
 ble  years beginning on or after January first, two thousand sixteen, in
 the case of a taxpayer classified as a partnership  for  federal  income
 tax  purposes,  such  amount  shall  be  deemed to have been paid on the
 fifteenth day of the third month following the close of his or her taxa-
 ble year with respect to which  such  amount  constitutes  a  credit  or
 payment.
   (j) Cross reference. For provision barring refund of overpayment cred-
 ited  against  tax  of a succeeding year, see subdivision (d) of section
 11-526 of this chapter.
   (k) Notice of change or correction of sales and compensating  use  tax
 liability. If a taxpayer is required by section 11-519.1 of this chapter
 to  file  a report or amended return or report in respect of a change or
 correction of his or her sales and compensating use tax liability, claim
 for credit or refund of any resulting overpayment of tax shall be  filed
 by  the  taxpayer  within two years from the time such report or amended
 return or report was required to  be  filed  with  the  commissioner  of
 finance.  The  amount of such credit or refund shall be computed without
 change of the allocation of income upon which the taxpayer's return,  or
 any additional assessment, was based, and shall not exceed the amount of
 the  reduction in tax attributable to such change or correction of sales
 and compensating use tax liability.
   This subdivision shall not affect the time within which or the  amount
 for  which  a  claim  for  credit or refund may be filed apart from this
 subdivision.
   § 11-528  Interest on overpayment. (a) General.   Notwithstanding  the
 provisions  of  section  three-a  of the general municipal law, interest
 shall be allowed and paid as follows at the overpayment rate set by  the
 commissioner  of finance pursuant to section 11-537 of this chapter, or,
 if no rate is set, at the rate of six percent per annum upon  any  over-
 payment in respect of the tax imposed by this chapter:
   (1)  from  the  date  of  the overpayment to the due date of an amount
 against which a credit is taken; or
   (2) from the date of the overpayment to a date, to  be  determined  by
 the commissioner of finance, preceding the date of a refund check by not
 more  than  thirty days, whether or not such refund check is accepted by
 the taxpayer after tender of such check to the taxpayer.  The acceptance
 of such check shall be without prejudice to any right of the taxpayer to
 claim any additional overpayment and interest thereon.
   (3) Late  and  amended  returns  and  claims  for  credit  or  refund.
 Notwithstanding paragraph one or two of this subdivision, in the case of
 an  overpayment claimed on a return of tax which is filed after the last
 date prescribed for filing such return, determined with regard to exten-
 sions, or claimed on an amended return of tax or claimed on a claim, for
 credit or refund, no interest shall be  allowed  or  paid  for  any  day
 before the date on which such return or claim is filed.
 S. 8474                            417
 
   (4)  Interest  on certain refunds. To the extent provided for in regu-
 lations promulgated by the  commissioner  of  finance,  if  an  item  of
 income, gain, loss, deduction or credit is changed from the taxable year
 or period in which it is reported to the taxable year or period in which
 it  belongs  and the change results in an underpayment in a taxable year
 or period and an overpayment in some other taxable year or  period,  the
 provisions  of  paragraph  three  of this subdivision with respect to an
 overpayment shall not be applicable to the extent that the limitation in
 such paragraph on the right to interest would result in a  taxpayer  not
 being  allowed interest for a length of time with respect to an overpay-
 ment while being required to pay interest on an equivalent amount of the
 related underpayment.  However, this paragraph shall not be construed as
 limiting or mitigating the effect of any statute of limitations  or  any
 other  provisions  of law relating to the authority of such commissioner
 to issue a notice of deficiency or to allow a credit  or  refund  of  an
 overpayment.
   (5)  Amounts  of less than one dollar. No interest shall be allowed or
 paid if the amount thereof is less than one dollar.
   (b) Advance payment  of  tax  and  payment  of  estimated  tax.    The
 provisions of subdivisions (h) and (i) of section 11-527 of this chapter
 applicable  in  determining  the  date of payment of tax for purposes of
 determining the period of limitations on  credit  or  refund,  shall  be
 applicable  in  determining  the  date  of  payment for purposes of this
 section.
   (c) Refund within three months of claim for overpayment.  If any over-
 payment of tax imposed by this chapter is credited  or  refunded  within
 three  months  after the last date prescribed, or permitted by extension
 of time, for filing the return of such tax on which such overpayment was
 claimed or within three months after such return was filed, whichever is
 later, or within three months after an amended return was filed claiming
 such overpayment or within three months after  a  claim  for  credit  or
 refund  was  filed  on  which  such overpayment was claimed, no interest
 shall be allowed  under  this  section  on  any  such  overpayment.  For
 purposes  of this subdivision, any amended return or claim for credit or
 refund filed before the last day prescribed, or permitted  by  extension
 of  time,  for  the  filing  of the return of tax for such year shall be
 considered as filed on such last day.
   (d) Refund of tax caused by carryback.  For purposes of this  section,
 if  any overpayment of tax imposed by this chapter results from a carry-
 back of a net operating loss, such overpayment shall be  deemed  not  to
 have  been  made  prior to the filing date for the taxable year in which
 such net operating loss arises.  Such filing date  shall  be  determined
 without  regard  to extensions of time to file. For purposes of subdivi-
 sion (c) of this section  any  overpayment  described  herein  shall  be
 treated  as an overpayment for the loss year and  such subdivision shall
 be applied with respect to such overpayment by treating the  return  for
 the  loss  year as not filed before claim for such overpayment is filed.
 The term "loss year" means the taxable year in which such loss arises.
   (e) No interest until return in processible form. (1) For purposes  of
 subdivisions  (a) and (c) of this section, a return shall not be treated
 as filed until it is filed in processible form.
   (2) For purposes of paragraph one of this subdivision, a return is  in
 a processible form if:
   (A) such return is filed on a permitted form, and
   (B) such return contains:
 S. 8474                            418
 
   (i)  the  taxpayer's  name,  address,  and  identifying number and the
 required signatures, and
   (ii)  sufficient  required  information,  whether  on the return or on
 required attachments, to permit the  mathematical  verification  of  tax
 liability shown on the return.
   (f)  Cross-reference.    For  provision with respect to interest after
 failure to file notice of federal or New York state change under section
 11-519 of this chapter, see subdivision (c) of section  11-527  of  this
 chapter.
   §  11-529 Petition to tax appeals tribunal. (a) General. The form of a
 petition to the tax appeals tribunal, and further proceedings before the
 tax appeals tribunal in any case initiated by the filing of a  petition,
 shall  be  governed  by  such  rules  as  the tax appeals tribunal shall
 prescribe. No petition shall be denied  in  whole  or  in  part  without
 opportunity  for  a hearing on reasonable prior notice. Such hearing and
 any appeal to the tribunal sitting en banc from the decision rendered in
 such hearing shall be  conducted  in  the  manner  and  subject  to  the
 requirements prescribed by the tax appeals tribunal pursuant to sections
 one  hundred  sixty-eight through one hundred seventy-two of the charter
 of the preceding municipality as  it  existed  January  first,  nineteen
 hundred  ninety-four.  A  decision  of the tax appeals tribunal shall be
 rendered, and notice thereof shall be given, in the manner  provided  by
 section  one hundred seventy-one of the charter of the preceding munici-
 pality.
   (b) Petition for redetermination of a deficiency. Within ninety  days,
 or one hundred fifty days if the notice is addressed to a person outside
 of  the  United  States,  after  the mailing of the notice of deficiency
 authorized by section 11-521 of this chapter, or if the commissioner  of
 finance  has  established  a  conciliation procedure pursuant to section
 11-124 of this title and  the  taxpayer  has  requested  a  conciliation
 conference  in accordance therewith, within ninety days from the mailing
 of the conciliation decision or the date of the commissioner's confirma-
 tion of the discontinuance of the conciliation proceeding, the  taxpayer
 may  file a petition with the tax appeals tribunal for a redetermination
 of the deficiency. Such petition may also assert a claim for refund  for
 the  same  taxable year or years, subject to the limitations of subdivi-
 sion (g) of section 11-527 of this chapter.
   (c) Petition for refund. A taxpayer may file a petition with  the  tax
 appeals tribunal for the amounts asserted in a claim for refund if:
   (1)  the taxpayer has filed a timely claim for refund with the commis-
 sioner of finance,
   (2) the taxpayer has not previously filed with the tax appeals  tribu-
 nal a timely petition under subdivision (b) of this section for the same
 taxable  year  unless  the  petition under this subdivision relates to a
 separate claim for credit or refund properly filed under subdivision (f)
 of section 11-527 of this chapter, and
   (3) either: (A) six months have expired since the claim was filed,  or
 (B)  the  commissioner  of finance has mailed to the taxpayer, by regis-
 tered or certified mail, a notice of disallowance of such claim in whole
 or in part. No petition under this subdivision shall be filed more  than
 two  years after the date of mailing of a notice of disallowance, unless
 prior to the expiration of such two year period it has been extended  by
 written  agreement between the taxpayer and the commissioner of finance.
 If a taxpayer files a written waiver of the requirement that he  or  she
 be  mailed  a  notice of disallowance, the two year period prescribed by
 S. 8474                            419

 this subdivision for filing a petition for refund  shall  begin  on  the
 date such waiver is filed.
   (4)  If  the  commissioner  of  finance has established a conciliation
 procedure pursuant to section 11-124 of this title, a  taxpayer  who  is
 eligible  to  file  a  petition for refund with the tax appeals tribunal
 pursuant to this subdivision may request a conciliation conference prior
 to filing such petition, provided the request is made  within  the  time
 prescribed  for  filing  the  petition. Notwithstanding anything in this
 subdivision to the contrary, if the taxpayer  has  requested  a  concil-
 iation  conference in accordance with the procedure established pursuant
 to section 11-124 of this title, a petition for refund may be  filed  no
 later  than ninety days from the mailing of the conciliation decision or
 the date of the commissioner's confirmation of the discontinuance of the
 conciliation proceeding.
   (d) Assertion of deficiency after filing petition.  (1)  Petition  for
 redetermination  of deficiency. If a taxpayer files with the tax appeals
 tribunal a petition for redetermination of a deficiency, the tax appeals
 tribunal shall  have  power  to  determine  a  greater  deficiency  than
 asserted in the notice of deficiency and to determine if there should be
 assessed  any  addition  to tax or penalty provided in section 11-525 of
 this chapter, if claim therefor is asserted at  or  before  the  hearing
 under the rules of the tax appeals tribunal.
   (2)  Petition  for  refund. If the taxpayer files with the tax appeals
 tribunal a petition for credit or refund for a  taxable  year,  the  tax
 appeals tribunal may:
   (A) determine a deficiency for such year as to any amount of deficien-
 cy  asserted  at  or  before  the hearing under rules of the tax appeals
 tribunal, and within the period in which an assessment would  be  timely
 under section 11-523 of this chapter, or
   (B) deny so much of the amount for which credit or refund is sought in
 the  petition, as is offset by other issues pertaining to the same taxa-
 ble year which are asserted at or before the hearing under rules of  the
 tax appeals tribunal.
   (3)  Opportunity  to  respond.  A taxpayer shall be given a reasonable
 opportunity to respond to any matters asserted by  the  commissioner  of
 finance under this subdivision.
   (4)  Restriction  on  further  notices  of deficiency. If the taxpayer
 files a petition with the tax appeals tribunal under  this  section,  no
 notice of deficiency under section 11-521 of this chapter may thereafter
 be  issued  by  the  commissioner  of finance for the same taxable year,
 except in case of fraud or with respect to a  change  or  correction  in
 federal  or  New York state taxable income required to be reported under
 section 11-519 of this chapter or with respect  to  a  state  change  or
 correction  of  sales  and compensating use tax liability to be reported
 under section 11-519.1 of this chapter.
   (e) Burden of proof. In any case before the tax appeals tribunal under
 this chapter, the burden of proof shall be upon  the  petitioner  except
 for  the following issues, as to which the burden of proof shall be upon
 the commissioner of finance:
   (1) whether the petitioner has been guilty of  fraud  with  intent  to
 evade tax;
   (2)  whether the petitioner is liable as the transferee of property of
 a taxpayer, but not to show that the taxpayer was liable for the tax;
   (3) whether the petitioner is liable for any increase in a  deficiency
 where  such  increase is asserted initially after a notice of deficiency
 was mailed and a petition under this section filed, unless such increase
 S. 8474                            420
 
 in deficiency is the result of a change or correction of federal or  New
 York  state  taxable income required to be reported under section 11-519
 of this chapter, and of which change or correction the  commissioner  of
 finance  had  no notice at the time he or she mailed the notice of defi-
 ciency or unless such increase in deficiency is the result of  a  change
 or correction of sales and compensating use tax liability required to be
 reported  under  section  11-519.1 of this title, and of which change or
 correction the commissioner of finance had no notice at the time  he  or
 she mailed the notice of deficiency; and
   (4)  whether  any person is liable for a penalty under subdivision (k)
 of section 11-525 of this chapter.
   (f) Evidence of related federal or state determination. Evidence of  a
 federal  or  state  determination  relating  to  issues raised in a case
 before the tax appeals tribunal under this section shall be  admissible,
 under rules established by the tax appeals tribunal.
   (g)  Jurisdiction  over  other  years.  The tax appeals tribunal shall
 consider such facts with relation to the taxes for other years as may be
 necessary correctly to determine the tax for the taxable year, but in so
 doing shall have no jurisdiction to determine whether or not the tax for
 any other year has been overpaid or underpaid.
   § 11-530 Review of tax appeals tribunal's  decision.  (a)  General.  A
 decision of the tax appeals tribunal sitting en banc shall be subject to
 judicial  review at the instance of any taxpayer affected thereby in the
 manner provided by law for the review of a final decision or  action  of
 administrative  agencies  of the city.  An application by a taxpayer for
 such review must be made within four months after notice of the decision
 is sent by certified mail, return receipt requested, to the taxpayer and
 the commissioner of finance.
   (b) Judicial review exclusive remedy. The review of a decision of  the
 tax  appeals  tribunal  provided  by this section shall be the exclusive
 remedy available to any taxpayer for the judicial determination  of  the
 liability of the taxpayer for the taxes imposed by this chapter.
   (c)  Assessment  pending  review;  review  bond.  Irrespective  of any
 restrictions on the  assessment  and  collection  of  deficiencies,  the
 commissioner  of  finance  may assess a deficiency determined by the tax
 appeals tribunal in a decision rendered pursuant to section one  hundred
 seventy-one  of  the charter of the preceding municipality as it existed
 January first, nineteen hundred ninety-four after the expiration of  the
 period  specified  in  subdivision  (a) of this section, notwithstanding
 that an application for judicial review in respect  of  such  deficiency
 has  been  duly  made by the taxpayer, unless the taxpayer, at or before
 the time his or her application for review is made, has paid  the  defi-
 ciency, has deposited with the commissioner of finance the amount of the
 deficiency,  or has filed with the commissioner of finance a bond, which
 may be a jeopardy bond under subdivision (h) of section 11-534  of  this
 chapter,  in  the  amount  of  the  portion of the deficiency, including
 interest and other amounts, in respect  of  which  the  application  for
 review  is  made and all costs and charges which may accrue against such
 taxpayer in the prosecution of the proceeding, including  costs  of  all
 appeals,  and  with surety approved by a justice of the supreme court of
 the state of New York, conditioned upon the payment of  the  deficiency,
 including  interests  and  other amounts, as finally determined and such
 costs and charges. If, as a result of a waiver of  the  restrictions  on
 the  assessment  and  collection of a deficiency, any part of the amount
 determined by the tax appeals tribunal is paid after the filing  of  the
 S. 8474                            421

 review bond, such bond shall, at the request of the taxpayer, be propor-
 tionately reduced.
   (d) Credit, refund or abatement after review. If the amount of a defi-
 ciency  determined by the tax appeals tribunal is disallowed in whole or
 in part by the court of review, the amount so disallowed shall be  cred-
 ited, or refunded to the taxpayer, without the making of claim therefor,
 or, if payment has not been made, shall be abated.
   (e) Date of finality of tax appeals tribunal's decision. A decision of
 the  tax  appeals tribunal shall become final upon the expiration of the
 period specified in subdivision (a) of this section for making an appli-
 cation for review, if no such application has been duly made within such
 time, or if such application has been duly made, upon expiration of  the
 time  for  all further judicial review, or upon the rendering by the tax
 appeals tribunal of a decision in accordance with  the  mandate  of  the
 court  on  review.   Notwithstanding the provisions of this subdivision,
 for the purpose of making an application for review, the decision of the
 tax appeals tribunal shall be deemed final on the  date  the  notice  of
 decision  is sent by certified mail to the taxpayer and the commissioner
 of finance.
   § 11-531 Mailing rules; holidays; miscellaneous.  (a) Timely  mailing.
 (1)  If  any  return,  declaration  of  estimated tax, claim, statement,
 notice, petition, or other document required to be filed, or any payment
 required to be made, within a  prescribed  period  or  on  or  before  a
 prescribed  date  under  authority  of any provision of this chapter is,
 after such period or such date, delivered by the United States  mail  to
 the commissioner of finance, tax appeals tribunal, bureau, office, offi-
 cer  or  person  with which or with whom such document is required to be
 filed, or to which or to whom such payment is required to be  made,  the
 date  of  the  United  States  postmark stamped on the envelope shall be
 deemed to be the date of delivery. This subdivision shall apply only  if
 the postmark date falls within the prescribed period or on or before the
 prescribed  date  for  the  filing  of  such document, or for making the
 payment, including any extension granted for such filing or payment, and
 only if such document or payment was  deposited  in  the  mail,  postage
 prepaid,  properly addressed to the commissioner of finance, tax appeals
 tribunal, bureau, office, officer or person with which or with whom  the
 document  is required to be filed or to which or to whom such payment is
 required to be made. If any document is sent by United States registered
 mail, such registration shall be prima facie evidence that such document
 was delivered to the commissioner  of  finance,  tax  appeals  tribunal,
 bureau,  office, officer or person to which or to whom addressed. To the
 extent that the commissioner of finance  or,  where  relevant,  the  tax
 appeals  tribunal  shall  prescribe by regulation, certified mail may be
 used in lieu of registered mail under this section. Except  as  provided
 in  paragraph  two  of this subdivision, this subdivision shall apply in
 the case of postmarks not made by the United States postal service  only
 if  and  to  the  extent  provided by regulations of the commissioner of
 finance or, where relevant, the tax appeals tribunal.
   (2) (A) Any reference in paragraph one  of  this  subdivision  to  the
 United  States  mail  shall  be  treated as including a reference to any
 delivery service designated by the secretary  of  the  treasury  of  the
 United States pursuant to section seventy-five hundred two of the inter-
 nal  revenue code and any reference in paragraph one of this subdivision
 to a United States postmark shall be treated as including a reference to
 any date recorded or marked in the manner described in section  seventy-
 five  hundred  two of the internal revenue code by a designated delivery
 S. 8474                            422
 
 service. If the commissioner of finance finds that any delivery  service
 designated  by  such  secretary is inadequate for the needs of the city,
 the commissioner may withdraw such  designation  for  purposes  of  this
 title.  The commissioner may also designate additional delivery services
 meeting the criteria of section seventy-five hundred two of the internal
 revenue code for purposes of this title, or may withdraw any such desig-
 nation if the commissioner of finance finds that a delivery  service  so
 designated  is  inadequate  for  the needs of the city. Any reference in
 paragraph one of this subdivision to the United  States  mail  shall  be
 treated  as  including a reference to any delivery service designated by
 the commissioner of finance and any reference in paragraph one  of  this
 subdivision  to a United States postmark shall be treated as including a
 reference to any date recorded or marked  in  the  manner  described  in
 section  seventy-five  hundred  two  of  the  internal revenue code by a
 delivery service designated by the commissioner of  finance.    Notwith-
 standing the provisions of this paragraph, any withdrawal of designation
 or  additional  designation  by the commissioner of finance shall not be
 effective for purposes of service upon the tax appeals tribunal,  unless
 and  until  such  withdrawal of designation or additional designation is
 ratified by the president of the tax appeals tribunal.
   (B) Any equivalent of registered or certified mail designated  by  the
 United  States secretary of the treasury, or as may be designated by the
 commissioner of finance pursuant to  the  same  criteria  used  by  such
 secretary for such designations pursuant to section seventy-five hundred
 two  of  the internal revenue code, shall be included within the meaning
 of registered or certified mail as used in paragraph one of this  subdi-
 vision.  If  the  commissioner  of  finance finds that any equivalent of
 registered or certified mail designated by such secretary or the commis-
 sioner of finance is inadequate for the needs of the city,  the  commis-
 sioner  of  finance  may  withdraw such designation for purposes of this
 title. Notwithstanding the provisions of this paragraph, any  withdrawal
 of  designation or additional designation by the commissioner of finance
 shall not be effective for purposes of  service  upon  the  tax  appeals
 tribunal,  unless and until such withdrawal of designation or additional
 designation is ratified by the president of the tax appeals tribunal.
   (b) Last known address.  For purposes of this  chapter,  a  taxpayer's
 last  known  address  shall  be  given  in  the last return filed by the
 taxpayer, unless subsequently to the filing of such return the  taxpayer
 shall have notified the commissioner of finance of a change of address.
   (c)  Last  day a Saturday, Sunday or legal holiday.  When the last day
 prescribed under authority of this chapter, including any  extension  of
 time, for performing any act falls on Saturday, Sunday, or a legal holi-
 day  in  the  state  of  New  York, the performance of such act shall be
 considered timely if it is performed on the next succeeding day which is
 not a Saturday, Sunday or legal holiday.
   (d) Certificate: unfiled return. For  purposes  of  this  chapter  and
 sections  one hundred sixty-eight through one hundred seventy-two of the
 charter of the preceding municipality, the certificate  of  the  commis-
 sioner  of  finance  to  the effect that a tax has not been paid, that a
 return or declaration of estimated tax  has  not  been  filed,  or  that
 information  has  not  been  supplied,  as  required  by  or  under  the
 provisions of this title, shall be prima facie evidence  that  such  tax
 has  not  been paid, that such return or declaration has not been filed,
 or that such information has not been supplied.
   § 11-532 Collection, levy and liens.  (a) Collection procedures.   The
 taxes  imposed by this chapter shall be collected by the commissioner of
 S. 8474                            423
 
 finance, and the commissioner may establish the mode  or  time  for  the
 collection  of  any  amount  due  it under this chapter if not otherwise
 specified.   The commissioner of finance shall,  upon  request,  give  a
 receipt  for  any sum collected under this chapter.  The commissioner of
 finance may authorize banks or trust companies which are depositories or
 financial agents of the city to receive and give a receipt for  any  tax
 imposed under this chapter in such manner, at such times, and under such
 conditions as the commissioner of finance may prescribe; and the commis-
 sioner of finance shall prescribe the manner, times and conditions under
 which the receipt of such tax by such banks and trust companies is to be
 treated as payment of such tax to the commissioner of finance.
   (b)   Notice and demand for tax.  The commissioner of finance shall as
 soon as practicable give notice to each person liable for any amount  of
 tax,  addition  to tax, penalty or interest, which has been assessed but
 remains unpaid, stating the amount and demanding payment thereof.   Such
 notice  shall be left at the dwelling or usual place of business of such
 person or shall be sent by mail to such  person's  last  known  address.
 Except  where  the  commissioner  of  finance determines that collection
 would be jeopardized by delay, if any tax is assessed prior to the  last
 date,  including  any date fixed by extension, prescribed for payment of
 such tax, payment of such tax shall not be  demanded  until  after  such
 date.
   (c) Issuance of warrant after notice and demand.  If any person liable
 under  this chapter for the payment of any tax, addition to tax, penalty
 or interest neglects or refuses to pay the  same  within  the  ten  days
 after  notice  and demand herefor is given to such person under subdivi-
 sion (b) of this section, the commissioner of  finance  may  within  six
 years  after the date of such assessment issue a warrant directed to the
 sheriff of any county of the state, or to any officer or employee of the
 department of finance, commanding such person to levy upon and sell such
 person's real and personal  property  for  the  payment  of  the  amount
 assessed,  with  the  cost  of executing the warrant, and to return such
 warrant to the commissioner of finance and pay to the  commissioner  the
 money collected by virtue thereof within sixty days after the receipt of
 the  warrant.   If the commissioner of finance finds that the collection
 of the tax or other amount is in jeopardy, notice and demand for immedi-
 ate payment of such tax may be made by the commissioner of  finance  and
 upon failure or refusal to pay such tax or other amount the commissioner
 of  finance  may  issue  a  warrant without regard to the ten-day period
 provided in this subdivision.
   (d) Copy of warrant to be filed and lien to be created.   Any  sheriff
 or  officer  or employee who receives a warrant under subdivision (c) of
 this section shall within five days thereafter  file  a  copy  with  the
 clerk of the appropriate county.  The clerk shall thereupon enter in the
 judgment  docket,  in  the  column for judgment debtors, the name of the
 taxpayer mentioned in the warrant, and in appropriate columns the tax or
 other amounts for which the warrant is issued and  the  date  when  such
 copy  is  filed;  and such amount shall thereupon be a binding lien upon
 the real, personal and other property of the taxpayer.
   (e) Judgment.  When a warrant has been filed with the county clerk the
 commissioner of finance shall, on behalf of the city, be deemed to  have
 obtained judgment against the taxpayer for the tax or other amounts.
   (f)    Execution.   The sheriff or officer or employee shall thereupon
 proceed upon the judgment in all respects, with like effect, and in  the
 same  manner  prescribed  by law in respect to executions issued against
 property upon judgments of a court of record, and  a  sheriff  shall  be
 S. 8474                            424
 
 entitled  to  the  same fees for the sheriff's services in executing the
 warrant, to be collected in the same manner.  An officer or employee  of
 the  department of finance may proceed in any county or counties of this
 state  and  shall have all the powers of execution conferred by law upon
 sheriffs, but shall be entitled to no fee or compensation in  excess  of
 actual expenses paid in connection with the execution of the warrant.
   (g)  Taxpayer not a resident of this state.  Where a notice and demand
 under subdivision (b) of this section shall have been given to a taxpay-
 er who is not then a resident of this  state,  and  it  appears  to  the
 commissioner of finance that it is not practicable to find in this state
 property  of the taxpayer sufficient to pay the entire balance of tax or
 other amount owing by such taxpayer who is not then a resident  of  this
 state,  the  commissioner of finance may, in accordance with subdivision
 (c) of this section, issue a warrant directed to an officer or  employee
 of the department of finance, a copy of which warrant shall be mailed by
 certified  or  registered  mail  to  the taxpayer at the taxpayer's last
 known address, subject to the rules for mailing provided in  subdivision
 (a)  of  section 11-521 of this chapter.  Such warrant shall command the
 officer or employee to proceed in Richmond county, and such  officer  or
 employee  shall, within five days after receipt of the warrant, file the
 warrant and obtain a judgment in accordance with this section.  Thereup-
 on the commissioner of finance may  authorize  the  institution  of  any
 action or proceeding to collect or enforce the judgment in any place and
 by any procedure that a civil judgment of the supreme court of the state
 of New York could be collected or enforced.  The commissioner of finance
 may  also,  in the commissioner's discretion, designate agents or retain
 counsel for the purpose of collecting, outside the state  of  New  York,
 any  unpaid  taxes,  additions  to tax, penalties or interest which have
 been assessed under this chapter against taxpayers who are not residents
 of this state, may fix the compensation of such agents and counsel to be
 paid out of money  appropriated  or  otherwise  lawfully  available  for
 payment thereof, and may require of them bonds or other security for the
 faithful performance of their duties, in such form and in such amount as
 the commissioner of finance shall deem proper and sufficient.
   (h)    Action by city for recovery of taxes.  Action may be brought by
 the corporation counsel of the city at the instance of the  commissioner
 of  finance  as  agent and trustee for the city to recover the amount of
 any unpaid taxes, additions to tax, penalties  or  interest  which  have
 been  assessed under this chapter within six years prior to the date the
 action is commenced.
   (i) Release of lien or vacating warrant. The commissioner of  finance,
 if  he  or  she finds that the interests of the city will not thereby be
 jeopardized, and upon such conditions as the commissioner  may  require,
 may  release  any  property  from the lien of any warrant or vacate such
 warrant for unpaid taxes, additions to tax, penalties and interest filed
 pursuant to subdivision (d) or (g) of this section, and such release  or
 vacating  of  the warrant may be recorded in the office of any recording
 officer in which such warrant has been filed. The clerk shall  thereupon
 cancel  and  discharge  as of the original date of docketing the vacated
 warrant.
   § 11-533 Transferees. (a) General. The liability, at law or in equity,
 of a transferee of property of a taxpayer for any tax, additions to tax,
 penalty or interest due the commissioner of finance under this  chapter,
 shall be assessed, paid, and collected in the same manner and subject to
 the  same  provisions and limitations as in the case of the tax to which
 the liability relates, except that the period of limitations for assess-
 S. 8474                            425
 
 ment against the transferee shall be  extended  by  one  year  for  each
 successive  transfer, in order, from the original taxpayer to the trans-
 feree involved, but not by more than three years in the aggregate.   The
 term  "transferee"  includes donee, heir, legatee, devisee and distribu-
 tee.
   (b)  Exceptions.  (1) If before the expiration of the period of  limi-
 tations  for assessment of liability of the transferee, a claim has been
 filed by the commissioner of finance in any court against  the  original
 taxpayer  or  the  last preceding transferee based upon the liability of
 the original taxpayer, then the period of limitation for  assessment  of
 liability  of  the transferee shall in no event expire prior to one year
 after such claim has  been  finally  allowed,  disallowed  or  otherwise
 disposed of.
   (2)    If, before the expiration of the time prescribed in subdivision
 (a) of this section or  the  immediately  preceding  paragraph  of  this
 subdivision  for  the  assessment  of the liability, the commissioner of
 finance and the transferee have both consented in writing to its assess-
 ment after such time, the liability may be assessed at any time prior to
 the expiration of the period agreed upon.  The period so agreed upon may
 be extended by subsequent agreements in writing made before the  expira-
 tion of the period previously agreed upon.  For the purpose of determin-
 ing  the  period  of limitation on credit or refund to the transferee of
 overpayments of tax made by such transferee or overpayments of tax  made
 by  the  transferor  as  to  which the transferee is legally entitled to
 credit or refund, such agreement and  any  extension  thereof  shall  be
 deemed an agreement and extension thereof referred to in subdivision (b)
 of  section  11-527 of this chapter.  If the agreement is executed after
 the expiration of the period of limitation for  assessment  against  the
 original  taxpayer,  then  in applying the limitations under subdivision
 (b) of section 11-527 of this chapter on the amount  of  the  credit  or
 refund,  the  periods  specified in subdivision (a) of section 11-527 of
 this chapter shall be increased by the period  from  the  date  of  such
 expiration to the date of agreement.
   (c)    Deceased transferor.   If any person is deceased, the period of
 limitation for assessment against such person shall be the  period  that
 would be in effect if such person had lived.
   (d)   Evidence.   Notwithstanding the provisions of subdivision (e) of
 section 11-537 of this chapter the commissioner of finance shall use his
 or her powers to make available to the transferee evidence necessary  to
 enable the transferee to determine the liability of the original taxpay-
 er  and  of any preceding transferees, but without undue hardship to the
 original taxpayer or preceding  transferee.    See  subdivision  (e)  of
 section 11-529 of this chapter for rules as to burden of proof.
   § 11-534 Jeopardy assessment. (a) Authority for making. If the commis-
 sioner  of finance believes that the assessment or collection of a defi-
 ciency will be jeopardized by delay, the  commissioner  shall,  notwith-
 standing  the  provision  of sections 11-521 and 11-536 of this chapter,
 and immediately assess such  deficiency,  together  with  all  interest,
 penalties  and  additions  to  tax  provided  for by law, and notice and
 demand shall be made by the commissioner  of  finance  for  the  payment
 thereof.
   (b)  Notice  of  deficiency. If the jeopardy assessment is made before
 any notice in respect to  the  tax  to  which  the  jeopardy  assessment
 relates  has  been mailed under section 11-521 of this chapter, then the
 commissioner of finance shall mail a notice under  such  section  within
 sixty days after the making of the assessment.
 S. 8474                            426

   (c)  Amount  assessable  before  decision of tax appeals tribunal. The
 jeopardy assessment may be made in respect of a  deficiency  greater  or
 less  than that of which notice is mailed to the taxpayer and whether or
 not the taxpayer has heretofore filed a petition with  the  tax  appeals
 tribunal.  The  commissioner  of finance may, at any time before the tax
 appeals tribunal renders its decision, abate  such  assessment,  or  any
 unpaid portion thereof, to the extent that the commissioner believes the
 assessment  to  be  excessive in amount. The tax appeals tribunal may in
 its decision redetermine the entire amount of the deficiency and of  all
 amounts assessed at the same time in connection therewith.
   (d)  Amount  assessable after decision of tax appeals tribunal. If the
 jeopardy assessment is made after the decision of the tax appeals tribu-
 nal is rendered, such assessment may be made  only  in  respect  of  the
 deficiency determined by the tax appeals tribunal in its decision.
   (e)  Expiration  of  right to assess. A jeopardy assessment may not be
 made after the decision of the tax appeals tribunal has become final  or
 after the taxpayer has made an application for review of the decision of
 the tax appeals tribunal.
   (f)  Collection of unpaid amounts. When a petition has been filed with
 the tax appeals tribunal and when the  amount  which  should  have  been
 assessed  has  been determined by a decision of the tax appeals tribunal
 which has become final, then any unpaid portion, the collection of which
 has been stayed by bond, shall be collected as  part  of  the  tax  upon
 notice  and  demand  from the commissioner of finance, and any remaining
 portion of the assessment shall  be  abated.    If  the  amount  already
 collected  exceeds the amount determined as the amount which should have
 been assessed, such excess shall be credited or refunded to the taxpayer
 as provided in section 11-526 of this  chapter  without  the  filing  of
 claim therefor. If the amount determined as the amount which should have
 been  assessed  is  greater  than the amount actually assessed, then the
 difference shall be assessed and shall be collected as part of  the  tax
 upon notice and demand from the commissioner of finance.
   (g)  Abatement if jeopardy does not exist. The commissioner of finance
 may abate the jeopardy assessment if the commissioner finds that jeopar-
 dy does not exist. Such abatement may not be made after  a  decision  of
 the  tax appeals tribunal in respect of the deficiency has been rendered
 or, if no petition is filed with the tax  appeals  tribunal,  after  the
 expiration of the period for filing such petition. The period of limita-
 tion  on  the  making  of  assessments  and  levy  or  a  proceeding for
 collection, in respect of any deficiency, shall be determined as if  the
 jeopardy assessment so abated had not been made, except that the running
 of  such  period shall in any event be suspended for the period from the
 date of such jeopardy assessment until the expiration of the  tenth  day
 after the day on which such jeopardy assessment is abated.
   (h) Bond to stay collection. The collection of the whole or any amount
 of any jeopardy assessment may be stayed by filing with the commissioner
 of finance, within such time as may be fixed by regulation, a bond in an
 amount  equal to the amount as to which the stay is desired, conditioned
 upon the payment of the amount,  together  with  interest  thereon,  the
 collection  of  which is stayed at the time at which, but for the making
 of the jeopardy assessment, such amount would be due. Upon the filing of
 the bond the collection of so much of the amount assessed as is  covered
 by  the bond shall be stayed. The taxpayer shall have the right to waive
 such stay at any time in respect of the whole or any part of the  amount
 covered  by  the bond, and if as a result of such waiver any part of the
 amount covered by the bond is paid, then the bond shall at  the  request
 S. 8474                            427
 
 of  the  taxpayer,  be  proportionately  reduced.  If any portion of the
 jeopardy assessment is abated,  or  if  a  notice  or  deficiency  under
 section  11-521  of  this  chapter is mailed to the taxpayer in a lesser
 amount,  the  bond shall, at the request of the taxpayer, be proportion-
 ately reduced.
   (i) Petition to tax appeals tribunal.  If the bond is given before the
 taxpayer has filed his or her petition  under  section  11-529  of  this
 chapter,  the  bond shall contain a further condition that if a petition
 is not filed within the period provided in such section, then the amount
 the collection of which is stayed by the bond, will be  paid  on  notice
 and  demand  at  any  time after the expiration of such period, together
 with interest thereon from the date of the jeopardy notice and demand to
 the date of notice and demand under this subdivision. The bond shall  be
 conditioned  upon  the payment of so much of such assessment, collection
 of which is stayed by the bond, as is not abated by a  decision  of  the
 tax appeals tribunal which has become final. If the tax appeals tribunal
 determines  that  the  amount  assessed is greater than the amount which
 should have been assessed, then the bond shall, at the  request  of  the
 taxpayer,  be  proportionately  reduced  when  the  decision  of the tax
 appeals tribunal is rendered.
   (j) Stay of sale of seized property pending tax appeals tribunal deci-
 sion. Where a jeopardy assessment is made, the property seized  for  the
 collection of the tax shall not be sold:
   (1)  if  subdivision  (b)  of this section is applicable, prior to the
 issuance of the notice of deficiency and  the  expiration  of  the  time
 provided  in  section  11-529 of this chapter for filing a petition with
 the tax appeals tribunal, and
   (2) if a petition is filed with  the  tax  appeals  tribunal,  whether
 before  or  after  the  making of such jeopardy assessment, prior to the
 expiration of the period during which the assessment of  the  deficiency
 would be prohibited if subdivision (a) of this section were not applica-
 ble.
   Such  property may be sold if the taxpayer consents to the sale, or if
 the commissioner of finance determines that the expenses of conservation
 and maintenance will greatly reduce the net proceeds, or if the property
 is perishable.
   (k) Interest. For the purpose of subdivision (a) of section 11-524  of
 this  chapter,  the last date prescribed for payment shall be determined
 without regard to any notice and demand for payment  issued  under  this
 section prior to the last date otherwise prescribed for such payment.
   (l)  Early termination of taxable year. If the commissioner of finance
 finds that a taxpayer designs quickly to depart from this  state  or  to
 remove  his  or her property therefrom, or to conceal himself or herself
 or his or her property therein, or to do any other act tending to preju-
 dice or to render wholly or partly ineffectual  proceedings  to  collect
 the income tax for the current or the preceding taxable year unless such
 proceedings  be brought without delay, the commissioner of finance shall
 declare the taxable period for such taxpayer immediately terminated, and
 shall cause notice of such finding and declaration to be  given  to  the
 taxpayer,  together  with  a demand for immediate payment of the tax for
 the taxable period so declared terminated and of the tax for the preced-
 ing taxable year or so much of such tax as is unpaid, whether or not the
 time otherwise allowed by law for filing return and paying the  tax  has
 expired; and such taxes shall thereupon become immediately due and paya-
 ble.  In any proceeding brought to enforce payment of taxes made due and
 payable by virtue of the provisions of this subdivision, the finding  of
 S. 8474                            428
 
 the  commissioner  of finance, whether made after notice to the taxpayer
 or not, shall be for all purposes presumptive evidence of jeopardy.
   (m)  Reopening  of  taxable period. Notwithstanding the termination of
 the taxable period of the taxpayer by the  commissioner  of  finance  as
 provided in subdivision (l) of this section, the commissioner of finance
 may  reopen  such  taxable period each time the taxpayer is found by the
 commissioner of finance to have  received  income,  within  the  current
 taxable  year, since the termination of such period. A taxable period so
 terminated by the commissioner of finance may be reopened by the taxpay-
 er if the taxpayer files with the commissioner of  finance  a  true  and
 accurate return of taxable income and credits allowed under this chapter
 for  taxable period, together with such other information as the commis-
 sioner of finance may by regulations prescribe.
   (n) Furnishing of bond where taxable year is closed by the commission-
 er of finance. Payment of taxes shall not be enforced by any proceedings
 under the provisions of subdivision (l) of this  section  prior  to  the
 expiration  of  the  time otherwise allowed for paying such taxes if the
 taxpayer furnishes, under regulations prescribed by the commissioner  of
 finance,  a bond to insure the timely making of returns with respect to,
 and payment of, such taxes or any taxes under  this  chapter  for  prior
 years.
    § 11-535 Criminal penalties; cross-reference. For criminal penalties,
 see chapter forty of this title.
   §  11-536  Armed forces relief provisions. (a) Time to be disregarded.
 In the case of an individual serving in the armed forces of  the  United
 States or serving in support of such armed forces, in an area designated
 by  the  president  of the United States by executive order as a "combat
 zone" at any time during the period designated by the president by exec-
 utive order as the period of  combatant  activities  in  such  zone,  or
 hospitalized  outside  the  state  as  a result of injury received while
 serving in such an area during such time, the period of service in  such
 area,  plus  the  period of continuous hospitalization outside the state
 attributable to such injury, and the next one hundred eighty days there-
 after, shall be disregarded  in  determining,  under  this  chapter,  in
 respect  of the tax liability, including any interest, penalty, or addi-
 tion to the tax, of such individual:
   (1) Whether any of the following acts was performed  within  the  time
 prescribed therefor:
   (A) filing any return of tax;
   (B)  payment  of  any  tax  or any installment thereof or of any other
 liability to the commissioner of finance, in respect thereof;
   (C) filing a petition with the tax  appeals  tribunal  for  credit  or
 refund or for redetermination of a deficiency, or application for review
 of a decision rendered by the tax appeals tribunal;
   (D) allowance of a credit or refund of tax;
   (E) filing a claim for credit or refund of tax;
   (F) assessment of tax;
   (G)  giving or making any notice or demand for the payment of any tax,
 or with respect to any liability  to  the  commissioner  of  finance  in
 respect of tax;
   (H)  collection,  by the commissioner of finance, by levy or otherwise
 of the amount of any liability in respect of tax;
   (I) bringing suit by the city, or  any  officer,  on  its  behalf,  in
 respect of any liability in respect of tax; and
 S. 8474                            429
 
   (J)  any  other act required or permitted under this chapter or speci-
 fied in regulations prescribed under this section by the commissioner of
 finance.
   (2) The amount of any credit or refund (including interest).
   (b)  Action  taken  before  ascertainment  of  right  to benefits. The
 assessment or collection of the tax imposed by this chapter  or  of  any
 liability  to the commissioner of finance in respect of such tax, or any
 action or proceeding by or on behalf of the commissioner of  finance  in
 connection  therewith,  may  be  made,  taken,  begun,  or prosecuted in
 accordance with law, without regard to the provisions of subdivision (a)
 of this section, unless prior to such assessment, collection, action, or
 proceeding it is ascertained that the person concerned  is  entitled  to
 the benefit of subdivision (a) of this section.
   (c) Members of armed forces dying in action. In the case of any person
 who  dies during an induction period while in active service as a member
 of the armed forces of the United States, if such death  occurred  while
 serving in a combat zone during a period of combatant activities in such
 zone, as described in subdivision (a) of this section, or as a result of
 wounds,  disease or injury incurred while so serving, the tax imposed by
 this chapter shall not apply with respect to the taxable year  in  which
 falls  the  date  of  such  person's death, or with respect to any prior
 taxable year ending on or after the first day he or she so served  in  a
 combat  zone,  and no returns shall be required in behalf of such person
 or such person's estate for such year; and the tax for any such  taxable
 year  which  is unpaid at the date of his or her death, including inter-
 est, additions to tax and penalties, if any, shall not be  assessed  and
 if  assessed, the assessment shall be abated and, if collected, shall be
 refunded to the legal representative of such person's estate if one  has
 been  appointed  and  has  qualified, or, if no legal representative has
 been appointed or has qualified, to such person's surviving spouse.
   § 11-537  General powers of commissioner of finance. (a) General.  The
 commissioner of finance shall administer and enforce the tax imposed  by
 this  chapter  and the commissioner is authorized to make such rules and
 regulations, and to require such facts and information to  be  reported,
 as  the commissioner may deem necessary to enforce the provision of this
 chapter; and the commissioner may delegate  his or her powers and  func-
 tions under all parts of this chapter to one of the commissioner's depu-
 ties or to any employee or employees of the commissioner's department.
   (b)  Examination  of books and witnesses.  The commissioner of finance
 for the purpose of ascertaining the correctness of any  return,  or  for
 the purpose of making an estimate of tax of any person, shall have power
 to  examine or to cause to have examined, by any agent or representative
 designated by the commissioner for  that  purpose,  any  books,  papers,
 records or memoranda bearing upon the matters required to be included in
 the  return,  and may require the attendance of the person rendering the
 return or any officer or employee of such person, or the  attendance  of
 any other person having knowledge in the premises, and may take testimo-
 ny  and  require proof material for the commissioner's information, with
 power to administer oaths to such person or persons.
   (c) Abatement authority.  The commissioner of finance, of his  or  her
 own  motion,  may abate any small unpaid balance of an assessment of tax
 under this part, or any  liability in respect thereof,  if  the  commis-
 sioner  of  finance  determines  under  uniform  rules prescribed by the
 commissioner that the administration and collection costs involved would
 not warrant collection of the amount due.   The  commissioner  may  also
 abate, of his or her own motion, the unpaid portion of the assessment of
 S. 8474                            430

 any  tax  or  any  liability  in  respect thereof, which is excessive in
 amount, or is assessed after the expiration of the period of  limitation
 properly  applicable  thereto,  or is erroneously or illegally assessed.
 No  claim  for  abatement  under  this subdivision shall be filed by   a
 taxpayer.
   (d) Special refund authority.  Where no questions of fact or  law  are
 involved  and it appears from the records of the commissioner of finance
 that any moneys have been erroneously or illegally  collected  from  any
 taxpayer or other person, or paid by such taxpayer or other person under
 a  mistake  of  facts,  pursuant  to the provisions of this chapter, the
 commissioner of finance at any time, without regard  to  any  period  of
 limitations,  shall  have  the power, upon making a record of his or her
 reasons therefor in writing, to cause such  moneys  so  paid  and  being
 erroneously and illegally held to be refunded.
   (e)  Cooperation  with the United States, this state and other states.
 Notwithstanding the provisions of section 11-538 of  this  chapter,  the
 commissioner  of finance may permit the secretary of the treasury of the
 United States or the secretary's delegates, or  the  proper  officer  of
 this or any other state imposing an income tax upon the incomes of indi-
 viduals,  or  the  authorized  representative  of  any  such officer, to
 inspect any return filed under this chapter or may furnish to such offi-
 cer or his or her authorized representative  an  abstract  of  any  such
 return  or  supply  such  officer  with  information  concerning an item
 contained in any such return, or disclosed by any investigation  of  tax
 liability  under  this  chapter, but such permission shall be granted or
 such information furnished to such officer or such  officer's  represen-
 tative  only  if  the laws of the United States or of such state, as the
 case may be, grant substantially similar privileges to the  commissioner
 of finance and such information is to be used for tax purposes only; and
 provided  further  the commissioner of finance may furnish to the secre-
 tary of the treasury of the United States or the  secretary's  delegates
 or  to the tax commission of the state of New York or its delegates such
 returns filed under this chapter and other tax information, as he or she
 may consider proper for use in court actions or  proceedings  under  the
 internal  revenue  code or the tax law of the state of New York, whether
 civil or criminal, where a written request therefor has been made to the
 commissioner of finance by the secretary of the treasury or by such  tax
 commission or by their delegates, provided the laws of the United States
 or  the laws of the state of New York grant substantially similar powers
 to the secretary of the treasury of the United States or the secretary's
 delegates or to such tax commission or its delegates.  Where the commis-
 sioner of finance has so authorized use of returns or other  information
 in such actions or proceedings, officers and employees of the department
 of finance may testify in such actions or proceedings in respect to such
 returns or other information.
   (f)  (1)  Authority to set interest rates. The commissioner of finance
 shall set the overpayment and underpayment rates of interest to be  paid
 pursuant  to  sections 11-524, 11-525 and 11-528 of this chapter, but if
 no such rate or rates of interest are set, such overpayment  rate  shall
 be  deemed to be set at six percent per annum and such underpayment rate
 shall be deemed to be set at seven and one-half percent per annum.  Such
 overpayment  and  underpayment  rates  shall  be the rates prescribed in
 paragraph two of this subdivision, but the underpayment rate  shall  not
 be less than seven and one-half percent per annum. Any such rates set by
 the  commissioner of finance shall apply to taxes, or any portion there-
 of, which remain or become due or overpaid on or after the date on which
 S. 8474                            431
 
 such rates become effective and shall apply only with respect to  inter-
 est  computed or computable for periods or portions of periods occurring
 in the period during which such rates are in effect.
   (2) General rule. (A) Overpayment rate. The overpayment rate set under
 this  subdivision shall be the sum of (i) the federal short-term rate as
 provided under paragraph  three  of  this  subdivision,  plus  (ii)  two
 percentage points.
   (B)  Underpayment  rate. The underpayment rate set under this subdivi-
 sion shall be the sum of (i) the federal  short-term  rate  as  provided
 under  paragraph  three  of this subdivision, plus (ii) seven percentage
 points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A) The federal short-term rate for any month  shall  be  the  federal
 short-term  rate determined by the United States secretary of the treas-
 ury during such month in  accordance  with  subsection  (d)  of  section
 twelve  hundred  seventy-four  of  the  internal revenue code for use in
 connection with section six  thousand  six  hundred  twenty-one  of  the
 internal  revenue  code.  Any  such rate shall be rounded to the nearest
 full percent, or, if a multiple of one-half of one  percent,  such  rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i)  In  general.  Except  as provided in clause (ii) of this subpara-
 graph, the federal short-term rate for the first month in each  calendar
 quarter  shall  apply  during the first calendar quarter beginning after
 such month.
   (ii) Special rule for the month of September, nineteen hundred  eight-
 y-nine.  The  federal  short-term  rate for the month of April, nineteen
 hundred eighty-nine shall apply with respect to setting the  overpayment
 and  underpayment  rates  for  the  month of September, nineteen hundred
 eighty-nine.
   (4) Publication of interest rates. The commissioner of  finance  shall
 cause  to  be  published  in the City Record, and give other appropriate
 general notice of, the interest rates to be set under  this  subdivision
 no  later than twenty days preceding the first day of the calendar quar-
 ter during which such interest rates apply. The setting and  publication
 of  such  interest  rates  shall not be included within paragraph (a) of
 subdivision five of section one thousand forty-one of the  city  charter
 of  the  preceding  municipality  as  it existed January first, nineteen
 hundred ninety-four relating to the definition of a rule.
   (5) Cross-reference. For provisions  relating  to  the  power  of  the
 commissioner of finance to abate small amounts of interest, see subdivi-
 sion (c) of this section.
   (g)  In computing the amount of any interest required to be paid under
 this chapter by the commissioner of finance or by the taxpayer,  or  any
 other  amount  determined  by reference to such amount of interest, such
 interest and such amount shall be compounded daily.  The  provisions  of
 this subdivision shall not apply for purposes of computing the amount of
 any  addition  to tax for failure to pay estimated tax under subdivision
 (c) of section 11-525 of this chapter.
   § 11-538 Secrecy requirement  and  the  penalties  for  violation.  1.
 Except in accordance with proper judicial order or as otherwise provided
 by  law,  it  shall  be  unlawful  for  the commissioner of finance, the
 department of finance of the  city,  any  officer  or  employee  of  the
 department  of  finance  of  the city, any person engaged or retained by
 such department on an independent  contract  basis,  any  depository  to
 which  any  return  may  be delivered as provided in subdivision four of
 S. 8474                            432
 
 this section, any officer  or  employee  of  such  depository,  the  tax
 appeals  tribunal, any commissioner or employee of such tribunal, or any
 person who, pursuant to this section, is permitted to inspect any report
 or  return  or to whom a copy, an abstract or a portion of any report or
 return is furnished, or to whom any information contained in any  report
 or  return  is  furnished,  to  divulge  or make known in any manner the
 amount of income or any particulars set forth or disclosed in any report
 or return required under this chapter. The  officers  charged  with  the
 custody of such reports and returns shall not be required to produce any
 of  them  or  evidence  of  anything  contained in them in any action or
 proceeding in any court, except on behalf of the city in  an  action  or
 proceeding  under  the provisions of this chapter or in any other action
 or proceeding involving the collection of a tax due under  this  chapter
 to which the city is a party or a claimant, or on behalf of any party to
 any  action  or proceeding under the provisions of this chapter when the
 reports, returns or facts shown thereby are directly  involved  in  such
 action  or  proceeding, in any of which events the court may require the
 production of, and may admit in  evidence,  so  much  of  said  reports,
 returns or of the facts shown thereby, as are pertinent to the action or
 proceeding  and  no more.  Nothing herein shall be construed to prohibit
 the delivery to a taxpayer or to the taxpayer's duly  authorized  repre-
 sentative  of  a  certified  copy  of  any  return  or  report  filed in
 connection with his or her tax or to prohibit the publication of statis-
 tics so classified  as  to  prevent  the  identification  of  particular
 reports  or  returns  and  the  items  thereof, or the inspection by the
 corporation counsel or other legal representatives of the  city  of  the
 report  or return of any taxpayer who shall bring action to set aside or
 review the tax based thereon, or against whom an  action  or  proceeding
 under  this  chapter has been recommended by the commissioner of finance
 or the corporation counsel or has been instituted, or the inspection  of
 the  reports  or  returns required under this chapter by the duly desig-
 nated officers or employees of the city for purposes of an  audit  under
 this  chapter  or  an  audit authorized by the enacting of this chapter.
 Reports and returns shall be preserved for three  years  and  thereafter
 until the commissioner of finance orders them to be destroyed.
   2.  Any  officer  or  employee  of the city or the state who willfully
 violates the provisions of subdivision one  of  this  section  shall  be
 dismissed  from  office and be incapable of holding any public office in
 the city or the state for a period of five years thereafter.
   3. Cross-reference: For criminal penalties, see chapter forty of  this
 title.
   4.  Notwithstanding the provisions of subdivision one of this section,
 the commissioner of finance, in his or her discretion,  may  require  or
 permit any or all persons liable for any tax imposed by this chapter, to
 make payments on account of estimated tax and payment of any tax, penal-
 ty or interest imposed by this chapter to banks, banking houses or trust
 companies designated by the commissioner of finance and to file declara-
 tions  of estimated tax and reports and returns with such banks, banking
 houses or trust companies as agents of the commissioner of  finance,  in
 lieu of making any such payment directly to the commissioner of finance.
 However,  the  commissioner  of finance shall designate only such banks,
 banking houses or trust  companies  as  are  depositories  or  financial
 agents of the city.
   5. This section  shall be deemed a state statute for purposes of para-
 graph (a) of subdivision two of section eighty-seven of the public offi-
 cers law.
 S. 8474                            433
 
   6.  Notwithstanding anything in subdivision one of this section to the
 contrary, if a taxpayer has petitioned  the  tax  appeals  tribunal  for
 administrative  review as provided in section one hundred seventy of the
 charter of the preceding municipality as it existed January first, nine-
 teen  hundred  ninety-four, the commissioner of finance shall be author-
 ized to present to the tribunal any report or return of  such  taxpayer,
 or  any  information contained therein or relating thereto, which may be
 material or relevant to the proceeding  before  the  tribunal.  The  tax
 appeals  tribunal  shall be authorized to publish a copy or a summary of
 any decision rendered pursuant to section one hundred seventy-one of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four.
   7. Notwithstanding anything in subdivision one of  this  section,  the
 commissioner  of  finance  may  disclose  to  a taxpayer or a taxpayer's
 related member, as defined in subdivision (e) of section 11-506 of  this
 chapter,  information relating to any royalty paid, incurred or received
 by such taxpayer or related member to or from the other,  including  the
 treatment  of such payments by the taxpayer or the related member in any
 report or return transmitted to the commissioner of finance  under  this
 title.
   §  11-539   Inconsistencies with other laws.  If any provision of this
 chapter is inconsistent with, in conflict with, or contrary to any other
 provision of law, such provision of this chapter shall prevail over such
 other provision and such other provision shall be deemed  to  have  been
 amended,  superseded  or  repealed  to the extent of such inconsistency,
 conflict or contrariety.
   § 11-540  Disposition of revenues.   All revenues resulting  from  the
 imposition of the taxes under this chapter shall be paid into the treas-
 ury  of  the  city and shall be credited to and deposited in the general
 fund of the city, but no part of such revenues may  be  expended  unless
 appropriated in the annual budget of the city.
 
                                 CHAPTER 6
                               CITY BUSINESS
                                   TAXES
                               SUBCHAPTER 1
                            GENERAL PROVISIONS
   § 11-601 Definitions. When used in subchapters one through five:
   1.  "Taxpayer"  means  any corporation, association or other entity or
 individual subject to tax under this chapter;
   2. "State", "the state" or "this state" means the state of New York;
   3. "Tax law", "insurance law", "private housing finance  law",  "envi-
 ronmental  conservation law", "public housing law", "state finance law",
 "general municipal law", "public service  law",  "workers'  compensation
 law", "business corporation law", "civil practice law and rules", "crim-
 inal procedure law", and "banking law" refer to laws of the state;
   4.  "Superintendent  of insurance", and "commissioner of health" refer
 to officials of the state;
   5.  "Commissioner of finance" means the commissioner of finance of the
 city;
   6. "Department of finance" means the  department  of  finance  of  the
 city;
   7. "Domestic corporation" means a corporation organized under the laws
 of the state; and
 S. 8474                            434
 
   8.  "Tax  appeals tribunal" means the tax appeals tribunal established
 by section one hundred sixty-eight of the charter of the preceding muni-
 cipality as it existed January first, nineteen hundred ninety-four.
   9.  "REIT"  means a real estate investment trust as defined in section
 eight hundred fifty-six of the internal revenue code.
   10. "RIC" means a regulated investment company as defined  in  section
 eight hundred fifty-one of the internal revenue code.
   11. "Captive REIT" means a REIT (a) that is not regularly traded on an
 established  securities  market,  and (b) more than fifty percent of the
 voting stock of which is owned or controlled, directly or indirectly, by
 a single corporation that is not exempt from federal income tax  and  is
 not  a  REIT.  Any  voting  stock in a REIT that is held in a segregated
 asset account of a life insurance corporation, as described  in  section
 eight hundred seventeen of the internal revenue code, shall not be taken
 into  account  for  purposes  of determining whether a REIT is a captive
 REIT.
   12. "Captive RIC" means a RIC (a) that is not regularly traded  on  an
 established  securities  market,  and (b) more than fifty percent of the
 voting stock of which is owned or controlled, directly or indirectly, by
 a single corporation that is not exempt from federal income tax  and  is
 not  a RIC. Any voting stock in a RIC that is held in a segregated asset
 account of a life insurance corporation, as described in  section  eight
 hundred  seventeen of the internal revenue code, shall not be taken into
 account for purposes of determining whether a RIC is a captive RIC.
   13. Unless a different meaning is clearly required, any term  used  in
 this  chapter  shall  have the same meaning as when used in a comparable
 context in the laws of the United  States  relating  to  federal  income
 taxes, and any reference to the laws of the United States shall mean the
 provisions  of the internal revenue code of nineteen hundred fifty-four,
 and amendments thereto, and other provisions of the laws of  the  United
 States relating to federal income taxes, as the same are included in the
 appendix  to  this  chapter.  The quotation of the aforesaid laws of the
 United States is intended to make them a part of any appropriate chapter
 and to avoid constitutional uncertainties which  might  result  if  such
 laws  were  merely  incorporated  by  reference.    The  quotation  of a
 provision of the federal internal revenue code or of any  other  law  of
 the United States shall not necessarily mean that it is applicable to or
 has relevance to any of the chapters.
 
                               SUBCHAPTER 2
                          GENERAL CORPORATION TAX
 
   § 11-602 Definitions. When used in this subchapter:
   1. (a) "Corporation" includes (1) an association within the meaning of
 paragraph  three  of subsection (a) of section seventy-seven hundred one
 of the internal revenue code, including a limited liability company, (2)
 a joint-stock company or association, (3) a publicly traded  partnership
 treated  as  a  corporation  for  purposes  of the internal revenue code
 pursuant to section seventy-seven hundred four thereof and (4) any busi-
 ness conducted by a trustee or trustees wherein interest or ownership is
 evidenced by certificate or other written instrument;
   (b) (1) Notwithstanding paragraph (a) of this subdivision, an unincor-
 porated organization that (i) is described in subparagraph one or  three
 of  such paragraph (a) and (ii) was subject to the provisions of chapter
 five of this title for its taxable year beginning  in  nineteen  hundred
 ninety-five,  may make a one-time election not to be treated as a corpo-
 S. 8474                            435
 
 ration and, instead, to continue to be  subject  to  the  provisions  of
 chapter  five  of this title for its taxable years beginning in nineteen
 hundred ninety-six and thereafter. Such election shall be  made  on  the
 return prescribed pursuant to such chapter five for such electing organ-
 ization's  taxable  year beginning in nineteen hundred ninety-six, which
 shall be filed on or before the due  date,  determined  with  regard  to
 extensions, for filing such return.
   (2)  An  election  under this paragraph shall continue to be in effect
 until revoked by the unincorporated organization. An election under this
 paragraph shall be revoked by the filing of a return under this subchap-
 ter for the first taxable year with respect to which such revocation  is
 to  be effective, which return shall be filed on or before the due date,
 determined with regard to extensions, for  filing  such  return.  In  no
 event shall such election or revocation be for a part of a taxable year.
   (c)  Notwithstanding  paragraph (a) of this subdivision, a corporation
 shall not include an entity classified  as  a  partnership  for  federal
 income tax purposes.
   2.  "Subsidiary" means a corporation of which over fifty per centum of
 the number of shares of stock entitling the holders thereof to vote  for
 the election of directors or trustees is owned by the taxpayer;
   3. "Subsidiary capital" means investments in the stock of subsidiaries
 and any indebtedness from subsidiaries, exclusive of accounts receivable
 acquired  in  the  ordinary  course  of  trade  or business for services
 rendered or for sales of property held primarily for sale to  customers,
 whether or not evidenced by written instrument, on which interest is not
 claimed  and  deducted  by the subsidiary for purposes of taxation under
 this subchapter or subchapter three of this chapter, provided,  however,
 that,  in  the discretion of the commissioner of finance, there shall be
 deducted from subsidiary capital any liabilities which are  directly  or
 indirectly attributable to subsidiary capital;
   4.  "Investment  capital" means investments in stocks, bonds and other
 securities, corporate and governmental, not held for sale  to  customers
 in  the  regular course of business, exclusive of subsidiary capital and
 stock issued by the taxpayer, provided, however, that, in the discretion
 of the commissioner of finance, there shall be deducted from  investment
 capital any liabilities which are directly or indirectly attributable to
 investment capital; and provided, further, that investment capital shall
 not  include any such investments the income from which is excluded from
 entire net income pursuant to  the  provisions  of  paragraph  (c-1)  of
 subdivision  eight of this section, and that investment capital shall be
 computed without  regard  to  any  liabilities  directly  or  indirectly
 attributable  to such investments, but only if air carriers organized in
 the United States and operating in the foreign country or  countries  in
 which  the  taxpayer has its major base of operations and in which it is
 organized, resident or headquartered, if not in the same country as  its
 major  base  of operations, are not subject to any tax based on or meas-
 ured by capital imposed by such foreign  country  or  countries  or  any
 political  subdivision  thereof,  or if taxed are provided an exemption,
 equivalent to that provided for herein, from any tax based on  or  meas-
 ured  by  capital  imposed by such foreign country or countries and from
 any such tax imposed by any political subdivision thereof;
   5. "Investment income" means income, including capital gains in excess
 of capital losses, from investment capital to  the  extent  included  in
 computing  entire net income, less, (a) in the discretion of the commis-
 sioner of finance, any deductions  allowable  in  computing  entire  net
 income which are directly or indirectly attributable to investment capi-
 S. 8474                            436
 
 tal or investment income, and (b) such portion of any net operating loss
 deduction  allowable  in  computing entire net income, as the investment
 income, before such deduction, bears to entire net income,  before  such
 deduction,  provided,  however,  that in no case shall investment income
 exceed entire net income;
   6. (a) "Business capital" means  all  assets,  other  than  subsidiary
 capital,  investment  capital  and  stock  issued  by the taxpayer, less
 liabilities not deducted from subsidiary or  investment  capital  except
 that  cash on hand and on deposit shall be treated as investment capital
 or as business capital as the taxpayer may elect;
   (b) Provided, however, "business capital" shall not include assets  to
 the  extent  employed  for  the  purpose  of  generating income which is
 excluded from entire net income pursuant to the provisions of  paragraph
 (c-1) of subdivision eight of this section and shall be computed without
 regard  to  liabilities  directly  or  indirectly  attributable  to such
 assets, but only if air carriers organized  in  the  United  States  and
 operating  in the foreign country or countries in which the taxpayer has
 its major base of operations and in which it is organized,  resident  or
 headquartered,  if  not  in  the same country as its major base of oper-
 ations, are not subject to any tax  based  on  or  measured  by  capital
 imposed  by  such foreign country or countries or any political subdivi-
 sion thereof, or if taxed, are provided an exemption, equivalent to that
 provided for herein, from any  tax  based  on  or  measured  by  capital
 imposed  by  such  foreign  country  or  countries and from any such tax
 imposed by any political subdivision thereof.
   7. "Business income" means entire net income minus investment income;
   8. "Entire net income" means total net income from all sources,  which
 shall  be  presumably  the  same  as  the entire taxable income, but not
 alternative minimum taxable income,
   (i) which the taxpayer is required to  report  to  the  United  States
 treasury department, or
   (ii)  which  the  taxpayer  would  have been required to report to the
 United States treasury department if it had not made an  election  under
 subchapter s of chapter one of the internal revenue code, or
   (iii) which the taxpayer, in the case of a corporation which is exempt
 from  federal income tax, other than the tax on unrelated business taxa-
 ble income imposed under section five hundred  eleven  of  the  internal
 revenue  code,  but which is subject to tax under this subchapter, would
 have been required to report to the United  States  treasury  department
 but for such exemption, or
   (iv)  which  the  taxpayer  would  have been required to report to the
 United States treasury department if no election had been made to  treat
 the  taxpayer  as  a  qualified  subchapter s subsidiary under paragraph
 three of subsection (b) of section thirteen  hundred  sixty-one  of  the
 internal revenue code, except as provided in this paragraph, and subject
 to  any  modification  required by paragraphs (d) and (e) of subdivision
 three of section 11-604 of this subchapter.
   (a) Entire net income shall not include:
   (1) income, gains and losses from  subsidiary  capital  which  do  not
 include the amount of a recovery in respect of any war loss;
   (2)  fifty  percent  of dividends other than from subsidiaries, except
 that entire net income shall include one hundred percent of dividends on
 shares of stock with respect to which a dividend deduction is disallowed
 by subsection (c) of section  two  hundred  forty-six  of  the  internal
 revenue code;
 S. 8474                            437

   (2-a)  any  amounts  treated as dividends pursuant to section seventy-
 eight of the internal revenue code and not  otherwise  deductible  under
 subparagraphs one and two of this paragraph;
   (3) bona fide gifts;
   (4) income and deductions with respect to amounts received from school
 districts and from corporations and associations, organized and operated
 exclusively  for  religious, charitable or educational purposes, no part
 of the net earnings of which inures to the benefit of any private share-
 holder or individual, for the operation of school buses;
   (5) any refund or credit of a  tax  imposed  under  this  chapter,  or
 imposed  by  article nine or nine-A or thirty-two of the tax law as such
 article was in effect on December thirty-first, two  thousand  fourteen,
 for  which  tax no exclusion or deduction was allowed in determining the
 taxpayer's entire net income under this subchapter or  subchapter  three
 of this chapter for any prior year;
   (6)  in  the case of a taxpayer who is separately or as a partner of a
 partnership doing an insurance business as a  member  of  the  New  York
 insurance  exchange described in section six thousand two hundred one of
 the insurance law, any item of income, gain, loss or deduction  of  such
 business  which  is  the  taxpayer's  distributive or pro rata share for
 federal income tax purposes or which the taxpayer is  required  to  take
 into account separately for federal income tax purposes;
   (7)  that portion of wages and salaries paid or incurred for the taxa-
 ble year for which a deduction is not allowed pursuant to the provisions
 of section two hundred eighty C of the internal revenue code;
   (8) for taxable years beginning after December thirty-first,  nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass  commuting vehicle described in subparagraph (D) of paragraph eight
 of subsection (f) of section one hundred  sixty-eight  of  the  internal
 revenue code, relating to qualified mass commuting vehicles, and proper-
 ty  of  a  taxpayer  principally  engaged in the conduct of an aviation,
 steamboat, ferry or navigation business, or two or more  of  such  busi-
 nesses,  which  is  placed  in service before taxable years beginning in
 nineteen hundred eighty-nine,  any  amount  which  is  included  in  the
 taxpayer's federal taxable income solely as a result of an election made
 pursuant  to  the provisions of such paragraph eight as it was in effect
 for agreements entered into prior to  January  first,  nineteen  hundred
 eighty-four;
   (9)  for taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, and proper-
 ty of a taxpayer principally engaged in  the  conduct  of  an  aviation,
 steamboat,  ferry  or  navigation business, or two or more of such busi-
 nesses, which is placed in service before  taxable  years  beginning  in
 nineteen  hundred  eighty-nine, any amount which the taxpayer could have
 excluded from federal taxable  income  had  it  not  made  the  election
 provided  for in such paragraph eight as it was in effect for agreements
 entered into prior to January first, nineteen hundred eighty-four;
   (10) the amount deductible pursuant to paragraph (j) of this  subdivi-
 sion;
   (11)  upon  the disposition of property to which paragraph (j) of this
 subdivision applies, the amount, if any, by which the aggregate  of  the
 amounts described in subparagraph eleven of paragraph (b) of this subdi-
 vision  attributable  to  such  property  exceeds  the  aggregate of the
 S. 8474                            438
 
 amounts described in paragraph (j) of this subdivision  attributable  to
 such property;
   (12) for taxable years ending after September tenth, two thousand one,
 the amount deductible pursuant to paragraph (k) of this subdivision;
   (13)  the amount deductible pursuant to paragraph (o) of this subdivi-
 sion;
   (14) any amount excepted, for purposes of subsection  (a)  of  section
 one  hundred  eighteen  of  the  internal  revenue  code,  from the term
 "contribution to the capital  of  the  taxpayer"  by  paragraph  two  of
 subsection  (b)  of section one hundred eighteen of the internal revenue
 code;
   (15) the amount of any gain added back to determine entire net  income
 in  a  previous  taxable year pursuant to subparagraph nineteen of para-
 graph (b) of this subdivision that is included in federal  gross  income
 for the taxable year; and
   (16)  the  amount  of  any  grant received through either the COVID-19
 pandemic small business recovery  grant  program,  pursuant  to  section
 sixteen-ff  of  the New York state urban development corporation act, or
 the small business resilience grant program administered by the  depart-
 ment of small business services, to the extent the amount of either such
 grant is included in federal taxable income.
   (a-1)  Notwithstanding  any  other  provision  of this subchapter, for
 taxable years beginning on or after August first, two thousand  two,  in
 the case of a taxpayer that is a partner in a partnership subject to the
 tax  imposed by chapter eleven of this title as a utility, as defined in
 subdivision six of section 11-1101 of such chapter,  entire  net  income
 shall  not  include  the  taxpayer's  distributive or pro rata share for
 federal income tax purposes  of  any  item  of  income,  gain,  loss  or
 deduction  of  such  partnership,  or  any item of income, gain, loss or
 deduction of such partnership that the taxpayer is required to take into
 account separately for federal income tax purposes.
   (b) Entire net income  shall  be  determined  without  the  exclusion,
 deduction or credit of:
   (1)  the amount of any specific exemption or credit allowed in any law
 of the United States imposing any tax on or measured by  the  income  of
 any corporation,
   (2)  any  part of any income from dividends or interest on any kind of
 stock, securities, or indebtedness, except as provided  in  clauses  one
 and two of paragraph (a) of this subdivision,
   (3)  taxes  on or measured by profits or income paid or accrued to the
 United States, any of its possessions or to any foreign country, includ-
 ing taxes in lieu of any of  the  foregoing  taxes  otherwise  generally
 imposed  by  any  foreign  country  or  by  any possession of the United
 States, or taxes on or measured by profited or income paid or accrued to
 the state or any subdivision thereof, including taxes  paid  or  accrued
 under  article nine, nine-A, thirteen-A, twenty-four-A, or twenty-four-B
 of the tax law or under article thirty-two of the tax law as such  arti-
 cle was in effect on December thirty-first, two thousand fourteen,
   (3-a)  taxes  on  or  measured  by profits or income, or which include
 profits or income as a measure, paid or accrued to any  other  state  of
 the  United  States,  or  any  political  subdivision thereof, or to the
 District of Columbia, including taxes expressly in lieu of  any  of  the
 foregoing  taxes  otherwise  generally imposed by any other state of the
 United States, or any political subdivision thereof, or the District  of
 Columbia;
   (4) taxes imposed under this chapter,
 S. 8474                            439
 
   (4-a) (A) the entire amount allowable as an exclusion or deduction for
 stock  transfer taxes imposed by article twelve of the tax law in deter-
 mining the entire taxable income  which  the  taxpayer  is  required  to
 report  to  the United States treasury department but only to the extent
 that such taxes are incurred and paid in market making transactions, and
   (B)  the amount allowed as an exclusion or deduction for sales and use
 taxes imposed by section eleven hundred seven of the tax law  in  deter-
 mining  the  entire  taxable  income  which  the taxpayer is required to
 report to the United States treasury department but only such portion of
 such exclusion or deduction which is not in excess of the amount of  the
 credit  allowed pursuant to subdivision twelve of section 11-604 of this
 subchapter,
   (4-b) the amount allowed as an exclusion or a deduction imposed by the
 tax law in determining the entire taxable income which the  taxpayer  is
 required  to  report  to  the United States treasury department but only
 such portion of such exclusion or deduction which is not  in  excess  of
 the  amount  of  the  credit allowed pursuant to subdivision thirteen of
 section 11-604 of this subchapter,
   (4-c) the amount allowed as an exclusion or a deduction imposed by the
 tax law in determining the entire taxable income which the  taxpayer  is
 required  to  report  to  the United States treasury department but only
 such portion of such exclusion or deduction which is not  in  excess  of
 the  amount  of  the  credit allowed pursuant to subdivision fourteen of
 section 11-604 of this subchapter,
   (4-d) the amount allowed as an exclusion or deduction  for  sales  and
 use  taxes  imposed  by  section  eleven hundred seven of the tax law in
 determining the entire taxable income which the taxpayer is required  to
 report  to  the United States Treasury Department, but only such portion
 of such exclusion or deduction which is not in excess of the  amount  of
 the  credit allowed pursuant to subdivision fifteen of section 11-604 of
 this chapter,
   (4-g) The amount allowed as an exclusion or deduction  for  sales  and
 use taxes imposed by section eleven hundred seven of the tax law, or for
 any  interest imposed in connection therewith, in determining the entire
 taxable income which the taxpayer is required to report  to  the  United
 States  treasury  department  but only such portion of such exclusion or
 deduction which is not in excess of the amount  of  the  credit  allowed
 pursuant  to  subdivision seventeen-a of section 11-604 of this subchap-
 ter.
   (6) in the discretion of the commissioner of finance,  any  amount  of
 interest  directly  or indirectly and any other amount directly or indi-
 rectly attributable as a carrying  charge  or  otherwise  to  subsidiary
 capital or to income, gains or losses from subsidiary capital,
   (7)  any  amount  by  reason of the granting, issuing or assuming of a
 restricted stock option, as defined in  the  internal  revenue  code  of
 nineteen  hundred  fifty-four, or by reason of the transfer of the share
 of stock upon the exercise of the option, unless such share is  disposed
 of  by  the  grantee of the option within two years from the date of the
 granting of the option or within six months after the transfer  of  such
 share to the grantee,
   (8)  in  the case of a taxpayer who is separately or as a partner of a
 partnership doing an insurance business as a  member  of  the  New  York
 insurance  exchange described in section six thousand two hundred one of
 the insurance law, such taxpayer's distributive or pro rata share of the
 allocated entire  net  income  of  such  business  as  determined  under
 sections  fifteen hundred three and fifteen hundred four of the tax law,
 S. 8474                            440
 
 provided however, in the event such allocated entire  net  income  is  a
 loss,  such taxpayer's distributive or pro rata share of such loss shall
 not be subtracted from federal taxable income in  computing  entire  net
 income under this subdivision,
   (9)  for taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, and proper-
 ty of a taxpayer principally engaged in  the  conduct  of  an  aviation,
 steamboat,  ferry  or  navigation business, or two or more of such busi-
 nesses, which is placed in service before  taxable  years  beginning  in
 nineteen hundred eighty-nine, any amount which the taxpayer claimed as a
 deduction  in computing its federal taxable income solely as a result of
 an election made pursuant to the provisions of such paragraph  eight  as
 it  was  in  effect  for agreements entered into prior to January first,
 nineteen hundred eighty-four,
   (10) for taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, and proper-
 ty of a taxpayer principally engaged in  the  conduct  of  an  aviation,
 steamboat,  ferry  or  navigation business, or two or more of such busi-
 nesses, which is placed in service before  taxable  years  beginning  in
 nineteen  hundred  eighty-nine, any amount which the taxpayer would have
 been required to include in  the  computation  of  its  federal  taxable
 income had it not made the election permitted pursuant to such paragraph
 eight  as  it was in effect for agreements entered into prior to January
 first, nineteen hundred eighty-four,
   (11) in the case of property placed in service in taxable years begin-
 ning before nineteen hundred ninety-four, for  taxable  years  beginning
 after  December  thirty-first,  nineteen hundred eighty-one, except with
 respect to property subject to the provisions  of  section  two  hundred
 eighty-F   of  the  internal  revenue  code,  property  subject  to  the
 provisions of section one hundred sixty-eight of  the  internal  revenue
 code which is placed in service in this state in taxable years beginning
 after  December  thirty-first, nineteen hundred eighty-four and property
 of a taxpayer principally engaged in the conduct of an aviation,  steam-
 boat,  ferry  or navigation business, or two or more of such businesses,
 which is placed in service before taxable years  beginning  in  nineteen
 hundred  eighty-nine,  the  amount  allowable  as a deduction determined
 under section one hundred sixty-eight of the internal revenue code,
   (12) upon the disposition of property to which paragraph (j)  of  this
 subdivision  applies,  the amount, if any, by which the aggregate of the
 amounts described in such paragraph (j) attributable  to  such  property
 exceeds the aggregate of the amounts described in subparagraph eleven of
 this paragraph attributable to such property,
   (13) for taxable years ending after September tenth, two thousand one,
 in  the  case  of  qualified  property  described  in  paragraph  two of
 subsection k of section one hundred sixty-eight of the internal  revenue
 code,  other  than qualified resurgence zone property described in para-
 graph (m) of this subdivision, and other than qualified New York Liberty
 Zone property described in paragraph two  of  subsection  b  of  section
 fourteen  hundred  L  of  the  internal  revenue code, without regard to
 clause (i) of subparagraph (C) of such paragraph, the  amount  allowable
 S. 8474                            441
 
 as  a  deduction  under  section one hundred sixty-seven of the internal
 revenue code,
   (14)  for taxable years beginning on or after January first, two thou-
 sand four, in the case of a taxpayer that is not an eligible  farmer  as
 defined in subsection (n) of section six hundred six of the tax law, the
 amount allowable as a deduction under sections one hundred seventy-nine,
 one  hundred  sixty-seven  and  one  hundred sixty-eight of the internal
 revenue code with respect to a sport  utility  vehicle  that  is  not  a
 passenger  automobile  as defined in paragraph five of subsection (d) of
 section two hundred eighty F of the internal revenue code,
   (15) the amount of any  deduction  allowed  pursuant  to  section  one
 hundred ninety-nine of the internal revenue code,
   (16) the amount of any federal deduction for taxes imposed under arti-
 cle twenty-three of the tax law,
   (17)  the amount of any federal deduction that would have been allowed
 pursuant to subparagraph (A) of paragraph  one  of  subdivision  (a)  of
 section  two  hundred fifty of the internal revenue code if the taxpayer
 had not made an election under subchapter s of chapter one of the inter-
 nal revenue code,
   (18) for taxable years beginning in  two  thousand  nineteen  and  two
 thousand  twenty,  the  amount  of  the increase in the federal interest
 deduction allowed pursuant  to  paragraph  ten  of  subdivision  (j)  of
 section one hundred sixty-three of the internal revenue code, and
   (19) the amount of any gain excluded from federal gross income for the
 taxable  year  by subparagraph (A) of paragraph (1) of subsection (a) of
 section one thousand four hundred Z-two of the internal revenue code.
   (c) Entire net income shall include  income  within  and  without  the
 United States;
   (c-1)(1)  Notwithstanding  any  other provision of this subchapter, in
 the case of a taxpayer which is a foreign air carrier holding a  foreign
 air carrier permit issued by the United States department of transporta-
 tion pursuant to section four hundred two of the federal aviation act of
 nineteen  hundred  fifty-eight, as amended, and which is qualified under
 subparagraph two of this paragraph, entire net income shall not include,
 and shall be computed without the  deduction  of,  amounts  directly  or
 indirectly  attributable  to,  (i)  any income derived from the interna-
 tional operation  of  aircraft  as  described  in  and  subject  to  the
 provisions of section eight hundred eighty-three of the internal revenue
 code,  (ii)  income  without the United States which is derived from the
 operation of aircraft, and (iii) income without the United States  which
 is  of  a  type  described  in  subdivision (a) of section eight hundred
 eighty-one of the internal revenue code except that it is  derived  from
 sources  without  the  United  States.  Entire  net income shall include
 income described in clauses (i), (ii) and (iii) of this subparagraph  in
 the case of taxpayers not described in this subparagraph.
   (2)  A  taxpayer  is qualified under this subparagraph if air carriers
 organized in the United States and operating in the foreign  country  or
 countries  in which the taxpayer has its major base of operations and in
 which it is organized, resident or headquartered, if  not  in  the  same
 country  as  its major base of operations, are not subject to any income
 tax or other tax based on or measured by income or receipts  imposed  by
 such  foreign country or countries or any political subdivision thereof,
 or if so subject to such tax, are provided an exemption  from  such  tax
 equivalent to that provided for in this paragraph.
   (d) The commissioner of finance may, whenever necessary in order prop-
 erly  to  reflect  the  entire net income of any taxpayer, determine the
 S. 8474                            442
 
 year or period in which  any  item  of  income  or  deduction  shall  be
 included,  without  regard  to  the method of accounting employed by the
 taxpayer;
   (e)  The  entire net income of any bridge commission created by act of
 congress to construct a bridge across an  international  boundary  means
 its gross income less the expense of maintaining and operating its prop-
 erties,  the  annual  interest upon its bonds and other obligations, and
 the annual charge for the retirement of such  bonds  or  obligations  at
 maturity;
   (f) A net operating loss deduction shall be allowed which shall be the
 same  as  the  net  operating  loss  deduction allowed under section one
 hundred seventy-two of the internal revenue code  or  which  would  have
 been allowed if the taxpayer had not made an election under subchapter s
 of  chapter  one  of  the  internal  revenue  code, except that in every
 instance where such deduction is allowed under this subchapter:
   (1) any net operating loss  included  in  determining  such  deduction
 shall  be  adjusted to reflect the inclusions and exclusions from entire
 net income pursuant to paragraphs (a), (b), (g) and (h) of this subdivi-
 sion,
   (2) such deductions shall not include any net operating loss sustained
 during any taxable year in which the taxpayer was not subject to the tax
 imposed by this subchapter,
   (3) such deduction shall not exceed the deduction for the taxable year
 allowed under section one hundred seventy-two of  the  internal  revenue
 code,  or  the  deduction  for  the  taxable  year which would have been
 allowed if the taxpayer had not made an election under subchapter  s  of
 chapter one of the internal revenue code,
   (4)  any  net  operating loss for a taxable year beginning in nineteen
 hundred eighty-one shall be computed without  regard  to  the  deduction
 allowed  with  respect  to  recovery  property under section one hundred
 sixty-eight of the internal revenue code; in lieu of such  deduction,  a
 taxpayer  shall  be  allowed  for such taxable year with respect to such
 property the depreciation deduction allowable under section one  hundred
 sixty-seven of such code as such section was in full force and effect on
 December thirty-first, nineteen hundred eighty, and
   (5) the net operating loss deduction allowed under section one hundred
 seventy-two  of  the  internal  revenue  code shall for purposes of this
 paragraph be determined as  if  the  taxpayer  had  elected  under  such
 section  to  relinquish  the entire carryback period with respect to net
 operating losses, except with respect to the first ten thousand  dollars
 of each of such losses, sustained during taxable years ending after June
 thirtieth, nineteen hundred eighty-nine.
   (6)  Notwithstanding  any  other  provision  of this subchapter to the
 contrary, for taxable years beginning before January first, two thousand
 twenty-one, any amendment to section  one  hundred  seventy-two  of  the
 internal  revenue code made after March first, two thousand twenty shall
 not apply to this subchapter.
   (g) At the election of the taxpayer, a deduction shall be allowed  for
 expenditures   paid   or  incurred  during  the  taxable  year  for  the
 construction, reconstruction,  erection  or  improvement  of  industrial
 waste treatment facilities and air pollution control facilities.
   (1)(A)  The  term  "industrial  waste treatment facilities" shall mean
 facilities for the treatment, neutralization or stabilization of  indus-
 trial  waste,  as  the  term  "industrial  waste"  is defined in section
 17-0105 of the environmental conservation law, from a point  immediately
 preceding  the  point of such treatment, neutralization or stabilization
 S. 8474                            443
 
 to the point of disposal, including the necessary pumping and  transmit-
 ting facilities, but excluding such facilities installed for the primary
 purpose  of  salvaging  materials  which are usable in the manufacturing
 process or are marketable.
   (B)  The term "air pollution control facilities" shall mean facilities
 which remove, reduce, or render less noxious  air  contaminants  emitted
 from  an  air  contamination  source, as the terms "air contaminant" and
 "air contamination source" are defined in section 19-0107 of  the  envi-
 ronmental conservation law, from a point immediately preceding the point
 of  such  removal,  reduction  or rendering to the point of discharge of
 air, meeting emission standards as  established  by  the  air  pollution
 control  board,  but excluding such facilities installed for the primary
 purpose of salvaging materials which are  usable  in  the  manufacturing
 process  or are marketable and excluding those facilities which rely for
 their efficacy on dilution, dispersion or assimilation  of  air  contam-
 inants in the ambient air after emission.
   (2)  However, such deduction shall be allowed only (A) with respect to
 tangible property which is depreciable, pursuant to section one  hundred
 sixty-seven of the internal revenue code, having a situs in the city and
 used  in  the  taxpayer's  trade  or  business, the construction, recon-
 struction, erection or improvement of which, in the case  of  industrial
 waste  treatment  facilities,  is  initiated  on or after January first,
 nineteen hundred sixty-six, and only for expenditures paid  or  incurred
 prior  to  January first, nineteen hundred seventy-two, or which, in the
 case of air pollution control facilities, is initiated on or after Janu-
 ary first, nineteen hundred sixty-six, and
   (B) on condition that such facilities have been certified by the state
 commissioner of environmental conservation or the  state  commissioner's
 designated representative, in the same manner as provided for in section
 17-0707 or 19-0309 of the environmental conservation law, as applicable,
 as  complying  with applicable provisions of the environmental conserva-
 tion law, the state sanitary code and  regulations,  permits  or  orders
 issued pursuant thereto, and
   (C)  on  condition that entire net income for the taxable year and all
 succeeding taxable years be computed without  any  deductions  for  such
 expenditures  or  for  depreciation  of the same property other than the
 deductions allowed by this paragraph except to the extent that the basis
 of the property may be attributable to factors other than such  expendi-
 tures,  or  in  case a deduction is allowable pursuant to this paragraph
 for only a part of such expenditures, on condition  that  any  deduction
 allowed  for  federal  income  tax purposes for such expenditures or for
 depreciation of the same property be proportionately reduced in  comput-
 ing  entire  net  income for the taxable year and all succeeding taxable
 years, and
   (D) where the election provided for in paragraph  (d)  of  subdivision
 three  of  section  11-604  of this subchapter has not been exercised in
 respect to the same property.
   (3)(A) If expenditures in respect to  an  industrial  waste  treatment
 facility  or  an  air  pollution  control facility have been deducted as
 provided herein and if within ten years from the end of the taxable year
 in which such deduction was allowed such property or any part thereof is
 used for the primary purpose of salvaging materials which are usable  in
 the  manufacturing  process or are marketable, the taxpayer shall report
 such change of use in its report for the first taxable year during which
 it occurs, and the commissioner of finance may recompute the tax for the
 year or years for which such deduction was allowed and any carryback  or
 S. 8474                            444
 
 carryover  year,  and  may assess any additional tax resulting from such
 recomputation within the time fixed  by  paragraph  (h)  of  subdivision
 three of section 11-674 of this chapter.
   (B) If a deduction is allowed as herein provided for expenditures paid
 or  incurred during any taxable year on the basis of a temporary certif-
 icate of compliance issued pursuant to  the  environmental  conservation
 law  and  if  the  taxpayer  fails  to obtain a permanent certificate of
 compliance upon completion of the facilities with respect to which  such
 temporary certificate was issued, the taxpayer shall report such failure
 in  its  report  for  the  taxable year during which such facilities are
 completed, and the commissioner of finance may recompute the tax for the
 year or years for which such deduction was allowed and any carryback  or
 carryover  year,  and  may assess any additional tax resulting from such
 recomputation within the time fixed  by  paragraph  (h)  of  subdivision
 three of section 11-674 of this chapter.
   (4)  In  any  taxable year when property is sold or otherwise disposed
 of, with respect to which a deduction has been allowed pursuant to  this
 paragraph,  such  deduction  shall  be  disregarded in computing gain or
 loss, and the gain or loss on the sale  or  other  disposition  of  such
 property  shall  be  the  gain  or loss entering into the computation of
 entire taxable income which the taxpayer is required to  report  to  the
 United States treasury for such taxable year;
   (h) With respect to gain derived from the sale or other disposition of
 any  property  acquired  prior to January first, nineteen hundred sixty-
 six; which had a federal adjusted basis on such date, or on the date  of
 its  sale  or other disposition prior to January first, nineteen hundred
 sixty-six, lower than its fair market value on January  first,  nineteen
 hundred  sixty-six  or  the  date of its sale or other disposition prior
 thereto, except property  described  in  subsections  one  and  four  of
 section  twelve  hundred  twenty-one of the internal revenue code, there
 shall be deducted from entire net income, the difference between (1) the
 amount of the taxpayer's federal taxable income, and (2) the  amount  of
 the  taxpayer's  federal  taxable  income,  if  smaller  than the amount
 described in subparagraph one of  this  paragraph  computed  as  if  the
 federal adjusted basis of each such property on the sale or other dispo-
 sition  of  which  gain  was  derived,  on the date of the sale or other
 disposition had been equal to either (A) its fair market value on  Janu-
 ary  first,  nineteen hundred sixty-six or the date of its sale or other
 disposition prior to January first, nineteen hundred sixty-six, plus  or
 minus  all  adjustments  to basis made with respect to such property for
 federal income tax purposes for periods  on  and  after  January  first,
 nineteen  hundred  sixty-six or (B) the amount realized from its sale or
 disposition, whichever is  lower;  provided,  however,  that  the  total
 modification  provided  by this paragraph shall not exceed the amount of
 the taxpayer's net gain from the sale or other disposition of  all  such
 property.
   (i)  If  the period covered by a report under this subchapter is other
 than the period covered by the report  of  the  United  States  treasury
 department,  entire  net  income  shall be determined by multiplying the
 federal taxable income, as adjusted pursuant to the provisions  of  this
 subchapter,  by  the  number  of  calendar months or major parts thereof
 covered by the report under this subchapter and dividing by  the  number
 of  calendar months or major parts thereof covered by the report to such
 department.
   If it shall appear that such method of determining entire  net  income
 does  not  properly  reflect  the  taxpayer's  income  during the period
 S. 8474                            445

 covered by the report under this subchapter, the commissioner of finance
 shall be authorized in his or her discretion to  determine  such  entire
 net income solely on the basis of the taxpayer's income during the peri-
 od covered by its report under this subchapter.
   (j)  In the case of property placed in service in taxable years begin-
 ning before nineteen hundred ninety-four, for  taxable  years  beginning
 after  December  thirty-first,  nineteen hundred eighty-one, except with
 respect to property subject to the provisions  of  section  two  hundred
 eighty-F  of  the  internal  revenue  code  and  property subject to the
 provisions of section one hundred sixty-eight of  the  internal  revenue
 code which is placed in service in this state in taxable years beginning
 after  December thirty-first, nineteen hundred eighty-four, and provided
 a deduction has not been excluded from entire  net  income  pursuant  to
 subparagraph nine of paragraph (b) of this subdivision, a taxpayer shall
 be  allowed  with respect to property which is subject to the provisions
 of section one hundred sixty-eight of  the  internal  revenue  code  the
 depreciation  deduction  allowable under section one hundred sixty-seven
 of the internal revenue code as such section would have applied to prop-
 erty placed  in  service  on  December  thirty-first,  nineteen  hundred
 eighty. This paragraph shall not apply to property of a taxpayer princi-
 pally engaged in the conduct of an aviation, steamboat, ferry or naviga-
 tion  business,  or  two  or more of such businesses, which is placed in
 service before taxable years beginning in nineteen hundred eighty-nine.
   (k) for taxable years ending after September tenth, two thousand  one,
 in  the  case  of  qualified  property  described  in  paragraph  two of
 subsection k of section one hundred sixty-eight of the internal  revenue
 code,  other  than qualified resurgence zone property described in para-
 graph (m) of this subdivision, and other than qualified New York Liberty
 Zone property described in paragraph two  of  subsection  b  of  section
 fourteen  hundred  L  of  the  internal  revenue code, without regard to
 clause (i) of subparagraph  (C)  of  such  paragraph,  the  depreciation
 deduction  allowable  under  section  one  hundred  sixty-seven  as such
 section would have applied to such property had it been acquired by  the
 taxpayer  on  September tenth, two thousand one, provided, however, that
 for taxable years beginning on or  after  January  first,  two  thousand
 four,  in the case of a passenger motor vehicle or a sport utility vehi-
 cle subject to the provisions of paragraph (o) of this subdivision,  the
 limitation  under  clause  (i)  of  subparagraph (A) of paragraph one of
 subdivision (a) of section two hundred eighty-F of the internal  revenue
 code  applicable  to  the amount allowed as a deduction under this para-
 graph shall be determined as of the date  such  vehicle  was  placed  in
 service and not as of September tenth, two thousand one.
   (l)  for taxable years ending after September tenth, two thousand one,
 upon the disposition of property to which paragraph (k) of this subdivi-
 sion applies, the amount of any gain or loss includible  in  entire  net
 income  shall  be adjusted to reflect the inclusions and exclusions from
 entire net income pursuant to subparagraph twelve of paragraph  (a)  and
 subparagraph  thirteen of paragraph (b) of this subdivision attributable
 to such property.
   (m) for purposes of this paragraph and paragraph (l) of this  subdivi-
 sion,  qualified  resurgence zone property shall mean qualified property
 described in paragraph two  of  subsection  k  of  section  one  hundred
 sixty-eight of the internal revenue code substantially all of the use of
 which is in the resurgence zone, as defined in this paragraph, and is in
 the  active conduct of a trade or business by the taxpayer in such zone,
 and the original use of which in the resurgence zone commences with  the
 S. 8474                            446
 
 taxpayer  after  September  tenth, two thousand one. The resurgence zone
 shall mean the area of New York county bounded on the south  by  a  line
 running  from  the  intersection  of  the  Hudson River with the Holland
 Tunnel,  and running thence east to Canal Street, then running along the
 centerline of Canal Street to the intersection of the Bowery  and  Canal
 Street,  running  thence  in a southeasterly direction diagonally across
 Manhattan Bridge Plaza, to the Manhattan Bridge, and  thence  along  the
 centerline  of the Manhattan Bridge to the point where the centerline of
 the Manhattan Bridge would intersect with the easterly bank of the  East
 River,  and bounded on the north by a line running from the intersection
 of the Hudson River with the Holland Tunnel  and  running  thence  north
 along  West  Avenue  to the intersection of Clarkson Street then running
 east along the centerline of Clarkson  Street  to  the  intersection  of
 Washington Avenue, then running south along the centerline of Washington
 Avenue  to  the intersection of West Houston Street, then east along the
 centerline of West Houston Street,  then  at  the  intersection  of  the
 Avenue  of  the  Americas  continuing  east along the centerline of East
 Houston Street to the easterly bank of the East River.
   (n) Related members expense add back.
   (1) Definitions. (A) Related member. "Related member" means a  related
 person  as  defined in subparagraph (c) of paragraph three of subsection
 (b) of section four hundred sixty-five of  the  internal  revenue  code,
 except that "fifty percent" shall be substituted for "ten percent".
   (B)  Effective  rate  of tax. "Effective rate of tax" means, as to any
 city, the maximum statutory rate of tax imposed by the city on or  meas-
 ured  by  a  related member's net income multiplied by the apportionment
 percentage, if any, applicable to the related member under the  laws  of
 said  jurisdiction.  For purposes of this definition, the effective rate
 of tax as to any city is zero where the related member's net income  tax
 liability  in said city is reported on a combined or consolidated return
 including both the taxpayer and the related member  where  the  reported
 transactions  between the taxpayer and the related member are eliminated
 or offset. Also, for purposes of this  definition,  when  computing  the
 effective  rate of tax for a city in which a related member's net income
 is eliminated or offset by  a  credit  or  similar  adjustment  that  is
 dependent  upon the related member either maintaining or managing intan-
 gible property or collecting interest income in that city,  the  maximum
 statutory rate of tax imposed by said city shall be decreased to reflect
 the  statutory  rate of tax that applies to the related member as effec-
 tively reduced by such credit or similar adjustment.
   (C) Royalty payments. Royalty payments are payments directly connected
 to the acquisition, use, maintenance  or  management,  ownership,  sale,
 exchange,  or any other disposition of licenses, trademarks, copyrights,
 trade names, trade dress, service  marks,  mask  works,  trade  secrets,
 patents  and  any other similar types of intangible assets as determined
 by the commissioner of finance, and include amounts allowable as  inter-
 est  deductions  under  section  one hundred sixty-three of the internal
 revenue code to the extent such amounts are directly or indirectly  for,
 related  to  or  in connection with the acquisition, use, maintenance or
 management, ownership, sale, exchange or disposition of such  intangible
 assets.
   (D)  Valid  business  purpose. A valid business purpose is one or more
 business purposes, other than the avoidance or  reduction  of  taxation,
 which alone or in combination constitute the primary motivation for some
 business  activity or transaction, which activity or transaction changes
 in a meaningful way, apart from tax effects, the  economic  position  of
 S. 8474                            447
 
 the taxpayer. The economic position of the taxpayer includes an increase
 in  the  market share of the taxpayer, or the entry by the taxpayer into
 new business markets.
   (2) Royalty expense add backs. (A) For the purpose of computing entire
 net  income  or other applicable taxable basis, a taxpayer must add back
 royalty payments directly or indirectly paid, accrued,  or  incurred  in
 connection  with one or more direct or indirect transactions with one or
 more related members during the taxable year to the extent deductible in
 calculating federal taxable income.
   (B) (i) The adjustment required in this paragraph shall not  apply  to
 the  portion  of  the  royalty payment that the taxpayer establishes, by
 clear and convincing evidence of the type and in the form  specified  by
 the  commissioner  of  finance, meets all of the following requirements:
 (I) the related member was subject to tax in this city or  another  city
 within the United States or a foreign nation or some combination thereof
 on  a  tax  base  that  included  the  royalty  payment paid, accrued or
 incurred by the taxpayer; (II) the related member during the same  taxa-
 ble  year  directly or indirectly paid, accrued or incurred such portion
 to a person that is not a related  member;  and  (III)  the  transaction
 giving  rise to the royalty payment between the taxpayer and the related
 member was undertaken for a valid business purpose.
   (ii) The adjustment required in this paragraph shall not apply if  the
 taxpayer  establishes,  by clear and convincing evidence of the type and
 in the form specified by the commissioner  of  finance,  that:  (I)  the
 related  member  was  subject to tax on or measured by its net income in
 this city or another city within the United States, or some  combination
 thereof;  (II)  the  tax  base for said tax included the royalty payment
 paid, accrued or incurred by  the  taxpayer;  and  (III)  the  aggregate
 effective  rate  of tax applied to the related member in those jurisdic-
 tions is no less than eighty percent of the statutory rate of  tax  that
 applied  to the taxpayer under section 11-604 of this subchapter for the
 taxable year.
   (iii) The adjustment required in this paragraph shall not apply if the
 taxpayer establishes, by clear and convincing evidence of the  type  and
 in  the  form  specified  by  the commissioner of finance, that: (I) the
 royalty payment was paid, accrued or incurred to a related member organ-
 ized under the laws of a country other than the United States; (II)  the
 related member's income from the transaction was subject to a comprehen-
 sive income tax treaty between such country and the United States; (III)
 the  related member was subject to tax in a foreign nation on a tax base
 that included the royalty payment  paid,  accrued  or  incurred  by  the
 taxpayer;  (IV)  the  related  member's  income from the transaction was
 taxed in such country at an effective rate of tax at least equal to that
 imposed by this city; and (V) the royalty payment was paid,  accrued  or
 incurred pursuant to a transaction that was undertaken for a valid busi-
 ness purpose and using terms that reflect an arm's length relationship.
   (iv)  The adjustment required in this paragraph shall not apply if the
 taxpayer and the commissioner of finance agree in writing to the  appli-
 cation  or  use  of alternative adjustments or computations. The commis-
 sioner of finance may, in his or her discretion, agree to  the  applica-
 tion  or  use  of alternative adjustments or computations when he or she
 concludes that in the absence  of  such  agreement  the  income  of  the
 taxpayer would not be properly reflected.
   (o)  For  taxable years beginning on or after January first, two thou-
 sand four, in the case of a taxpayer that is not an eligible  farmer  as
 defined in subsection (n) of section six hundred six of the tax law, the
 S. 8474                            448
 
 deductions  allowable  under  sections  one  hundred  seventy-nine,  one
 hundred sixty-seven and one hundred sixty-eight of the internal  revenue
 code  with  respect  to  a sport utility vehicle that is not a passenger
 automobile as defined in paragraph five of subsection (d) of section two
 hundred  eighty-F  of  the  internal revenue code, determined as if such
 sport utility vehicle were a passenger automobile  as  defined  in  such
 paragraph  five. For purposes of paragraph (k) and subparagraph thirteen
 of paragraph (b) of this subdivision,  the  terms  qualified  resurgence
 zone  property and qualified New York Liberty Zone property described in
 paragraph two of subsection b  of  section  fourteen  hundred-L  of  the
 internal  revenue  code shall not include any sport utility vehicle that
 is not a passenger automobile as defined in paragraph five of subsection
 (d) of section two hundred eighty-F of the internal revenue code.
   (p) Upon the disposition of property to which paragraph  (o)  of  this
 subdivision applies, the amount of any gain or loss includible in entire
 net  income  shall  be adjusted to reflect the inclusions and exclusions
 from entire net income pursuant to subparagraph  thirteen  of  paragraph
 (a)  and  subparagraph  fourteen  of  paragraph  (b) of this subdivision
 attributable to such property.
   9. (a) The term "calendar year" means  a  period  of  twelve  calendar
 months, or any shorter period beginning on the date the taxpayer becomes
 subject  to  the  tax  imposed by this subchapter, ending on the thirty-
 first day of December, provided the taxpayer  keeps  its  books  on  the
 basis  of  such  period  or on the basis of any period ending on any day
 other than the last day of a calendar month, or  provided  the  taxpayer
 does  not  keep  books,  and  includes, in case the taxpayer changes the
 period on the basis of which it keeps its books from a fiscal year to  a
 calendar  year, the period from the close of its last old fiscal year up
 to and including the following December thirty-first.
   (b) The term "fiscal year" means a period of twelve  calendar  months,
 or any shorter period beginning on the date the taxpayer becomes subject
 to  the  tax  imposed  by this subchapter, ending on the last day of any
 month other than December, provided the taxpayer keeps its books on  the
 basis  of  such  period,  and includes, in case the taxpayer changes the
 period on the basis of which it keeps its books from a calendar year  to
 a fiscal year or from one fiscal year to another fiscal year, the period
 from  the  close  of its last old calendar or fiscal year up to the date
 designated as the close of its new fiscal year.
   10.  The term "tangible personal property"  means  corporeal  personal
 property,  such  as  machinery,  tools,  implements,  goods,  wares  and
 merchandise, and does not mean  money,  deposits  in  banks,  shares  of
 stock,  bonds,  notes,  credits  or evidence of an interest property and
 evidences of debt.
   § 11-603 Imposition of tax; exemptions. 1. For the privilege of  doing
 business,  or  of employing capital, or of owning or leasing property in
 the city in a corporate or organized  capacity,  or  of  maintaining  an
 office  in the city, for all or any part of each of its fiscal or calen-
 dar years, every domestic or foreign  corporation,  except  corporations
 specified in subdivision four of this section, shall annually pay a tax,
 upon the basis of its entire net income, or upon such other basis as may
 be  applicable  as provided by this section, for such fiscal or calendar
 year or part thereof, on a  report  which  shall  be  filed,  except  as
 provided  by  this section, on or before the fifteenth day of March next
 succeeding the close of each such year, or, in the case  of  a  taxpayer
 which  reports  on  the  basis of a fiscal year, within two and one-half
 S. 8474                            449
 
 months after the close of  such  fiscal  year,  and  shall  be  paid  as
 provided by this section.
   2.   A corporation shall not be deemed to be doing business, employing
 capital, owning or leasing property, or maintaining  an  office  in  the
 city,  for the purposes of this subchapter, by reason of (a) the mainte-
 nance of cash balances with banks or trust companies in the city, or (b)
 the ownership of shares of stock or securities kept in the city, if kept
 in a safe deposit box, safe, vault or other receptacle  rented  for  the
 purpose,  or if pledged as collateral security, or if deposited with one
 or more banks or trust companies, or brokers who are members of a recog-
 nized security exchange, in safekeeping or custody accounts, or (c)  the
 taking  of any action by any such bank or trust company or broker, which
 is incidental to the rendering of safekeeping or  custodian  service  to
 such corporation, or (d) the maintenance of an office in the city by one
 or  more  officers or directors of the corporation who are not employees
 of the corporation if the corporation otherwise is not doing business in
 the city, and does not employ capital or own or lease  property  in  the
 city,  or  (e)  the  keeping of books or records of a corporation in the
 city if such books or records are not kept by employees of  such  corpo-
 ration and such corporation does not otherwise do business, employ capi-
 tal, own or lease property or maintain an office in the city, or (f) any
 combination of the activities described in this subdivision.
   2-a.  An  alien  corporation shall not be deemed to be doing business,
 employing capital, owning or leasing property, or maintaining an  office
 in  the  city, for the purposes of this subchapter, if its activities in
 the city are limited solely to (a) investing or trading  in  stocks  and
 securities  for  its  own  account  within the meaning of clause (ii) of
 subparagraph (A) of paragraph (2) of subsection  (b)  of  section  eight
 hundred  sixty-four  of  the  internal  revenue code or (b) investing or
 trading in commodities for its own account within the meaning of  clause
 (ii)  of  subparagraph (B) of paragraph (2) of subsection (b) of section
 eight hundred sixty-four of the internal revenue code or (c) any  combi-
 nation  of activities described in paragraphs (a) and (b) of this subdi-
 vision. For purposes of this subdivision,  an  alien  corporation  is  a
 corporation  organized  under  the  laws  of a country, or any political
 subdivision thereof, other than the United States.
   3.  Any receiver, referee, trustee, assignee or  other  fiduciary,  or
 any  officer  or agent appointed by any court, who conducts the business
 of any corporation, shall be subject to the tax imposed by this subchap-
 ter in the same manner and to the same extent as if  the  business  were
 conducted  by  the  agents or officers of such corporation.  A dissolved
 corporation which continues to conduct business shall also be subject to
 the tax imposed by this subchapter.
   4. (a) Corporations subject to tax  under  subchapter  three  of  this
 chapter  or under chapter eleven of this title, any trust company organ-
 ized under a law of this state all of the stock of which is owned by not
 less than twenty savings banks organized under a law of this state, bank
 holding companies filing a combined return in accordance  with  subdivi-
 sion  (f) of section 11-646 of this chapter, a captive REIT or a captive
 RIC filing a combined return under subdivision (f) of section 11-646  of
 this  chapter, housing companies organized and operating pursuant to the
 provisions of article two of the private housing  finance  law,  housing
 development fund companies organized pursuant to the provisions of arti-
 cle eleven of the private housing finance law, corporations described in
 section  three  of the tax law, a corporation principally engaged in the
 operation of marine vessels whose activities in  the  city  are  limited
 S. 8474                            450
 
 exclusively  to  the  use of property in interstate or foreign commerce,
 provided, however, such a corporation will not be subject to  tax  under
 this  subchapter  solely  because it maintains an office in the city, or
 employs  capital in the city, in connection with such use of property, a
 corporation principally engaged in the conduct of a ferry  business  and
 operating  between any of the boroughs of the city under a lease granted
 by the city and a corporation principally engaged in the conduct  of  an
 aviation,  steamboat,  ferry  or  navigation business, or two or more of
 such businesses, all of the capital stock of which is owned by a munici-
 pal corporation of this state, shall not be subject to  tax  under  this
 subchapter;  provided,  however,  that any corporation, other than (1) a
 utility corporation subject to the supervision of the  state  department
 of  public  service,  and  (2)  for  taxable years beginning on or after
 August first, two thousand two, a utility as defined in subdivision  six
 of  section 11-1101 of this title, which is subject to tax under chapter
 eleven of this title as a vendor of utility services shall be subject to
 tax under this subchapter, but in computing  the  tax  imposed  by  this
 section  pursuant to the provisions of clause one of subparagraph (a) of
 paragraph A of subdivision one of section  11-604  of  this  subchapter,
 business  income  allocated  to  the  city  pursuant to paragraph (a) of
 subdivision three of such section shall be  reduced  by  the  percentage
 which  such  corporation's  gross  operating income subject to tax under
 chapter eleven of this title is of its gross operating income.
   (b) The term "gross operating income", when used in paragraph  (a)  of
 this  subdivision, means receipts received in or by reason of any trans-
 action had and consummated in the  city,  including  cash,  credits  and
 property  of any kind or nature, whether or not such transaction is made
 for profit, without any deduction therefrom on account of  the  cost  of
 the  property sold, the cost of materials used, labor or other services,
 delivery costs or any other costs whatsoever, interest or discount  paid
 or any other expenses whatsoever.
   (c)  If it shall appear to the commissioner of finance that the appli-
 cation of the proviso of paragraph (a) of  this  subdivision,  does  not
 fairly  and  equitably  reflect  the  portion of the taxpayer's business
 income allocable to the city which is attributable to  its  city  activ-
 ities  which  are  not  taxable  under chapter eleven of this title, the
 commissioner may prescribe other means or methods  of  determining  such
 portion,  including the use of the books and records of the taxpayer, if
 the commissioner finds that such means or methods used in  keeping  them
 fairly and equitably reflect such portion.
   5.    The  tax  imposed  by  subdivision one of this section, with the
 modifications provided by subdivision six of this  section,  is  imposed
 for each calendar or fiscal year beginning with calendar or fiscal years
 ending in or with the calendar year nineteen hundred sixty-six.
   6.   (a) The tax for any taxable year ending prior to December thirty-
 first, nineteen hundred sixty-six shall be an amount equal  to  the  tax
 imposed by subdivision one of this section for such taxable year, multi-
 plied  by the number of months, or major portions thereof, in such taxa-
 ble year which  occur  after  December  thirty-first,  nineteen  hundred
 sixty-five and divided by the number of months, or major portions there-
 of, in such taxable year.
   (b)  In  lieu  of the method of computation of tax prescribed in para-
 graph (a) of this  subdivision,  if  the  taxpayer  maintained  adequate
 records  for  the  portion  of any taxable year ending prior to December
 thirty-first, nineteen hundred sixty-six, which portion falls within the
 calendar year nineteen hundred sixty-six, it may elect  to  compute  the
 S. 8474                            451
 
 tax  for such taxable year by determining entire net income on the basis
 of the entire taxable income which it would have  reported  for  federal
 income tax purposes had it filed a federal income tax return for a taxa-
 ble  year beginning January first, nineteen hundred sixty-six and ending
 with the close of its actual taxable year and such taxable  year  begin-
 ning  January  first,  nineteen hundred sixty-six, shall be deemed to be
 the period covered by its report, except that in computing such tax  any
 portion  of  a  capital loss which results from a capital loss carryover
 and any net operating loss deduction, as modified pursuant to  paragraph
 (f)  of subdivision eight of section 11-602 of this subchapter, shall be
 reduced by the same part of such portion of such capital loss or of such
 net operating loss deduction, as the case  may  be,  as  the  number  of
 months,  or major portions thereof, in the taxable year occurring before
 January first, nineteen hundred sixty-six is of the number of months, or
 major portions thereof, in such taxable year.
   7. For any taxable year of a real estate investment trust  as  defined
 in section eight hundred fifty-six of the internal revenue code in which
 such  trust  is  subject  to federal income taxation under section eight
 hundred fifty-seven of such code, such trust shall be subject to  a  tax
 computed  under  either clause one of subparagraph (a) of paragraph A of
 subdivision one of section 11-604 of this subchapter with respect to its
 entire net income, or clause four of  such  subparagraph,  whichever  is
 greater,  and  shall not be subject to any tax under subchapter three of
 this chapter, except for a captive REIT  required  to  file  a  combined
 return  under  subdivision (f) of section 11-646 of this chapter. In the
 case of such a real estate investment trust, including a captive REIT as
 defined in section 11-601 of this chapter, the term "entire net  income"
 means  "real estate investment trust taxable income" as defined in para-
 graph two of subdivision (b) of section eight  hundred  fifty-seven,  as
 modified  by  section eight hundred fifty-eight, of the internal revenue
 code plus the amount taxable under paragraph three of subdivision (b) of
 section eight hundred fifty-seven of such code, subject to the modifica-
 tion required by subdivision eight of section 11-602 of this subchapter,
 other than the modification required by clause two of paragraph (a)  and
 by  paragraph (f) thereof, including the modifications required by para-
 graphs (d) and (e) of  subdivision  three  of  section  11-604  of  this
 subchapter.
   8.  For any taxable year beginning on or after January first, nineteen
 hundred eighty-one of a regulated  investment  company,  as  defined  in
 section  eight  hundred fifty-one of the internal revenue code, in which
 such company is subject to federal income taxation under  section  eight
 hundred  fifty-two  of such code, such company shall be subject to a tax
 computed under clause one or four of subparagraph (a) of paragraph E  of
 subdivision  one  of  section  11-604  of  this subchapter, whichever is
 greater, and such company shall not be subject to any tax under subchap-
 ter three of this chapter. The term "entire net income" used in subdivi-
 sion one of this section means "investment company  taxable  income"  as
 defined  in  paragraph  two  of subdivision (b) of section eight hundred
 fifty-two, as modified by  section  eight  hundred  fifty-five,  of  the
 internal  revenue  code plus the amount taxable under paragraph three of
 subdivision (b) of section eight hundred fifty-two of such code  subject
 to  the modifications required by subdivision eight of section 11-602 of
 this subchapter, other than the modification required by clause  two  of
 paragraph  (a)  and  by paragraph (f) of such subdivision, including the
 modification required by paragraphs (d) and (e) of subdivision three  of
 section 11-604 of this subchapter.
 S. 8474                            452
 
   9.  For any taxable year beginning on or after January first, nineteen
 hundred eighty-seven, an organization  described  in  paragraph  two  or
 twenty-five of subdivision (c) of section five hundred one of the inter-
 nal revenue code of nineteen hundred eighty-six shall be exempt from all
 taxes imposed by this chapter.
   §  11-604 Computation of tax. 1.  A. For taxable years beginning on or
 after January first, nineteen  hundred  seventy-one  and  ending  on  or
 before  December  thirty-first,  nineteen  hundred seventy-four, and for
 taxable years beginning on or  after  January  first,  nineteen  hundred
 seventy-six,  the  tax  imposed  by subdivision one of section 11-603 of
 this subchapter shall be, in the case of each taxpayer: (a)  a  tax  (1)
 computed  at  the  rate of six and seven-tenths per centum of its entire
 net income, or the portion of such entire net  income  allocated  within
 the  city  as  provided  in  this  section,  subject to any modification
 required by paragraphs (d) and (e) of subdivision three of this section,
 or (2) computed at one mill for each dollar of its  total  business  and
 investment capital, or the portion thereof allocated within the city, as
 provided in this section, except that in the case of a cooperative hous-
 ing  corporation as defined in the internal revenue code, or in the case
 of a housing company organized and operating pursuant to the  provisions
 of article four of the private housing finance law, the applicable rates
 shall be one-quarter of one mill, or (3) computed at the rate of six and
 seven-tenths  per  centum  on thirty per centum of the taxpayer's entire
 net income plus salaries and other compensation paid to  the  taxpayer's
 elected  or appointed officers and to every stockholder owning in excess
 of five per centum of its issued capital stock  minus  fifteen  thousand
 dollars,  except  as  provided in this section, and any net loss for the
 reported year, or on the portion of any such sum  allocated  within  the
 city  as  provided  in  this  section  for  the allocation of entire net
 income, subject to any modification required by paragraphs (d)  and  (e)
 of subdivision three of this section, or (4) twenty-five dollars, which-
 ever  is  greatest, plus (b) a tax computed at the rate of one-half mill
 for each dollar of the portion of its subsidiary capital allocated with-
 in the city as provided in this section.   In the  case  of  a  taxpayer
 which is not subject to tax for an entire year, the exemption allowed in
 clause  three  of  subparagraph  (a) of this paragraph shall be prorated
 according to the period such taxpayer was subject to tax.
   B. For taxable years beginning on or  after  January  first,  nineteen
 hundred  seventy-five and before January first nineteen hundred seventy-
 seven, the tax imposed by subdivision one  of  section  11-603  of  this
 subchapter  shall  be,  in  the  case  of  each  taxpayer: (a) a tax (1)
 computed at the rate of ten and five one-hundredths per  centum  of  its
 entire  net  income,  or the portion of such entire net income allocated
 within the city as provided in this paragraph, subject to any  modifica-
 tion  required  by  paragraphs  (d) and (e) of subdivision three of this
 section, or (2) computed at one and one-half mills for  each  dollar  of
 its  total business and investment capital, or the portion thereof allo-
 cated within the city, as provided in this paragraph, except that in the
 case of a cooperative housing corporation as  defined  in  the  internal
 revenue  code, or in the case of a housing company organized and operat-
 ing pursuant to the provisions of article four of  the  private  housing
 finance  law,  the  applicable rate shall be four-tenths of one mill, or
 (3) computed at the rate of ten and five one-hundredths  per  centum  on
 thirty  per centum of the taxpayer's entire net income plus salaries and
 other compensation paid to the taxpayer's elected or appointed  officers
 and  to  every  stockholder  owning  in excess of five per centum of its
 S. 8474                            453
 
 issued capital stock minus fifteen thousand dollars, except as  provided
 in  this  paragraph,  and  any net loss for the reported year, or on the
 portion of any such sum allocated within the city as  provided  in  this
 paragraph  for  the  allocation  of  entire  net  income, subject to any
 modification required by paragraphs (d) and (e) of subdivision three  of
 this  section,  or  (4)  one  hundred  twenty-five dollars, whichever is
 greatest, plus (b) a tax computed at the rate  of  three-quarters  of  a
 mill  for each dollar of the portion of its subsidiary capital allocated
 within the city as provided in this paragraph.  In the case of a taxpay-
 er which is not subject to tax for an entire year, the exemption allowed
 in clause three of subparagraph (a) of this paragraph shall be  prorated
 according to the period such taxpayer was subject to tax.
   C.  For  each  taxable year beginning in nineteen hundred seventy-four
 and ending in nineteen hundred seventy-five, two tentative  taxes  shall
 be  computed,  the  first  as  provided in paragraph A and the second as
 provided in paragraph B of this subdivision, and the tax for  each  such
 year shall be the sum of that proportion of each tentative tax which the
 number  of  days in nineteen hundred seventy-four and the number of days
 in nineteen hundred seventy-five, respectively, bears to the  number  of
 days in the entire taxable year.
   D.  For  taxable  years  beginning on or after January first, nineteen
 hundred seventy-seven and before January first, nineteen hundred  seven-
 ty-eight,  the  tax imposed by subdivision one of section 11-603 of this
 subchapter shall be, in the  case  of  each  taxpayer:  (a)  a  tax  (1)
 computed  at  the rate of nine and one-half per centum of its entire net
 income, or the portion of such entire net income  allocated  within  the
 city as provided in this paragraph, subject to any modification required
 by  paragraphs  (d) and (e) of subdivision three of this section, or (2)
 computed at one and one-half mills for each dollar of its total business
 and investment capital, or the  portion  thereof  allocated  within  the
 city,  as provided in this paragraph, except that in the case of a coop-
 erative housing corporation as defined in the internal revenue code, the
 applicable rate shall be four-tenths of one mill, or (3) computed at the
 rate of nine and one-half per centum on thirty per centum of the taxpay-
 er's entire net income plus salaries and other compensation paid to  the
 taxpayer's elected or appointed officers and to every stockholder owning
 in  excess  of five per centum of its issued capital stock minus fifteen
 thousand dollars, except as provided in this paragraph, and any net loss
 for the reported year, or on the portion of any such sum allocated with-
 in the city as provided in this paragraph for the allocation  of  entire
 net  income,  subject to any modification required by paragraphs (d) and
 (e) of subdivision three of this section, or (4) one hundred twenty-five
 dollars, whichever is greatest, plus (b) a tax computed at the  rate  of
 three-quarters  of  a mill for each dollar of the portion of its subsid-
 iary capital allocated within the city as provided in this paragraph. In
 the case of a taxpayer which is not subject to tax for an  entire  year,
 the  exemption allowed in clause three of subparagraph (a) of this para-
 graph shall be prorated  according  to  the  period  such  taxpayer  was
 subject to tax.
   E.  For  taxable  years  beginning on or after January first, nineteen
 hundred seventy-eight but before January first, two thousand twenty-sev-
 en, the tax imposed  by  subdivision  one  of  section  11-603  of  this
 subchapter shall be, in the case of each taxpayer:
   (a) whichever of the following amounts is the greatest:
   (1)  an  amount  computed, for taxable years beginning before nineteen
 hundred eighty-seven, at the rate of nine per centum,  and  for  taxable
 S. 8474                            454
 
 years  beginning after nineteen hundred eighty-six, at the rate of eight
 and eighty-five one-hundredths per centum, of its entire net  income  or
 the  portion  of  such  entire  net  income allocated within the city as
 provided  in  this  paragraph,  subject  to any modification required by
 paragraphs (d) and (e) of subdivision three of this section,
   (2) an amount computed at one and one-half mills for  each  dollar  of
 its  total business and investment capital, or the portion thereof allo-
 cated within the city, as provided in this paragraph, except that in the
 case of a cooperative housing corporation as  defined  in  the  internal
 revenue code, the applicable rate shall be four-tenths of one mill,
   (3)  an  amount  computed, for taxable years beginning before nineteen
 hundred eighty-seven, at the rate of nine per centum,  and  for  taxable
 years  beginning after nineteen hundred eighty-six, at the rate of eight
 and eighty-five one-hundredths per centum, on thirty per centum  of  the
 taxpayer's  entire  net income plus salaries and other compensation paid
 to the taxpayer's elected or appointed officers and to every stockholder
 owning in excess of five per centum of its issued  capital  stock  minus
 fifteen thousand dollars, subject to proration as provided in this para-
 graph,  and any net loss for the reported year, or on the portion of any
 such sum allocated within the city as provided in this paragraph for the
 allocation of entire net income, subject to any modification required by
 paragraphs (d) and (e) of subdivision three of this  section,  provided,
 however,  that for taxable years beginning on or after July first, nine-
 teen hundred ninety-six, the provisions of paragraph H of this  subdivi-
 sion shall apply for purposes of the computation under this clause, or
   (4)  for  taxable  years  ending on or before June thirtieth, nineteen
 hundred eighty-nine, one hundred twenty-five dollars, for taxable  years
 ending  after June thirtieth, nineteen hundred eighty-nine and beginning
 before two thousand nine, three hundred dollars, and for  taxable  years
 beginning after two thousand eight:
 
  If city                                          Fixed dollar
 receipts are:                                    minimum tax is:
 
 Not more than $100,000                           $25
 More than $100,000 but not over $250,000         $75
 More than $250,000 but not over $500,000         $175
 More than $500,000 but not over $1,000,000       $500
 More than $1,000,000 but not over $5,000,000     $1,500
 More than $5,000,000 but not over $25,000,000    $3,500
 Over $25,000,000                                 $5,000
 
 For  purposes of this clause, city receipts are the receipts computed in
 accordance with subparagraph two of paragraph (a) of  subdivision  three
 of this section for the taxable year.  For taxable years beginning after
 two  thousand  eight, if the taxable  year  is  less than twelve months,
 the amount prescribed by this clause shall  be  reduced  by  twenty-five
 percent  if  the period for which the taxpayer is subject to tax is more
 than six months but not more than nine months and by  fifty  percent  if
 the period for which the taxpayer is subject to tax is not more than six
 months.  If  the  taxable year is less than twelve months, the amount of
 city receipts for  purposes  of  this  clause  is determined  by  divid-
 ing the amount of the receipts for the taxable year  by  the  number  of
 months in the taxable year and multiplying  the result by twelve plus;
 S. 8474                            455

   (b)  an  amount  computed  at the rate of three-quarters of a mill for
 each dollar of the portion of its subsidiary  capital  allocated  within
 the city as provided in this paragraph.
   In  the  case  of a taxpayer which is not subject to tax for an entire
 year, the exemption allowed in clause three of subparagraph (a) of  this
 paragraph  shall  be  prorated according to the period such taxpayer was
 subject to tax. Provided, however, that this paragraph shall  not  apply
 to  taxable  years  beginning  after December thirty-first, two thousand
 twenty-six.  For the taxable years specified in this  subparagraph,  the
 tax  imposed  by  subdivision  one  of section 11-603 of this subchapter
 shall be, in the case of each taxpayer, determined as specified in para-
 graph A of this subdivision, provided, however, that the  provisions  of
 paragraphs  G  and H of this subdivision shall apply for purposes of the
 computation under clause three of subparagraph (a) of such paragraph.
   F. Notwithstanding any other provision  of  this  subdivision  to  the
 contrary, for taxable years beginning after nineteen hundred eighty-sev-
 en  and before two thousand nine the amount of tax computed on the basis
 of the taxpayer's total business and investment capital, or the  portion
 thereof  allocated  within  the  city,  shall  in  no event exceed three
 hundred fifty thousand dollars and for taxable years beginning after two
 thousand eight the amount of tax computed on the basis of the taxpayer's
 total business and investment capital, or the portion thereof  allocated
 within the city, shall in no event exceed one million dollars.
   G. In the case of a foreign air carrier described in subparagraph  one
 of  paragraph  (c-1)  of  subdivision  eight  of  section 11-602 of this
 subchapter, there shall be excluded from  the  computation  of  the  tax
 under  clause  three of subparagraph (a) of paragraph E of this subdivi-
 sion salaries and other compensation described therein which are direct-
 ly attributable to the generation of income  excluded  from  entire  net
 income  for  the  taxable  year  pursuant to the provisions of paragraph
 (c-1) of subdivision eight of section 11-602 of this subchapter.
   H. For taxable years  beginning  on  or  after  July  first,  nineteen
 hundred  ninety-six,  the computation under clause three of subparagraph
 (a) of paragraph E of this subdivision shall be subject to the following
 modifications:
   (a) (1) For taxable years beginning on or after July  first,  nineteen
 hundred ninety-six but before July first, nineteen hundred ninety-eight,
 only  seventy-five  percent of the total salaries and other compensation
 paid to the taxpayer's elected or appointed officers shall be  added  to
 the  entire net income entering into such computation; for taxable years
 beginning on or after July  first,  nineteen  hundred  ninety-eight  but
 before  July  first, nineteen hundred ninety-nine, only fifty percent of
 such salaries and other compensation shall be added to such  entire  net
 income; and for taxable years beginning on or after July first, nineteen
 hundred  ninety-nine,  no  part  of such salaries and other compensation
 shall be added to such entire net income.
   (2) Notwithstanding anything in clause one of this subparagraph to the
 contrary, the full amount of the salary or other  compensation  paid  to
 any  such  elected  or  appointed  officer  shall be added to entire net
 income as provided in clause three of subparagraph (a) of paragraph E of
 this subdivision if such officer was, at any  time  during  the  taxable
 year,  a  stockholder owning more than five percent of taxpayer's issued
 capital stock.
   (b) For taxable years beginning  on  or  after  July  first,  nineteen
 hundred  ninety-seven  but  before  July first, nineteen hundred ninety-
 eight, the fixed dollar  amount  entering  into  the  computation  under
 S. 8474                            456
 
 clause  three  of  subparagraph  (a)  of paragraph E of this subdivision
 shall be thirty thousand dollars instead of  fifteen  thousand  dollars;
 and for taxable years beginning on or after July first, nineteen hundred
 ninety-eight, such fixed dollar amount shall be forty thousand dollars.
   (c)  For  taxable years beginning on or after January first, two thou-
 sand seven and before January first, two thousand eight the  per  centum
 entering  into the computation under clause three of subparagraph (a) of
 paragraph E of this subdivision shall be twenty-six and  one-fourth  per
 centum  instead  of thirty per centum, for taxable years beginning on or
 after January first, two thousand eight and before  January  first,  two
 thousand  nine  such  per  centum  shall  be twenty-two and one-half per
 centum, for taxable years beginning on or after January first, two thou-
 sand nine and before January first, two thousand  ten  such  per  centum
 shall  be  eighteen  and  three-fourths per centum and for taxable years
 beginning on or after January first, two thousand ten  such  per  centum
 shall be fifteen per centum.
   I.  Notwithstanding any provision of this subdivision to the contrary,
 for taxable years beginning on or  after  January  first,  two  thousand
 seven for any corporation that:
   (a)  has  a  business  allocation  percentage for the taxable year, as
 determined under paragraph (a) of subdivision three of this section,  of
 one hundred percent;
   (b) has no investment capital or income at any time during the taxable
 year;
   (c) has no subsidiary capital or income at any time during the taxable
 year; and
   (d)  has gross income, as defined in section sixty-one of the internal
 revenue code, less than two hundred fifty thousand dollars for the taxa-
 ble year:
   the tax imposed by subdivision one of section 11-603 of this  subchap-
 ter  shall be the greater of the tax on entire net income computed under
 clause one of subparagraph (a) of paragraph E of  this  subdivision  and
 the  fixed  dollar  minimum tax specified in clause four of subparagraph
 (a) of paragraph E of this subdivision.
   For purposes of this paragraph, for  taxable  years  beginning  before
 January  first,  two  thousand  fifteen,  any  corporation  for which an
 election under subsection (a) of section six hundred sixty  of  the  tax
 law  is  not in effect for the taxable year may elect to treat as entire
 net income the sum of:
   (i) entire net income as determined under section two hundred eight of
 the tax law; and
   (ii) any deductions taken for the taxable year  in  computing  federal
 taxable  income  for Staten Island city taxes paid or accrued under this
 chapter.
   2. The amount of subsidiary capital, investment capital  and  business
 capital  shall  each  be  determined  by taking the average value of the
 gross assets included therein,  less  liabilities  deductible  therefrom
 pursuant  to  the  provisions  of  subdivisions  three,  four and six of
 section 11-602 of this subchapter, and, if the  period  covered  by  the
 report  is other than a period of twelve calendar months, by multiplying
 such value by the number of  calendar  months  or  major  parts  thereof
 included  in  such  period,  and  dividing  the product thus obtained by
 twelve. For purposes of this subdivision, real property  and  marketable
 securities  shall  be  valued  at  fair  market  value  and the value of
 personal property other than marketable securities shall  be  the  value
 S. 8474                            457
 
 thereof  shown  on  the  books and records of the taxpayer in accordance
 with generally accepted accounting principles.
   3.  The portion of the entire net income of a taxpayer to be allocated
 within the city shall be determined as follows:
   (a) multiply its business income by a business  allocation  percentage
 to be determined by:
   (1) ascertaining the percentage which the average value of the taxpay-
 er's real and tangible personal property, whether owned or rented to it,
 within  the  city  during  the period covered by its report bears to the
 average value of all the taxpayer's real and tangible personal property,
 whether owned or rented to it, wherever situated during such period. For
 the purpose of this subparagraph, the term "value of the taxpayer's real
 and tangible personal property" shall mean the adjusted  bases  of  such
 properties  for  federal income tax purposes, except that in the case of
 rented property such value shall mean the product of (A) eight  and  (B)
 the gross rents payable for the rental of such property during the taxa-
 ble  year;  provided,  however,  that  the taxpayer may make a one-time,
 revocable election, pursuant to regulations promulgated by  the  commis-
 sioner  of  finance  to use fair market value as the value of all of its
 real and tangible personal property, provided that such election is made
 on or before the due date for filing a report under  section  11-605  of
 this  subchapter  for the taxpayer's first taxable year commencing on or
 after January first, nineteen hundred  eighty-eight  and  provided  that
 such  election shall not apply to any taxable year with respect to which
 the taxpayer is included on a combined report unless each of the taxpay-
 ers included on such report has made such an election which  remains  in
 effect for such year;
   (2)  ascertaining  the  percentage which the receipts of the taxpayer,
 computed on the cash  or  accrual  basis  according  to  the  method  of
 accounting  used  in  the  computation of its entire net income, arising
 during such period from:
   (A) except as otherwise provided in subparagraph nine  of  this  para-
 graph,  sales of its tangible personal property where shipments are made
 to points within the city;
   (B) services performed within the city, provided, however, that (i) in
 the case of a taxpayer engaged in the business of publishing  newspapers
 or  periodicals, receipts arising from sales of advertising contained in
 such newspapers and periodicals shall be deemed to arise  from  services
 performed within the city to the extent that such newspapers and period-
 icals  are  delivered  to points within the city, (ii) receipts received
 from an investment company arising from the sale of management, adminis-
 tration or distribution services to such  investment  company  shall  be
 deemed  to  arise  from services performed within the city to the extent
 set forth in subparagraph five of this paragraph, (iii) in the  case  of
 taxpayers  principally engaged in the activity of air freight forwarding
 acting as principal and like indirect  air  carriage,  receipts  arising
 from  such  activity  shall  be  deemed to arise from services performed
 within the city as follows: one hundred percent of such receipts if both
 the pickup and delivery associated with such receipts are  made  in  the
 city and fifty percent of such receipts if either the pickup or delivery
 associated  with  such  receipts  is  made in the city, (iv) for taxable
 years beginning on or after January first, two thousand two, in the case
 of a taxpayer engaged in the business of publishing newspapers or  peri-
 odicals,  or  broadcasting radio or television programs, whether through
 the public airwaves or by cable, direct  or  indirect  satellite  trans-
 mission, or any other means of transmission, receipts arising from sales
 S. 8474                            458
 
 of  subscriptions,  advertising or broadcasting shall be deemed to arise
 from services performed within  the  city  to  the  extent  provided  in
 subparagraph nine of this paragraph, and (v) for taxable years beginning
 after  two  thousand  eight, in the case of a taxpayer which is a regis-
 tered securities or commodities broker or dealer, the receipts specified
 in subparagraph ten of this paragraph shall  be  deemed  to  arise  from
 services  performed  within  the  city  to  the extent set forth in such
 subparagraph ten;
   (C) rentals from property situated  and  royalties  from  the  use  of
 patents or copyrights, within the city;
   (D)  all  other  business receipts earned within the city, bear to the
 total amount of the taxpayer's  receipts,  similarly  computed,  arising
 during  such  period  from  all sales of its tangible personal property,
 services, rentals, royalties and all other business transactions, wheth-
 er within or without the city; and
   (E) notwithstanding any other provision of this paragraph, net  global
 intangible  low-taxed  income shall be included in the receipts fraction
 as provided in this clause. Receipts constituting net global  intangible
 low-taxed  income shall not be included in the numerator of the receipts
 fraction. Receipts constituting net global intangible  low-taxed  income
 shall  be  included  in  the  denominator  of the receipts fraction. For
 purposes of this clause,  the  term  "net  global  intangible  low-taxed
 income" means the amount that would have been required to be included in
 the  taxpayer's  federal  gross  income  pursuant  to  subsection (a) of
 section nine hundred fifty-one-A of the internal revenue code  less  the
 amount of the deduction that would have been allowed under clause (i) of
 subparagraph  (B)  of  paragraph  one  of subdivision (a) of section two
 hundred fifty of such code if the taxpayer  had  not  made  an  election
 under subchapter s of chapter one of the internal revenue code;
   (3) ascertaining the percentage of the total wages, salaries and other
 personal service compensation, similarly computed, during such period of
 employees  within  the  city,  except general executive officers, to the
 total wages, salaries and other personal service compensation, similarly
 computed, during such period of all the taxpayer's employees within  and
 without the city, except general executive officers; and
   (4)  adding  together  the  percentages so determined and dividing the
 result by the number of percentages; provided, however, that for taxable
 years beginning on or after July first, nineteen hundred  ninety-six,  a
 taxpayer  that  is a "manufacturing corporation," as defined in subpara-
 graph eight of this paragraph, may  determine  its  business  allocation
 percentage  as  provided  in  such  subparagraph  eight;  and  provided,
 further, however, that for taxable years beginning  before  July  first,
 nineteen  hundred  ninety-six,  if  the taxpayer does not have a regular
 place of business outside the city other than a  statutory  office,  the
 business allocation percentage shall be one hundred per centum.
   (5)  Rules for receipts from certain services to investment companies.
 (A) For purposes of subclause (ii) of clause (B) of subparagraph two  of
 this  paragraph,  the  portion  of  receipts received from an investment
 company arising from the sale of management, administration or  distrib-
 ution  services to such investment company determined in accordance with
 clause (B) of this subparagraph shall be deemed to arise  from  services
 performed within the city, such portion referred to as the Staten Island
 city portion.
   (B)  The  Staten  Island  city portion shall be the product of (a) the
 total of such receipts from the sale of such services and  (b)  a  frac-
 tion.  The numerator of that fraction is the sum of the monthly percent-
 S. 8474                            459

 ages, as defined, determined for each month of the investment  company's
 taxable  year  for  federal  income tax purposes which taxable year ends
 within the taxable year of the taxpayer, but excluding any month  during
 which  the  investment  company  had no outstanding shares.  The monthly
 percentage for each such month is determined by dividing (a) the  number
 of  shares  in the investment company which are owned on the last day of
 the month by shareholders which are domiciled in the  city  by  (b)  the
 total  number  of  shares  in the investment company outstanding on that
 date. The denominator of the fraction is  the  number  of  such  monthly
 percentages.
   (C) (i) For purposes of this subparagraph, the term "domicile", in the
 case of an individual, shall have the meaning ascribed to it under chap-
 ter seventeen of this title; an estate or trust is domiciled in the city
 if  it  is a city resident estate or trust as defined in paragraph three
 of subdivision (b) of section 11-1705 of the code of the preceding muni-
 cipality; a business entity is domiciled in the city if the location  of
 the  actual  seat  of  management or control is in the city. It shall be
 presumed that the domicile of a shareholder, with respect to any  month,
 is  his,  her  or  its  mailing address on the records of the investment
 company as of the last day of such month.
   (ii) For purposes of this subparagraph, the term "investment  company"
 means  a  regulated  investment  company,  as  defined  in section eight
 hundred fifty-one of the internal revenue code,  and  a  partnership  to
 which  subdivision  (a)  of section seven thousand seven hundred four of
 the internal revenue code applies,  by  virtue  of  paragraph  three  of
 subdivision  (c)  of  section  seven thousand seven hundred four of such
 code, and that meets the requirements  of  subdivision  (b)  of  section
 eight  hundred  fifty-one of such code.  The provisions of this subpara-
 graph shall be applied to  the  taxable  year  for  federal  income  tax
 purposes  of  the  business  entity  that  is  asserted to constitute an
 investment company that ends within the taxable year of the taxpayer.
   (iii) For purposes of this subparagraph, the term  "receipts  from  an
 investment  company"  includes amounts received directly from an invest-
 ment company as well as amounts received from the shareholders  in  such
 investment company in their capacity as such.
   (iv) For purposes of this subparagraph, the term "management services"
 means  the  rendering  of  investment  advice  to an investment company,
 making determinations as to when sales and purchases of  securities  are
 to  be  made  on  behalf  of  an  investment  company, or the selling or
 purchasing of securities constituting assets of an  investment  company,
 and  related  activities, but only where such activity or activities are
 performed pursuant to a contract with  the  investment  company  entered
 into  pursuant  to  subdivision  (a)  of  section fifteen of the federal
 investment company act of nineteen hundred forty, as amended.
   (v)  For  purposes  of  this  subparagraph,  the  term   "distribution
 services"   means   the  services  of  advertising,  servicing  investor
 accounts, including redemptions, marketing shares or selling  shares  of
 an investment company, but, in the case of advertising, servicing inves-
 tor  accounts,  including  redemptions,  or marketing shares, only where
 such service is performed by a person who is, or was, in the case  of  a
 closed  end company, also engaged in the service of selling such shares.
 In the case of an open end company, such service of selling shares  must
 be performed pursuant to a contract entered into pursuant to subdivision
 (b) of section fifteen of the federal investment company act of nineteen
 hundred forty, as amended.
 S. 8474                            460
 
   (vi)  For  purposes  of  this  subparagraph,  the term "administration
 services" includes (1) clerical, accounting, bookkeeping, data  process-
 ing,  internal auditing, legal and tax services performed for an invest-
 ment company but only (2) if the provider of such  service  or  services
 during  the taxable year in which such service or services are sold also
 sells management or distribution services, as defined in this paragraph,
 to such investment company.
   (6) (A)  Provided,  further,  however,  that  a  taxpayer  principally
 engaged in the conduct of aviation, other than as provided in clause (C)
 of  this  subparagraph, shall, notwithstanding subparagraphs one through
 five of this paragraph, determine the portion of entire net income to be
 allocated within the city by multiplying its business income by a  busi-
 ness  allocation  percentage which is equal to the arithmetic average of
 the following three percentages:
   (i) the percentage determined by dividing aircraft arrivals and depar-
 tures within the city by the taxpayer during the period covered  by  its
 report  by the total aircraft arrivals and departures within and without
 the city during such period; provided, however, arrivals and  departures
 solely  for  maintenance  or  repair, refueling, where no debarkation or
 embarkation of traffic occurs, arrivals  and  departures  of  ferry  and
 personnel  training  flights  or arrivals and departures in the event of
 emergency situations shall not be included in computing such arrival and
 departure percentage; provided, further, the commissioner of finance may
 also exempt from such percentage aircraft arrivals and departures of all
 non-revenue flights including flights involving  the  transportation  of
 officers  or  employees  receiving air transportation to perform mainte-
 nance or repair services or where such officers or employees are  trans-
 ported  in  conjunction with an emergency situation or the investigation
 of an air disaster, other than on a scheduled flight; provided, however,
 that arrivals  and  departures  of  flights  transporting  officers  and
 employees receiving air transportation for purposes other than specified
 above,  without  regard  to remuneration, shall be included in computing
 such arrival and departure percentage;
   (ii) the percentage determined by dividing the revenue tons handled by
 the taxpayer at airports within the city during such period by the total
 revenue tons handled by it at  airports  within  and  without  the  city
 during such period; and
   (iii) the percentage determined by dividing the taxpayer's originating
 revenue within the city for such period by its total originating revenue
 within and without the city for such period.
   (B)  As used herein, the term "aircraft arrivals and departures" means
 the number of landings and takeoffs of the aircraft of the taxpayer  and
 the number of air pickups and deliveries by the aircraft of such taxpay-
 er;  the  term  "originating revenue" means revenue to the taxpayer from
 the transportation of revenue  passengers  and  revenue  property  first
 received  by the taxpayer either as originating or connecting traffic at
 airports; and the  term  "revenue  tons  handled"  by  the  taxpayer  at
 airports  means the weight in tons of revenue passengers, at two hundred
 pounds per passenger, and revenue cargo first received either as  origi-
 nating  or  connecting  traffic or finally discharged by the taxpayer at
 airports;
   (C) A foreign air carrier described in subparagraph one  of  paragraph
 (c-1)  of  subdivision  eight of section 11-602 of this subchapter shall
 determine its business allocation percentage pursuant to the  provisions
 of  subparagraphs  one  through  four of this paragraph, except that the
 numerators and denominators involved in such computation  shall  exclude
 S. 8474                            461
 
 property  to  the  extent  employed  in  generating income excluded from
 entire net income pursuant to  the  provisions  of  paragraph  (c-1)  of
 subdivision  eight  of  section  11-602 of this subchapter, exclude such
 receipts  as  are  excluded  from entire net income for the taxable year
 pursuant to the provisions of paragraph (c-1) of  subdivision  eight  of
 section  11-602 of this subchapter, and exclude wages, salaries or other
 personal service compensation which are  directly  attributable  to  the
 generation  of  income  excluded  from entire net income for the taxable
 year pursuant to the provisions of paragraph (c-1) of subdivision  eight
 of section 11-602 of this subchapter.
   (7) Provided, further, however, that a taxpayer principally engaged in
 the  operation  of  vessels  shall,  notwithstanding  subparagraphs  one
 through six of this paragraph,  determine  the  portion  of  entire  net
 income  to  be  allocated  within  the  city by multiplying its business
 income by a business allocation percentage determined  by  dividing  the
 aggregate  number  of  working  days of the vessels it owns or leases in
 territorial waters of the city during the period covered by  its  report
 by  the  aggregate  number of working days of all the vessels it owns or
 leases during such period.
   (8) (A) For taxable years beginning on or after July  first,  nineteen
 hundred  ninety-six  and  before  January  first, two thousand eleven, a
 manufacturing corporation may elect to determine its business allocation
 percentage by adding together the percentages determined under  subpara-
 graphs one, two and three of this paragraph and an additional percentage
 equal  to the percentage determined under subparagraph two of this para-
 graph, and dividing the result by the number  of  percentages  so  added
 together.
   (B)  An  election  under  this  subparagraph  must be made on a timely
 filed, determined with regard to extensions granted, original report for
 the taxable year. Once made for a taxable year, such election  shall  be
 irrevocable  for that taxable year. A separate election must be made for
 each taxable year. A manufacturing corporation that has failed  to  make
 an  election  as  provided in this clause shall be required to determine
 its business allocation percentage without regard to the  provisions  of
 this  subparagraph.  Notwithstanding  anything  in  this  clause  to the
 contrary, the commissioner of finance may permit a manufacturing  corpo-
 ration  to make or revoke an election under this subparagraph, upon such
 terms and conditions  as  the  commissioner  may  prescribe,  where  the
 commissioner  determines  that  such permission should be granted in the
 interests of fairness and  equity  due  to  a  change  in  circumstances
 resulting from an audit adjustment.
   (C) As used in this subparagraph, the term "manufacturing corporation"
 means  a  corporation  primarily  engaged  in the manufacturing and sale
 thereof of tangible personal  property;  and  the  term  "manufacturing"
 includes the process, including the assembly process, (i) of working raw
 materials  into  wares  suitable for use or (ii) which gives new shapes,
 new qualities or new combinations  to  matter  which  already  has  gone
 through  some artificial process, by the use of machinery, tools, appli-
 ances and other similar equipment. A corporation shall be deemed  to  be
 primarily  engaged in the activities described in the provisions of this
 subparagraph if more than fifty percent of its gross  receipts  for  the
 taxable year are attributable to such activities.
   (D)  Notwithstanding  anything  to the contrary, if a taxpayer that is
 otherwise eligible to make the election authorized by this  subparagraph
 is  required  or permitted to make a report on a combined basis with one
 or more other corporations  pursuant  to  subdivision  four  of  section
 S. 8474                            462
 
 11-605  of  this  chapter,  the  taxpayer  shall be permitted to make an
 election under this subparagraph only if such taxpayer  and  such  other
 corporation or corporations would be a manufacturing corporation if they
 were  treated  as  a  single  corporation. In making such determination,
 intercorporate transactions shall be eliminated. Where such election has
 been made by the taxpayer for a taxable year, each of the  other  corpo-
 rations  included  in  the  combined report shall also be deemed to have
 made a proper election under this subparagraph for such taxable year.
   (9) Special rules for publishers and broadcasters. (A) Notwithstanding
 anything in subparagraph two of  this  paragraph  to  the  contrary  and
 except  as provided in clause (C) of this subparagraph, in the case of a
 taxpayer engaged in the business of  publishing  newspapers  or  period-
 icals,  there  shall  be allocated to the city, for purposes of subpara-
 graph two of this paragraph, the gross sales  or  charges  for  services
 arising  from sales of advertising contained in such newspapers or peri-
 odicals, to the extent that such newspapers or periodicals are delivered
 to points within the city.
   (B) Notwithstanding anything in subparagraph two of this paragraph  to
 the  contrary and except as provided in clause (C) of this subparagraph,
 in the case of a taxpayer engaged in the business of broadcasting  radio
 or television programs, whether through the public airwaves or by cable,
 direct  or indirect satellite transmission, or any other means of trans-
 mission, there shall be allocated to the city, for purposes of  subpara-
 graph two of this paragraph, a portion of the gross sales or charges for
 services  arising  from the broadcasting of such programs and of commer-
 cial messages in connection therewith, such  portion  to  be  determined
 according  to  the number of listeners or viewers within and without the
 city.
   (C) Notwithstanding anything in clause (A) or (B) of this subparagraph
 to the contrary, in the case of a taxpayer engaged in  the  business  of
 publishing  newspapers  or  periodicals,  or broadcasting radio or tele-
 vision programs, whether through the public airwaves or by cable, direct
 or indirect satellite transmission, or any other means of  transmission,
 there  shall  be allocated to the city, for purposes of subparagraph two
 of this paragraph, the gross sales or charges to subscribers located  in
 the  city  for subscriptions to such newspapers, periodicals, or program
 services. For purposes of this clause,  a  subscriber  shall  be  deemed
 located  in  the city if, in the case of newspapers and periodicals, the
 mailing address for the subscription is within the city and, in the case
 of program services, the billing address for the subscription is  within
 the  city. For purposes of this clause, "subscriber" shall mean a member
 of the general public  who  receives  such  newspapers,  periodicals  or
 program services and does not further distribute them.
   (10) Notwithstanding subparagraphs one through five of this paragraph,
 but  subject to subparagraph eight of this paragraph, the business allo-
 cation percentage, to the extent that it is computed by reference to the
 percentages determined under subparagraphs one, two and  three  of  this
 paragraph,  shall  be  computed in the manner set forth in this subpara-
 graph.
   (A) For taxable years beginning in two  thousand  nine,  the  business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i)  the product of thirty percent and the percentage determined under
 subparagraph one of this paragraph,
   (ii) the product of forty percent and the percentage determined  under
 subparagraph two of this paragraph, and
 S. 8474                            463
 
   (iii)  the  product  of  thirty  percent and the percentage determined
 under subparagraph three of this paragraph.
   (B)  For  taxable  years  beginning  in two thousand ten, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i) the product of twenty-seven percent and the percentage  determined
 under subparagraph one of this paragraph,
   (ii)  the  product  of forty-six percent and the percentage determined
 under subparagraph two of this paragraph, and
   (iii) the product of twenty-seven percent and  the  percentage  deter-
 mined under subparagraph three of this paragraph.
   (C)  For  taxable years beginning in two thousand eleven, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i) the product of twenty-three and one-half percent and the  percent-
 age determined under subparagraph one of this paragraph,
   (ii)  the product of fifty-three percent and the percentage determined
 under subparagraph two of this paragraph, and
   (iii) the  product  of  twenty-three  and  one-half  percent  and  the
 percentage determined under subparagraph three of this paragraph.
   (D)  For  taxable years beginning in two thousand twelve, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i) the product of twenty percent and the percentage determined  under
 subparagraph one of this paragraph,
   (ii)  the product of sixty percent and the percentage determined under
 subparagraph two of this paragraph, and
   (iii) the product of twenty  percent  and  the  percentage  determined
 under subparagraph three of this paragraph.
   (E) For taxable years beginning in two thousand thirteen, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i)  the  product  of  sixteen and one-half percent and the percentage
 determined under subparagraph one of this paragraph,
   (ii) the product of sixty-seven percent and the percentage  determined
 under subparagraph two of this paragraph, and
   (iii)  the  product of sixteen and one-half percent and the percentage
 determined under subparagraph three of this paragraph.
   (F) For taxable years beginning in two thousand fourteen, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i) the product of thirteen and one-half percent  and  the  percentage
 determined under subparagraph one of this paragraph,
   (ii)  the  product  of seventy-three percent and the percentage deter-
 mined under subparagraph two of this paragraph, and
   (iii) the product of thirteen and one-half percent and the  percentage
 determined under subparagraph three of this paragraph.
   (G)  For taxable years beginning in two thousand fifteen, the business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i) the product of ten percent and  the  percentage  determined  under
 subparagraph one of this paragraph,
   (ii) the product of eighty percent and the percentage determined under
 subparagraph two of this paragraph, and
   (iii)  the  product of ten percent and the percentage determined under
 subparagraph three of this paragraph.
 S. 8474                            464
 
   (H) For taxable years beginning in two thousand sixteen, the  business
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i)  the product of six and one-half percent and the percentage deter-
 mined under subparagraph one of this paragraph,
   (ii) the product of eighty-seven percent and the percentage determined
 under subparagraph two of this paragraph, and
   (iii) the product of six  and  one-half  percent  and  the  percentage
 determined under subparagraph three of this paragraph.
   (I)  For  taxable years beginning in two thousand seventeen, the busi-
 ness allocation percentage shall be determined by  adding  together  the
 following percentages:
   (i)  the  product  of  three  and  one-half percent and the percentage
 determined under subparagraph one of this paragraph,
   (ii) the product of ninety-three percent and the percentage determined
 under subparagraph two of this paragraph, and
   (iii) the product of three and one-half  percent  and  the  percentage
 determined under subparagraph three of this paragraph.
   (J)  For  taxable  years  beginning  after two thousand seventeen, the
 business allocation percentage shall be the percentage determined  under
 subparagraph two of this paragraph.
   (K) The commissioner shall promulgate rules necessary to implement the
 provisions  of  this  subparagraph under such circumstances where any of
 the percentages to be determined under subparagraph one, two or three of
 this paragraph cannot be determined because the taxpayer has no  proper-
 ty, receipts or wages within or without the city.
   (11) (A) In the case of a taxpayer which is a registered securities or
 commodities  broker  or  dealer,  the  receipts  specified  in items (i)
 through (vii) of this clause shall be  deemed  to  arise  from  services
 performed within the city to the extent set forth in each of such items.
   (i)  Receipts  constituting  brokerage  commissions  derived  from the
 execution of securities or commodities purchase or sales orders for  the
 accounts  of  customers shall be deemed to arise from services performed
 at the mailing address in the records of the taxpayer  of  the  customer
 who is responsible for paying such commissions.
   (ii) Receipts constituting margin interest earned on behalf of broker-
 age  accounts  shall  be  deemed to arise from services performed at the
 mailing address in the records of the taxpayer of the  customer  who  is
 responsible for paying such margin interest.
   (iii)  Gross income, including any accrued interest or dividends, from
 principal transactions for  the  purchase  or  sale  of  stocks,  bonds,
 foreign  exchange and other securities or commodities, including futures
 and forward contracts, options and other types of securities or  commod-
 ities  derivatives  contracts,  shall  be  deemed to arise from services
 performed within the city either (I) to the extent that production cred-
 its are awarded to branches, offices or employees of the taxpayer within
 the city as a result of such  principal  transactions  or  (II)  if  the
 taxpayer  so  elects,  to  the  extent that the gross proceeds from such
 principal  transactions,  determined  without  deduction  for  any  cost
 incurred  by  the taxpayer to acquire the securities or commodities, are
 generated from sales of securities or commodities  to  customers  within
 the  city  based  upon  the  mailing  addresses of such customers in the
 records of the taxpayer. For purposes of subitem (II) of this item,  the
 taxpayer  shall  separately  calculate  such gross income from principal
 transactions by type of security or  commodity.  For  purposes  of  this
 item, gross income from principal transactions shall be determined after
 S. 8474                            465
 
 the  deduction of any cost incurred by the taxpayer to acquire the secu-
 rities or commodities. For  purposes  of  this  subparagraph,  the  term
 "production  credits"  means  credits  granted  pursuant to the internal
 accounting  system used by the taxpayer to measure the amount of revenue
 that should be awarded to a particular branch or office or  employee  of
 the  taxpayer  which  is  based,  at least in part, on the branch's, the
 office's or the employee's  particular  activities.  Upon  request,  the
 taxpayer  shall  be  required  to furnish a detailed explanation of such
 internal accounting system to the department.
   (iv) (I) Receipts constituting fees earned by the taxpayer  for  advi-
 sory services to a customer in connection with the underwriting of secu-
 rities  for  such  customer,  such  customer  being  the entity which is
 contemplating issuing or is issuing securities, or fees  earned  by  the
 taxpayer  for  managing  an  underwriting  shall be deemed to arise from
 services performed at the mailing address in the records of the taxpayer
 of such customer who is responsible for paying such fees.
   (II) Receipts constituting the primary spread  or  selling  concession
 from  underwritten  securities  shall  be  deemed to arise from services
 performed within the city to the  extent  that  production  credits  are
 awarded  to  branches,  offices  or employees of the taxpayer within the
 city as a result of the sale of the underwritten securities.
   (III) The term "primary spread" means the difference between the price
 paid by the taxpayer to the issuer of the securities being marketed  and
 the  price received from the subsequent sale of the underwritten securi-
 ties at the initial public offering price, less any  selling  concession
 and any fees paid to the taxpayer for advisory services or any manager's
 fees,  if  such  fees are not paid by the customer to the taxpayer sepa-
 rately. The term "public offering price" means the price agreed upon  by
 the taxpayer and the issuer at which the securities are to be offered to
 the  public.  The term "selling concession" means the amount paid to the
 taxpayer for participating in the underwriting of a security  where  the
 taxpayer is not the lead underwriter.
   (v) Receipts constituting interest earned by the taxpayer on loans and
 advances  made  by  the  taxpayer  to  a corporation affiliated with the
 taxpayer but with which the taxpayer is not  permitted  or  required  to
 file a combined report pursuant to subdivision four of section 11-605 of
 this  subchapter shall be deemed to arise from services performed at the
 principal place of business of such affiliated corporation.
   (vi) Receipts constituting account maintenance fees shall be deemed to
 arise from services performed at the mailing address in the  records  of
 the  taxpayer of the customer who is responsible for paying such account
 maintenance fees.
   (vii) Receipts constituting fees for management or advisory  services,
 including  fees  for advisory services in relation to merger or acquisi-
 tion activities but excluding fees paid for services described  in  item
 (ii)  of  clause  (B)  of  subparagraph  two of this paragraph, shall be
 deemed to arise from services performed at the mailing  address  in  the
 records  of  the  taxpayer of the customer who is responsible for paying
 such fees.
   (B) For purposes of this subparagraph,  the  term  "securities"  shall
 have  the same meaning as in paragraph two of subdivision (c) of section
 four hundred seventy-five of the internal  revenue  code  and  the  term
 "commodities"  shall have the same meaning as in paragraph two of subdi-
 vision (e) of section four hundred seventy-five of the internal  revenue
 code.  The  term "registered securities or commodities broker or dealer"
 means a broker or dealer  registered  as  such  by  the  securities  and
 S. 8474                            466
 
 exchange  commission  or the commodities futures trading commission, and
 shall include an over-the-counter derivatives dealer  as  defined  under
 regulations  of the securities and exchange commission at title 17, part
 240,   section  3b-12  of  the  code  of  federal  regulations  (17  CFR
 240.3b-12).
   (C) If the taxpayer receives any of the receipts enumerated in  clause
 (A)  of  this  subparagraph  as  a  result of a securities correspondent
 relationship such taxpayer has with  another  registered  securities  or
 commodities  broker or dealer with the taxpayer acting in this relation-
 ship as the clearing firm, such receipts shall be deemed to  arise  from
 services  performed  within  the city to the extent set forth in each of
 the items of clause  (A)  of  this  subparagraph.  The  amount  of  such
 receipts shall exclude the amount the taxpayer is required to pay to the
 correspondent  firm for such correspondent relationship. If the taxpayer
 receives any of the receipts enumerated in clause (A) of  this  subpara-
 graph  as  a  result  of  a  securities  correspondent relationship such
 taxpayer has with another registered securities or commodities broker or
 dealer with the taxpayer acting in this relationship as the  introducing
 firm,  such  receipts  shall  be deemed to arise from services performed
 within the city to the extent set forth in each of the items  of  clause
 (A) of this subparagraph.
   (D) If, for purposes of item (i) or (ii), subitem (I) of item (iv), or
 item  (vi), or (vii) of clause (A) of this subparagraph, the taxpayer is
 unable from its records to determine the mailing address of the  custom-
 er,  the  receipts  enumerated  in  any of such items shall be deemed to
 arise from services performed at the branch or office  of  the  taxpayer
 that  generates  the  transaction  for  the customer that generated such
 receipts.
   (b)  multiply  its  investment  income  by  an  investment  allocation
 percentage to be determined by:
   (1)  multiplying the amount of its investment capital invested in each
 stock, bond or  other  security,  other  than  governmental  securities,
 during  the  period  covered  by  its  report by the issuer's allocation
 percentage of the issuer or obligor thereof.
   (i) In the case of an issuer or obligor  subject  to  tax  under  this
 subchapter,  subchapter  three-A  or subchapter four of this chapter, or
 subject to tax as a utility corporation under  chapter  eleven  of  this
 title, the issuer's allocation percentage shall be the percentage of the
 appropriate  measure,  which is required to be allocated within the city
 on the report or reports, if any, required  of  the  issuer  or  obligor
 under this title for the preceding year. The "appropriate measure" shall
 be  defined  as:  in  the  case  of an issuer or obligor subject to this
 subchapter or subchapter three-A, entire capital;  in  the  case  of  an
 issuer  or  obligor  subject  to subchapter four of this chapter, issued
 capital stock; in the case of an issuer or obligor  subject  to  chapter
 eleven of this title as a utility corporation, gross income.
   (ii)  In  the  case  of an issuer or obligor subject to tax under part
 four of subchapter  three  of  this  chapter,  the  issuer's  allocation
 percentage shall be determined as follows:
   (A)  In  the case of a banking corporation described in paragraphs one
 through eight of subdivision (a) of section 11-640 of this chapter which
 is organized under the laws of the United  States,  this  state  or  any
 other  state  of  the  United States, the issuer's allocation percentage
 shall be its alternative entire net  income  allocation  percentage,  as
 defined  in  subdivision  (c) of section 11-642 of this chapter, for the
 preceding year. In the case of such a banking corporation whose alterna-
 S. 8474                            467
 
 tive entire net income for the preceding  year  is  derived  exclusively
 from  business  carried  on  within  the  city,  its issuer's allocation
 percentage shall be one hundred percent.
   (B) In the case of a banking corporation described in paragraph two of
 subdivision  (a)  of  section  11-640 of this chapter which is organized
 under the laws of a country other than the United States,  the  issuer's
 allocation  percentage  shall  be  determined by dividing (I) the amount
 described in clause (i) of subparagraph (A) of paragraph two of subdivi-
 sion (a) of section 11-642 of this chapter with respect to  such  issuer
 or  obligor  for  the  preceding  year, by (II) the gross income of such
 issuer or obligor from all sources within and without the United States,
 for such preceding year, whether or not included in  alternative  entire
 net income for such year.
   (C) In the case of an issuer or obligor described in paragraph nine of
 subdivision (a) or in paragraph two of subdivision (d) of section 11-640
 of  this chapter, the issuer's allocation percentage shall be determined
 by dividing the portion of the entire capital of the issuer  or  obligor
 allocable  to  the  city  for  the preceding year by the entire capital,
 wherever located, of the issuer or obligor for the preceding year.
   (iii) Provided, however, that if a report or reports for the preceding
 year are not filed, or if filed do not contain information  which  would
 permit  the  determination  of such issuer's allocation percentage, then
 the issuer's allocation percentage to be used shall, at  the  discretion
 of  the  commissioner  of finance, be either (A) the issuer's allocation
 percentage derived from the most recently filed report or reports of the
 issuer or obligor or (B) a percentage calculated, by the commissioner of
 finance, reasonably to indicate the degree of economic presence  in  the
 city of the issuer or obligor during the preceding year.
   (2) adding together the sum so obtained, and
   (3)  dividing  the  result  so obtained by the total of its investment
 capital invested during such period in stocks, bonds and  other  securi-
 ties; provided, however, that in case any investment capital is invested
 in any stock, bond or other security during only a portion of the period
 covered  by the report, only such portion of such capital shall be taken
 into account; and provided further,  that  if  a  taxpayer's  investment
 allocation  percentage is zero, interest received on bank accounts shall
 be multiplied by its business allocation percentage; and
   (c) add the products so obtained.
   (d) Except as provided in subparagraph three of this paragraph  or  in
 paragraph (e) of this subdivision, at the election of the taxpayer there
 shall  be  deducted  from the portion of its entire net income allocated
 within the city either or both of the items set forth  in  subparagraphs
 one  and  two of this paragraph, except that only one of such deductions
 shall be allowed with respect to any one item of property.
   (1) Depreciation with respect to any property  such  as  described  in
 subparagraph  three  of this paragraph, not exceeding twice the depreci-
 ation allowed with respect to the same property for federal  income  tax
 purposes.  Such  deduction  shall  be  allowed  only upon condition that
 entire net income be computed without any deduction for the depreciation
 of the same property, and the total of all  deductions  allowed  in  any
 taxable year or years with respect to the depreciation of any such prop-
 erty shall not exceed its cost or other basis.
   (2)  Expenditures  paid  or  incurred  during the taxable year for the
 construction, reconstruction, erection or acquisition  of  any  property
 such  as described in subparagraph three of this paragraph which is used
 or to be used for purposes of research and  development  in  the  exper-
 S. 8474                            468
 
 imental  or  laboratory  sense.  Such  purposes  shall  not be deemed to
 include the ordinary testing or inspection of materials or products  for
 quality   control,  efficiency  surveys,  management  studies,  consumer
 surveys,  advertising,  promotions or research in connection with liter-
 ary, historical or similar projects. Such  deduction  shall  be  allowed
 only  on  condition  that entire net income for the taxable year and all
 succeeding taxable years be computed without the deduction of  any  such
 expenditures  and  without  any  deduction  for depreciation of the same
 property, except to the extent that its basis  may  be  attributable  to
 factors  other  than such expenditures, or in case a deduction is allow-
 able pursuant to this subparagraph for only a part of such expenditures,
 on condition that any deduction allowed for federal income tax  purposes
 on  account  of  such  expenditures or on account of depreciation of the
 same property be proportionately reduced in computing entire net  income
 for  the  taxable year and all succeeding taxable years. With respect to
 property which is used or to be used for research and  development  only
 in part, or during only part of its useful life, a proportionate part of
 such  expenditures  shall be deductible. If all or part of such expendi-
 tures with respect to any property shall have been deducted as  provided
 in  this subparagraph, and such property is used for purposes other than
 research and development to a greater extent than  originally  reported,
 the  taxpayer  shall report such use in its report for the first taxable
 year during which it occurs, and the commissioner of finance may  recom-
 pute the tax for the year or years for which such deduction was allowed,
 and  may  assess  any  additional  tax resulting from such recomputation
 regardless of the time limitations set forth in section 11-674  of  this
 chapter.
   (3)  Such  deductions  shall  be allowed only with respect to tangible
 property which is depreciable pursuant to section one hundred sixty-sev-
 en of the internal revenue code, having a situs in the city and used  in
 the  taxpayer's  trade  or  business,  (A) constructed, reconstructed or
 erected after December thirty-first, nineteen hundred sixty-five, pursu-
 ant to a contract which was, on or before December  thirty-first,  nine-
 teen  hundred  sixty-seven,  and at all times thereafter, binding on the
 taxpayer or, property,  the  physical  construction,  reconstruction  or
 erection  of  which  began  on or before December thirty-first, nineteen
 hundred sixty-seven or which began after such date pursuant to an  order
 placed on or before December thirty-first, nineteen hundred sixty-seven,
 and  then  only with respect to that portion of the basis thereof or the
 expenditures relating thereto which is  properly  attributable  to  such
 construction,  reconstruction  or  erection after December thirty-first,
 nineteen hundred sixty-five, or  (B)  acquired  after  December  thirty-
 first, nineteen hundred sixty-five, pursuant to a contract which was, on
 or  before  December  thirty-first, nineteen hundred sixty-seven, and at
 all times thereafter, binding on the taxpayer or pursuant  to  an  order
 placed on or before December thirty-first, nineteen hundred sixty-seven,
 by  purchase  as  defined in section one hundred seventy-nine (d) of the
 internal revenue code, if the original use of  such  property  commenced
 with  the  taxpayer,  commenced in the city and commenced after December
 thirty-first, nineteen hundred sixty-five, or (C) acquired, constructed,
 reconstructed, or erected subsequent to December  thirty-first  nineteen
 hundred  sixty-seven,  if such acquisition, construction, reconstruction
 or erection is pursuant to a plan of the taxpayer which was in existence
 December thirty-first, nineteen hundred sixty-seven and  not  thereafter
 substantially  modified,  and  such  acquisition,  construction,  recon-
 struction or erection would qualify under the rules in paragraphs  four,
 S. 8474                            469
 
 five  or  six  of  subsection (h) of section forty-eight of the internal
 revenue code provided all references in such paragraphs four,  five  and
 six  to  the dates October nine, nineteen hundred sixty-six, and October
 ten, nineteen hundred sixty-six, shall be read as December thirty-first,
 nineteen  hundred  sixty-seven.  A taxpayer shall be allowed a deduction
 under clauses (A), (B) or (C) of this subparagraph only if the  tangible
 property  shall  be  delivered  or  the  construction, reconstruction or
 erection shall be completed on or before December thirty-first, nineteen
 hundred sixty-nine, except in the case of  tangible  property  which  is
 acquired,  constructed,  reconstructed or erected pursuant to a contract
 which was, on or before December thirty-first, nineteen  hundred  sixty-
 seven,  and  at all times thereafter, binding on the taxpayer. Provided,
 however, for any taxable year beginning on or after January first, nine-
 teen hundred sixty-eight, a taxpayer shall not be  allowed  a  deduction
 under  this  paragraph with respect to tangible personal property leased
 by it to any other person or corporation. Accordingly, any  contract  or
 agreement  to  lease or rent or for a license to use such property shall
 be considered a lease. With respect to property which the taxpayer  uses
 itself  for  purposes  other than leasing for part of a taxable year and
 leases for a part of a taxable year, the taxpayer  shall  be  allowed  a
 deduction  under this paragraph in proportion to the part of the year it
 uses such property.
   (4) If the deductions allowable for any taxable year, pursuant to this
 subdivision, exceed the portion of  the  taxpayer's  entire  net  income
 allocated  to  the city for such year, the excess may be carried over to
 the following taxable year or years and may be deducted from the portion
 of the taxpayer's entire net income allocated to the city for such  year
 or years.
   (5)  In  any  taxable year when property is sold or otherwise disposed
 of, with respect to which a  deduction  has  been  allowed  pursuant  to
 subparagraph  one  or  two  of  this paragraph, the gain or loss thereon
 entering into the computation of federal taxable income shall be  disre-
 garded  in  computing  entire net income, and there shall be added to or
 subtracted from the portion of entire net income  allocated  within  the
 city  the gain or loss upon such sale or other disposition. In computing
 such gain or loss the basis of the property sold or disposed of shall be
 adjusted to reflect the deduction allowed with respect to such  property
 pursuant  to subparagraph one or two of this paragraph. Provided, howev-
 er, that no loss shall be recognized for the purposes of  this  subpara-
 graph  with  respect  to  a  sale  or other disposition of property to a
 person whose acquisition thereof is not a purchase as defined in section
 one hundred seventy-nine (d) of the internal revenue code.
   (e) At the election of the taxpayer there shall be deducted  from  the
 portion  of  its  entire  net income allocated within the city either or
 both of the items set forth in subparagraphs one and two of  this  para-
 graph,  except  that  only  one of such deductions shall be allowed with
 respect to any one item of property.
   (1) Depreciation with respect to any property  such  as  described  in
 subparagraphs  three and four of this paragraph, not exceeding twice the
 depreciation allowed with respect  to  the  same  property  for  federal
 income tax purposes. Such deduction shall be allowed only upon condition
 that  entire net income be computed without any deduction for the depre-
 ciation of the same property, and the total of all deductions allowed in
 any taxable year or years with respect to the depreciation of  any  such
 property  shall  not  exceed  its  cost or other basis multiplied by the
 taxpayer's business allocation percentage determined under this subdivi-
 S. 8474                            470
 
 sion for the first year it deducts such depreciation  under  this  para-
 graph.
   (2)  Expenditures  paid  or  incurred  during the taxable year for the
 construction, reconstruction, erection or acquisition  of  any  property
 such  as described in subparagraph three of this paragraph which is used
 or to be used for purposes of research and  development  in  the  exper-
 imental  or  laboratory  sense.  Such  purposes  shall  not be deemed to
 include the ordinary testing or inspection of materials or products  for
 quality   control,  efficiency  surveys,  management  studies,  consumer
 surveys, advertising, promotions or research in connection  with  liter-
 ary,  historical  or  similar projects. Such deductions shall be allowed
 only on condition that it does not exceed the amount of the expenditures
 multiplied by the taxpayer's business allocation  percentage  determined
 under  this  subdivision  for  the  year  the  expenditures  are paid or
 incurred and that entire  net  income  for  the  taxable  year  and  all
 succeeding  taxable  years be computed without the deduction of any such
 expenditures and without any deduction  for  depreciation  of  the  same
 property,  except  to  the  extent that its basis may be attributable to
 factors other than such expenditures, or in case a deduction  is  allow-
 able pursuant to this subparagraph for only a part of such expenditures,
 on  condition that any deduction allowed for federal income tax purposes
 on account of such expenditures or on account  of  depreciation  of  the
 same  property be proportionately reduced in computing entire net income
 for the taxable year and all succeeding taxable years. With  respect  to
 property  which  is used or to be used for research and development only
 in part, or during only part of its useful life, a proportionate part of
 such expenditures shall be deductible. If all or part of  such  expendi-
 tures  with respect to any property shall have been deducted as provided
 in this subparagraph, and such property is used for purposes other  than
 research  and  development to a greater extent than originally reported,
 the taxpayer shall report such use in its report for the  first  taxable
 year  during which it occurs, and the commissioner of finance may recom-
 pute the tax for the year or years for which such deduction was allowed,
 and may assess any additional  tax  resulting  from  such  recomputation
 regardless  of  the time limitations set forth in section 11-674 of this
 chapter.
   (3) Such deduction shall be allowed  only  with  respect  to  tangible
 property which is depreciable pursuant to section one hundred sixty-sev-
 en  of the internal revenue code, having a situs in the city and used in
 the taxpayer's trade or business (A) the construction, reconstruction or
 erection of which is completed  after  December  thirty-first,  nineteen
 hundred  sixty-seven,  and then only with respect to that portion of the
 basis thereof or the expenditures relating  thereto  which  is  properly
 attributable  to  such  construction,  reconstruction  or erection after
 December thirty-first, nineteen  hundred  sixty-five,  or  (B)  acquired
 after December thirty-first, nineteen hundred sixty-seven by purchase or
 defined  in section one hundred seventy-nine (d) of the internal revenue
 code, if the original use of such property commenced with the  taxpayer,
 commenced  in this state and commenced after December thirty-first nine-
 teen hundred sixty-five.  Provided, however, for any taxable year begin-
 ning on or after January first, nineteen hundred sixty-eight, a taxpayer
 shall not be allowed a deduction under this paragraph  with  respect  to
 tangible  personal  property  leased by it to any other person or corpo-
 ration. Accordingly, any contract or agreement to lease or rent or for a
 license to use such property shall be considered a lease.  With  respect
 to property which the taxpayer uses itself for purposes other than leas-
 S. 8474                            471
 
 ing  for part of a taxable year and leases for a part of a taxable year,
 the taxpayer shall be  allowed  a  deduction  under  this  paragraph  in
 proportion to the part of the year it uses such property.
   (4)  A  deduction  under  subparagraph  one of this paragraph shall be
 allowed with respect to  tangible  property  described  in  subparagraph
 three  only  if such property is principally used by the taxpayer in the
 production of goods by manufacturing; processing; assembling;  refining;
 mining;  extracting;  farming;  agriculture; horticulture; floriculture;
 viticulture or commercial fishing. For purposes  of  this  subparagraph,
 manufacturing shall mean the process of working raw materials into wares
 suitable  for use or which gives new shapes, new qualities or new combi-
 nations to matter which already has gone through some artificial process
 by the use of machinery, tools, appliances and other similar  equipment.
 Property used in the production of goods shall include machinery, equip-
 ment  or other tangible property which is principally used in the repair
 and service of other machinery, equipment  or  other  tangible  property
 used principally in the production of goods and shall include all facil-
 ities used in the manufacturing operation, including storage of material
 to  be  used in manufacturing and of the products that are manufactured.
 At the option of the taxpayer, air and water pollution  control  facili-
 ties which qualify for elective deductions under paragraph (g) of subdi-
 vision  eight  of  section 11-602 of this subchapter may be treated, for
 purposes of this paragraph, as tangible property principally used in the
 production of goods by manufacturing; processing; assembling;  refining;
 mining;  extracting;  farming;  agriculture; horticulture; floriculture;
 viticulture; or commercial fishing, in which event,  a  deduction  shall
 not be allowed under such paragraph (g).
   (5)  Subject to the limitation imposed by subparagraphs one and two of
 this paragraph, if the deductions allowable for any taxable year, pursu-
 ant to this subdivision, exceed the portion of the taxpayer's entire net
 income allocated to the city for such year, the excess  may  be  carried
 over to the following taxable year or years and may be deducted from the
 portion  of  the  taxpayer's entire net income allocated to the city for
 such year or years.
   (6) In any taxable year when property is sold  or  otherwise  disposed
 of,  with  respect  to  which  a  deduction has been allowed pursuant to
 subparagraph one or two of this paragraph,  the  gain  or  loss  thereon
 entering  into the computation of federal taxable income shall be disre-
 garded in computing entire net income, and there shall be  added  to  or
 subtracted  from  the  portion of entire net income allocated within the
 city the gain or loss upon such sale or other disposition. In  computing
 such gain or loss the basis of the property sold or disposed of shall be
 adjusted  to reflect the deduction allowed with respect to such property
 pursuant to subparagraph one or two of this paragraph. Provided,  howev-
 er,  that  no loss shall be recognized for the purposes of this subpara-
 graph with respect to a sale or  other  disposition  of  property  to  a
 person whose acquisition thereof is not a purchase as defined in section
 one hundred seventy-nine (d) of the internal revenue code.
   4.  The  portion of the business capital of a taxpayer to be allocated
 within the city shall be determined by multiplying the amount thereof by
 the business allocation percentage determined as provided  for  in  this
 subdivision. Provided, however, such business allocation percentage, for
 purposes  of  allocating  business  capital, shall (a) for taxable years
 beginning before nineteen hundred  ninety-four,  be  determined  without
 regard to clause (C) of subparagraph six of paragraph (a) of subdivision
 three of this section and (b) for taxable years beginning after nineteen
 S. 8474                            472

 hundred  ninety-three,  be determined with regard to such clause (C) but
 only in the case of a taxpayer subject to the  provisions  of  paragraph
 (b) of subdivision six of section 11-602 of this subchapter.
   5. The portion of the investment capital of a taxpayer to be allocated
 within the city shall be determined by multiplying the amount thereof by
 the  investment  allocation  percentage  determined  as provided in this
 subdivision.
   7. The portion of the subsidiary capital of a taxpayer to be allocated
 within the city shall be determined by (a) multiplying the amount of its
 subsidiary capital invested in each subsidiary during the period covered
 by its report, or, in the case of any such capital  so  invested  during
 only  a  portion  of  such  period, such portion of such capital, by the
 issuer's allocation percentage, as defined in subparagraph one of  para-
 graph  (b) of subdivision three of this section, of each such subsidiary
 and (b) adding together the sums so obtained.
   8. If it shall appear to the commissioner of finance that any business
 or investment allocation  percentage  determined  as  provided  in  this
 subdivision  does not properly reflect the activity, business, income or
 capital of a taxpayer within the city, the commissioner of finance shall
 be authorized in his or her discretion, in the case of a business  allo-
 cation  percentage,  to  adjust  it  by (a) excluding one or more of the
 factors therein, (b) including  one  or  more  other  factors,  such  as
 expenses,  purchases,  contract  values,  minus  subcontract values, (c)
 excluding one or more assets in computing  such  allocation  percentage,
 provided the income therefrom is also excluded in determining entire net
 income,  or  (d)  any  other  similar  or different method calculated to
 effect a fair and proper allocation of the income and capital reasonably
 attributable to the city, and in the case of  an  investment  allocation
 percentage  to  adjust  it  by excluding one or more assets in computing
 such percentage provided the income therefrom is also excluded in deter-
 mining entire net income. The commissioner of finance from time to  time
 shall publish all rulings of general public interest with respect to any
 application of the provisions of this subdivision.
   9. If it shall appear to the commissioner of finance that any business
 allocation percentage determined as provided in subdivisions one through
 eight  of this section does not properly reflect the activity, business,
 income or capital of a taxpayer within the  city,  the  commissioner  of
 finance shall be authorized in his or her discretion to adjust it by (a)
 excluding  one or more of the factors therein, (b) including one or more
 other factors, such  as  expenses,  purchases,  contract  values,  minus
 subcontract  values,  (c) excluding one or more assets in computing such
 allocation percentage, provided the income therefrom, is  also  excluded
 in  determining entire net income, or (d) any other similar or different
 method calculated to effect a fair and proper allocation of  the  income
 and  capital  reasonably attributable to the city, and in the case of an
 investment allocation percentage, to adjust it by excluding one or  more
 assets  in  computing  such  percentage provided the income therefrom is
 also excluded in determining entire  net  income.  The  commissioner  of
 finance  from  time  to time shall publish all rulings of general public
 interest with respect to any  application  of  the  provisions  of  this
 subdivision.
   11.  (a)  A  taxpayer shall be allowed a credit, to be refunded in the
 manner as provided in this subdivision, against the tax imposed by  this
 chapter.  The  amount  of  such credit shall be fifty percent of the tax
 incurred in market making transactions under the provisions  of  article
 twelve of the tax law on such transactions subject to such tax occurring
 S. 8474                            473
 
 on and after August first, nineteen hundred seventy-six and paid by such
 taxpayer,  except when such tax shall have been paid pursuant to section
 two hundred seventy-nine-a of such tax law.
   (b) For purposes of this subdivision:
   (1)  the  term  "taxpayer"  shall  mean any corporation subject to tax
 under this chapter registered with  the  United  States  securities  and
 exchange commission in accordance with subsection (b) of section fifteen
 of  the  securities  exchange  act  of  nineteen hundred thirty-four, as
 amended, and acting as a dealer in a transaction described  in  subpara-
 graph two of this paragraph, and
   (2)  the  term  "market making transaction" shall mean any transaction
 involving a sale, including a short sale,  by  a  dealer  of  shares  or
 certificates  subject  to  the  tax imposed by article twelve of the tax
 law, provided such shares or certificates are sold:
   (i) as stock in trade or inventory or as property held for sale in the
 ordinary course of such dealer's trade or business, including  transfers
 which are part of an underwriting,
   (ii)  in  (a) a bona fide arbitrage transaction; (b) a bona fide hedge
 transaction involving a long or short position in  any  equity  security
 and  a  long  or  short  position  in a security entitling the holder to
 acquire or sell such equity security; or (c)  a  risk  arbitrage  trans-
 action  in  connection  with a merger, acquisition, tender offer, recap-
 italization, reorganization, or similar transaction, or
   (iii) to offset a transaction made in error.
   Provided, however, that, except as to subclause (c) of clause (ii)  of
 this  paragraph,  the term "market making transaction" shall not include
 any sale of shares or certificates identified in such  dealer's  records
 as  a  security held for investment within the meaning of section twelve
 hundred thirty-six of the internal revenue code.
   (c) The credit allowed under this subdivision  for  any  taxable  year
 shall  be deemed to be an overpayment of tax by the taxpayer to be cred-
 ited or refunded in accordance with the provisions of section 11-677  of
 this  chapter,  except  as  otherwise  provided  in subdivision three of
 section 11-606 and  subdivision  eleven  of  section  11-608;  provided,
 however,  that  the provisions of this title notwithstanding, the amount
 to be refunded pursuant to this subdivision shall not be paid  prior  to
 the  first  day  of  the eighth month following the close of the taxable
 year, and the provisions of subdivision three of section 11-679 of  this
 chapter  notwithstanding interest shall be allowed and paid on the over-
 payment of the credit under this subdivision from the first day  of  the
 eleventh  month following the close of the taxable year, or three months
 after a claim for the credit or refund provided for in this  subdivision
 has been filed, whichever is later.
   (d) Provided, however, that the credit provided under this subdivision
 shall  be allowed only to the extent that the amount of credit allowable
 with respect to market making transactions under the provisions of  this
 subdivision,  determined  without regard to the provisions of this para-
 graph, exceeds fifty percent of all  rebates,  provided  for  under  the
 provisions  of  section two hundred eighty-a of the tax law, allowed for
 such taxes incurred in the same market making transactions with  respect
 to which the credit is determined. No credit shall be allowed under this
 subdivision  with  respect  to  any tax incurred in market making trans-
 actions occurring on or after October first,  nineteen  hundred  eighty-
 one.
   12.  (a)  In  addition  to the credit allowed by subdivision eleven of
 this section, a taxpayer shall be  allowed  a  credit  against  the  tax
 S. 8474                            474
 
 imposed  by  this  subchapter  to  be credited or refunded in the manner
 provided in this section. The amount of such credit shall be the  excess
 of (A) the amount of sales and compensating use taxes imposed by section
 eleven  hundred  seven of the tax law during the taxpayer's taxable year
 which became legally due on or after and  was  paid  on  or  after  July
 first,  nineteen  hundred  seventy-seven, less any credits or refunds of
 such taxes, with respect to the purchase  or  use  by  the  taxpayer  of
 machinery or equipment for use or consumption directly and predominantly
 in  the  production  of  tangible  personal  property, gas, electricity,
 refrigeration or steam for sale, by manufacturing, processing,  generat-
 ing,  assembling,  refining,  mining or extracting, or telephone central
 office equipment or station apparatus or comparable telegraph  equipment
 for use directly and predominantly in receiving at destination or initi-
 ating  and  switching  telephone  or  telegraph  communication,  but not
 including parts with a useful life of one  year  or  less  or  tools  or
 supplies  used in connection with such machinery, equipment or apparatus
 over (B) the amount of any credit for such sales  and  compensating  use
 taxes  allowed  or allowable against the taxes imposed by subchapter two
 of chapter eleven of this title for  any  periods  embraced  within  the
 taxable year of the taxpayer under this subchapter.
   (b)  The  credit  allowed  under this subdivision for any taxable year
 shall be deemed to be an overpayment of tax by the taxpayer to be  cred-
 ited or refunded, without interest, in accordance with the provisions of
 section 11-677 of this chapter.
   (c)  Where the taxpayer receives a refund or credit of any tax imposed
 under section eleven hundred seven of the tax law for which the taxpayer
 had claimed a credit under the provisions of this subdivision in a prior
 taxable year, the amount of such tax refund shall be added  to  the  tax
 imposed  by  subdivision  one  of section 11-603 of this subchapter, and
 such amount shall be subtracted in computing entire net income  for  the
 taxable year.
   13.  (a)  In  addition  to any other credit allowed by this section, a
 taxpayer shall be allowed a credit  against  the  tax  imposed  by  this
 subchapter  to  be  credited or refunded without interest, in the manner
 provided in this section.
   (1) Where a taxpayer shall have relocated to the city from a  location
 outside  the  state, and by such relocation shall have created a minimum
 of one hundred industrial or commercial  employment  opportunities;  and
 where  such  taxpayer  shall  have  entered into a written lease for the
 relocation premises, the terms of  which  lease  provide  for  increased
 additional  payments to the landlord which are based solely and directly
 upon any increase or addition in real estate taxes imposed on the leased
 premises, the taxpayer upon approval and certification by the industrial
 and commercial incentive board shall be entitled to a credit against the
 tax imposed by this subchapter. The amount of such credit shall  be:  An
 amount  equal  to  the  annual  increased  payments actually made by the
 taxpayer to the landlord which are solely and directly  attributable  to
 an  increase  or addition to the real estate tax imposed upon the leased
 premises. Such credit shall be allowed  only  to  the  extent  that  the
 taxpayer  has  not  otherwise claimed said amount as a deduction against
 the tax imposed by this subchapter.
   The industrial and commercial incentive board in approving and  certi-
 fying  to  the  qualifications of the taxpayer to receive the tax credit
 provided for in this subdivision shall first determine that  the  appli-
 cant  has  met  the  requirements of this section, and further, that the
 granting of the tax credit to the applicant is in the "public interest".
 S. 8474                            475
 
 In determining that the granting of the tax  credit  is  in  the  public
 interest,  the  board shall make affirmative findings that: the granting
 of the tax credit to the applicant will not effect an undue hardship  on
 similar taxpayers already located within the city; the existence of this
 tax  incentive has been instrumental in bringing about the relocation of
 the applicant to the city; and the  granting  of  the  tax  credit  will
 foster the economic recovery and economic development of the city.
   The  tax  credit,  if  approved  and  certified  by the industrial and
 commercial incentive board, must be utilized annually  by  the  taxpayer
 for  the  length  of the term of the lease or for a period not to exceed
 ten years from the date of relocation whichever period is shorter.
   (2) When used in this section, the  following  terms  shall  have  the
 following meanings:
   (i)  "Employment  opportunity" means the creation of a full time posi-
 tion of gainful employment for an industrial or commercial employee  and
 the actual hiring of such employee for the said position.
   (ii)  "Industrial  employee"  means  one engaged in the manufacture or
 assembling of tangible goods or the processing of raw materials.
   (iii) "Commercial employee" means one engaged in the  buying,  selling
 or  otherwise  providing  of  goods  or  services other than on a retail
 basis.
   (iv) "Retail" means the selling or otherwise disposing  or  furnishing
 of tangible goods or services directly to the ultimate user or consumer.
   (v)  "Full time position" means the hiring of an industrial or commer-
 cial employee in a position of gainful employment where  the  number  of
 hours  worked by such employees is not less than thirty hours during any
 given work week.
   (vi) "Industrial and  commercial  incentive  board"  means  the  board
 created  pursuant to part three of subchapter two of chapter two of this
 title.
   (b) The credit allowed under this subdivision  for  any  taxable  year
 shall  be deemed to be an overpayment of tax by the taxpayer to be cred-
 ited or refunded, without interest, in accordance with the provisions of
 section 11-677 of this chapter.
   14. (a) In addition to any other credit allowed  by  this  section,  a
 taxpayer  shall  be  allowed  a  credit  against the tax imposed by this
 subchapter to be credited or refunded without interest,  in  the  manner
 provided in this section. The amount of such credit shall be:
   (1)  A maximum of three hundred dollars for each commercial employment
 opportunity and a maximum of five hundred dollars  for  each  industrial
 employment  opportunity  relocated  to the city from an area outside the
 state. Such credit shall be allowed to a taxpayer who relocates a  mini-
 mum of ten employment opportunities. The credit shall be allowed against
 employment  opportunity  relocation costs incurred by the taxpayer. Such
 credit shall be allowed only to the extent that  the  taxpayer  has  not
 claimed  a  deduction  for  allowable  employment opportunity relocation
 costs. Such credit may be taken by the taxpayer in whole or in  part  in
 the  year  in  which  the  employment  opportunity  is relocated by such
 taxpayer or either of the two years  succeeding  such  event,  provided,
 however, no credit shall be allowed under this subdivision to a taxpayer
 for  industrial  employment opportunities relocated to premises (A) that
 are within an industrial business zone established pursuant  to  section
 22-626  of this code and (B) for which a binding contract to purchase or
 lease was first entered into by the taxpayer on or after July first, two
 thousand five.
 S. 8474                            476

   The commissioner of finance is empowered to promulgate rules and regu-
 lations and to prescribe the form of application to be used by a taxpay-
 er seeking such credit.
   (2)  When used in this section: (i) "Employment opportunity" means the
 creation of a full time position of gainful employment for an industrial
 or commercial employee and the actual hiring of such  employee  for  the
 said position.
   (ii)  "Industrial  employee"  means  one engaged in the manufacture or
 assembling of tangible goods or the processing of raw materials.
   (iii) "Commercial employee" means one engaged in the  buying,  selling
 or  otherwise  providing  of  goods  or  services other than on a retail
 basis.
   (iv) "Retail" means the selling or  otherwise  disposing  of  tangible
 goods directly to the ultimate user or consumer.
   (v)  "Full time position" means the hiring of an industrial or commer-
 cial employee in a position of gainful employment where  the  number  of
 hours  worked  by such employee is not less than thirty hours during any
 given work week.
   (vi)  "Employment  opportunity  relocation  costs"  means  the   costs
 incurred  by  the taxpayer in moving furniture, files, papers and office
 equipment into the city from a location outside  the  state;  the  costs
 incurred by the taxpayer in the moving and installation of machinery and
 equipment  into the city from a location outside the state; the costs of
 installation of telephones and other communications  equipment  required
 as  a  result  of the relocation to the city from a location outside the
 state; the cost  incurred  in  the  purchase  of  office  furniture  and
 fixtures  required  as  a  result  of  the relocation to the city from a
 location outside the state; and the cost of renovation of  the  premises
 to  be  occupied  as  a result of the relocation provided, however, that
 such renovation costs shall be allowable only to the extent that they do
 not exceed seventy-five cents per square foot of the total area utilized
 by the taxpayer in the occupied premises.
   (b) The credit allowed under this section for any taxable  year  shall
 be  deemed to be an overpayment of tax by the taxpayer to be credited or
 refunded without interest in accordance with the provisions  of  section
 11-677 of this chapter.
   17.  (a)  In  addition  to any other credit allowed by this section, a
 taxpayer that has obtained the certifications required by chapter  six-B
 of  title twenty-two of the preceding municipality code shall be allowed
 a credit against the tax imposed by this subchapter. The amount  of  the
 credit  shall  be  the  amount  determined  by  multiplying five hundred
 dollars or, in the case of a taxpayer  that  has  obtained  pursuant  to
 chapter  six-B  of  such title twenty-two a certification of eligibility
 dated on or after July first, nineteen hundred ninety-five, one thousand
 dollars or, in the case of an eligible business that has obtained pursu-
 ant to chapter six-B of such title twenty-two a certification of  eligi-
 bility  dated  on or after July first, two thousand, for a relocation to
 eligible premises located within a revitalization area defined in subdi-
 vision (n) of section 22-621 of the code of the preceding  municipality,
 three  thousand  dollars, by the number of eligible aggregate employment
 shares maintained by the taxpayer during the taxable year  with  respect
 to  particular  premises  to which the taxpayer has relocated; provided,
 however, with respect to a relocation for which  no  application  for  a
 certificate  of  eligibility is submitted prior to July first, two thou-
 sand three, to eligible premises that are not  within  a  revitalization
 area,  if the date of such relocation as determined pursuant to subdivi-
 S. 8474                            477
 
 sion (j) of section 22-621 of the code of the preceding municipality  is
 before July first, nineteen hundred ninety-five, the amount to be multi-
 plied  by  the  number  of eligible aggregate employment shares shall be
 five  hundred  dollars,  and  with  respect to a relocation for which no
 application for a certificate of eligibility is submitted prior to  July
 first,  two thousand three, to eligible premises that are within a revi-
 talization area, if the date of such relocation as  determined  pursuant
 to  subdivision  (j)  of  such  section  is  before July first, nineteen
 hundred ninety-five, the amount to be multiplied by the number of eligi-
 ble aggregate employment shares shall be five hundred  dollars,  and  if
 the date of such relocation as determined pursuant to subdivision (j) of
 such  section  is  on or after July first, nineteen hundred ninety-five,
 and before July first, two thousand,  one  thousand  dollars;  provided,
 however,  that  no  credit  shall  be  allowed for the relocation of any
 retail activity or hotel services; provided,  further,  that  no  credit
 shall be allowed under this subdivision to any taxpayer that has elected
 pursuant to subdivision (d) of section 22-622 of the code of the preced-
 ing  municipality  to  take  such  credit  against  a gross receipts tax
 imposed by chapter eleven of this title; and provided that in  the  case
 of  an  eligible business that has obtained pursuant to chapter six-B of
 such title twenty-two certifications of eligibility for  more  than  one
 relocation,  the  portion  of  the  total  amount  of eligible aggregate
 employment shares to be multiplied by the  dollar  amount  specified  in
 this  subdivision  for  each such certification of a relocation shall be
 the number of total  attributed  eligible  aggregate  employment  shares
 determined  with  respect to such relocation pursuant to subdivision (o)
 of section 22-621 of the  code  of  the  preceding  municipality.    For
 purposes  of  this subdivision, the terms "eligible aggregate employment
 shares," "relocate," "retail activity" and "hotel services"  shall  have
 the  meanings  ascribed  by  section 22-621 of the code of the preceding
 municipality.
   (b) The credit allowed under this subdivision with respect to eligible
 aggregate employment shares maintained with respect to particular  prem-
 ises  to which the taxpayer has relocated shall be allowed for the first
 taxable year during which such eligible aggregate employment shares  are
 maintained  with  respect  to  such  premises  and for any of the twelve
 succeeding taxable years  during  which  eligible  aggregate  employment
 shares  are  maintained with respect to such premises; provided that the
 credit allowed for the twelfth succeeding taxable year shall  be  calcu-
 lated  by multiplying the number of eligible aggregate employment shares
 maintained with respect to such premises in the twelfth succeeding taxa-
 ble year by the lesser of one and a fraction the numerator of  which  is
 such number of days in the taxable year of relocation less the number of
 days  the eligible business maintained employment shares in the eligible
 premises in the taxable year of relocation and the denominator of  which
 is  the  number  of  days in such twelfth succeeding taxable year during
 which such eligible aggregate  employment  shares  are  maintained  with
 respect  to  such  premises. Except as provided in paragraph (d) of this
 subdivision, if the amount of the credit allowable under  this  subdivi-
 sion  for  any  taxable  year exceeds the tax imposed for such year, the
 excess may be carried over, in order, to the five immediately succeeding
 taxable years and, to the  extent  not  previously  deductible,  may  be
 deducted from the taxpayer's tax for such years.
   (c)  The  credit  allowable  under  this subdivision shall be deducted
 after the credit allowed by subdivision eighteen of  this  section,  but
 prior to the deduction of any other credit allowed by this section.
 S. 8474                            478
 
   (d)  In  the  case  of a taxpayer that has obtained a certification of
 eligibility pursuant to chapter six-B of title twenty-two of the code of
 the preceding municipality dated on or after July  first,  two  thousand
 for  a relocation to eligible premises located within the revitalization
 area  defined  in  subdivision  (n) of section 22-621 of the code of the
 preceding municipality, the credits allowed under this  subdivision,  or
 in the case of a taxpayer that has relocated more than once, the portion
 of such credits attributed to such certification of eligibility pursuant
 to  paragraph  (a)  of this subdivision, against the tax imposed by this
 chapter for the taxable year of such relocation and for the four taxable
 years immediately succeeding the taxable year of such relocation,  shall
 be  deemed  to  be overpayments of tax by the taxpayer to be credited or
 refunded, without interest, in accordance with the provisions of section
 11-677 of this chapter. For such taxable years, such credits or portions
 thereof may  not  be  carried  over  to  any  succeeding  taxable  year;
 provided, however, that this paragraph shall not apply to any relocation
 for  which  an  application  for  a certification of eligibility was not
 submitted prior to July first, two thousand three, unless  the  date  of
 such relocation is on or after July first, two thousand.
   17-a.  (a)  In addition to any other credit allowed by this section, a
 taxpayer shall be allowed a credit  against  the  tax  imposed  by  this
 subchapter  to  be  credited  or refunded in the manner provided in this
 subdivision. The amount of such credit shall be equal to the  amount  of
 sales and compensating use taxes imposed by section eleven hundred seven
 of the tax law during the taxpayer's taxable year, and the amount of any
 interest  imposed  in connection therewith, which was paid after January
 first, nineteen hundred ninety-five, less any credit or refund  of  such
 taxes,  or  such  interest,  with  respect to the purchase or use by the
 taxpayer of the services described in subdivision (b) of section  eleven
 hundred five-b of the tax law.
   (b)  The  credit  allowed  under this subdivision for any taxable year
 shall be deemed to be an overpayment of tax by the taxpayer to be  cred-
 ited or refunded, without interest, in accordance with the provisions of
 section 11-677 of this chapter.
   (c)  Where the taxpayer receives a refund or credit of any tax imposed
 under section eleven hundred seven of the tax law, or  of  any  interest
 imposed  in  connection  therewith, for which the taxpayer had claimed a
 credit under the provisions of this subdivision in a prior taxable year,
 the amount of such tax, or such interest,  refund  or  credit  shall  be
 added  to  the  tax imposed by subdivision one of section 11-603 of this
 subchapter, and such amount shall be subtracted in computing entire  net
 income for the taxable year.
   17-b.  (a)  For taxable years beginning on or after January first, two
 thousand six, in addition to any other credit allowed by  this  section,
 an  eligible  business  that  first enters into a binding contract on or
 after July first, two thousand five to purchase or lease eligible  prem-
 ises  to  which  it relocates shall be allowed a one-time credit against
 the tax imposed by this subchapter to be credited  or  refunded  in  the
 manner  hereinafter  provided  in  this  subdivision. The amount of such
 credit shall be one thousand dollars per full-time  employee;  provided,
 however,  that  the amount of such credit shall not exceed the lesser of
 actual relocation costs or one hundred thousand dollars.
   (b) When used in this subdivision, the following terms shall have  the
 following meanings:
   (i)  "Eligible  business" means any business subject to tax under this
 subchapter that (1) has been conducting substantial business  operations
 S. 8474                            479
 
 and engaging primarily in industrial and manufacturing activities at one
 or  more locations within the city of Staten Island or outside the state
 of New York continuously during the twenty-four consecutive full  months
 immediately preceding relocation, (2) has leased the premises from which
 it relocates continuously during the twenty-four consecutive full months
 immediately  preceding  relocation,  (3)  first  enters  into  a binding
 contract on or after July first, two thousand five to purchase or  lease
 eligible  premises to which such business will relocate, and (4) will be
 engaged primarily in industrial and  manufacturing  activities  at  such
 eligible premises.
   (ii)  "Eligible  premises"  means  premises located entirely within an
 industrial business zone. For any eligible business, an industrial busi-
 ness zone tax credit shall not be granted with respect to more than  one
 eligible premises.
   (iii)  "Full-time employee" means (1) one person gainfully employed in
 an eligible premises by an eligible business where the number  of  hours
 required  to be worked by such person is not less than thirty-five hours
 per week; or (2) two persons gainfully employed in an eligible  premises
 by  an eligible business where the number of hours required to be worked
 by each such person is more than fifteen hours per week  but  less  than
 thirty-five hours per week.
   (iv)  "Industrial  business  zone"  means  an  area within the city of
 Staten Island established pursuant to section 22-626 of the code of  the
 preceding municipality.
   (v)  "Industrial business zone tax credit" means a credit, as provided
 for in this subdivision, against a tax imposed under this subchapter.
   (vi)  "Industrial  and  manufacturing  activities"  means   activities
 involving  the  assembly  of goods to create a different article, or the
 processing, fabrication, or packaging of goods. Industrial and  manufac-
 turing   activities  shall  not  include  waste  management  or  utility
 services.
   (vii)  "Relocation"  means  the  physical  relocation  of   furniture,
 fixtures,  equipment,  machinery  and  supplies  directly to an eligible
 premises, from one or more locations of an eligible business,  including
 at  least one location at which such business conducts substantial busi-
 ness operations and engages primarily in  industrial  and  manufacturing
 activities.  For  purposes  of  this subdivision, the date of relocation
 shall be (1) the date of the completion of the relocation to the  eligi-
 ble  premises or (2) ninety days from the commencement of the relocation
 to the eligible premises, whichever is earlier.
   (viii) "Relocation costs" means costs incurred in  the  relocation  of
 such  furniture, fixtures, equipment, machinery and supplies, including,
 but not limited to, the cost of dismantling and  reassembling  equipment
 and  the  cost  of floor preparation necessary for the reassembly of the
 equipment. Relocation costs shall  include  only  such  costs  that  are
 incurred   during   the  ninety-day  period  immediately  following  the
 commencement of the relocation to an eligible premises. Relocation costs
 shall not include costs for structural or capital improvements or  items
 purchased in connection with the relocation.
   (c)  The  credit  allowed  under this subdivision for any taxable year
 shall be deemed to be an overpayment of tax by the taxpayer to be  cred-
 ited  or refunded without interest, in accordance with the provisions of
 section 11-677 of this chapter.
   (d) The number of full-time employees for the purposes of  calculating
 an  industrial  business tax credit shall be the average number of full-
 time employees, calculated on a weekly basis, employed in  the  eligible
 S. 8474                            480
 
 premises  by  the  eligible  business in the fifty-two week period imme-
 diately following the earlier of (1) the date of the completion  of  the
 relocation to eligible premises or (2) ninety days from the commencement
 of the relocation to the eligible premises.
   (e)  The  credit  allowed  under this subdivision must be taken by the
 taxpayer in the taxable year in which such twelve-month period  selected
 by the taxpayer ends.
   (f)  For  the purposes of calculating entire net income in the taxable
 year that an industrial business tax credit is allowed, a taxpayer  must
 add back the amount of the credit allowed under this subdivision, to the
 extent of any relocation costs deducted in the current taxable year or a
 prior taxable year in calculating federal taxable income.
   (g) The credit allowed under this subdivision shall not be granted for
 an eligible business for more than one relocation, provided, however, an
 industrial  business  tax  credit  shall  not be granted if the eligible
 business receives benefits pursuant to chapter six-B or six-C  of  title
 twenty-two  of  the  code of the preceding municipality, through a grant
 program administered by the business relocation assistance  corporation,
 or through the New York city printers relocation fund grant.
   (h)  The commissioner of finance is authorized to promulgate rules and
 regulations and to prescribe forms necessary to effectuate the  purposes
 of this subdivision.
   18.  (a)  If  a corporation is a partner in an unincorporated business
 taxable under chapter five of this title, and is required to include  in
 entire  net  income  its  distributive  share  of income, gain, loss and
 deductions of, or guaranteed payments from,  such  unincorporated  busi-
 ness, such corporation shall be allowed a credit against the tax imposed
 by  this  subchapter  equal  to  the lesser of the amounts determined in
 subparagraphs one and two of this paragraph:
   (1) The amount determined in this subparagraph is the product  of  (A)
 the  sum  of  (i)  the  tax imposed by chapter five of this title on the
 unincorporated business for its taxable year ending within or  with  the
 taxable  year of the corporation and paid by the unincorporated business
 and (ii) the amount of any credit or credits taken by the unincorporated
 business under section 11-503 of this title, except the  credit  allowed
 by  subdivision  (b) of such section, for its taxable year ending within
 or with the taxable year of the corporation, to  the  extent  that  such
 credits do not reduce such unincorporated business's tax below zero, and
 (B)  a  fraction,  the numerator of which is the net total of the corpo-
 ration's distributive share of income, gain, loss and deductions of, and
 guaranteed payments from, the unincorporated business for  such  taxable
 year, and the denominator of which is the sum, for such taxable year, of
 the  net  total distributive shares of income, gain, loss and deductions
 of, and guaranteed payments to, all partners in the unincorporated busi-
 ness for whom or which such net total, as separately determined for each
 partner, is greater than zero.
   (2) The amount determined in this subparagraph is the product  of  (A)
 the  excess of (i) the tax computed under clause one of subparagraph (a)
 of paragraph E of subdivision one of this section, without allowance  of
 any  credits  allowed  by  this  section, over (ii) the tax so computed,
 determined as if the corporation had no such distributive share or guar-
 anteed payments with respect to the unincorporated business, and  (B)  a
 fraction, the numerator of which is four and the denominator of which is
 eight  and  eighty-five  one-hundredths,  provided,  however,  that  the
 amounts computed in clauses (i) and (ii) of this subparagraph  shall  be
 computed with the following modifications:
 S. 8474                            481
 
   (I)  such  amounts  shall  be computed without taking into account any
 carryforward or carryback by the partner of a net operating loss;
   (II)  if, prior to taking into account any distributive share or guar-
 anteed payments from any unincorporated business or  any  net  operating
 loss  carryforward or carryback, the entire net income of the partner is
 less than zero, such entire net income shall be treated as zero; and
   (III) if such partner's net total distributive share of income,  gain,
 loss and deductions of, and guaranteed payments from, any unincorporated
 business is less than zero, such net total shall be treated as zero. The
 amount determined in this subparagraph shall not be less than zero.
   (b)(1)  Notwithstanding  anything  to the contrary in paragraph (a) of
 this subdivision, in the case of a corporation that, before the applica-
 tion of this subdivision or any other credit allowed by this section, is
 liable for the tax on entire net income under clause one of subparagraph
 (a) of paragraph E of subdivision one of this section, the credit or the
 sum of the credits that may be taken by such corporation for  a  taxable
 year  under  this subdivision with respect to an unincorporated business
 or unincorporated businesses in which it is a partner shall  not  exceed
 the  tax  so  computed, without allowance of any credits allowed by this
 section, multiplied by a fraction the numerator of which is four and the
 denominator of which is eight and  eighty-five  one-hundredths.  If  the
 credit allowed under this subdivision or the sum of such credits exceeds
 the  product of such tax and such fraction, the amount of the excess may
 be carried forward, in order, to each of the seven immediately  succeed-
 ing  taxable  years  and,  to  the extent not previously taken, shall be
 allowed as a credit in each  of  such  years.  Accordingly,  the  credit
 determined  for the taxable year under paragraph (a) of this subdivision
 shall be taken before taking any credit carryforward  pursuant  to  this
 paragraph and the credit carryforward attributable to the earliest taxa-
 ble year shall be taken before taking a credit carryforward attributable
 to a subsequent taxable year.
   (2)  Notwithstanding anything to the contrary in paragraph (a) of this
 subdivision, in the case of a corporation that, before  the  application
 of  this  subdivision  or  any  other credit allowed by this section, is
 liable for the tax on entire net income plus certain salaries and  other
 compensation  under  clause  three of subparagraph (a) of paragraph E of
 subdivision one of this section, the maximum credit that may be taken in
 any taxable year is the amount that will reduce  the  tax  so  computed,
 without  allowance  of any credits allowed by this section, to zero. For
 purposes of this paragraph each dollar of credit shall be applied so  as
 to reduce such tax for taxable years beginning before January first, two
 thousand  seven  by sixty-six and thirty-eight one-hundredths cents; for
 taxable years beginning on or after January first,  two  thousand  seven
 and  before  January  first, two thousand eight by fifty-eight and eight
 one-hundredths cents; for taxable years beginning on  or  after  January
 first, two thousand eight and before January first, two thousand nine by
 forty-nine  and  seventy-eight  one-hundredths  cents; for taxable years
 beginning on or after January first, two thousand nine and before  Janu-
 ary  first, two thousand ten by forty-one and forty-eight one-hundredths
 cents; and for taxable years beginning on or after  January  first,  two
 thousand  ten  by thirty-three and nineteen one-hundredths cents. If the
 amount of credit allowed under this subdivision or the sum of such cred-
 its exceeds the amount that may be taken against such tax, the amount of
 the excess may be carried forward, in order, to each of the seven  imme-
 diately  succeeding  taxable  years  and,  to  the extent not previously
 taken, shall be allowed as a credit in each of such years.  Accordingly,
 S. 8474                            482
 
 the  credit  determined for the taxable year under paragraph (a) of this
 subdivision shall be taken before taking any credit carryforward  pursu-
 ant  to  this  paragraph and the credit carryforward attributable to the
 earliest taxable year shall be taken before taking a credit carryforward
 attributable to a subsequent taxable year.
   (3) No credit allowed under this subdivision may be taken in a taxable
 year  by a taxpayer that, in the absence of such credit, would be liable
 for the tax computed on the basis of  business  and  investment  capital
 under  clause  two of subparagraph (a) of paragraph E of subdivision one
 of this section or the fixed-dollar minimum tax  under  clause  four  of
 subparagraph  (a)  of paragraph E of subdivision one of this section. No
 credit allowed under this subdivision  may  be  taken  against  the  tax
 computed  on  the  basis of subsidiary capital under subparagraph (b) of
 paragraph E of subdivision one of this section.
   (c) For corporations that file a report on a combined  basis  pursuant
 to  subdivision  four  of  section  11-605  of  this chapter, the credit
 allowed by this subdivision shall be computed as if the  combined  group
 were  the  partner in each unincorporated business from which any of the
 members of such group had a distributive share or  guaranteed  payments,
 provided,  however,  if  more than one member of the combined group is a
 partner in the same unincorporated business, for purposes of the  calcu-
 lation  required  in  subparagraph one of paragraph (a) of this subdivi-
 sion, the numerator of the fraction described  in  clause  (B)  of  such
 subparagraph  one  shall be the sum of the net total distributive shares
 of income, gain, loss and deductions of, and guaranteed  payments  from,
 the unincorporated business of all of the partners of the unincorporated
 business  within  the  combined group for which such net total, as sepa-
 rately determined for each partner, is greater than zero, and the denom-
 inator of such fraction shall be the sum of the net  total  distributive
 shares  of income, gain, loss and deductions of, and guaranteed payments
 from, the unincorporated business of all partners in the  unincorporated
 business  for whom or which such net total, as separately determined for
 each partner, is greater than zero.
   (d) The credit allowed by this subdivision shall not be allowed  to  a
 partner  in  an  unincorporated business with respect to any tax paid by
 the unincorporated business under chapter five of  this  title  for  any
 taxable year beginning before July first, nineteen hundred ninety-four.
   (e) Notwithstanding any other provision of this subchapter, the credit
 allowable  under  this subdivision shall be taken prior to the taking of
 any other credit allowed by  this  section.  Notwithstanding  any  other
 provision  of this subchapter, the application of this subdivision shall
 not change the basis on which the taxpayer's tax is computed under para-
 graph E of subdivision one of this section.
   19. Lower Manhattan relocation and employment assistance  credit.  (a)
 In addition to any other credit allowed by this section, a taxpayer that
 has obtained the certifications required by chapter six-C of title twen-
 ty-two  of  the  code  of  the preceding municipality shall be allowed a
 credit against the tax imposed by this chapter. The amount of the credit
 shall be the amount determined by multiplying three thousand dollars  by
 the  number  of  eligible  aggregate employment shares maintained by the
 taxpayer during the taxable year with respect to  eligible  premises  to
 which  the  taxpayer  has  relocated;  provided, however, that no credit
 shall be allowed for the relocation of  any  retail  activity  or  hotel
 services;  provided, further, that no credit shall be allowed under this
 subdivision to any taxpayer that has elected pursuant to subdivision (d)
 of section 22-624 of the code of the preceding municipality to take such
 S. 8474                            483
 
 credit against a gross receipts tax imposed under chapter eleven of this
 title. For purposes of this subdivision, the terms  "eligible  aggregate
 employment  shares,"  "eligible premises," "relocate," "retail activity"
 and  "hotel services" shall have the meanings ascribed by section 22-623
 of the code of the preceding municipality.
   (b) The credit allowed under this subdivision with respect to eligible
 aggregate employment shares maintained with respect to eligible premises
 to which the taxpayer has relocated shall be  allowed  for  the  taxable
 year  of  the  relocation  and  for any of the twelve succeeding taxable
 years during which eligible aggregate employment shares  are  maintained
 with  respect to eligible premises; provided that the credit allowed for
 the twelfth succeeding taxable year shall be calculated  by  multiplying
 the  number  of  eligible  aggregate  employment  shares maintained with
 respect to eligible premises in the twelfth succeeding taxable  year  by
 the  lesser  of one and a fraction the numerator of which is such number
 of days in the taxable year of relocation less the number  of  days  the
 taxpayer  maintained employment shares in eligible premises in the taxa-
 ble year of relocation and the denominator of which  is  the  number  of
 days  in  such twelfth taxable year during which such eligible aggregate
 employment shares are maintained with respect to such premises.
   (c) Except as provided in paragraph (d) of this  subdivision,  if  the
 amount  of  the  credit allowable under this subdivision for any taxable
 year exceeds the tax imposed for such year, the excess  may  be  carried
 over, in order, to the five immediately succeeding taxable years and, to
 the  extent  not previously deductible, may be deducted from the taxpay-
 er's tax for such years.
   (d) The credits  allowed  under  this  subdivision,  against  the  tax
 imposed  by  this chapter for the taxable year of the relocation and for
 the four taxable years immediately succeeding the taxable year  of  such
 relocation, shall be deemed to be overpayments of tax by the taxpayer to
 be  credited  or  refunded,  without  interest,  in  accordance with the
 provisions of section 11-677 of this chapter. For  such  taxable  years,
 such credits or portions thereof may not be carried over to any succeed-
 ing taxable year.
   (e)  The  credit  allowable  under  this subdivision shall be deducted
 after the credits allowed by subdivisions seventeen and eighteen of this
 section, but prior to the deduction of any other credit allowed by  this
 section.
   20.  Film  production  credit.  (a)(1) allowance of credit. A taxpayer
 which is a qualified film production company, and which  is  subject  to
 tax  under  this subchapter, shall be allowed a credit against such tax,
 pursuant to the provisions in paragraph (c) of this subdivision,  to  be
 computed as provided in this subdivision.
   (2)  The amount of the credit shall be the product of five percent and
 the qualified production costs paid or incurred in the production  of  a
 qualified  film, provided that the qualified production costs, excluding
 post production costs, paid or incurred which are  attributable  to  the
 use  of  tangible property or the performance of services at a qualified
 film production facility in the production of such qualified film  equal
 or  exceed  seventy-five percent of the production costs, excluding post
 production costs, paid or incurred which are attributable to the use  of
 tangible  property or the performance of services at any film production
 facility within and without the city of Staten Island in the  production
 of  such  qualified  film.  However,  if the qualified production costs,
 excluding post production costs, which are attributable to  the  use  of
 tangible  property  or  the  performance of services at a qualified film
 S. 8474                            484
 
 production facility in the production of such qualified  film  are  less
 than three million dollars, then the portion of the qualified production
 costs attributable to the use of tangible property or the performance of
 services in the production of such qualified film outside of a qualified
 film  production  facility  shall  be  allowed only if the shooting days
 spent in the city of Staten Island outside of a film production facility
 in the production of such qualified film equal  or  exceed  seventy-five
 percent  of the total shooting days spent within and without the city of
 Staten Island outside of a film production facility in the production of
 such qualified film. The credit shall be allowed for the taxable year in
 which the production of such qualified film is completed.
   (3) No qualified production costs used by a  taxpayer  either  as  the
 basis  for  the allowance of the credit provided for under this subdivi-
 sion or used in the calculation of the credit provided  for  under  this
 subdivision  shall  be  used  by such taxpayer to claim any other credit
 allowed pursuant to this title.
   (b) Definitions. As used in  this  subdivision,  the  following  terms
 shall have the following meanings:
   (1)  "Qualified  production  costs" means production costs only to the
 extent such costs are attributable to the use of  tangible  property  or
 the  performance  of  services  within the city of New York directly and
 predominantly in  the  production,  including  pre-production  and  post
 production, of a qualified film.
   (2)  "Production costs" means any costs for tangible property used and
 services performed directly and predominantly in the production, includ-
 ing  pre-production  and  post  production,   of   a   qualified   film.
 "Production  costs"  shall  not include (i) costs for a story, script or
 scenario to be used for a qualified film and (ii) wages or  salaries  or
 other  compensation  for  writers, directors, including music directors,
 producers and performers, other than background actors with no  scripted
 lines.   "Production   costs"   generally  include  technical  and  crew
 production costs, such as expenditures for film  production  facilities,
 or  any  part thereof, props, makeup, wardrobe, film processing, camera,
 sound recording,  set  construction,  lighting,  shooting,  editing  and
 meals.
   (3)  "Qualified  film"  means  a feature-length film, television film,
 television pilot and/or each episode of a television series,  regardless
 of the medium by means of which the film, pilot or episode is created or
 conveyed.  "Qualified  film"  shall  not include (i) a documentary film,
 news or current affairs program, interview  or  talk  program,  "how-to"
 (i.e., instructional) film or program, film or program consisting prima-
 rily  of  stock  footage, sporting event or sporting program, game show,
 award ceremony, film  or  program  intended  primarily  for  industrial,
 corporate  or  institutional  end-users,  fundraising  film  or program,
 daytime drama (i.e., daytime "soap opera"), commercials, music videos or
 "reality" program, or (ii) a production for which records  are  required
 under  section  2257  of  title 18, United States code, to be maintained
 with respect to any performer in such production,  reporting  of  books,
 films, etc. with respect to sexually explicit conduct.
   (4) "Film production facility" shall mean a building and/or complex of
 buildings  and  their improvements and associated back-lot facilities in
 which films are or are intended  to  be  regularly  produced  and  which
 contain at least one sound stage.
   (5)  "Qualified film production facility" shall mean a film production
 facility in the city of Staten Island, which contains at least one sound
 S. 8474                            485
 
 stage having a minimum of  seven  thousand  square  feet  of  contiguous
 production space.
   (6) "Qualified film production company" shall mean a corporation which
 is  principally  engaged  in  the  production  of  a  qualified film and
 controls the qualified film during production.
   (c) Application of credit. (1) The credit allowed under this  subdivi-
 sion  for any taxable year shall not reduce the tax due for such year to
 less than the amount prescribed in clause four of  subparagraph  (a)  of
 paragraph  E of subdivision one of this section. Provided, however, that
 if the amount of the credit allowable under  this  subdivision  for  any
 taxable year reduces the tax to such amount, fifty percent of the excess
 shall  be treated as an overpayment of tax to be credited or refunded in
 accordance with the  provisions  of  section  11-677  of  this  chapter;
 provided,  however,  the  provisions  of  section 11-679 of this chapter
 notwithstanding, no interest shall be paid thereon. The balance of  such
 credit not credited or refunded in such taxable year may be carried over
 to  the  immediately succeeding taxable year and may be credited against
 the taxpayer's tax for such year. The excess, if any, of the  amount  of
 the  credit over the tax for such succeeding year shall be treated as an
 overpayment of tax to be credited or refunded  in  accordance  with  the
 provisions  of  section  11-677  of this chapter. Provided, however, the
 provisions of section 11-679 of this chapter notwithstanding, no  inter-
 est shall be paid thereon.
   (2)  Notwithstanding anything contained in this section to the contra-
 ry, the credit provided by this subdivision shall be allowed against the
 taxes authorized by this chapter for the taxable year after reduction by
 all other credits permitted by this chapter.
   21. Biotechnology credit. (a) (1)  A  taxpayer  that  is  a  qualified
 emerging  technology  company, engages in biotechnologies, and meets the
 eligibility requirements of this subdivision, shall be allowed a  credit
 against  the  tax imposed by this subchapter. The amount of credit shall
 be equal to the sum of the amounts  specified  in  subparagraphs  three,
 four, and five of this paragraph, subject to the limitations in subpara-
 graph seven of this paragraph and paragraph (b) of this subdivision. For
 the  purposes of this subdivision, "qualified emerging technology compa-
 ny" shall mean a company located in a city: (A) whose  primary  products
 or  services  are  classified  as  emerging technologies and whose total
 annual product sales are ten million dollars or less; or (B)  a  company
 that  has research and development activities in city and whose ratio of
 research and development funds to net sales equals or exceeds the  aver-
 age  ratio  for  all  surveyed companies classified as determined by the
 National Science Foundation in the most recent  published  results  from
 its  Survey  of  Industry  Research  and  Development, or any comparable
 successor survey as determined by the department, and whose total annual
 product sales are ten million dollars or less. For the purposes of  this
 subdivision,  the  definition of research and development funds shall be
 the same as that used by the National Science Foundation in  the  afore-
 mentioned  survey.   For the purposes of this subdivision, "biotechnolo-
 gies" shall mean the technologies involving the scientific  manipulation
 of  living organisms, especially at the molecular and/or the sub-molecu-
 lar genetic level, to produce products conducive to improving the  lives
 and health of plants, animals, and humans; and the associated scientific
 research,  pharmacological,  mechanical,  and computational applications
 and services connected with these improvements. Activities included with
 such applications and services shall include, but  not  be  limited  to,
 alternative  mRNA  splicing,  DNA  sequence  amplification,  antigenetic
 S. 8474                            486
 
 switching  bioaugmentation,  bioenrichment,  bioremediation,  chromosome
 walking,  cytogenetic  engineering,  DNA  diagnosis, fingerprinting, and
 sequencing, electroporation, gene translocation, genetic mapping,  site-
 directed  mutagenesis, bio-transduction, bio-mechanical and bio-electri-
 cal engineering, and bio-informatics.
   (2) An eligible taxpayer shall (A) have no more than one hundred full-
 time employees, of which at least seventy-five percent are  employed  in
 the  city,  (B)  have  a  ratio of research and development funds to net
 sales, as referred to in section thirty-one hundred two-e of the  public
 authorities law, which equals or exceeds six percent during the calendar
 year  ending  with  or  within  the taxable year for which the credit is
 claimed, and (C) have gross revenues, along with the gross  revenues  of
 its  "affiliates"  and  "related  members"  not exceeding twenty million
 dollars for the calendar year immediately preceding  the  calendar  year
 ending  with or within the taxable year for which the credit is claimed.
 For the purposes of this  subdivision,  "affiliates"  shall  mean  those
 corporations  that  are members of the same affiliated group, as defined
 in section fifteen hundred four of the internal  revenue  code,  as  the
 taxpayer.  For  the  purposes  of  this  subdivision,  the term "related
 members" shall mean a person, corporation, or other entity, including an
 entity that is treated as a partnership or  other  pass-through  vehicle
 for  purposes  of  federal taxation, whether such person, corporation or
 entity is a taxpayer or not, where one such person, corporation or enti-
 ty, or set of related persons, corporations  or  entities,  directly  or
 indirectly  owns  or  controls a controlling interest in another entity.
 Such entity or entities may include all taxpayers under  chapters  five,
 eleven  and  seventeen  of  this title, and subchapters two and three of
 this chapter. A controlling interest shall mean, in the case of a corpo-
 ration, either thirty percent or more of the total combined voting power
 of all classes of stock of such corporation, or thirty percent  or  more
 of  the  capital, profits or beneficial interest in such voting stock of
 such corporation; and in the case of a partnership,  association,  trust
 or other entity, thirty percent or more of the capital, profits or bene-
 ficial interest in such partnership, association, trust or other entity.
   (3)  An  eligible  taxpayer shall be allowed a credit for eighteen per
 centum of the cost or other basis for federal  income  tax  purposes  of
 research  and  development  property that is acquired by the taxpayer by
 purchase as defined in subdivision (d) of section one  hundred  seventy-
 nine  of  the  internal  revenue  code  and placed in service during the
 calendar year that ends with or within the taxable year  for  which  the
 credit is claimed. Provided, however, for the purposes of this paragraph
 only, an eligible taxpayer shall be allowed a credit for such percentage
 of the (A) cost or other basis for federal income tax purposes for prop-
 erty  used  in  the testing or inspection of materials and products, (B)
 the costs or expenses associated with quality control  of  the  research
 and development, (C) fees for use of sophisticated technology facilities
 and  processes,  and  (D) fees for the production or eventual commercial
 distribution of materials and products resulting from the activities  of
 an  eligible  taxpayer  as long as such activities fall under activities
 relating to biotechnologies. The costs, expenses and other  amounts  for
 which  a credit is allowed and claimed under this paragraph shall not be
 used in the calculation of any other credit allowed under this  subchap-
 ter.  For  the  purposes  of this subdivision, "research and development
 property" shall mean property that is used for purposes of research  and
 development in the experimental or laboratory sense. Such purposes shall
 not be deemed to include the ordinary testing or inspection of materials
 S. 8474                            487
 
 or products for quality control, efficiency surveys, management studies,
 consumer  surveys,  advertising,  promotions,  or research in connection
 with literary, historical or similar projects.
   (4) An eligible taxpayer shall be allowed a credit for nine per centum
 of  qualified  research expenses paid or incurred by the taxpayer in the
 calendar year that ends with or within the taxable year  for  which  the
 credit  is  claimed.  For  the  purposes of this subdivision, "qualified
 research expenses" shall mean expenses associated with in-house research
 and processes, and  costs  associated  with  the  dissemination  of  the
 results  of  the  products  that  directly result from such research and
 development activities; provided, however, that  such  costs  shall  not
 include advertising or promotion through media. In addition, costs asso-
 ciated  with  the preparation of patent applications, patent application
 filing fees, patent research fees, patent examinations fees, patent post
 allowance fees, patent maintenance fees, and grant application  expenses
 and  fees shall qualify as qualified research expenses. In no case shall
 the credit allowed under this subparagraph apply to expenses  for  liti-
 gation  or  the  challenge  of  another  entity's  intellectual property
 rights, or for contract expenses involving outside paid consultants.
   (5) An eligible taxpayer shall be allowed a credit for qualified high-
 technology training expenditures as described in this subparagraph  paid
 or  incurred  by the taxpayer during the calendar year that ends with or
 within the taxable year for which the credit is claimed.
   (A) The amount of credit shall be one hundred percent of the  training
 expenses  described  in  clause  (C)  of this subparagraph, subject to a
 limitation of no more than four thousand dollars per employee per calen-
 dar year for such training expenses.
   (B) Qualified high-technology  training  shall  include  a  course  or
 courses taken and satisfactorily completed by an employee of the taxpay-
 er at an accredited, degree granting post-secondary college or universi-
 ty  in a city that (i) directly relates to biotechnology activities, and
 (ii) is intended to upgrade, retrain  or  improve  the  productivity  or
 theoretical  awareness  of  the  employee.  Such  course  or courses may
 include, but are not limited to, instruction  or  research  relating  to
 techniques,  meta,  macro,  or  micro-theoretical or practical knowledge
 bases or frontiers, or ethical concerns related to such activities. Such
 course or courses shall  not  include  classes  in  the  disciplines  of
 management,  accounting  or the law or any class designed to fulfill the
 discipline specific requirements of a degree program at  the  associate,
 baccalaureate,  graduate  or  professional  level  of these disciplines.
 Satisfactory completion of a course or courses shall  mean  the  earning
 and  granting  of  credit  or  equivalent unit, with the attainment of a
 grade of "B" or higher in a graduate level course or courses, a grade of
 "C" or higher in an undergraduate level course or courses, or a  similar
 measure  of  competency for a course that is not measured according to a
 standard grade formula.
   (C) Qualified  high-technology  training  expenditures  shall  include
 expenses for tuition and mandatory fees, software required by the insti-
 tution,  fees for textbooks or other literature required by the institu-
 tion offering the course or courses, minus applicable  scholarships  and
 tuition  or fee waivers not granted by the taxpayer or any affiliates of
 the taxpayer, that are paid or reimbursed  by  the  taxpayer.  Qualified
 high-technology  expenditures  do  not  include room and board, computer
 hardware or software not specifically assigned for such course or cours-
 es, late-charges, fines or membership dues and similar expenses.    Such
 qualified  expenditures shall not be eligible for the credit provided by
 S. 8474                            488
 
 this section unless the employee for whom the expenditures are disbursed
 is continuously employed by the taxpayer in a full-time, full-year posi-
 tion primarily located at a qualified site during  the  period  of  such
 coursework  and  lasting  through at least one hundred eighty days after
 the satisfactory completion of the qualifying  course-work.    Qualified
 high-technology  training  expenditures  shall  not include expenses for
 in-house or shared training outside of a city higher education  institu-
 tion  or  the  use  of  consultants  outside of credit granting courses,
 whether such consultants function inside of such higher education insti-
 tution or not.
   (D) If a taxpayer relocates from an academic business incubator facil-
 ity partnered with an accredited  post-secondary  education  institution
 located  within city, which provides space and business support services
 to taxpayers, to another site, the credit provided in  this  subdivision
 shall  be  allowed for all expenditures referenced in clause (C) of this
 subparagraph paid or incurred in the two preceding calendar  years  that
 the  taxpayer was located in such an incubator facility for employees of
 the taxpayer who also relocate from said incubator facility to such city
 site and are employed and primarily located by  the  taxpayer  in  city.
 Such  expenditures  in  the  two  preceding  years shall be added to the
 amounts otherwise qualifying for the credit provided by this subdivision
 that were paid or incurred in the calendar year that the taxpayer  relo-
 cates  from  such  a  facility. Such expenditures shall include expenses
 paid for an eligible employee who is a full-time, full-year employee  of
 said  taxpayer during the calendar year that the taxpayer relocated from
 an  incubator  facility  notwithstanding  (i)  that  such  employee  was
 employed full or part-time as an officer, staff-person or paid intern of
 the  taxpayer  when such taxpayer was located at such incubator facility
 or (ii) that such employee  was  not  continuously  employed  when  such
 taxpayer  was  located  at the incubator facility during the one hundred
 eighty day period referred  to  in  clause  (C)  of  this  subparagraph,
 provided  such employee received wages or equivalent income for at least
 seven hundred fifty hours during any twenty-four month period  when  the
 taxpayer  was located at the incubator facility. Such expenditures shall
 include payments made to such employee after the taxpayer has  relocated
 from  the incubator facility for qualified expenditures if such payments
 are made to reimburse an employee for expenditures paid by the  employee
 during  such  two  preceding years. The credit provided under this para-
 graph shall be allowed in any taxable year that the  taxpayer  qualifies
 as an eligible taxpayer.
   (E)  For  purposes  of this subdivision the term "academic year" shall
 mean the annual period  of  sessions  of  a  post-secondary  college  or
 university.
   (F)  For the purposes of this subdivision the term "academic incubator
 facility" shall mean a  facility  providing  low-cost  space,  technical
 assistance,  support  services  and educational opportunities, including
 but not limited to central services  provided  by  the  manager  of  the
 facility  to  the tenants of the facility, to an entity located in city.
 Such entity's primary activity must  be  in  biotechnologies,  and  such
 entity must be in the formative stage of development. The academic incu-
 bator facility and the entity must act in partnership with an accredited
 post-secondary  college or university located in city. An academic incu-
 bator facility's mission shall be to promote job creation, entrepreneur-
 ship, technology transfer, and provide  support  services  to  incubator
 tenants,  including,  but  not limited to, business planning, management
 S. 8474                            489
 
 assistance, financial-packaging, linkages  to  financing  services,  and
 coordinating with other sources of assistance.
   (6)  An eligible taxpayer may claim credits under this subdivision for
 three consecutive years. In no case shall the  credit  allowed  by  this
 subdivision  to a taxpayer exceed two hundred fifty thousand dollars per
 calendar year for eligible expenditures made during such calendar year.
   (7) 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 clause four of subparagraph (a) of paragraph E of subdivi-
 sion one of this section. Provided, however, if  the  amount  of  credit
 allowed  under  this subdivision for any taxable year reduces the tax to
 such amount, any amount of credit not deductible in  such  taxable  year
 shall  be treated as an overpayment of tax to be credited or refunded in
 accordance with the  provisions  of  section  11-677  of  this  chapter;
 provided, however, that notwithstanding the provisions of section 11-679
 of this chapter, no interest shall be paid thereon.
   (8)  The  credit  allowed under this subdivision shall only be allowed
 for taxable years beginning on or after January first, two thousand  ten
 and before January first, two thousand nineteen.
   (b)  (1) The percentage of the credit allowed to a taxpayer under this
 subdivision in any calendar year shall be:
   (A) If the average number of  individuals  employed  full  time  by  a
 taxpayer  in  the city during the calendar year that ends with or within
 the taxable year for which the credit is claimed is at least one hundred
 five percent  of  the  taxpayer's  base  year  employment,  one  hundred
 percent,  except  that  in  no  case shall the credit allowed under this
 clause exceed two hundred fifty  thousand  dollars  per  calendar  year.
 Provided,  however, the increase in base year employment shall not apply
 to a taxpayer allowed a credit under  this  subdivision  that  was,  (i)
 located  outside  of the city, (ii) not doing business, or (iii) did not
 have any employees, in the year preceding the first year that the credit
 is claimed. Any such taxpayer shall be eligible for one hundred  percent
 of  the  credit for the first calendar year that ends with or within the
 taxable year for which the credit is claimed, provided that such taxpay-
 er locates in the city, begins doing  business  in  the  city  or  hires
 employees  in the city during such calendar year and is otherwise eligi-
 ble for the credit pursuant to the provisions of this subdivision.
   (B) If the average number of  individuals  employed  full  time  by  a
 taxpayer  in  the city during the calendar year that ends with or within
 the taxable year for which the  credit  is  claimed  is  less  than  one
 hundred  five  percent  of  the  taxpayer's  base year employment, fifty
 percent, except that in no case shall  the  credit  allowed  under  this
 clause  exceed  one  hundred  twenty-five  thousand dollars per calendar
 year. In the case of an entity located in city receiving space and busi-
 ness support services by an academic incubator facility, if the  average
 number  of  individuals  employed  full  time by such entity in the city
 during the calendar year in which the credit allowed under this subdivi-
 sion is claimed is less than one hundred five percent of the  taxpayer's
 base year employment, the credit shall be zero.
   (2) For the purposes of this subdivision, "base year employment" means
 the  average number of individuals employed full-time by the taxpayer in
 the city in the year preceding the first calendar year that ends with or
 within the taxable year for which the credit is claimed.
   (3) For the purposes of this subdivision, average number  of  individ-
 uals  employed  full-time shall be computed by adding the number of such
 individuals employed by the taxpayer at the end of each  quarter  during
 S. 8474                            490
 
 each  calendar  year  or other applicable period and dividing the sum so
 obtained by the number of such quarters occurring within  such  calendar
 year or other applicable period.
   (4)  Notwithstanding anything contained in this section to the contra-
 ry, the credit provided by this subdivision shall be allowed against the
 taxes authorized by this chapter for the taxable year after reduction by
 all other credits permitted by this chapter.
   22. Beer production credit. (a) A taxpayer subject to tax  under  this
 subchapter,  that  is registered as a distributor under article eighteen
 of the tax law, and that produces sixty million or fewer gallons of beer
 in this state in the taxable year, shall be allowed a credit against the
 tax imposed by this subchapter in the amount specified in paragraph  (b)
 of  this subdivision. Provided, however, that no credit shall be allowed
 for any beer produced in excess of fifteen million five hundred thousand
 gallons in the taxable year. Notwithstanding anything in this  title  to
 the contrary, if a partnership is allowed a credit under subdivision (p)
 of  section  11-503  of this title, a taxpayer that is a partner in such
 partnership shall not be allowed a credit under this subdivision for any
 taxable year that includes the last day of the taxable  year  for  which
 the partnership is allowed such credit.
   (b)  The  amount  of the credit per taxpayer per taxable year for each
 gallon of beer produced in the city of New  York  on  or  after  January
 first, two thousand seventeen shall be determined as follows:
   (1)  for  the  first five hundred thousand gallons of beer produced in
 the city of New York in the taxable year, the credit shall equal  twelve
 cents per gallon; and
   (2)  for  each  gallon of beer produced in the city of New York in the
 taxable year in excess of five  hundred  thousand  gallons,  the  credit
 shall  equal three and eighty-six one-hundredths cents per gallon. In no
 event shall the credit allowed under this subdivision  for  any  taxable
 year reduce the tax due for such year to less than the amount prescribed
 in  clause four of subparagraph (a) of paragraph E of subdivision one of
 this section. However, if the amount of credit allowed under this subdi-
 vision for any taxable year reduces the tax to such amount,  any  amount
 of  credit  thus not deductible in such taxable year shall be treated as
 an overpayment of tax to be credited or refunded in accordance with  the
 provisions  of  section  11-677 of this chapter; provided, however, that
 notwithstanding the provisions of section 11-679  of  this  chapter,  no
 interest shall be paid thereon.
   23.  Credit  for the provision of child care. In addition to any other
 credit allowed under this section, a taxpayer whose  application  for  a
 credit  authorized  by section 11-144 of this title has been approved by
 the department of finance shall be allowed  a  credit  against  the  tax
 imposed by this chapter. The amount of the credit shall be determined as
 provided in such section. To the extent the amount of the credit allowed
 by  this  subdivision  exceeds  the  amount  of tax due pursuant to this
 subchapter, as calculated without such credit, such excess amount  shall
 be  treated  as  an  overpayment  of  tax  to be credited or refunded in
 accordance with the  provisions  of  section  11-677  of  this  chapter,
 provided,  however,  that  notwithstanding  the  requirements of section
 11-679 of this chapter to the contrary, no interest shall be paid there-
 on.
   § 11-605 Reports.  1. Every corporation having an  officer,  agent  or
 representative  within  the  city,  shall  annually  on  or before March
 fifteenth, transmit to the commissioner of finance a report  in  a  form
 prescribed  by the commissioner, except that a corporation which reports
 S. 8474                            491
 
 on the basis of a fiscal year shall transmit its report within  two  and
 one-half  months  after the close of its fiscal year, setting forth such
 information as the commissioner  of  finance  may  prescribe  and  every
 taxpayer which ceases to do business in the city or to be subject to the
 tax  imposed  by  this  subchapter shall transmit to the commissioner of
 finance a report on the date of such cessation or at such other time  as
 the  commissioner  may require covering each year or period for which no
 report was theretofore filed. Every taxpayer shall  also  transmit  such
 other  reports  and  such  facts  and information as the commissioner of
 finance may require  in  the  administration  of  this  subchapter.  The
 commissioner  of  finance  may  grant a reasonable extension of time for
 filing reports whenever good cause exists.
   With respect to taxable years ending prior to  December  thirty-first,
 nineteen  hundred  sixty-six,  the returns required to be made and filed
 pursuant to this section shall be  made  and  filed  on  or  before  the
 fifteenth  day  of  the  third month following the close of such taxable
 year or September eleventh, nineteen  hundred  sixty-six,  whichever  is
 later.
   An  automatic  extension  of  six  months for the filing of its annual
 report shall be allowed any taxpayer if, within the time  prescribed  by
 either  of  the  preceding  paragraphs,  whichever  is  applicable, such
 taxpayer files with the  commissioner  of  finance  an  application  for
 extension  in  such form as the commissioner may prescribe by regulation
 and pays on or before the date of such filing the amount properly  esti-
 mated as its tax.
   2.  Every  report  shall  have  annexed thereto a certification by the
 president,  vice-president,  treasurer,   assistant   treasurer,   chief
 accounting officer or another officer of the taxpayer duly authorized so
 to  act to the effect that the statements contained therein are true. In
 the case of an association, within the meaning  of  paragraph  three  of
 section (a) of section seventy-seven hundred one of the internal revenue
 code,  a  publicly-traded  partnership  treated  as  a  corporation  for
 purposes of the internal revenue code pursuant to section  seventy-seven
 hundred four thereof and any business conducted by a trustee or trustees
 wherein  interest  or  ownership  is  evidenced by certificates or other
 written instruments, such certification shall be made by any person duly
 authorized so to act on  behalf  of  such  association,  publicly-traded
 partnership or business. The fact that an individual's name is signed on
 a  certification  of  the report shall be prima facie evidence that such
 individual is authorized to sign and certify the report on behalf of the
 corporation. Blank forms of reports shall be furnished  by  the  commis-
 sioner  of  finance,  on application, but failure to secure such a blank
 shall not release any corporation from  the  obligation  of  making  any
 report required by this subchapter.
   2-a.  The  commissioner  of  finance  may  prescribe  regulations  and
 instructions requiring returns of information to be made  and  filed  in
 conjunction  with  the  reports  required  to  be filed pursuant to this
 section, relating to payments made to shareholders owning,  directly  or
 indirectly, individually or in the aggregate, more than fifty percent of
 the issued capital stock of the taxpayer, where such payments are treat-
 ed  as  payments  of  interest  in  the computation of entire net income
 reported on such reports.
   3. If the amount of taxable income, alternative minimum taxable income
 or other basis of tax for any year of any taxpayer, or of any sharehold-
 er of any taxpayer which has elected to be taxed under subchapter  s  of
 chapter  one  of  the internal revenue code or of any shareholder of any
 S. 8474                            492
 
 taxpayer with respect to which an election has been made to  be  treated
 as  a  qualified  subchapter  s  subsidiary  under  paragraph  three  of
 subsection (b) of section thirteen hundred  sixty-one  of  the  internal
 revenue  code,  as  returned to the United States treasury department or
 the New York state commissioner of taxation and finance  is  changed  or
 corrected  by  the  commissioner of internal revenue or other officer of
 the United States or the New York state  commissioner  of  taxation  and
 finance  or  other  competent  authority,  or where a renegotiation of a
 contract or subcontract with the United States or the state of New  York
 results  in  a  change  in  taxable  income, alternative minimum taxable
 income or other basis of tax, or where a recovery of a war loss  results
 in  a  computation  or  recomputation  of  any tax imposed by the United
 States or the state of New York, or if a taxpayer or such shareholder of
 a taxpayer, pursuant to subsection  (d)  of  section  sixty-two  hundred
 thirteen  of  the  internal revenue code, executes a notice of waiver of
 the restrictions provided in subsection (a) of said  section,  or  if  a
 taxpayer,  or such shareholder of a taxpayer, pursuant to subsection (f)
 of section one thousand eighty-one of the tax law, executes a notice  of
 waiver  of  the restrictions provided in subsection (c) of said section,
 such taxpayer shall report such changed  or  corrected  taxable  income,
 alternative minimum taxable income or other basis of tax, or the results
 of  such  renegotiation,  or such computation, or recomputation, or such
 execution of such notice of waiver and the changes or corrections of the
 taxpayer's federal or New York state taxable income, alternative minimum
 taxable income or other basis of tax on which it is based, within ninety
 days, or one hundred twenty days, in the case of  a  taxpayer  making  a
 combined  report  under  this  subchapter  for  such  year,  after  such
 execution or the final determination of such  change  or  correction  or
 renegotiation,  or such computation, or recomputation, or as required by
 the commissioner of finance, and shall  concede  the  accuracy  of  such
 determination  or  state  wherein  it  is  erroneous. The allowance of a
 tentative carryback adjustment based upon a net operating loss carryback
 or net capital loss carryback pursuant  to  section  sixty-four  hundred
 eleven of the internal revenue code shall be treated as a final determi-
 nation  for purposes of this subdivision. Any taxpayer filing an amended
 return with such department shall also file within ninety days thereaft-
 er an amended report with the commissioner of finance.
   4. (a) Any taxpayer which owns or controls either  directly  or  indi-
 rectly  substantially  all the capital stock of one or more other corpo-
 rations, or substantially all the capital stock of  which  is  owned  or
 controlled  either  directly  or  indirectly by one or more other corpo-
 rations or by interests which own or control either  directly  or  indi-
 rectly  substantially  all the capital stock of one or more other corpo-
 rations,  hereinafter  referred  to  in  this  paragraph   as   "related
 corporations",  shall make a combined report covering any related corpo-
 rations if there are substantial intercorporate transactions  among  the
 related  corporations,  regardless of the transfer price for such inter-
 corporate transactions. It is not necessary that  there  be  substantial
 intercorporate  transactions between any one corporation and every other
 related corporation. It is necessary, however, that there be substantial
 intercorporate transactions between the taxpayer and  a  related  corpo-
 ration  or,  collectively,  a  group  of  such related corporations. The
 report shall set forth such information as the commissioner  of  finance
 may require.
   In  determining  whether  there  are substantial intercorporate trans-
 actions, the commissioner shall consider and evaluate all activities and
 S. 8474                            493

 transactions of the taxpayer and its  related  corporations.  Activities
 and  transactions  that  will be considered include, but are not limited
 to:  manufacturing, acquiring goods or property, or performing services,
 for  related  corporations;  selling  goods acquired from related corpo-
 rations; financing sales of  related  corporations;  performing  related
 customer  services  using  common  facilities  and employees for related
 corporations; incurring expenses that benefit, directly  or  indirectly,
 one  or  more  related  corporations; and transferring assets, including
 such assets as accounts receivable, patents or trademarks  from  one  or
 more related corporations.
   (1)  No taxpayer may be permitted to make a report on a combined basis
 covering any such other corporations where such  taxpayer  or  any  such
 other  corporation  allocates  in accordance with clause (A) of subpara-
 graph six of paragraph (a) of subdivision three  of  section  11-604  of
 this subchapter and such taxpayer or any such other corporation does not
 so allocate.
   (2)  No taxpayer may be permitted to make a report on a combined basis
 covering any such other corporations where such  taxpayer  or  any  such
 other  corporation  allocates  in  accordance with subparagraph seven of
 paragraph (a) of subdivision three of section 11-604 of this  subchapter
 and such taxpayer or any such other corporation does not so allocate.
   (3)  Except  as  provided  in the first undesignated paragraph of this
 subdivision, no combined report covering any corporation not a  taxpayer
 shall be required unless the commissioner of finance deems such a report
 necessary,  because  of  inter-company  transactions  or some agreement,
 understanding, arrangement or transaction  referred  to  in  subdivision
 five  of  this  section,  in order properly to reflect the tax liability
 under this subchapter.
   (4) A corporation organized under the laws of a country other than the
 United States shall not be required or permitted to make a report  on  a
 combined basis.
   (5)(i)  For  purposes of this subparagraph, the term "closest control-
 ling stockholder" means the corporation that indirectly owns or controls
 over fifty percent of the voting stock of a captive REIT or captive RIC,
 is subject to tax under this subchapter  or  otherwise  required  to  be
 included  in  a combined report under this subchapter, and is the fewest
 tiers of corporations away in the ownership structure from  the  captive
 REIT  or  captive  RIC.  The  commissioner is authorized to prescribe by
 regulation or published guidance the criteria for determining the  clos-
 est controlling stockholder.
   (ii)  A  captive  REIT or a captive RIC must be included in a combined
 report with the corporation that directly owns or  controls  over  fifty
 percent  of  the voting stock of the captive REIT or captive RIC if that
 corporation is subject to tax or required to be included in  a  combined
 report under this subchapter.
   (iii)  If  over fifty percent of the voting stock of a captive REIT or
 captive RIC is not directly owned or controlled by a corporation that is
 subject to tax or required to be included in  a  combined  report  under
 this  subchapter,  then the captive REIT or captive RIC must be included
 in a combined report with the corporation that is the  closest  control-
 ling  stockholder  of  the  captive  REIT or captive RIC. If the closest
 controlling stockholder of the captive REIT or captive RIC is subject to
 tax or otherwise required to be included in a combined report under this
 subchapter, then the captive REIT or captive RIC must be included  in  a
 combined report under this subchapter.
 S. 8474                            494
 
   (iv)  If  the  corporation  that  directly owns or controls the voting
 stock of the captive REIT or captive RIC is  described  in  subparagraph
 one,  two  or  four  of this paragraph as a corporation not permitted to
 make a combined report, then the provisions  in  clause  (iii)  of  this
 subparagraph  must  be  applied  to  determine  the corporation in whose
 combined report the captive REIT or captive RIC should be included.  If,
 under  clause  (iii)  of  this subparagraph, the corporation that is the
 closest controlling stockholder of the captive REIT or  captive  RIC  is
 described in subparagraph one, two or four of this paragraph as a corpo-
 ration not permitted to make a combined report, then that corporation is
 deemed  to  not  be  in  the  ownership structure of the captive REIT or
 captive RIC, and the closest controlling stockholder will be  determined
 without regard to that corporation.
   (v)  If  a captive REIT owns the stock of a qualified REIT subsidiary,
 as defined in paragraph two of subsection (i) of section  eight  hundred
 fifty-six  of the internal revenue code, then the qualified REIT subsid-
 iary must be included in a combined report with the captive REIT.
   (vi) If a captive REIT or a captive RIC is required under this subpar-
 agraph to be included in a combined report with another corporation, and
 that other corporation is also required to be  included  in  a  combined
 report with another related corporation or corporations under this para-
 graph, then the captive REIT or the captive RIC must be included in that
 combined report with those corporations.
   (vii)  If  a  captive  REIT  or  a  captive  RIC is not required to be
 included in a combined report with another corporation under clause (ii)
 or (iii) of this  subparagraph,  or  in  a  combined  return  under  the
 provisions  of  subparagraph  (v) of paragraph two of subdivision (f) of
 section 11-646 of this chapter, then the captive REIT or captive RIC  is
 subject  to  the opening provisions of this paragraph and the provisions
 of subparagraph three of this paragraph. The captive REIT or captive RIC
 must be included in a combined report under this subchapter with another
 corporation  if  either  the  substantial  intercorporate   transactions
 requirement  in  the  opening provisions of this paragraph or the inter-
 company transactions or agreement, understanding, arrangement or  trans-
 action  requirement of subparagraph three of this paragraph is satisfied
 and more than fifty percent of the voting stock of the captive  REIT  or
 the captive RIC and substantially all of the capital stock of that other
 corporation  are  owned  and  controlled, directly or indirectly, by the
 same corporation.
   (b)(1)(i) In the case of a combined report the tax shall  be  measured
 by  the combined entire net income or combined capital of all the corpo-
 rations included in the report, including any captive  REIT  or  captive
 RIC;  provided,  however, in no event shall the tax measured by combined
 capital exceed the limitation provided for in paragraph F of subdivision
 one of section 11-604 of this subchapter.
   (ii) In the case of a captive REIT or captive RIC required under  this
 subdivision  to be included in a combined report, entire net income must
 be computed as required under  subdivision  seven,  in  the  case  of  a
 captive  REIT,  or  subdivision  eight, in the case of a captive RIC, of
 section 11-603 of this chapter. However, the deduction under the  inter-
 nal  revenue  code for dividends paid by the captive REIT or captive RIC
 to any member of the affiliated group that includes the corporation that
 directly or indirectly owns over fifty percent of the  voting  stock  of
 the  captive  REIT or captive RIC shall not be allowed for taxable years
 beginning on or after January first, two thousand nine. The term "affil-
 iated group" means "affiliated group"  as  defined  in  section  fifteen
 S. 8474                            495
 
 hundred  four  of  the  internal revenue code, but without regard to the
 exceptions provided for in subsection (b) of that section.
   (2)  In  computing combined entire net income intercorporate dividends
 shall be eliminated, in computing combined business and investment capi-
 tal intercorporate stock holdings and intercorporate  bills,  notes  and
 accounts  receivable  and  payable and other intercorporate indebtedness
 shall be eliminated and in computing combined subsidiary capital  inter-
 corporate stockholdings shall be eliminated.
   5.  In  case  it  shall appear to the commissioner of finance that any
 agreement, understanding or arrangement exists between the taxpayer  and
 any other corporation or any person or firm, whereby the activity, busi-
 ness, income or capital of the taxpayer within the city is improperly or
 inaccurately  reflected,  the  commissioner of finance is authorized and
 empowered, in its discretion and in such manner as it may determine,  to
 adjust  items of income, deductions and capital, and to eliminate assets
 in computing any allocation percentage provided  only  that  any  income
 directly  traceable  thereto be also excluded from entire net income, so
 as equitably to determine the tax. Where (a) any taxpayer  conducts  its
 activity  or  business under any agreement, arrangement or understanding
 in such manner as either directly or indirectly to benefit  its  members
 or  stockholders,  or  any of them, or any person or persons directly or
 indirectly interested in such activity or business, by entering into any
 transaction at more or less than a fair price which, but for such agree-
 ment, arrangement or understanding, might have  been  paid  or  received
 therefor,  or  (b)  any taxpayer, a substantial portion of whose capital
 stock is owned either directly or  indirectly  by  another  corporation,
 enters into any transaction with such other corporation on such terms as
 to  create  an  improper loss or net income, the commissioner of finance
 may include in the entire net income of the taxpayer the  fair  profits,
 which, but for such agreement, arrangement or understanding, the taxpay-
 er might have derived from such transaction.
   6.  An action may be brought at any time by the corporation counsel at
 the instance of the commissioner of finance  to  compel  the  filing  of
 reports due under this subchapter.
   7. Reports shall be preserved for five years, and thereafter until the
 commissioner of finance orders them to be destroyed.
   8.  Where  the  state  tax commission changes or corrects a taxpayer's
 sales and compensating use tax liability with respect to the purchase or
 use of items for which a sales or compensating use  tax  credit  against
 the  tax  imposed by this chapter was claimed, the taxpayer shall report
 such change or correction to the commissioner of finance  within  ninety
 days  of  the  final  determination  of such change or correction, or as
 required by the commissioner of finance, and shall concede the  accuracy
 of  such  determination  or  state wherein it is erroneous. Any taxpayer
 filing an amended return or report relating to the purchase  or  use  of
 such  items shall also file within ninety days thereafter a copy of such
 amended return or report with the commissioner of finance.
   § 11-606 Payment and lien of tax. 1. To the extent the tax imposed  by
 section  11-603  of  this subchapter shall not have been previously paid
 pursuant to section 11-608 of this subchapter,
   (a) such tax, or the balance thereof, shall be payable to the  commis-
 sioner  of  finance  in  full  at  the time the report is required to be
 filed, and
   (b) such tax, or the balance thereof, imposed on  any  taxpayer  which
 ceases to do business in the city or to be subject to the tax imposed by
 this  subchapter  shall be payable to the commissioner of finance at the
 S. 8474                            496
 
 time the report is required to be filed; all other  taxes  of  any  such
 taxpayer,  which pursuant to the provisions of this section would other-
 wise be payable subsequent to the time such report  is  required  to  be
 filed, shall nevertheless be payable at such time.
   If  the taxpayer, within the time prescribed by section 11-605 of this
 subchapter, shall have applied for an automatic  extension  of  time  to
 file  its  annual  report  and  shall  have  paid to the commissioner of
 finance on or before the date such application is filed an amount  prop-
 erly  estimated  as provided by said section, the only amount payable in
 addition to the tax shall be interest at the underpayment  rate  set  by
 the  commissioner of finance pursuant to section 11-687 of this chapter,
 or, if no rate is set, at the rate of seven  and  one-half  percent  per
 annum  upon  the amount by which the tax, or the portion thereof payable
 on or before the date the report was required to be filed,  exceeds  the
 amount so paid. For purposes of this paragraph:
   (1)  an  amount  so  paid  shall be deemed properly estimated if it is
 either: (A) not less than ninety percent of the tax  as  finally  deter-
 mined, computed without regard to any credit allowable under subdivision
 eleven  of  section  11-604 of this subchapter, or (B) not less than the
 tax shown, computed without regard to any credit allowable under  subdi-
 vision  eleven  of  section 11-604 of this subchapter, on the taxpayer's
 report for the preceding taxable year, if  such  preceding  year  was  a
 taxable year of twelve months; and
   (2) the time when a report is required to be filed shall be determined
 without regard to any extension of time for filing such report.
   2.  The  commissioner  of  finance may grant a reasonable extension of
 time for payment of any tax imposed by this subchapter under such condi-
 tions as it deems just and proper.
   3. Subdivision one of this section shall apply to a taxpayer which has
 a right to a credit pursuant to subdivision eleven of section 11-604  of
 this subchapter, except that the tax, or balance thereof, payable to the
 commissioner  of  finance  in  full  pursuant to subdivision one of this
 section, at the time the report is required to be filed, shall be calcu-
 lated and paid at such time as if the credit provided for in subdivision
 eleven of section 11-604 of this subchapter were not allowed.
   § 11-607  Declaration of estimated tax.  1. Every taxpayer subject  to
 the tax imposed by section 11-603 of this subchapter shall make a decla-
 ration of its estimated tax for the current privilege period, containing
 such  information  as the commissioner of finance may prescribe by regu-
 lations or  instructions,  if  such  estimated  tax  can  reasonably  be
 expected to exceed one thousand dollars.
   2.  The  term  "estimated tax" means the amount which a taxpayer esti-
 mates to be the tax imposed by section 11-603 of this subchapter for the
 current privilege period, less the amount which it estimates to  be  the
 sum  of  any  credits  allowable  against  the tax other than the credit
 allowable under subdivision eleven of section 11-604 of this subchapter.
   3. In the case of a taxpayer which reports on the basis of a  calendar
 year,  a  declaration  of estimated tax shall be filed on or before June
 fifteenth of the current privilege period, except that if  the  require-
 ments of subdivision one are first met:
     (a)  after  May  thirty-first  and  before  September  first of such
   current privilege period, the declaration shall be filed on or  before
   September fifteenth, or
     (b)  after  August  thirty-first  and  before December first of such
   current privilege period, the declaration shall be filed on or  before
   December fifteenth.
 S. 8474                            497
 
     4.  A  taxpayer  may  amend  a  declaration under regulations of the
   commissioner of finance.
     5. If, on or before February fifteenth of the succeeding year in the
   case  of  a  taxpayer which reports on the basis of a calendar year, a
   taxpayer files its report for the year for which  the  declaration  is
   required,  and  pays therewith the balance, if any, of the full amount
   of the tax shown to be due on the report,
     (a) such report shall be considered as its declaration if no  decla-
   ration  is required to be filed during the calendar or fiscal year for
   which the tax was imposed, but is otherwise required to be filed on or
   before December  fifteenth  pursuant  to  subdivision  three  of  this
   section, and
     (b)  such  report  shall be considered as the amendment permitted by
   subdivision four of this section to be filed  on  or  before  December
   fifteenth if the tax shown on the report is greater than the estimated
   tax shown on a declaration previously made.
     6.  This  section  shall apply to privilege periods of twelve months
   other than a calendar year by the substitution of the months  of  such
   fiscal year for the corresponding months specified in this section.
     7.  If  the  privilege  period for which a tax is imposed by section
   11-603 of this subchapter is less than twelve months,  every  taxpayer
   required  to  make  a  declaration of estimated tax for such privilege
   period shall make such a declaration in accordance with regulations of
   the commissioner of finance.
     8. The commissioner of finance may grant a reasonable  extension  of
   time,  not  to  exceed three months, for the filing of any declaration
   required pursuant to this section, on such terms and conditions as  it
   may require.
   §  11-608    Payments  on account of estimated tax.  1. Every taxpayer
 subject to the tax imposed by section 11-603 of  this  subchapter  shall
 pay  with  the  report  required to be filed for the preceding privilege
 period, if any, or with an application for extension  of  the  time  and
 filing  such  report,  an  amount equal to twenty-five per centum of the
 preceding year's tax, computed without regard to the credit provided for
 in subdivision twelve of section 11-604  of  this  subchapter,  if  such
 preceding year's tax exceeded one thousand dollars.
   2.  The  estimated  tax  with  respect to which a declaration for such
 privilege period is required shall be paid, in the case  of  a  taxpayer
 which reports on the basis of a calendar year, as follows:
   (a) If the declaration is filed on or before June fifteenth, the esti-
 mated tax shown thereon, after applying thereto the amount, if any, paid
 during  the  same  privilege  period pursuant to subdivision one of this
 section, shall be paid  in  three  equal  installments.    One  of  such
 installments shall be paid at the time of the filing of the declaration,
 one  shall  be paid on the following September fifteenth, and one on the
 following December fifteenth.
   (b) If the declaration is filed after June  fifteenth  and  not  after
 September  fifteenth of such privilege period, and is not required to be
 filed on or before June fifteenth of  such  period,  the  estimated  tax
 shown  on  such  declaration, after applying thereto the amount, if any,
 paid during the same privilege period pursuant  to  subdivision  one  of
 this  section,  shall  be  paid in two equal installments.   One of such
 installments shall be paid at the time of the filing of the  declaration
 and one shall be paid on the following December fifteenth.
   (c)  If  the  declaration  is  filed after September fifteenth of such
 privilege period, and is not required to be filed on or before September
 S. 8474                            498
 
 fifteenth of such privilege period, the  estimated  tax  shown  on  such
 declaration,  after applying thereto the amount, if any, paid in respect
 to such privilege period pursuant to subdivision one  of  this  section,
 shall be paid in full at the time of the filing of the declaration.
   (d) If the declaration is filed after the time prescribed therefor, or
 after  the  expiration of any extension of time therefor, paragraphs (b)
 and (c) of this subdivision shall not apply, and there shall be paid  at
 the  time of such filing all installments of estimated tax payable at or
 before such time, and the remaining installments shall be  paid  at  the
 times  at which, and in the amounts in which, they would have been paya-
 ble if the declaration had been filed when due.
   3. If any amendment of a declaration is filed, the remaining  install-
 ments,  if any, shall be ratably increased or decreased, as the case may
 be, to reflect any increase or decrease in the estimated tax  by  reason
 of  such  amendment,  and  if  any  amendment  is  made  after September
 fifteenth of the privilege period, any increase in the estimated tax  by
 reason thereof shall be paid at the time of making such amendment.
   4.  Any amount paid shall be applied after payment as a first install-
 ment against the estimated tax of the taxpayer for the current privilege
 period shown on the declaration required to be filed pursuant to section
 11-607 of this subchapter or, if no  declaration  of  estimated  tax  is
 required  to  be  filed by the taxpayer to such section, any such amount
 shall be considered a payment on account of the tax shown on the  report
 required to be filed by the taxpayer for such privilege period.
   5. Notwithstanding the provisions of section 11-679 of this chapter or
 of  section  three-a  of  the  general  municipal law, if an amount paid
 pursuant to subdivision one of this section exceeds the tax shown on the
 report required to be filed by the taxpayer  for  the  privilege  period
 during  which the amount was paid, interest shall be allowed and paid on
 the amount by which the amount so  paid  pursuant  to  such  subdivision
 exceeds  such  tax,  at  the overpayment rate set by the commissioner of
 finance pursuant to section 11-687 of this chapter, or, if  no  rate  is
 set,  at  the rate of four percent per annum from the date of payment of
 the amount so paid pursuant to such subdivision to the fifteenth day  of
 the  third  month following the close of the privilege period, provided,
 however, that no interest shall be allowed or paid under  this  subdivi-
 sion  if  the amount thereof is less than one dollar or if such interest
 becomes payable solely because of a carryback of a net operating loss in
 a subsequent privilege period.
   6. As used in this section, "the preceding year's tax" means  the  tax
 imposed  upon  the taxpayer by section 11-603 of this subchapter for the
 preceding calendar or fiscal year, or, for  purposes  of  computing  the
 first  installment  of  estimated tax when an application has been filed
 for extension of the time for filing the report required to be filed for
 such preceding calendar or fiscal year, the  amount  properly  estimated
 pursuant  to  section  11-607 of this subchapter as the tax imposed upon
 the taxpayer for such calendar or fiscal year.
   7. This section shall apply to a privilege period of less than  twelve
 months in accordance with regulations of the commissioner of finance.
   8.  The provisions of this section shall apply to privilege periods of
 twelve months other than a calendar year  by  the  substitution  of  the
 months  of  such  fiscal  year for the corresponding months specified in
 such provisions.
   9. The commissioner of finance may grant  a  reasonable  extension  of
 time,  not to exceed six months, for payment of any installment of esti-
 mated tax required pursuant to this section, on such  terms  and  condi-
 S. 8474                            499
 
 tions as the commissioner may require including the furnishing of a bond
 or  other  security by the taxpayer in an amount not exceeding twice the
 amount for which any extension of time for payment is granted,  provided
 however  that  interest at the underpayment rate set by the commissioner
 of finance pursuant to section 11-687 of this chapter, or, if no rate is
 set, at the rate of seven and one-half percent per annum for the  period
 of  the extension shall be charged and collected on the amount for which
 any extension of time for payment is granted under this subdivision.
   10. A taxpayer may elect to pay any installment of estimated tax prior
 to the date prescribed in this section for payment thereof.
   11. The portion of an overpayment attributable to a  credit  allowable
 pursuant  to subdivision eleven of section 11-604 of this subchapter may
 not be credited against any payment due under this section.
   § 11-609  Collection of taxes.  Every foreign corporation, other  than
 a  moneyed  corporation,  subject  to the provisions of this subchapter,
 except a corporation having  authority  to  do  business  by  virtue  of
 section  thirteen  hundred  five  of the business corporation law, shall
 file in the department of state a  certificate  of  designation  in  its
 corporate  name, signed and acknowledged by its president or a vice-pre-
 sident or its secretary or treasurer, under its corporate  seal,  desig-
 nating  the  secretary  of  state  as its agent upon whom process in any
 action provided for by this subchapter may be served within this  state,
 and  setting forth an address to which the secretary of state shall mail
 a copy of any such process against the corporation which may  be  served
 upon  the  secretary of state.   In case any such corporation shall have
 failed to file such certificate of designation, it shall  be  deemed  to
 have designated the secretary of state as its agent upon whom such proc-
 ess  against  it  may  be served; and until a certificate of designation
 shall have been filed, the corporation shall be deemed to have  directed
 the  secretary of state to mail copies of process served upon him or her
 to the corporation at its last known office address  within  or  without
 the  state.    When  a certificate of designation has been filed by such
 corporation the secretary of state shall mail copies of  process  there-
 after  served  upon  the  secretary of state to the address set forth in
 such certificate.  Any such corporation, from time to time,  may  change
 the  address  to which the secretary of state is directed to mail copies
 of process, by filing a certificate to that effect executed, signed  and
 acknowledged  in like manner as a certificate of designation as provided
 in this section.  Service of process upon any such corporation  or  upon
 any  corporation  having  authority  to do business by virtue of section
 thirteen hundred five of the business corporation  law,  in  any  action
 commenced at any time pursuant to the provisions of this subchapter, may
 be  made  by  either:  (a) personally delivering to and leaving with the
 secretary of state, a deputy secretary  of  state  or  with  any  person
 authorized  by  the secretary of state to receive such service duplicate
 copies thereof at the office of the department of state in the  city  of
 Albany,  in  which  event the secretary of state shall forthwith send by
 registered mail, return receipt requested, one of  such  copies  to  the
 corporation  at the address designated by it or at its last known office
 address within or without the state, or (b) personally delivering to and
 leaving with the secretary of state, a deputy secretary of state or with
 any person authorized by the secretary of state to receive such service,
 a copy thereof at the office of the department of state in the  city  of
 Albany  and by delivering a copy thereof to, and leaving such copy with,
 the president, vice-president, secretary, assistant secretary,  treasur-
 er, assistant treasurer, or cashier of such corporation, or the  officer
 S. 8474                            500
 
 performing  corresponding functions under another name, or a director or
 managing agent of such corporation, personally without the state.  Proof
 of such personal service without the state shall be filed with the clerk
 of  the  court  in  which the action is pending within thirty days after
 such service, and such service shall be complete ten  days  after  proof
 thereof is filed.
   §  11-610   Limitations of time.  The provisions of the civil practice
 law and rules relative to the limitation of time enforcing a civil reme-
 dy shall not apply to any proceeding or action taken to levy,  appraise,
 assess,  determine  or  enforce  the  collection  of  any tax or penalty
 prescribed by this subchapter, provided, however, that as to real estate
 in the hands of persons who are owners thereof who would  be  purchasers
 in  good  faith  but  for such tax or penalty and as to the lien on real
 estate of mortgages held by persons who would be holders thereof in good
 faith but for such tax or penalty, all such taxes  and  penalties  shall
 cease  to  be  a  lien on such real estate as against such purchasers or
 holders after the expiration of ten  years  from  the  date  such  taxes
 became  due  and payable.   The limitations provided for in this section
 shall not apply to any transfer from a corporation to a person or corpo-
 ration with intent to avoid payment of any taxes,  or  where  with  like
 intent  the transfer is made to a grantee corporation, or any subsequent
 grantee corporation, controlled by such grantor or which has any  commu-
 nity of interest with it, either through stock ownership or otherwise.
 
                               SUBCHAPTER 3
                         FINANCIAL CORPORATION TAX
                                  PART 1
              TAX ON STATE BANKS, TRUST COMPANIES, FINANCIAL
              CORPORATIONS AND SAVINGS AND LOAN ASSOCIATIONS
 
   § 11-611 Definitions. When used in this part:
   1.  The  term  "financial corporation" means every corporation doing a
 banking business as defined in this section, other than a national bank-
 ing association, a trust company all of the capital stock  of  which  is
 owned  by  not  less  than twenty savings banks organized under a law of
 this state, or a corporation taxable under subchapter two of this  chap-
 ter,  and  shall  include the mortgage facilities corporation created by
 chapter five hundred sixty-four of the laws of nineteen  hundred  fifty-
 six  and any corporation eighty percent or more of whose voting stock is
 beneficially owned by a corporation or corporations subject  to  article
 three  or article three-a of the banking law or a national banking asso-
 ciation or associations, provided the corporation whose voting stock  is
 so  owned  is  principally  engaged  in business which might be lawfully
 conducted by a corporation subject to article three of the  banking  law
 or a national banking association.
   2.  The  word  "paid",  for  the purpose of the deductions and credits
 under this part, means "paid or accrued" or "paid or incurred," and  the
 terms  "paid  or  incurred"  and  "paid  or  accrued" shall be construed
 according to the method of accounting upon the basis of  which  the  net
 income  is  computed,  under  this  part.  The  term "received," for the
 purpose of the computation of net income under this part means "received
 or accrued" and the  term  "received  or  accrued"  shall  be  construed
 according  to  the  method of accounting upon the basis of which the net
 income is computed under this part.
 S. 8474                            501
 
   3. The word "dividend" means any distribution made by a corporation to
 its shareholders or  members, out of its earnings or profits, whether in
 cash, or in property other than stock of the corporation.
   4. The words "doing a banking business" means doing such business as a
 corporation may be created to do under articles three, five, five-a, and
 six  of  the  banking  law, or doing any business which a corporation is
 authorized by such articles to do.
   5. The words "foreign banker doing a banking business"  in  the  city,
 include  every foreign corporation doing a banking business in the city,
 except a national banking association.
   6. The words "savings and loan  association"  mean  every  corporation
 doing  such business as a corporation may be created to do under article
 ten of the banking law, including every federal savings and loan associ-
 ation organized under authority of the United States.
   § 11-612  Tax based on net income; imposition; minimum tax; new incor-
 porations; dissolution; consolidations; mergers, etc.
   1. For the privilege of doing business in the city:
   (a) Every bank and savings and loan association  organized  under  the
 authority of this state;
   (b) Every trust company incorporated, organized or formed under, by or
 pursuant  to  a  law of the state, other than a trust company all of the
 stock of which is owned by not less than twenty savings banks  organized
 under  a  law of the state, and every domestic corporation authorized to
 do a trust company's business solely or in  connection  with  any  other
 business, under a general or special law of the state;
   (c) Every other domestic financial corporation;
   (d)  Every  incorporated  foreign  banker doing a banking business and
 every other foreign financial corporation; and
   (e) Every federal savings and  loan  association  located  within  the
 city,  shall  annually  pay  a  tax at the rate of four and one-half per
 centum except that for the years nineteen hundred seventy-one and  those
 following,  the  rate  shall  be five and sixty-three one hundredths per
 centum, to be computed as provided in this part, upon the basis  of  its
 net  income  for  each  calendar  year, beginning with the calendar year
 nineteen hundred sixty-six,  next  preceding  the  date  when  such  tax
 becomes  due, if the taxpayer is required to file a declaration of esti-
 mated tax and to make payments on  account  of  such  estimated  tax  as
 provided by section 11-636 of this subchapter, upon the basis of its net
 income  for  the calendar year with respect to which such declaration is
 required to be filed.
   2. Every such corporation for the privilege of doing business  in  the
 city  and every federal savings and loan association located in the city
 shall be subject to a minimum tax of not less than ten dollars  and  not
 less  than  one mill except that for the years nineteen hundred seventy-
 one and those following such minimum tax shall be not less  than  twelve
 and  one-half  dollars  and not less than one and one-quarter mills upon
 each dollar of such a part of its issued capital stock on the  last  day
 of  the  calendar  year preceding that in which such tax becomes due, at
 its face value, as the gross income of  such  corporation  derived  from
 business  carried on within the city during such calendar year, bears to
 its gross income derived from all business, both within and without  the
 city,  during said year, but if such a corporation has stock without par
 value, such stock shall be taken at its actual or market value, and  not
 less  than  five  dollars per share, as may be determined by the commis-
 sioner of finance; except that a savings bank and savings and loan asso-
 ciation shall be subject to a minimum tax of not  less  than  an  amount
 S. 8474                            502
 
 equal  to two per centum of the amount of interest or dividends credited
 by it to depositors or shareholders during the calendar  year  preceding
 that  in  which  such tax becomes due except that for the years nineteen
 hundred  seventy-one  and  those following such minimum tax shall be not
 less than twelve and one-half dollars and not less than an amount  equal
 to  two  and  one-half per centum of the amount of interest or dividends
 credited by it to depositors or shareholders during  the  calendar  year
 preceding  that  in which such tax becomes due, provided that, in deter-
 mining such amount each interest or dividend credit to  a  depositor  or
 shareholder  shall  be  deemed  to  be the interest or dividend actually
 credited or the interest or dividend which would have been  credited  if
 it  had  been  computed  and  credited at the rate of two per centum per
 annum whichever is less and except also that in  the  case  of  a  trust
 company or savings bank incorporated in the calendar year preceding that
 in  which  its  first  return under this part shall be due and after the
 thirtieth day of June in such year, the minimum tax, computed as in this
 subdivision provided, shall be reduced one-twelfth for  each  month,  or
 major  portion  thereof, subsequent to said thirtieth day of June during
 which such trust company or savings bank did not exercise the  privilege
 of doing business in the city.
   3.  For the privilege of doing business in the city, every such domes-
 tic corporation, except trust companies  and  savings  banks,  shall  be
 subject to a tax for the calendar year in which its organization certif-
 icate  is  filed,  and, for the privilege of doing business in the city,
 every such foreign corporation shall be subject to a tax for the  calen-
 dar year in which it first does business in the city, and, every federal
 savings and loan association located within the city shall be subject to
 a tax for the calendar year in which it first becomes located within the
 city,  computed  in  the same manner and at the same rate as the minimum
 tax under subdivision two of this section, except that the income  form-
 ing  the basis for proration shall be the income for such calendar year,
 and the issued capital stock shall be taken as of the last day  of  such
 calendar  year;  provided,  however,  that  the tax so computed shall be
 reduced one-twelfth for each month, or major portion  thereof,  in  such
 calendar  year,  during which such corporation was not doing business in
 the city, or, if a federal savings and loan association, was not located
 in the city, and in no event shall the tax  be  less  than  ten  dollars
 except  that for the year nineteen hundred seventy-one and those follow-
 ing, in no event shall the tax be less than twelve and one-half dollars.
   4. For the privilege of doing business in the city, every  such  trust
 company  and  savings  bank  which shall become incorporated between the
 thirty-first day of December and the succeeding first day of July, shall
 be subject to a tax for such period, computed in the same manner and  at
 the  same rate as the minimum tax under subdivision two of this section,
 except that the income forming the basis  for  proration  shall  be  the
 income  for such period; and the issued capital stock, or interest cred-
 ited to depositors of a savings bank, shall be taken as of the last  day
 of  such  period;  provided,  however, that the tax so computed shall be
 reduced one-half and an additional one-twelfth for each month, or  major
 portion  thereof,  in  such  period,  during which such trust company or
 savings bank was not doing business in the city, and in no  event  shall
 the  tax  be  less  than  ten  dollars except that for the year nineteen
 hundred seventy-one and those following, in no event shall  the  tax  be
 less than twelve and one-half dollars.
   5.  For the privilege of doing business in the city, every such corpo-
 ration, except  trust  companies  and  savings  banks,  which  shall  be
 S. 8474                            503
 
 dissolved  between  the  thirty-first day of December and the succeeding
 second day of September, and shall not  become  merged  or  consolidated
 with another corporation taxable under this part and, every such foreign
 corporation which shall cease to do business in the city during the same
 period,  and  every federal savings and loan association which ceases to
 be located in the city during the same  period,  and  shall  not  become
 merged or consolidated with another corporation taxable under this part,
 shall  pay a tax for the period from the thirty-first day of December up
 to the time of dissolution, ceasing to do business in the city, or ceas-
 ing to be located in the city, as the case may be, equal to  that  which
 would have been payable had it not been dissolved, ceased to do business
 in  the  city, or ceased to be located in the city, except that such tax
 shall be reduced one-third and an additional one-twelfth for each month,
 or major portion thereof, prior to such succeeding second day of Septem-
 ber, during which such corporation was not doing business in  the  city,
 or  was  not  located in the city, and in no event shall the tax be less
 than ten dollars except that for the year nineteen  hundred  seventy-one
 and  those  following, in no event shall the tax be less than twelve and
 one-half dollars.  If such dissolution or cessation occurs  between  the
 fifteenth  day  of  March  and  the second day of September, and if such
 corporation shall have filed its return on or before the  fifteenth  day
 of March as required by section 11-633 of this subchapter, it may file a
 claim  for refund as provided in section 11-678 of this chapter, showing
 any reduction in tax to which it may be  entitled  as  provided  in  the
 preceding sentence; and if it shall be made to appear that the amount of
 tax due is less than the amount as computed on the basis of the original
 return,  the commissioner of finance shall adjust the computation of tax
 accordingly.  If the amount of tax as so adjusted shall be less than the
 amount theretofore paid, the excess shall be refunded by the commission-
 er of finance as provided in subdivision one of section 11-677  of  this
 chapter.
   6.  Every  such  trust  company  and  savings  bank,  which  shall  be
 dissolved, and shall not become  merged  or  consolidated  with  another
 corporation  taxable  under this part, shall, if dissolution takes place
 between the thirtieth day of June and the succeeding first day of  Janu-
 ary,  be  subject to a tax, for that part of such period in which it had
 been doing business, computed in the same manner and at the same rate as
 the minimum tax under subdivision two of this section, except  that  the
 income  forming  the  basis  for  proration  shall be the income for the
 calendar year in which such dissolution occurs; and the  issued  capital
 stock,  or  interest  credited to depositors of a savings bank, shall be
 taken as of the date of dissolution; provided, however, that the tax  so
 computed  shall  be  reduced  one-half and an additional one-twelfth for
 each month, or major portion thereof, between the  date  of  dissolution
 and  the succeeding first day of January.  If dissolution occurs between
 the thirty-first day of December and the  succeeding  sixteenth  day  of
 March,  such trust company and savings bank shall be subject to the same
 tax that would have been due from it on or before the fifteenth  day  of
 March  had  it not been dissolved, except that such tax shall be reduced
 one-twelfth for each month, or major portion thereof, from the  date  of
 dissolution  to  the  succeeding first day of July, and shall be for the
 period beginning on the preceding first day of July and  ending  on  the
 date  of dissolution.   In no event shall the tax under this subdivision
 be less than ten dollars except  that  for  the  year  nineteen  hundred
 seventy-one  and  those  following, in no event shall the tax under this
 subdivision be less than twelve and one-half dollars.
 S. 8474                            504
 
   7. In the case of a consolidation or merger of taxpayers, or in case a
 national bank taxable under part two of this subchapter shall be consol-
 idated or merged with a taxpayer under this part, or in case of a series
 of such transactions, there shall be added to  the  net  income  of  the
 taxpayer resulting from such consolidations or mergers the net income of
 the  taxpayers which are consolidated or merged for the period for which
 the taxpayer resulting from such consolidation or merger is required  to
 render  any  return under this part, and if such resulting taxpayer is a
 savings bank or savings and loan association, there shall  be  added  to
 the  interest  or dividends credited by it to depositors or shareholders
 the amount of interest or dividends credited to depositors or sharehold-
 ers during such period by the    taxpayers  which  are  consolidated  or
 merged,  except  that  net  income,  interest  or dividends shall not be
 included if they have already been used as the basis  for  a  tax  under
 this part, and the tax payable on filing such return shall be based upon
 the  entire  net  income  reported  therein or upon the entire amount of
 interest or dividends so reported, as the case may be.  The  acquisition
 by  a  taxpayer,  directly or indirectly, of the assets or franchises of
 another taxpayer or national bank shall  be  deemed  a  merger  for  the
 purposes of this section.
   8.  The  tax  imposed by this part shall be for the calendar year next
 preceding the year in which it becomes due; except that with respect  to
 corporations  subject  to  a  tax imposed under subdivision three, four,
 five or six of this section, the tax shall be  for  the  period  therein
 specified, and except that with respect to corporations required to file
 a  declaration  of estimated tax and to make payments on account of such
 estimated tax as provided by section  11-636  of  this  subchapter,  all
 payments of tax within a calendar year, whether computed on the basis of
 net  income  for the current calendar year or on the basis of net income
 for the preceding calendar year, shall be for the calendar year in which
 the payments are required to be made.
   9. In the event that it shall be finally  determined  by  a  court  of
 competent  jurisdiction that the taxes imposed on national banking asso-
 ciations by part two of this subchapter are unconstitutional or  invalid
 for  the  reason  that they are not in conformity with the provisions of
 section fifty-two hundred nineteen of the United  States  revised  stat-
 utes, then, in lieu of the taxes imposed by the provisions of this part,
 every  corporation  that  otherwise would have been subject to tax under
 this part shall be subject to the tax imposed under subchapter two as of
 July thirteenth, nineteen hundred sixty-six, and all of  the  provisions
 of  subchapter  two,  unless  clearly inappropriate, shall be applicable
 except subdivision four of section 11-603 of this chapter; and, in  such
 event,  any  payments  made,  reports or returns filed or any act of the
 commissioner of finance or of a taxpayer purportedly under this subchap-
 ter shall be treated as though made, filed or done pursuant to  subchap-
 ter two.
   10.  Cross reference.  For years for which tax is imposed, see section
 11-613 of this part.
   § 11-613  Years for which imposed.   1. The  tax  imposed  by  section
 11-612  of  this  part is imposed for each calendar year included within
 the period beginning  January  first,  nineteen  hundred  sixty-six  and
 ending December thirty-first, nineteen hundred seventy-two.
   2. Cross reference. For tax imposed for years or periods subsequent to
 nineteen hundred seventy-two, see part four of this subchapter.
   § 11-614  Ascertainment of gain or loss.  1. For the purpose of ascer-
 taining the gain derived or loss sustained from the sale or other dispo-
 S. 8474                            505
 
 sition of property, real, personal or mixed, the basis shall be the cost
 thereof, or the inventoried value if the inventory is made in accordance
 with section 11-617 of this part.
   2.  Notwithstanding  subdivision  one of this section, with respect to
 gain derived from the sale or other disposition of any property acquired
 prior to January first, nineteen  hundred  sixty-six,  except  stock  in
 trade  of  the taxpayer or other property of a kind which would properly
 be included in the inventory of the taxpayer if on hand at the close  of
 the taxable year, or property held by the taxpayer primarily for sale to
 customers  in the ordinary course of its trade or business, and accounts
 or notes receivable acquired in the ordinary course of trade or business
 from the sale of such stock  in  trade  or  property,  or  for  services
 rendered, net income shall not include:
   (a) That portion of the gain included in determining net income pursu-
 ant to subdivision one of this section with respect to each such proper-
 ty, which exceeds:
   (b)  The  amount  of  gain  that  would be included in determining net
 income pursuant to subdivision one of this section with respect to  each
 such property if the basis of such property on the date of sale or other
 disposition  were equal to its fair market value on January first, nine-
 teen hundred sixty-six, plus or minus all adjustments to basis made with
 respect to each such property in computing net income for periods on  or
 after  January first, nineteen hundred sixty-six provided that the total
 adjustment to net income provided by this subdivision shall  not  exceed
 the amount of the taxpayer's net gain from the sale or other disposition
 of  all such property, as determined pursuant to subdivision one of this
 section.
   3. In the case of any bond, with respect  to  which  a  deduction  for
 amortizable  bond premium is allowable under subdivision nine of section
 11-621 of this part, the basis for determining gain  or  loss  shall  be
 reduced by the total amount of such deductions so allowable.
   § 11-615  Exchange of property.  Upon the sale or exchange of property
 the  entire  amount of the gain or loss, determined under section 11-614
 of this part, shall be recognized, except as provided in this section:
   1. No gain or loss shall be recognized if common  stock  in  a  corpo-
 ration  is exchanged solely for common stock in the same corporation, or
 if preferred stock in a corporation is exchanged  solely  for  preferred
 stock in the same corporation;
   2.  No  gain  or  loss shall be recognized if stock or securities in a
 corporation, a party to a reorganization are, in pursuance of  the  plan
 or  reorganization,  exchanged  solely  for  stock or securities in such
 corporation or in another corporation a party to such reorganization;
   3. No gain or loss shall be recognized if a taxpayer,  a  party  to  a
 reorganization, exchanges property, in pursuance of the plan of reorgan-
 ization,  solely  for stock or securities in another corporation a party
 to such reorganization; and
   4. No gain or loss shall be recognized if property is transferred to a
 corporation by a taxpayer solely in exchange for stock or securities  in
 such corporation, and immediately after the exchange such taxpayer is in
 control of the corporation; but in the case of an exchange by a taxpayer
 and  one  or  more  other corporations or persons this subdivision shall
 apply only if the amount of the stock and securities received by each is
 substantially in proportion to its interest in the property prior to the
 exchange.
   5. If property, as a result of its destruction in whole  or  in  part,
 theft  or seizure, or an exercise of the power of requisition or condem-
 S. 8474                            506
 
 nation, or the threat of imminence thereof, is compulsorily or  involun-
 tarily  converted  into property similar or related in service or use to
 the property so converted, or into money  which  is  forthwith  in  good
 faith,  under  regulations  prescribed  by  the commissioner of finance,
 expended in the acquisition of other  property  similar  or  related  in
 service  or  use  to the property so converted, or in the acquisition of
 control of a corporation owning such other property, or  in  the  estab-
 lishment of a replacement fund, no gain or loss shall be recognized.  If
 any  part  of  the  money is not so expended, the gain, if any, shall be
 recognized, but in an amount not in excess of the money which is not  so
 expended.
   6.  If there is distributed, in pursuance of a plan of reorganization,
 to a taxpayer shareholder in a corporation a party  to  the  reorganiza-
 tion,  stock or securities in such corporation or in another corporation
 a party to the reorganization, without the surrender  by  such  taxpayer
 shareholder of stock or securities in such a corporation, no gain to the
 distributee from the receipt of such stock or securities shall be recog-
 nized.
   7.  If  an exchange would be within the provisions of subdivision one,
 two, or four of this section if it were not for the fact that the  prop-
 erty  received  in  exchange  consists not only of property permitted by
 such subdivision to be received without the  recognition  of  gain,  but
 also of other property or money, then the gain, if any, to the recipient
 shall  be  recognized, but in an amount not in excess of the sum of such
 money and the fair market value of such other property.
   8. If an exchange would be within the provisions of subdivision  three
 of  this  section if it were not for the fact that the property received
 in exchange consists not only of stock or securities permitted  by  such
 subdivision  to be received without the recognition of gain, but also of
 other property or money, then:
   (a) If the taxpayer receiving such other property or money distributes
 it in pursuance of the plan of reorganization, no gain to  the  taxpayer
 shall be recognized from the exchange, but
   (b)  If  the  taxpayer receiving such other property or money does not
 distribute it in pursuance of the plan of reorganization, the  gain,  if
 any, to the taxpayer shall be recognized, but in an amount not in excess
 of the sum of such money and the fair market value of such other proper-
 ty so received, which is not so distributed.
   9.  If  an exchange would be within the provisions of subdivision one,
 two, three, or four of this section if it were not for the fact that the
 property received in exchange consists not only of property permitted by
 such subdivision to be received without the recognition of gain or loss,
 but also of other property or money, then  no  loss  from  the  exchange
 shall be recognized.
   10. As used in this section:
   (a)  The  term  "reorganization"  means (i) a merger or consolidation,
 including the acquisition by one corporation of at least a  majority  of
 the  voting  stock and at least a majority of the total number of shares
 of all other classes of stock of another corporation,  or  substantially
 all  the  properties  of  another  corporation,  or (ii) a transfer by a
 corporation of all or a part of its assets  to  another  corporation  if
 immediately  after  the  transfer  the transferor or its stockholders or
 both are in control of the corporation to which the  assets  are  trans-
 ferred,  or (iii) a recapitalization, or (iv) a mere change in identity,
 form or place of organization, however effected;
 S. 8474                            507
 
   (b) The term "a party to  a  reorganization"  includes  a  corporation
 resulting  from  a  reorganization and includes both corporations in the
 case of an acquisition by one corporation of at least a majority of  the
 voting  stock  and  at least a majority of the total number of shares of
 all other classes of stock of another corporation; and
   (c)  The  term  "control"  means  the ownership of at least eighty per
 centum of the voting stock and at least eighty per centum of  the  total
 number of shares of all other classes of stock of the corporation.
   11. No gain or loss shall be recognized upon the receipt by a taxpayer
 of  property  distributed in complete liquidation of a corporation.  For
 the purposes of this subdivision a distribution shall be  considered  to
 be in complete liquidation only if:
   (a)  the  taxpayer  receiving  such  property  was, on the date of the
 adoption of the plan of liquidation, and has  continued  to  be  at  all
 times  until  the  receipt  of the property, the owner of stock, in such
 corporation, possessing at least eighty per centum of the total combined
 voting power of all classes of stock entitled to vote and the  owner  of
 at  least eighty   per centum of the total number of shares of all other
 classes of stock, except non-voting stock which is limited and preferred
 as to dividends, and was at no time on or after the date of the adoption
 of the plan of liquidation and until the receipt  of  the  property  the
 owner  of a greater percentage of any class of stock than the percentage
 of such class owned at the time of the  receipt  of  the  property;  and
 either:
   (b)  the  distribution is by such corporation in complete cancellation
 or redemption of all its stock, and the transfer  of  all  the  property
 occurs within the base year; in such case the adoption by the sharehold-
 ers  of the resolution under which is authorized the distribution of all
 the assets of the corporation in complete cancellation or redemption  of
 all its stock, shall be considered an adoption of a plan of liquidation,
 even  though  no time for the completion of the transfer of the property
 is specified on such resolution; or
   (c) such distribution is one of a  series  of  distributions  by  such
 corporation  in  complete cancellation or redemption of all its stock in
 accordance with a plan of liquidation under which the  transfer  of  all
 the property under the liquidation is to be completed within three years
 from  the close of the year during which is made the first of the series
 of distributions under the plan, except that if  such  transfer  is  not
 completed within such period, or if the taxpayer does not continue qual-
 ified  under  paragraph  (a) of this subdivision until the completion of
 such transfer, no distribution under the  plan  shall  be  considered  a
 distribution in complete liquidation.
   If  such  transfer of all the property does not occur within the year,
 the commissioner of finance may require of the taxpayer  such  bond,  or
 waiver  of  the  statute of limitations on assessment and collection, or
 both, as the commissioner may deem necessary to insure, if the  transfer
 of  the  property  is not completed within such three year period, or if
 the taxpayer does not continue qualified under  paragraph  (a)  of  this
 subdivision  until  the  completion of such transfer, the assessment and
 collection of all taxes then imposed under this part for  such  year  or
 subsequent years, to the extent attributable to property so received.  A
 distribution  otherwise  constituting  a distribution in complete liqui-
 dation within the meaning of this paragraph shall not be  considered  as
 not  constituting such a distribution merely because it does not consti-
 tute a distribution or liquidation within the meaning of  the  corporate
 law  under  which the distribution is made; and for the purposes of this
 S. 8474                            508
 
 paragraph a transfer of property of such  corporation  to  the  taxpayer
 shall  not be considered as not constituting a distribution, or one of a
 series of distributions, in complete cancellation or redemption  of  all
 the  stock  of  such corporation, merely because the carrying out of the
 plan involves: (1) the transfer under the plan to the taxpayer  by  such
 corporation of property, not attributable to shares owned by the taxpay-
 er, upon an exchange described in subdivision three of this section, and
 (2)  the complete cancellation or redemption under the plan, as a result
 of exchanges described in subdivision two of this section, of the shares
 not owned by the taxpayers.
   § 11-616  Exchange of property when no gain or loss is realized.  When
 property is exchanged for other property and no gain or loss is realized
 under  the  provisions  of  the preceding section, the property received
 shall be treated as taking the place of the property exchanged therefor.
 Where no gain or loss is realized under the  provisions  of  subdivision
 eleven  of  section  11-615  of  this  part,  the  basis of the property
 received shall be the same as it would be in the hands of the transferor
 determined in accordance with the provisions of section 11-614  of  this
 part.
   §  11-617   Inventory.  Whenever in the opinion of the commissioner of
 finance the use of inventories is necessary in order clearly  to  deter-
 mine  the  income  of  any  taxpayer,  inventory  shall be taken by such
 taxpayer upon such basis as the commissioner of finance  may  prescribe,
 conforming  as  nearly  as may be to the best accounting practice in the
 banking business most clearly reflecting the income.
   § 11-618  Net income defined.  The term "net income" means  the  gross
 income of a taxpayer less the deductions allowed by this part.
   § 11-619  Computation of net income.  The net income shall be computed
 in  accordance with the method of accounting regularly employed in keep-
 ing the books of such taxpayer; but if no such method of accounting  has
 been so employed, or if the method employed does not clearly reflect the
 income, the computation shall be made upon such basis and in such manner
 as  in  the  opinion of the commissioner of finance does clearly reflect
 the income.  In determining net income, war losses, taxation of property
 recovered, and basis of property shall be treated in  substantially  the
 same  manner  as such losses, recoveries and basis are treated under the
 applicable provisions of section  thirteen  hundred  thirty-one  of  the
 internal revenue code.
   §  11-620   Gross income defined.  1. The term "gross income" includes
 gains, profits and income derived from the business,  of  whatever  kind
 and in whatever form paid, including gains, profits or income from deal-
 ings  in property, whether real or personal, or gains, profits or income
 received as compensation for services, as interest, rents,  commissions,
 brokerage  or  other  fees,  or  otherwise in carrying on such business,
 including all dividends received on stocks  and  all  interest  received
 from federal, state, municipal or other bonds.
   2.  If the gross income of a taxpayer is derived from business carried
 on both within and without the city, "gross income" means  that  propor-
 tion  thereof which is derived from business carried on within the city,
 to be allocated and determined on the basis of separate  accounting  for
 each  office  or branch or, at the election of the taxpayer, under rules
 and regulations prescribed by the commissioner of finance.
   3. "Gross income" of a savings bank shall include the amount  received
 by it in any taxable year as a distribution in liquidation of the mutual
 savings bank fund.
 S. 8474                            509
 
   § 11-621 Deductions. In computing net income there shall be allowed as
 deductions:
   1. All the ordinary and necessary expenses paid or incurred during the
 year in carrying on business, including a reasonable allowance for sala-
 ries  or other compensation for personal services actually rendered, and
 including rentals or other payments required to be made as  a  condition
 to  the continued use or possession for business purposes of property to
 which the taxpayer has not taken or is not taking title or in which such
 taxpayer has no equity.
   2. All interest paid or accrued during the year on indebtedness.
   3. Taxes, other than taxes on income or profits paid or accrued within
 the year, imposed, first, by the authority of the United States,  or  of
 any  of  its  possessions, or, second, by the authority of any state, or
 territory, or any county, school district, municipality, or other taxing
 subdivisions of any state or territory,  not  including  those  assessed
 against  local  benefits  of a kind tending to increase the value of the
 property assessed, or, third, by the authority of  any  foreign  govern-
 ment.
   4.  Losses sustained during the year and not compensated for by insur-
 ance or otherwise, if incurred in business; unless in order  to  clearly
 reflect  the income the losses should in the opinion of the commissioner
 of finance be accounted for as of a different period. No deduction shall
 be allowed for any loss claimed to have been sustained in  any  sale  or
 other disposition of shares of stock or securities where it appears that
 within  thirty days before or after the date such sale or other disposi-
 tion the taxpayer has acquired substantially identical property, and the
 property so acquired is held by the taxpayer for any period  after  such
 sale  or  other disposition, unless such claim is made with respect to a
 transaction made in the ordinary course of business.   If such  acquisi-
 tion  is to the extent of part only of substantially identical property,
 only a proportionate part of the loss shall be disallowed.
   5. Debts ascertained to be worthless and charged off within the  year;
 or  in  the discretion of the commissioner of finance a reasonable addi-
 tion to a reserve for bad debts. When satisfied that a debt is recovera-
 ble only in part, the commissioner of finance may allow such debt to  be
 charged off in part.
   6. A reasonable allowance for the exhaustion, wear and tear of proper-
 ty  used in business, including a reasonable allowance for obsolescence.
 In the case of any such property acquired before January first, nineteen
 hundred sixty-six, the amount of such deduction shall be  equal  to  the
 deduction  properly  taken  for  such  property in reporting the tax due
 pursuant to the former article nine-b of the tax law.  With  respect  to
 property  such  as described in subdivision twelve of this section, this
 deduction may be computed and allowed as provided therein.
   7. If the gross income be derived from business carried on within  and
 without  the city, the deductions allowed by this section shall be allo-
 cated and determined on the basis of separate accounting for each office
 or branch or, at the election of the taxpayer,  under  rules  and  regu-
 lations to be prescribed by the commissioner of finance.
   8.  In the case of any taxpayer who establishes or maintains a pension
 trust to provide for the payment of reasonable pensions to  its  employ-
 ees,  there shall be allowed as a deduction, in addition to the contrib-
 utions to such trust during  the  taxable  year  to  cover  the  pension
 liability  accruing during the year, allowed as a deduction under subdi-
 vision one of this section, a reasonable amount transferred or paid into
 such trust during the taxable year in excess of such contributions,  but
 S. 8474                            510
 
 only  if  such  amount  (a)  has  not  theretofore  been  allowable as a
 deduction, and (b) is apportioned in equal parts over a  period  of  ten
 consecutive  years  beginning  with  the  year  in which the transfer or
 payment  is  made  or, under regulations of the commissioner of finance,
 covers not more than one-tenth  of  the  total  pension  liability  with
 respect  to  services rendered prior to such taxable year; provided that
 said deduction shall be allowable only with respect to a  taxable  year,
 whether the year of the transfer or payment or a subsequent year, of the
 taxpayer  ending within or with a taxable year of the trust with respect
 to which the trust, by reason of its purposes or activities,  is  exempt
 from federal income tax.
   9.  The  amount of the amortizable bond premium on a bond for the year
 shall be allowed as a deduction as hereinafter  provided.  In  computing
 such  deduction:  (a) the amount of the bond premium shall be determined
 with reference to the amount of the basis, for determining loss on  sale
 or  exchange,  of such bond, and with reference to the amount payable on
 maturity or on earlier call date, with  adjustments  proper  to  reflect
 unamortized  bond premium with respect to the bond, for the period prior
 to July thirteenth, nineteen  hundred  sixty-six  with  respect  to  the
 taxpayer with respect to such bond, and (b) the amortizable bond premium
 of the year shall be the amount of the bond premium attributable to such
 year.  Accordingly,  such determination shall be made in accordance with
 the method of amortizing bond premium regularly employed by  the  holder
 of  such  bond,  if such method is reasonable, and in all other cases in
 accordance with regulations of the commissioner of  finance  prescribing
 reasonable  methods  of  amortizing bond premium. This subdivision shall
 apply only if the taxpayer shall so  elect,  in  accordance  with  regu-
 lations  of the commissioner of finance, and such election shall be made
 separately with respect to (1) bonds, the interest of  which  is  wholly
 taxable, and (2) bonds, the interest of which is wholly or partially tax
 exempt,  for  purposes  of  the income tax imposed by chapter one of the
 internal revenue code. If such election is made with respect to any bond
 of the taxpayer described in clauses one or two of this subdivision,  it
 shall  also apply to all bonds in the same class held by the taxpayer at
 the beginning of the first year to which the election applies and to all
 such bonds thereafter acquired by it and shall be binding for all subse-
 quent years with respect to all such bonds of the taxpayer, unless  upon
 the application by the taxpayer, the commissioner of finance permits the
 taxpayer,  subject  to  such  conditions  as the commissioner of finance
 deems necessary, to revoke such election. As used  in  this  subdivision
 the  term "bond" means any bond, debenture, note or certificate or other
 evidence of indebtedness, issued by any corporation and  bearing  inter-
 est,  including  any like obligation issued by a government or political
 subdivision thereof, with interest coupons or in  registered  form,  but
 does not include any such obligation which constitutes stock in trade of
 the  taxpayer  or  any such obligation of a kind which would properly be
 included in the inventory of the taxpayer if on hand at the close of the
 year, or any such obligation held by the taxpayer primarily for sale  to
 customers in the ordinary course of its trade or business.
   10.  In  the  case of a savings bank and savings and loan association,
 amounts paid or credited to depositors or holders of accounts as  inter-
 est  or  dividends  on  their deposits or withdrawable accounts, if such
 amounts are withdrawable on demand subject only to customary  notice  of
 intention to withdraw.
   11.  A savings bank and savings and loan association may deduct in any
 taxable year the amount of the repayment of any loan or advance from the
 S. 8474                            511
 
 mutual savings bank fund in computing its net income and the  amount  of
 interest or dividends subject to the minimum tax under subdivision three
 of section 11-612 of this part.
   12.  (a)  At the election of the taxpayer there shall be deducted from
 gross income, or if gross income is derived  from  business  carried  on
 within  and without this city, from the portion thereof allocated within
 the city, depreciation with respect to any property such as described in
 paragraph (b) of this subdivision, not exceeding twice the  depreciation
 allowed  with  respect  to  the  same  property  for  federal income tax
 purposes.
   (b) Such deduction shall be allowed  only  with  respect  to  tangible
 property which is depreciable pursuant to section one hundred sixty-sev-
 en of the internal revenue code, having a situs in this city and used in
 the taxpayer's business, (i) constructed, reconstructed or erected after
 December  thirty-first,  nineteen  hundred  sixty-five,  pursuant  to  a
 contract which was on or before December thirty-first, nineteen  hundred
 sixty-seven,  and  at  all times thereafter, binding on the taxpayer or,
 property, the physical construction, reconstruction or erection of which
 began on or before December thirty-first, nineteen  hundred  sixty-seven
 or  which began after such date pursuant to an order placed on or before
 December thirty-first, nineteen hundred sixty-seven, and then only  with
 respect to that portion of the basis thereof which is properly attribut-
 able  to  such  construction,  reconstruction or erection after December
 thirty-first, nineteen hundred sixty-five, or (ii) acquired after Decem-
 ber thirty-first, nineteen hundred sixty-five, pursuant  to  a  contract
 which  was,  on or before December thirty-first, nineteen hundred sixty-
 seven, and at all times thereafter, binding on the taxpayer or  pursuant
 to  an order placed on or before December thirty-first, nineteen hundred
 sixty-seven, by purchase as defined in section one hundred  seventy-nine
 (d)  of  the internal revenue code, if the original use of such property
 commenced with the taxpayer, commenced in this city and commenced  after
 December  thirty-first,  nineteen hundred sixty-five, or (iii) acquired,
 constructed, reconstructed or erected  subsequent  to  December  thirty-
 first,  nineteen hundred sixty-seven, if such acquisition, construction,
 reconstruction or erection is pursuant to a plan of the  taxpayer  which
 was in existence December thirty-first, nineteen hundred sixty-seven and
 not   thereafter   substantially   modified,   and   such   acquisition,
 construction, reconstruction or erection would qualify under  the  rules
 in  paragraph four, five or six of subsection (h) of section forty-eight
 of the internal revenue code provided all references in such  paragraphs
 four, five and six to the dates October nine, nineteen hundred sixty-six
 and  October  ten,  nineteen hundred sixty-six shall be read as December
 thirty-first, nineteen hundred sixty-seven. A taxpayer shall be  allowed
 a  deduction  under  clause (i), (ii) or (iii) of this paragraph only if
 the tangible property shall be delivered  or  the  construction,  recon-
 struction  or  erection shall be completed on or before December thirty-
 first, nineteen hundred sixty-nine, except in the case of tangible prop-
 erty which is acquired, constructed, reconstructed or  erected  pursuant
 to  a  contract  which was, on or before December thirty-first, nineteen
 hundred sixty-seven, and at all times thereafter, binding on the taxpay-
 er.  Provided, however, for any taxable year beginning on or after Janu-
 ary first, nineteen hundred sixty-eight, a taxpayer shall not be allowed
 a deduction under paragraph (a) of  this  subdivision  with  respect  to
 tangible  personal  property  leased by it to any other person or corpo-
 ration. Accordingly, any contract or agreement to lease or rent or for a
 license to use such property shall be considered a lease.  With  respect
 S. 8474                            512
 
 to property which the taxpayer uses itself for purposes other than leas-
 ing  for part of a taxable year and leases for a part of a taxable year,
 the taxpayer shall be allowed a deduction under paragraph  (a)  of  this
 subdivision in proportion to the part of the year it uses such property.
   (c)  If  the deduction allowable for any taxable year pursuant to this
 subdivision exceeds the  taxpayer's  net  income  computed  without  the
 allowance  of  such deduction and without the allowance of any deduction
 pursuant to subdivision six of this section with references to the  same
 property,  the  excess may be carried over to the following taxable year
 or years and may be deducted in computing net income for  such  year  or
 years.
   (d)  In  any  taxable year when property is sold or otherwise disposed
 of, with respect to which a deduction has been allowed pursuant to  this
 subdivision, the gain or loss thereon shall be computed by adjusting the
 basis  of such property to reflect the deductions so allowed, and if the
 taxpayer's gross income is derived from business carried on both  within
 and  without  the  city,  shall  be allocated within the city. Provided,
 however, that no loss shall be recognized for the purposes of this para-
 graph with respect to a sale or  other  disposition  of  property  to  a
 person whose acquisition thereof is not a purchase as defined in section
 one hundred seventy-nine (d) of the internal revenue code.
   §  11-622  Items not deductible.  In computing net income no deduction
 shall in any case be allowed in respect of:
   (a) Any amount paid out for new buildings or  for  permanent  improve-
 ments or betterments made to increase the value of any property.
   (b)  Any  amount  expended in restoring property or in making good the
 exhaustion thereof for which an allowance is or has been made.
 
                                  PART 2
                   TAX ON NATIONAL BANKING ASSOCIATIONS
                    AND PRODUCTION CREDIT ASSOCIATIONS
 
   § 11-623 Imposition of tax.  1. Pursuant to the authority conferred by
 section fifty-two hundred nineteen of the United States revised statutes
 and in conformity with the provisions  contained  in  subdivision  c  of
 clause one of such section, every national banking association organized
 under  authority of the United States and located within the city, shall
 annually pay a tax, measured by its  net  income,  to  be  computed,  as
 provided  in  this  part,  at  the  rate of four and one-half per centum
 except that for the year nineteen hundred seventy-one and those  follow-
 ing  the  rate  shall be five and sixty-three one hundredths per centum,
 upon the basis of its net income for the calendar  year  next  preceding
 the  date when such tax becomes due.  Such tax shall be for the calendar
 year next preceding the year in which it becomes due; except  that  with
 respect  to national banking associations required to file a declaration
 of estimated tax and to make payments on account of such  estimated  tax
 in  accordance with the provisions of section 11-636 of this subchapter,
 all payments of tax within a calendar  year,  whether  computed  on  the
 basis of net income for the current calendar year or on the basis of net
 income  for  the preceding calendar year, shall be for the calendar year
 in which the payments are required to be made.    If,  however,  such  a
 national banking association shall be dissolved between the thirty-first
 day  of  December  and the succeeding second day of September, and shall
 not become merged or consolidated with a corporation taxable under  part
 one of this subchapter, it shall pay a tax for the period from the thir-
 ty-first  day  of  December  up to the time of dissolution equal to that
 S. 8474                            513
 
 which would have been payable had it not  been  dissolved,  except  that
 such tax shall be reduced by one-third and an additional one-twelfth for
 each  month,  or  major portion thereof, prior to such succeeding second
 day  of  September,  during which such corporation was so dissolved.  If
 such dissolution occurs between the  fifteenth  day  of  March  and  the
 second  day  of  September, and if such corporation shall have filed its
 return on or before the fifteenth day of March as required  by  sections
 11-630  and 11-633 of this subchapter, it may file a claim for refund as
 provided in section 11-678 of this chapter, showing any reduction in tax
 to which it may be entitled as provided by this section; and if it shall
 be made to appear that the amount of tax due is less than the amount  as
 computed  on  the  basis  of  the  original  return, the commissioner of
 finance shall adjust the computation of tax accordingly.  If the  amount
 of  tax  as  so adjusted shall be less than the amount theretofore paid,
 the excess shall be refunded by the commissioner of finance as  provided
 in subdivision one of section 11-677 of this chapter.
   2.  In  the event that the taxes imposed by this part shall be finally
 determined to be unconstitutional or invalid for the reason that they do
 not conform with the provisions of section fifty-two hundred nineteen of
 the United States revised statutes, then, in lieu of the  taxes  imposed
 by  the  provisions of this part, every national banking association and
 every production credit  association  that  otherwise  would  have  been
 subject to tax under this part shall be subject to the tax imposed under
 subchapter  two  as  of July thirteenth, nineteen hundred sixty-six, and
 all of the provisions of subchapter two, unless  clearly  inappropriate,
 shall  be  applicable  except subdivision four of section 11-603 of this
 chapter; and, in such event, any payments made, reports or returns filed
 or any act of the commissioner of finance or of a  taxpayer  purportedly
 under  this  subchapter  shall  be treated as though made, filed or done
 pursuant to subchapter two.
   3. Cross reference. For years for which tax is  imposed,  see  section
 11-624 of this part.
   §  11-624    Years  for which imposed.   1. The tax imposed by section
 11-623 of this part is imposed for each calendar  year  included  within
 the  period  beginning  January  first,  nineteen  hundred sixty-six and
 ending December thirty-first, nineteen hundred seventy-two.
   2. Cross reference. For tax imposed for years or periods subsequent to
 nineteen hundred seventy-two, see part four of this subchapter.
   §  11-625  Ascertainment of gain or loss; exchange of  property.    1.
 For  the purpose of ascertaining the gain derived or loss sustained from
 the sale or other disposition of property, real, personal or mixed,  the
 basis  shall be the cost thereof, or the inventoried value if the inven-
 tory is made in accordance with section 11-626 of this part.
   2. Notwithstanding subdivision one of this section,  with  respect  to
 gain derived from the sale or other disposition of any property acquired
 prior  to  January  first,  nineteen  hundred sixty-six, except stock in
 trade of the taxpayer or other property of a kind which  would  properly
 be  included in the inventory of the taxpayer if on hand at the close of
 the taxable year, or property held by the taxpayer primarily for sale to
 customers in the ordinary course of its trade or business  and  accounts
 or notes receivable acquired in the ordinary course of trade or business
 from  the  sale  of  such  stock  in  trade or property, or for services
 rendered, net income shall not include:
   (a) That portion of the gain included in determining net income pursu-
 ant to subdivision one of this section with respect to each such proper-
 ty which exceeds:
 S. 8474                            514
 
   (b) The amount of gain, if any, that would be included in  determining
 net  income  pursuant to subdivision one of this section with respect to
 each such property if the basis  of such property on the date of sale or
 other disposition were equal to its fair market value on January  first,
 nineteen  hundred sixty-six, plus or minus all adjustments to basis made
 with respect to each such property in computing net income  for  periods
 on or after January first, nineteen hundred sixty-six; provided that the
 total  adjustment  to  net income provided by this subdivision shall not
 exceed the amount of the taxpayer's net gain  from  the  sale  or  other
 disposition  of all such property, as determined pursuant to subdivision
 one of this section.
   3. Upon the sale or exchange of property the amount  of  the  gain  or
 loss  shall  be determined in the manner prescribed by section 11-615 of
 this subchapter and the basis of such property shall  be  determined  in
 the manner prescribed by section 11-616 of this subchapter.
   4.  In  the  case  of  any bond, with respect to which a deduction for
 amortizable bond premium is allowable under paragraph (i) of subdivision
 one of section 11-629 of this part, the basis for  determining  gain  or
 loss  shall  be reduced by the total amount of such deductions so allow-
 able.
   § 11-626  Inventory.  Whenever in the opinion of the  commissioner  of
 finance  the  use of inventories is necessary in order clearly to deter-
 mine the income of any  taxpayer,  inventory  shall  be  taken  by  such
 taxpayer  upon  such basis as the commissioner of finance may prescribe,
 conforming as nearly as may be to the best accounting  practice  in  the
 banking business and most clearly reflecting the income.
   §  11-627    Net  income defined; computation.   The term "net income"
 means the gross income of a taxpayer less the deductions allowed by this
 part.  The net income shall be computed in accordance with the method of
 accounting regularly employed in keeping the books of such taxpayer; but
 if no such method of accounting has been so employed, or if  the  method
 employed  does  not clearly reflect the income, the computation shall be
 made upon such basis and in such manner as in the opinion of the commis-
 sioner of finance does clearly reflect the income.   In determining  net
 income, war losses, taxation of property recovered, and basis of proper-
 ty  shall  be  treated  in substantially the same manner as such losses,
 recoveries and basis are treated  under  the  applicable  provisions  of
 section thirteen hundred thirty-one of the internal revenue code.
   §  11-628   Gross income defined.  1. The term "gross income" includes
 gains, profit and income derived from the business, of whatever kind and
 in whatever form paid, including gains, profits or income from  dealings
 in  property,  whether  real  or  personal, or gains, profits, or income
 received as compensation for services, as interest, rents,  commissions,
 brokerage  or  other  fees,  or  otherwise in carrying on such business,
 including all dividends received on stocks  and  all  interest  received
 from federal, state, municipal or other bonds.
   2. If the gross income of such an association is derived from business
 carried  on  both within and without the city, "gross income" means that
 proportion thereof which is derived from business carried on within  the
 city, to be allocated and determined on the basis of separate accounting
 for  each  office  or  branch or, at the election of the taxpayer, under
 rules and regulations prescribed by the commissioner of finance.
   § 11-629   Deductions.   1. In computing net  income  there  shall  be
 allowed as deductions:
   (a)  All  the  ordinary and necessary expenses paid or incurred during
 the year in carrying on business, including a reasonable  allowance  for
 S. 8474                            515
 
 salaries  or other compensation for personal services actually rendered,
 and including rentals or other payments required to be made as a  condi-
 tion to the continued use or possession for business purposes of proper-
 ty  to  which  the  taxpayer  has not taken or is not taking title or in
 which such taxpayer has no equity;
   (b) All interest paid or accrued during the year on indebtedness;
   (c) Taxes, other than taxes on income or profits paid or accrued with-
 in  the year, imposed, first, by the authority of the United States,  or
 of any of its possessions, or, second, by the authority of any state, or
 territory, or any county, school district, municipality, or other taxing
 subdivisions  of  any  state  or territory, not including those assessed
 against local benefits of a kind tending to increase the  value  of  the
 property  assessed,  or,  third, by the authority of any foreign govern-
 ment;
   (d) Losses sustained during the year and not compensated for by insur-
 ance or otherwise, if incurred in business; unless in order  to  clearly
 reflect  the income the losses should in the opinion of the commissioner
 of finance be accounted for as of a  different  period.    No  deduction
 shall be allowed for any loss claimed to have been sustained in any sale
 or  other  disposition of shares of stock or securities where it appears
 that within thirty days before or after the date of such sale  or  other
 disposition  the taxpayer has acquired substantially identical property,
 and the property so acquired is held by  the  taxpayer  for  any  period
 after  such  sale  or  other disposition, unless such claim is made with
 respect to a transaction made in the ordinary course of  business.    If
 such  acquisition is to the extent of part only of substantially identi-
 cal property, only a proportionate part of the loss shall be disallowed;
   (e) Debts ascertained to be worthless and charged off within the year;
 or in the discretion of the commissioner of finance a  reasonable  addi-
 tion to a reserve for bad debts.  When satisfied that a debt is recover-
 able only in part, the commissioner of finance may allow such debt to be
 charged off in part;
   (f)  A reasonable allowance for the exhaustion, wear and tear of prop-
 erty used in business, including a  reasonable  allowance  for  obsoles-
 cence.   In the case of any such property acquired before January first,
 nineteen hundred sixty-six, the amount of such deduction shall be  equal
 to  the  deduction properly taken for such property in reporting the tax
 due.  With respect to property such as described  in  paragraph  (j)  of
 this subdivision, this deduction may be computed and allowed as provided
 therein;
   (g) If the gross income be derived from business carried on within and
 without  the city, the deductions allowed by this section shall be allo-
 cated and determined on the basis of separate accounting for each office
 or branch or, at the election of the taxpayer,  under  rules  and  regu-
 lations to be prescribed by the commissioner of finance;
   (h)  In  the  case  of  any  taxpayer,  who establishes or maintains a
 pension trust to provide for the payment of reasonable pensions  to  its
 employees,  there  shall  be  allowed as a deduction, in addition to the
 contributions to such trust during  the  taxable  years,  to  cover  the
 pension liability accruing during the year, allowed as a deduction under
 paragraph  (a)  of  this subdivision, a reasonable amount transferred or
 paid into such trust during the taxable year in excess of such  contrib-
 utions,  but only if such amount: (1) has not theretofore been allowable
 as a deduction, and (2) is apportioned in equal parts over a  period  of
 ten  consecutive  years beginning with the year in which the transfer of
 payment is made; provided that said deduction shall  be  allowable  only
 S. 8474                            516
 
 with  respect  to  a  taxable  year, whether the year of the transfer or
 payment or a subsequent year, of the taxpayer ending within  or  with  a
 taxable  year of the trust with respect to which the trust, by reason of
 its purposes or activities is exempt from federal income tax;
   (i)  The amount of the amortizable bond premium on a bond for the year
 shall be allowed as a deduction as  provided  in  this  paragraph.    In
 computing  such  deduction,  (a) the amount of the bond premium shall be
 determined with reference to the amount of the  basis,  for  determining
 loss on sale or exchange, of such bond, and with reference to the amount
 payable  on maturity or on earlier call date, with adjustments proper to
 reflect unamortized bond premium with respect to the bond, for the peri-
 od prior to July thirteenth, nineteen hundred sixty-six with respect  to
 the  taxpayer  with  respect  to such bond, and (b) the amortizable bond
 premium of the year shall be the amount of the bond premium attributable
 to such year.  Such determinations shall be made in accordance with  the
 method  of  amortizing  bond premium regularly employed by the holder of
 such bond, if such method is reasonable,  and  in  all  other  cases  in
 accordance  with  regulations of the commissioner of finance prescribing
 reasonable methods of amortizing bond premium.    This  paragraph  shall
 apply  only  if  the  taxpayer  shall so elect, in accordance with regu-
 lations of the commissioner of finance, and such election shall be  made
 separately  with  respect to: (1) bonds, the interest of which is wholly
 taxable, and (2) bonds, the interest of which is wholly or partially tax
 exempt, for purposes of the income tax imposed by  chapter  one  of  the
 internal revenue code. If such election is made with respect to any bond
 of the taxpayer described in clauses one or two of this subparagraph, it
 shall  also apply to all bonds in the same class held by the taxpayer at
 the beginning of the first year to which the election applies and to all
 such bonds thereafter acquired by it and shall be binding for all subse-
 quent years with respect to all such bonds of the taxpayer, unless, upon
 application by the taxpayer, the commissioner  of  finance  permits  the
 taxpayer,  subject  to  such  conditions  as the commissioner of finance
 deems necessary, to revoke such election.   As used in  this  paragraph,
 the term "bond" means any bond, debenture, note, or certificate or other
 evidence  of  indebtedness, issued by any corporation and bearing inter-
 est, including any like obligation issued by a government  or  political
 subdivision  thereof,  with  interest coupons or in registered form, but
 does not include any such obligation which constitutes stock in trade of
 the taxpayer or any such obligation of a kind which  would  properly  be
 included in the inventory of the taxpayer if on hand at the close of the
 year,  or any such obligation held by the taxpayer primarily for sale to
 customers in the ordinary course of its trade or business; and
   (j) (1) At the election of the taxpayer there shall be  deducted  from
 gross  income,  or  if  gross income is derived from business carried on
 within and without this city, from the portion thereof allocated  within
 the city, depreciation with respect to any property such as described in
 subparagraph two of this paragraph, not exceeding twice the depreciation
 allowed  with  respect  to  the  same  property  for  federal income tax
 purposes.
   (2) Such deduction shall be allowed  only  with  respect  to  tangible
 property which is depreciable pursuant to section one hundred sixty-sev-
 en of the internal revenue code, having a situs in this city and used in
 the taxpayer's business, (i) constructed, reconstructed or erected after
 December  thirty-first,  nineteen  hundred  sixty-five,  pursuant  to  a
 contract which was, on or before December thirty-first, nineteen hundred
 sixty-seven, and at all times thereafter, binding  on  the  taxpayer  or
 S. 8474                            517
 
 pursuant to an order placed on or before December thirty-first, nineteen
 hundred  sixty-seven,  by  purchase  as  defined  in section one hundred
 seventy-nine (d), of the internal revenue code, if the original  use  of
 such  property  commenced  with the taxpayer, commenced in this city and
 commenced after December thirty-first, nineteen  hundred  sixty-five  or
 (ii)  acquired,  constructed,  reconstructed,  or  erected subsequent to
 December thirty-first, nineteen hundred sixty-seven,  if  such  acquisi-
 tion,  construction, reconstruction or erection is pursuant to a plan of
 the taxpayer which was  in  existence  December  thirty-first,  nineteen
 hundred  sixty-seven and not thereafter substantially modified, and such
 acquisition, construction,  reconstruction  or  erection  would  qualify
 under  the  rules  in  paragraph  four, five or six of subsection (h) of
 section forty-eight of the internal revenue code provided all references
 in such paragraphs four, five and six to the dates October  nine,  nine-
 teen  hundred  sixty-six,  and  October ten, nineteen hundred sixty-six,
 shall read as December thirty-first, nineteen hundred  sixty-seven.    A
 taxpayer  shall  be allowed a deduction under clause (i) or (ii) of this
 subparagraph only if the tangible property shall  be  delivered  or  the
 construction, reconstruction or erection shall be completed on or before
 December  thirty-first,  nineteen hundred sixty-nine, except in the case
 of tangible property which is acquired,  constructed,  reconstructed  or
 erected  pursuant to a contract which was, on or before December thirty-
 first, nineteen hundred sixty-seven, and at all times thereafter,  bind-
 ing  on the taxpayer.  Provided, however, for any taxable year beginning
 on or after January first,  nineteen  hundred  sixty-eight,  a  taxpayer
 shall not be allowed a deduction under paragraph (a) of this subdivision
 with  respect  to  tangible  personal property leased by it to any other
 person or corporation.  Any such contract or agreement to lease or  rent
 or for a license to use such property shall be considered a lease.  With
 respect  to  property  which the taxpayer uses itself for purposes other
 than leasing for part of a taxable year and leases for a part of a taxa-
 ble year, the taxpayer shall be allowed a deduction under paragraph  (a)
 of  this  subdivision in proportion to the part of the year it uses such
 property.
   (3) If the deduction allowable for any taxable year pursuant  to  this
 subdivision  exceeds  the  taxpayer's  net  income  computed without the
 allowance of such deduction and without the allowance of  any  deduction
 pursuant to paragraph (f) of this subdivision with reference to the same
 property,  the  excess may be carried over to the following taxable year
 or years and may be deducted in computing net income for  such  year  or
 years.
   (4)  In  any  taxable year when property is sold or otherwise disposed
 of, with respect to which a deduction has been allowed pursuant to  this
 paragraph,  the  gain or loss thereon shall be computed by adjusting the
 basis of such property to reflect the deductions so allowed, and if  the
 taxpayer's  gross income is derived from business carried on both within
 and without the city, shall be allocated within  the  city.    Provided,
 however, that no loss shall be recognized for the purposes of this para-
 graph  with  respect  to  a  sale  or other disposition of property to a
 person whose acquisition thereof is not a purchase as defined in section
 one hundred seventy-nine (d) of the internal revenue code.
   2. In computing net income no deduction shall in any case  be  allowed
 in respect of:
   (a)  Any  amount  paid out for new buildings or for permanent improve-
 ments or betterments made to increase the value of any property.
 S. 8474                            518
 
   (b) Any amount expended in restoring or in making good the  exhaustion
 thereof for which an allowance is or has been made.
   §  11-630    Administration;  procedure; provisions of law applicable.
 For the purpose of carrying into effect the provisions of this part, and
 except as otherwise provided in this part,  income  shall  be  computed,
 gain  or  loss  ascertained,  deductions  made, apportionments and allo-
 cations determined, at the same time and subject to the same limitations
 and conditions, in so far as practicable, as is provided by part one  of
 this subchapter in relation to the tax imposed by such part.
   §  11-631    Tax  on production credit associations.   Pursuant to the
 authority conferred by the federal farm credit act of  nineteen  hundred
 thirty-three,  every  production  credit association organized under the
 authority of the United States and located within  the  city  after  the
 stock  held  in it by the federal production credit corporation has been
 retired shall annually pay a tax measured by its net income, which shall
 be computed in the same manner as the tax imposed upon national  banking
 associations  by section 11-623 of this part and shall be subject to the
 provisions of sections 11-624 of this part to 11-630 of this part inclu-
 sive.
   § 11-632  Applicability of part three. 1. This part shall be  applica-
 ble only to the taxes imposed by parts one and two of this subchapter.
   2.  Cross  reference.    For years for which parts one and two of this
 subchapter impose a tax, see sections 11-613 and 11-624 of this subchap-
 ter.
 
                                  PART 3
                     ADMINISTRATION FOR PARTS 1 AND 2
 
   § 11-633 Taxpayer's returns.  1. Every taxpayer, on  or  before  March
 fifteenth  of each year, beginning with the year nineteen hundred sixty-
 seven and ending with the year  nineteen  hundred  seventy-three,  shall
 make a return subscribed by the taxpayer and affirmed by the taxpayer to
 be  true  under the penalties of perjury to the commissioner of finance,
 for the calendar year next preceding, as to the business or that portion
 of the business of such taxpayer the income from which is the  basis  of
 taxation  under  part  one  or two of this subchapter, except that every
 trust company and savings bank which shall become  incorporated  between
 the  thirty-first  day of December and the succeeding first day of July,
 shall make its return for such period on or before September first,  and
 every taxpayer, other than a trust company and savings bank, which shall
 commence to do business in the city or become located in the city, shall
 make  its return for the calendar year in which it commences to do busi-
 ness or becomes located, on or before the twentieth day  of  January  of
 the  year succeeding such calendar year, and except that every taxpayer,
 other than a trust company and savings bank, which shall  be  dissolved,
 cease  to  do  business  in the city or cease to be located in the city,
 between the thirty-first day of December and  the  succeeding  sixteenth
 day  of  March  and shall not become merged or consolidated with another
 corporation taxable under the same part, shall make its return for  such
 period  on or before the date of such dissolution, or cessation of busi-
 ness, and every trust company and savings bank which shall be dissolved,
 and shall not become merged or  consolidated  with  another  corporation
 taxable  under  the same part, shall make its return, for the period for
 which it is taxable under subdivision six  of  section  11-612  of  this
 subchapter on or before the date of such dissolution.  Such return shall
 be  in  such  form  and  contain such information as the commissioner of
 S. 8474                            519
 
 finance may require for the purpose of making any computation or  other-
 wise  performing  its  duty  under  parts  one,  two,  and three of this
 subchapter.  Such return shall state specifically  the  items  of  gross
 income derived from such business and the deductions allowed by the part
 for  which the return is filed, the net income which is the basis of the
 tax, and the amount of tax due.  The return shall be subscribed  by  the
 president,   vice-president,   treasurer,   assistant  treasurer,  chief
 accounting officer or any other officer of the taxpayer duly  authorized
 so  to act.   The fact that an individual's name is signed on the return
 shall be prima facie evidence that  such  individual  is  authorized  to
 subscribe  and  affirm  the  return on behalf of the corporation.  Blank
 forms of return shall be furnished by the commissioner of  finance  upon
 application,  but  failure  to  secure  the  form  shall not relieve any
 taxpayer from the obligation of making any return herein required.    An
 automatic  extension of three months for the filing of its annual return
 shall be allowed for any taxpayer if, within the time  prescribed  under
 this  subdivision  for  the filing thereof, such taxpayer files with the
 commissioner of finance an application for extension in such form as the
 commissioner of finance may prescribe  by  regulation  and  pays  on  or
 before the date of such filing the amount properly estimated as its tax.
 The commissioner of finance may grant a reasonable extension of time for
 filing  a  return, which may be in addition to any three-month automatic
 extension allowed, whenever in the commissioner's  judgment  good  cause
 exists  and  shall  keep a record of every such extension and the reason
 therefor.  No such extension or extensions  shall  aggregate  more  than
 three months, exclusive of any automatic extension.
   2.  If  the  amount  of taxable income for any year of any taxpayer as
 returned to the United States treasury department or the New York  state
 tax  department  is changed or corrected by the commissioner of internal
 revenue or other officer of the United States or the New York state  tax
 commission  or  other competent authority; or if a taxpayer, pursuant to
 subsection (d) of section sixty-two hundred  thirteen  of  the  internal
 revenue  code,  executes a notice of waiver of the restrictions provided
 in subsection (a) of such section, or if a taxpayer, pursuant to  subdi-
 vision (f) of section one thousand eighty-one of the tax law, executes a
 notice of waiver of the restrictions provided in subdivision (c) of such
 section,  such  taxpayer  shall  report such change or corrected taxable
 income or such execution of such notice of waiver  and  the  changes  or
 corrections  of such taxpayer's federal or New York state taxable income
 on which it is based, within ninety days after  such  execution  or  the
 final  determination of such change or correction, or as required by the
 commissioner of finance, and shall concede the accuracy of such determi-
 nation or state wherein it is erroneous.  Any taxpayer filing an amended
 return with such department shall also file within ninety days thereaft-
 er an amended return  with  the  commissioner  of  finance  which  shall
 contain such information as it shall require.
   §  11-634    Consolidated returns.   Corporations which are affiliated
 may, if authorized, and shall,  if  required,  by  the  commissioner  of
 finance,  under  regulations  prescribed by the commissioner of finance,
 make a consolidated return for the purpose of parts one, two  and  three
 of  this  subchapter.    The  commissioner of finance may, in his or her
 discretion, authorize bank  holding  companies  as  defined  in  article
 three-a of the banking law to make a consolidated return with affiliated
 corporations  taxable under part one and under part two of this subchap-
 ter in which case the consolidated tax will be  computed  in  accordance
 with  the  provisions of part one of this subchapter. In all other cases
 S. 8474                            520
 
 in which a corporation taxable under part two of this subchapter makes a
 consolidated return with corporations taxable under  part  one  of  this
 subchapter, the consolidated tax will be computed in accordance with the
 provisions of part one of this subchapter. In any case in which a tax is
 assessed upon the basis of a consolidated return, the total tax shall be
 computed in the first instance as a unit and shall then be assessed upon
 the  respective  affiliated  corporations  in such proportions as may be
 agreed upon among them, or in the absence of any such agreement, then on
 the basis of the net income properly assignable to each.
   § 11-635  Payment of tax.  Each taxpayer shall, at the time of  filing
 its return, pay to the commissioner of finance:
   (a) the amount of tax payable under part one or two of this subchapter
 as the same shall appear from the face of the return, or
   (b)  if  payments  of estimated tax have been made pursuant to section
 11-636 of this part, the balance, if any, of the tax payable under  part
 one or two of this subchapter, as the same shall appear from the face of
 the  return,  after  applying thereto any payments made pursuant to said
 section.
   If the time for filing the return  shall  be  extended,  the  taxpayer
 shall  pay  in addition interest at the rate of six per centum per annum
 from the time when the return was originally required to be filed to the
 time of payment upon the amount by which the tax, or the portion thereof
 payable when the return was required to be  filed,  exceeds  the  amount
 then paid:
   (1)  a  payment made on or before the date of filing of an application
 for an automatic extension shall be deemed  properly  estimated  if  its
 either:    (A)  not  less  than  ninety per centum of the tax as finally
 determined, or (B) not less than the tax shown on the taxpayer's  return
 for  the  preceding  taxable  year, if such preceding year was a taxable
 year of twelve months; and
   (2) the time when a return is required to be filed shall be determined
 without regard to any extension of time for filing such return.
   § 11-636  Declaration of estimated tax; payments on account  of  esti-
 mated  tax.  1. Every taxpayer subject to the tax imposed by part one or
 two of this subchapter shall make a declaration  of  the  estimated  tax
 upon the basis of its net income for the current calendar year, contain-
 ing  such  information  as  the commissioner of finance may prescribe by
 regulations or instructions, if such estimated  tax  can  reasonably  be
 expected to exceed one thousand dollars.
   2.  The  term  "estimated tax" means the amount which a taxpayer esti-
 mates to be the tax imposed upon it by part one or two of this  subchap-
 ter upon the basis of its net income for the current calendar year, less
 the  amount  which  it  estimates to be the sum of any credits allowable
 against the tax.
   3. A declaration of estimated tax shall be filed  on  or  before  June
 fifteenth  of  the calendar year upon the net income of which the tax is
 based, except that if  the  requirements  of  subdivision  one  of  this
 section are first met:
   (a)  after June first and before October second of such calendar year,
 the declaration shall be filed on or before October fifteenth, or
   (b) after October first of such calendar year, the  declaration  shall
 be filed on or before January fifteenth of the succeeding calendar year.
   Notwithstanding  any  other provision of this subdivision, no declara-
 tion need be filed prior to September eleventh, nineteen hundred  sixty-
 six.
 S. 8474                            521
 
   4. A taxpayer may amend a declaration under regulations of the commis-
 sioner of finance.
   5.  If,  on  or  before  February  fifteenth of the succeeding year, a
 taxpayer files its return for the calendar year upon the net  income  of
 which  the   declaration is required to be based, and pays therewith the
 balance, if any, of the full amount of the tax shown to be  due  on  the
 return,
   (a)  such return shall be considered as its declaration if no declara-
 tion was required to be filed during such calendar year, but  is  other-
 wise required to be filed on or before January fifteenth of the succeed-
 ing year pursuant to subdivision three of this section,
   (b)  such  return  shall  be  considered  as an amendment permitted by
 subdivision four of this section  to  be  filed  on  or  before  January
 fifteenth  if  the tax shown on the return is greater than the estimated
 tax shown on a declaration previously made.
   6. The commissioner of finance may grant  a  reasonable  extension  of
 time,  not  to  exceed  three  months, for the filing of any declaration
 required pursuant to this section, on such terms and conditions  as  the
 commissioner may require.
   7.  Every  taxpayer  subject  to the tax imposed by part one or two of
 this subchapter shall pay with the return of tax, if any, required to be
 filed upon the basis of its net income for the preceding calendar  year,
 or with an application for extension of the time for filing such return,
 an  amount  equal to twenty-five per centum of the preceding year's tax,
 if such preceding year's tax exceeded one thousand dollars.
   8. The estimated tax with respect to  which  a  declaration  for  such
 calendar  year  is  required  pursuant  to this section shall be paid as
 follows:
   (a) If the declaration is filed on or before June fifteenth, the esti-
 mated tax shown thereon, after applying thereto the amount if any,  paid
 during  the  same  calendar  year  pursuant to subdivision seven of this
 section, shall be paid  in  three  equal  installments.    One  of  such
 installments shall be paid at the time of the filing of the declaration,
 one  shall  be  paid  on the following October fifteenth, and one on the
 following January fifteenth.
   (b) If the declaration is filed after June fifteenth,  and  not  after
 October fifteenth of such calendar year, and is not required to be filed
 on  or  before  June  fifteenth of such calendar year, the estimated tax
 shown on such declaration, after applying thereto the  amount,  if  any,
 paid during the same calendar year pursuant to subdivision seven of this
 section,  shall be paid in two equal installments.  One of such install-
 ments shall be paid at the time of the filing of the declaration and one
 shall be paid on the following January fifteenth.
   (c) If the declaration is filed after October fifteenth of such calen-
 dar year, and is not required to be filed on or before October fifteenth
 of such calendar year, the estimated  tax  shown  on  such  declaration,
 after  applying  thereto  the  amount,  if  any, paid in respect of such
 calendar year pursuant to subdivision seven of this  section,  shall  be
 paid in full at the time of the filing of the declaration.
   (d) If the declaration is filed after the time prescribed therefor, or
 after  the  expiration of any extension of time therefor, paragraphs (b)
 and (c) of this subdivision shall not apply, and there shall be paid  at
 the  time of such filing all installments of estimated tax payable at or
 before such time, and the remaining installments shall be  paid  at  the
 times  at which, and in the amounts in which, they would have been paya-
 ble if the declaration had been filed when due.
 S. 8474                            522
 
   9. If any amendment of a declaration is filed, the remaining  install-
 ments,  if any, shall be ratably increased or decreased, as the case may
 be, to reflect any increase or decrease in the estimated tax  by  reason
 of  such amendment, and if any amendment is made after October fifteenth
 of the calendar year, any increase in the estimated tax by reason there-
 of shall be paid at the time of making such amendment.
   10.  Any  amount  paid  pursuant  to subdivision seven of this section
 shall be applied after payment as a first installment against the  esti-
 mated  tax  of the taxpayer shown on the declaration next required to be
 filed pursuant to this section or, if no declaration of estimated tax is
 required to be filed by the taxpayer pursuant to this section, any  such
 amount  shall be considered a payment on account of the tax shown on the
 return of tax required to be filed by the taxpayer upon the basis of its
 net income for the calendar year during which such amount was paid.
   11. Notwithstanding the provisions of section 11-679 of  this  chapter
 or  of  section three-a of the general municipal law, if any amount paid
 pursuant to subdivision seven of this section, exceeds the tax shown  on
 the  return  required  to be filed by the taxpayer upon the basis of its
 net income for the calendar year  during  which  the  amount  was  paid,
 interest  shall be allowed and paid on the amount by which the amount so
 paid pursuant to such subdivision exceeds such tax, at the rate  of  six
 per  centum  per  annum  from  the date of payment of the amount so paid
 pursuant to such subdivision to March fifteenth of the succeeding calen-
 dar year, provided, however, that no interest shall be allowed  or  paid
 under this subdivision if the amount thereof is less than one dollar.
   12.  As used in this section, "the preceding year's tax" means the tax
 imposed upon the taxpayer by part one or two of this subchapter upon the
 basis of its net  income  for  the  preceding  calendar  year,  or,  for
 purposes  of  computing  the  first installment of estimated tax when an
 application has been filed for extension of time for  filing the  return
 required  to be filed for such preceding calendar year, the amount prop-
 erly estimated pursuant to section  11-635  of  this  part  as  the  tax
 imposed upon the basis of its net income for such calendar year.
   13.  This  section shall apply to an income period of less than twelve
 months in accordance with regulations of the commissioner of finance.
   14. The commissioner of finance may grant a  reasonable  extension  of
 time,  not to exceed six months, for payment of any installment of esti-
 mated tax required pursuant to this section, on such  terms  and  condi-
 tions  as  the  commissioner  may require, including the furnishing of a
 bond or other security by the taxpayer in an amount not exceeding  twice
 the  amount  for  which  any  extension  of time for payment is granted,
 provided however, that interest at the rate of six per centum per  annum
 for  the  period  of the extension shall be charged and collected on the
 amount for which any extension of time for payment is granted under this
 subdivision.
   15. A taxpayer may elect to pay any installment of estimated tax prior
 to the date prescribed in this section for payment thereof.
   § 11-637  Real property taxable.  Nothing in this subchapter shall  be
 construed  to  exempt the real property of any taxpayer from taxation to
 the same extent, according to its  value,  as  other  real  property  is
 taxed.
 
                                  PART 4
                          BANKING CORPORATION TAX
 
   § 11-638  General definitions.  As used in this part:
 S. 8474                            523
 
   (a)  The word "taxpayer" means a corporation or association subject to
 a tax imposed by this part.
   (b)  The  phrase  "taxable year" means the taxpayer's taxable year for
 federal income tax purposes,  or  the  part  thereof  during  which  the
 taxpayer is subject to the tax imposed by this part.
   (c)   The term "international banking facility" shall mean an interna-
 tional banking facility located in New York state  and  shall  have  the
 same  meaning as is set forth in the New York state banking law or regu-
 lations of the New York state banking department or as is set  forth  in
 the  laws  of the United States or regulations of the board of governors
 of the federal reserve system.
   (d) The term "subsidiary" means a corporation or association of  which
 over  fifty percent of the number of shares of stock entitling the hold-
 ers thereof to vote for the election of directors or trustees  is  owned
 by the taxpayer.
   (e)  The  term  "subsidiary capital" means investments in the stock of
 subsidiaries  and  any  indebtedness  from  subsidiaries,  exclusive  of
 accounts receivable acquired in the ordinary course of trade or business
 for  services  rendered or for sales of property held primarily for sale
 to customers, whether or not evidenced by written instrument,  on  which
 interest  is  not claimed and deducted by the subsidiary for purposes of
 taxation under this part or subchapter two of  this  chapter,  provided,
 however, there shall be deducted from subsidiary capital any liabilities
 payable  by  their  terms  on  demand  or  within one year from the date
 incurred, other than loans or advances outstanding for more than a  year
 as  of any date during the year covered by the return, which are attrib-
 utable to subsidiary capital.
   (f) The term "financial holding company"  means  a  corporation  that,
 pursuant  to  subsection (l) of section four of the federal bank holding
 company act of nineteen hundred fifty-six, as amended,  has  filed  with
 the  federal  reserve  board  a written declaration that the corporation
 elects to be a financial holding company and whose election has not been
 found to be ineffective by the federal reserve board.
   § 11-639  Imposition of tax. (a) (1) For the privilege of doing  busi-
 ness  in  the city in a corporate or organized capacity, a tax, computed
 under section 11-643 of this part, is hereby annually imposed  on  every
 banking  corporation for each of its taxable years, or any part thereof,
 beginning on or after January first, nineteen hundred seventy-three  and
 before January first, two thousand fifteen.
   (2)  For the privilege of doing business in the city in a corporate or
 organized capacity, a tax, computed under section 11-643 of  this  part,
 is hereby annually imposed on every banking corporation for each taxable
 year,  or  any  part  thereof, commencing on or after January first, two
 thousand fifteen, where such banking corporation (i) has an election  in
 effect under subsection (a) of section thirteen hundred sixty-two of the
 internal  revenue  code  of  1986,  as  amended,  or (ii) is a qualified
 subchapter S  subsidiary  within  the  meaning  of  paragraph  three  of
 subsection  (b)  of  section  thirteen hundred sixty-one of the internal
 revenue code of nineteen eighty-six, as amended.
   (b) In the case of a taxpayer whose  taxable  year  is  other  than  a
 calendar  year, there is hereby imposed a tax for the privilege of doing
 business in the city in a corporate or organized capacity for the period
 beginning January first, nineteen hundred  seventy-three  and  extending
 through  the subsequent part of its first such taxable year ending after
 such date.  Such tax shall be computed under section 11-643 of this part
 on the basis of such taxpayer's entire net income, or  other  applicable
 S. 8474                            524
 
 basis  as  the  case  may  be,  for such period and shall be paid with a
 return which shall be separately filed with the  department  of  finance
 not later than the fifteenth day of the third month succeeding the close
 of  such period.  The requirements of sections 11-644 and 11-645 of this
 part, relating to declarations and payments  of  estimated  tax,  except
 subdivision  (a) of section 11-645 of this part, shall not be applicable
 to the tax imposed by this subdivision.
   (c) For taxable years beginning on or after January first,  two  thou-
 sand  eleven, (1) a banking corporation is doing business in the city in
 a corporate or organized capacity if (i) it has issued credit  cards  to
 one  thousand  or  more  customers who have a mailing address within the
 city as of the last day of its taxable year, or  (ii)  it  has  merchant
 customer  contracts  with  merchants  and  the total number of locations
 covered by those contracts equals one thousand or more locations in  the
 city  to  whom the banking corporation remitted payments for credit card
 transactions during the taxable year, or (iii) it has  receipts  of  one
 million  dollars or more in the taxable year from its customers who have
 been issued credit cards by the banking corporation and have  a  mailing
 address  within the city, or (iv) it has receipts of one million dollars
 or more arising from merchant customer contracts with merchants relating
 to locations in the city, or (v) the sum  of  the  number  of  customers
 described  in  subparagraph  (i)  of  this  paragraph plus the number of
 locations covered by its contracts described  in  subparagraph  (ii)  of
 this  paragraph  equals  one  thousand  or  more,  or  the amount of its
 receipts described in subparagraphs (iii) and  (iv)  of  this  paragraph
 equals  one  million  dollars  or  more. For purposes of this paragraph,
 receipts from processing credit card transactions for merchants  include
 merchant discount fees received by the banking corporation.
   (2) As used in this subdivision, the term "credit card" includes bank,
 credit, travel and entertainment cards.
   (d)  Cross-Reference.  For  the  taxation of corporations that are not
 described in paragraph two of subdivision (a) of this section, that were
 taxable under this subchapter for tax  years  beginning  before  January
 first, two thousand fifteen, see subchapter three-A of this chapter.
   §  11-640  Banking, corporation defined; exempt corporations.  (a) For
 the purpose of this part, a banking corporation means:
   (1) every corporation or association organized under the laws of  this
 state  which  is authorized to do a banking business or which is doing a
 banking business;
   (2) every corporation or association organized under the laws  of  any
 other state or country which is doing a banking business;
   (3)  every  national banking association organized under the authority
 of the United States which is doing a banking business;
   (4) every federal savings bank which is doing a banking business;
   (5) every federal savings and loan association which is doing a  bank-
 ing business;
   (6)  a  production credit association organized under the federal farm
 credit act of nineteen hundred thirty-three, which is  doing  a  banking
 business  and  all  of whose stock held by the federal production credit
 corporation has been retired;
   (7) every other corporation or association organized under the author-
 ity of the United States which is doing a banking business;
   (8) the mortgage facilities corporation created in  article  seven  of
 the private housing finance law;
   (9)  any  corporation sixty-five percent or more of whose voting stock
 is owned or controlled, directly or  indirectly,  by  a  corporation  or
 S. 8474                            525
 
 corporations  subject  to  article three-a of the banking law, or regis-
 tered under the federal bank holding company  act  of  nineteen  hundred
 fifty-six,  as  amended,  or  registered  as  a savings and loan holding
 company,  but  excluding a diversified savings and loan holding company,
 under the federal national housing act, as amended, or by a  corporation
 or corporations described in paragraphs one through eight of this subdi-
 vision,  provided  the  corporation  whose  voting  stock is so owned or
 controlled is principally engaged in a  business,  regardless  of  where
 conducted,  which  (i)  might  be  lawfully  conducted  by a corporation
 subject to article three of the banking law or  by  a  national  banking
 association  or  (ii)  is  so  closely related to banking or managing or
 controlling banks as to be a proper incident thereto, as  set  forth  in
 paragraph  eight of subsection (c) or subparagraph (F) of paragraph four
 of subsection (k) of section four of the federal  bank  holding  company
 act  of  nineteen  hundred  fifty-six,  as  amended,  or (iii) holds and
 manages investment assets, including but not limited  to  bonds,  notes,
 debentures and other obligations for the payment of money, stocks, part-
 nership  interests or other equity interests, and other investment secu-
 rities, and which is not a business described  in  subparagraph  (i)  or
 (ii) of this paragraph.
   (b)  Banking business defined. The words "banking business" as used in
 this section mean such business as a corporation or association  may  be
 created  to do under article three, three-B, five, five-A, six or ten of
 the banking law or any business which a corporation  or  association  is
 authorized  by  such article to do.  However, with respect to a national
 banking association organized under the authority of the United  States,
 a  federal  savings  bank,  a  federal savings and loan association or a
 production credit association, the words "banking business" as  used  in
 this  section  mean  such  business  as  a national banking association,
 federal savings bank, federal savings and loan association or production
 credit association, respectively, may be created to do or is  authorized
 to  do  under  the  laws  of  the United States or this state. The words
 "banking business" as used in this section shall also mean such business
 as any corporation or association organized under the authority  of  the
 United  States or organized under the laws of any other state or country
 has authority to do which is substantially similar to the business which
 a corporation or association may be created to do under  article  three,
 three-B,  five,  five-A,  six  or ten of the banking law or any business
 which a corporation or association is authorized by such article to do.
   (c) Exempt corporations. A trust company all of whose capital stock is
 owned by twenty or more savings banks organized under New York law shall
 be exempt from the tax under this part.
   (d) Corporations taxable under  subchapter  two.  Notwithstanding  the
 provisions  of  this part, all corporations of classes now or heretofore
 taxable under subchapter two of this chapter shall continue to be  taxa-
 ble  under  subchapter  two  of  this  chapter, except: (1) corporations
 organized under article five-A of the banking  law;    (2)  corporations
 subject  to  article three-A of the banking law, or registered under the
 federal bank holding company  act  of  nineteen  hundred  fifty-six,  as
 amended,  or  registered  as  a  savings  and  loan holding company, but
 excluding a diversified savings and  loan  holding  company,  under  the
 federal  national  housing act, as amended, which make a combined return
 under the provisions of subdivision (f) of section 11-646 of this  part;
 (3)  banking corporations described in paragraph nine of subdivision (a)
 of this section; and (4)  any  captive  REIT  or  captive  RIC  that  is
 required  to  be  included  in a combined return under the provisions of
 S. 8474                            526
 
 section 11-646 of this  part.  Provided,  however,  that  a  corporation
 described  in  paragraph  three of this subdivision which was subject to
 the tax imposed by subchapter two of this chapter for its  taxable  year
 ending  during  nineteen  hundred  eighty-four may, on or before the due
 date for filing its return, determined with regard  to  extensions,  for
 its  taxable year ending during nineteen hundred eighty-five, make a one
 time election to continue to be taxable under such subchapter two.  Such
 election  shall  continue to be in effect until revoked by the taxpayer.
 In no event shall such election or revocation be for a part of a taxable
 year.
   (e) Corporations taxable under article thirty-three of  the  tax  law.
 Except  for corporations described in subsection (l) of section fourteen
 hundred fifty-three of the tax law, corporations  liable  to  tax  under
 article  thirty-three  of  the tax law shall not be subject to tax under
 this part.
   (f) A banking corporation organized under the laws of  a  country,  or
 any  political  subdivision  thereof, other than the United States shall
 not be deemed to be doing business in the city under this subchapter  if
 its  activities in the city are limited solely to (1) investing or trad-
 ing in stocks and securities for its own account within the  meaning  of
 clause  (ii)  of  subparagraph (A) of paragraph two of subsection (b) of
 section eight hundred sixty-four of the internal  revenue  code  or  (2)
 investing or trading in commodities for its own account within the mean-
 ing  of  clause  (ii) of subparagraph (B) of paragraph two of subsection
 (b) of section eight hundred sixty-four of the internal revenue code  or
 (3) any combination of activities described in paragraphs one and two of
 this subdivision.
   (g)  Transitional provisions relating to the enactment and implementa-
 tion  of  the  federal  Gramm-Leach-Bliley  act.    (1)  Notwithstanding
 anything  to  the contrary contained in this section other than subdivi-
 sion (m) of this section, a corporation that  was  in  existence  before
 January  first, two thousand and was subject to tax under subchapter two
 of this chapter for its  last  taxable  year  beginning  before  January
 first,  two  thousand, shall continue to be taxable under subchapter two
 of this chapter for all taxable years  beginning  on  or  after  January
 first,  two  thousand  and  before  January  first,  two  thousand  one;
 provided, however, this shall not apply to any taxable year during which
 such corporation is a banking corporation described  in  paragraphs  one
 through  eight  of  subdivision  (a)  of  this  section. Notwithstanding
 anything to the contrary contained in this section other  than  subdivi-
 sion  (m)  of  this section, a banking corporation that was in existence
 before January first, two thousand and was subject  to  tax  under  this
 subchapter for its last taxable year beginning before January first, two
 thousand,  shall  continue  to  be taxable under this subchapter for all
 taxable years beginning on or after  January  first,  two  thousand  and
 before  January first, two thousand one. Provided, however, that nothing
 in this subdivision shall prohibit a corporation that  elected  pursuant
 to subdivision (d) of this section to be taxable under subchapter two of
 this  chapter from revoking that election in accordance with such subdi-
 vision (d).
   For purposes of this paragraph, a corporation shall be  considered  to
 be  subject  to  tax  under subchapter two of this chapter for a taxable
 year if such corporation was not a taxpayer but was properly included in
 a combined report filed pursuant to subdivision four of  section  11-605
 of this chapter for such taxable year and a corporation shall be consid-
 ered  to  be  subject to tax under this subchapter for a taxable year if
 S. 8474                            527
 
 such corporation was not a taxpayer  but  was  properly  included  in  a
 combined  report  filed  pursuant  to  subdivision (f) or (g) of section
 11-646 of this chapter for such taxable year. A corporation that was  in
 existence before January first, two thousand but first becomes a taxpay-
 er  in  a taxable year beginning on or after January first, two thousand
 and before January first, two thousand  one,  shall  be  considered  for
 purposes  of this paragraph to have been subject to tax under subchapter
 two of this chapter for its last taxable year beginning  before  January
 first,  two  thousand if such corporation would have been subject to tax
 under such subchapter for such taxable year if it had  been  a  taxpayer
 during  such  taxable  year.  A corporation that was in existence before
 January first, two thousand but first becomes a taxpayer  in  a  taxable
 year  beginning on or after January first, two thousand and before Janu-
 ary first, two thousand one, shall be considered for  purposes  of  this
 paragraph to have been subject to tax under this subchapter for its last
 taxable year beginning before January first, two thousand if such corpo-
 ration  would  have  been  subject to tax under this subchapter for such
 taxable year if it had been a taxpayer during such taxable year.
   (2) Notwithstanding anything to the contrary contained in this section
 other than subdivision (m) of this section, a corporation formed  on  or
 after January first, two thousand and before January first, two thousand
 one  may  elect  to  be  subject  to  tax under this subchapter or under
 subchapter two of this chapter for its first taxable year  beginning  on
 or after January first, two thousand and before January first, two thou-
 sand  one  in  which either (i) sixty-five percent or more of its voting
 stock is owned or controlled, directly  or  indirectly  by  a  financial
 holding company, provided the corporation whose voting stock is so owned
 or controlled is principally engaged in activities that are described in
 paragraph four or five of subdivision (k) of section four of the federal
 bank  holding  company act of nineteen hundred fifty-six, as amended and
 the regulations promulgated pursuant to the authority of such section or
 (ii) it is a financial subsidiary. An election under this paragraph  may
 not  be  made by a corporation described in paragraphs one through eight
 of subdivision (a) of  this  section  or  in  subdivision  (e)  of  this
 section.  In  addition, an election under this paragraph may not be made
 by a corporation that is a party to  a  reorganization,  as  defined  in
 subsection  (a)  of  section  three  hundred sixty-eight of the internal
 revenue code of nineteen hundred eighty-six, as  amended,  of  a  corpo-
 ration  described  in  paragraph  one of this subdivision if both corpo-
 rations were sixty-five percent or more owned or controlled, directly or
 indirectly by the same interests at the time of the reorganization.
   An election under this paragraph must be made by the  taxpayer  on  or
 before  the  due  date  for filing its return, determined with regard to
 extensions of time for filing, for  the  applicable  taxable  year.  The
 election  to be taxed under subchapter two of this chapter shall be made
 by the taxpayer by filing the return required  pursuant  to  subdivision
 one of section 11-605 of this chapter and the election to be taxed under
 this  subchapter  shall  be  made  by  the taxpayer by filing the return
 required pursuant to subdivision (a) of section 11-646 of this  chapter.
 Any  election  made  pursuant to this paragraph shall be irrevocable and
 shall apply to each subsequent taxable year beginning on or after  Janu-
 ary  first,  two  thousand  and  before January first, two thousand one,
 provided that the stock ownership requirements described in subparagraph
 (i) of this paragraph are met or such corporation described in  subpara-
 graph (ii) of this paragraph continues as a financial subsidiary.
 S. 8474                            528
 
   (3)  For  purposes  of  this  section,  a financial subsidiary means a
 corporation (i) sixty-five percent or more  of  whose  voting  stock  is
 owned  or  controlled,  directly  or indirectly by a banking corporation
 described in paragraph one, two or three  of  subdivision  (a)  of  this
 section  and  (ii) is described in subdivision (g) of section five thou-
 sand one hundred thirty-six-A of the  revised  statutes  of  the  United
 States  or  section  forty-six of the federal deposit insurance act. For
 purposes of  this  subchapter,  the  term  "banking  corporation"  shall
 include  a corporation electing to be taxed under this subchapter pursu-
 ant to paragraph two of this subdivision for so long  as  such  election
 shall be in effect.
   (4)  The  provisions  of this subdivision shall not apply to a captive
 REIT or a captive RIC.
   (h) Transitional provisions relating to the enactment and  implementa-
 tion of the federal Gramm-Leach-Bliley act. (1) Notwithstanding anything
 to  the contrary contained in this section other than subdivision (m) of
 this section, a corporation that was in existence before January  first,
 two  thousand  one  and  was subject to tax under subchapter two of this
 chapter for its last taxable year beginning before  January  first,  two
 thousand  one, shall continue to be taxable under subchapter two for all
 taxable years beginning on or after January first, two thousand one  and
 before  January first, two thousand three, provided, however, this shall
 not apply to any taxable year during which such corporation is a banking
 corporation described in paragraphs one through eight of subdivision (a)
 of this section. Notwithstanding anything to the contrary  contained  in
 this  section  other  than  subdivision  (m)  of this section, a banking
 corporation that was in existence before January first, two thousand one
 and was subject to tax under this subchapter for its last  taxable  year
 beginning  before  January first, two thousand one, shall continue to be
 taxable under this subchapter for all  taxable  years  beginning  on  or
 after  January  first,  two  thousand  one and before January first, two
 thousand three. Provided, however,  that  nothing  in  this  subdivision
 shall prohibit a corporation that elected pursuant to subdivision (d) of
 this  section  to  be  taxable under subchapter two of this chapter from
 revoking that election  in  accordance  with  subdivision  (d)  of  this
 section.
   For  purposes  of this paragraph, a corporation shall be considered to
 be subject to tax under subchapter two of this  chapter  for  a  taxable
 year if such corporation was not a taxpayer but was properly included in
 a  combined  report filed pursuant to subdivision four of section 11-605
 of this chapter for such taxable year and a corporation shall be consid-
 ered to be subject to tax under this subchapter for a  taxable  year  if
 such  corporation  was  not  a  taxpayer  but was properly included in a
 combined report filed pursuant to subdivision  (f)  or  (g)  of  section
 11-646  of this chapter for such taxable year. A corporation that was in
 existence before January first, two thousand one  but  first  becomes  a
 taxpayer  in  a  taxable  year  beginning on or after January first, two
 thousand one and before January first,  two  thousand  three,  shall  be
 considered  for  purposes  of this paragraph to have been subject to tax
 under subchapter two of this chapter for its last taxable year beginning
 before January first, two thousand one if such  corporation  would  have
 been  subject  to  tax under such subchapter for such taxable year if it
 had been a taxpayer during such taxable year. A corporation that was  in
 existence  before  January  first,  two thousand one but first becomes a
 taxpayer in a taxable year beginning on  or  after  January  first,  two
 thousand  one  and  before  January  first, two thousand three, shall be
 S. 8474                            529
 
 considered for purposes of this paragraph to have been  subject  to  tax
 under this subchapter for its last taxable year beginning before January
 first,  two  thousand one if such corporation would have been subject to
 tax under this subchapter for such taxable year if it had been a taxpay-
 er during such taxable year.
   (2) Notwithstanding anything to the contrary contained in this section
 other  than  subdivision (m) of this section, a corporation formed on or
 after January first, two thousand one  and  before  January  first,  two
 thousand  three  may elect to be subject to tax under this subchapter or
 under subchapter two of this chapter for its first taxable  year  begin-
 ning  on  or  after  January  first, two thousand one and before January
 first, two thousand three in which either (i) sixty-five percent or more
 of its voting stock is owned or controlled, directly or indirectly by  a
 financial  holding  company, provided the corporation whose voting stock
 is so owned or controlled is principally engaged in activities that  are
 described  in  paragraph four or five of subdivision (k) of section four
 of the federal bank holding company act of nineteen  hundred  fifty-six,
 as  amended and the regulations promulgated pursuant to the authority of
 such section or (ii) it is a financial  subsidiary.  An  election  under
 this  paragraph may not be made by a corporation described in paragraphs
 one through eight of subdivision (a) of this section or  in  subdivision
 (e)  of  this section. In addition, an election under this paragraph may
 not be made by a corporation that is a party  to  a  reorganization,  as
 defined  in  subsection  (a) of section three hundred sixty-eight of the
 internal revenue code of nineteen hundred eighty-six, as amended,  of  a
 corporation  described  in  paragraph  one  of  this subdivision if both
 corporations were  sixty-five  percent  or  more  owned  or  controlled,
 directly or indirectly by the same interests at the time of the reorgan-
 ization.
   An  election  under  this paragraph must be made by the taxpayer on or
 before the due date for filing its return,  determined  with  regard  to
 extensions  of  time  for  filing,  for the applicable taxable year. The
 election to be taxed under subchapter two of this chapter shall be  made
 by  the  taxpayer  by filing the return required pursuant to subdivision
 one of section 11-605 of this chapter and the election to be taxed under
 this subchapter shall be made by  the  taxpayer  by  filing  the  return
 required  pursuant to subdivision (a) of section 11-646 of this chapter.
 Any election made pursuant to this paragraph shall  be  irrevocable  and
 shall  apply to each subsequent taxable year beginning on or after Janu-
 ary first, two thousand one  and  before  January  first,  two  thousand
 three,  provided  that  the  stock  ownership  requirements described in
 subparagraph (i) of this paragraph are met or such corporation described
 in subparagraph (ii) of this paragraph continues as a financial  subsid-
 iary.
   (3)  For  purposes  of  this  section,  a financial subsidiary means a
 corporation (i) sixty-five percent or more  of  whose  voting  stock  is
 owned  or  controlled,  directly  or indirectly by a banking corporation
 described in paragraph one, two or three  of  subdivision  (a)  of  this
 section  and  (ii) is described in subdivision (g) of section five thou-
 sand one hundred thirty-six-A of the  revised  statutes  of  the  United
 States  or  section  forty-six of the federal deposit insurance act. For
 purposes of  this  subchapter,  the  term  "banking  corporation"  shall
 include  a corporation electing to be taxed under this subchapter pursu-
 ant to paragraph two of this subdivision for so long  as  such  election
 shall be in effect.
 S. 8474                            530
 
   (i)  Transitional provisions relating to the enactment and implementa-
 tion of the federal Gramm-Leach-Bliley act. (1) Notwithstanding anything
 to the contrary contained in this section other than subdivision (m)  of
 this  section, a corporation that was in existence before January first,
 two  thousand  three and was subject to tax under subchapter two of this
 chapter for its last taxable year beginning before  January  first,  two
 thousand  three,  shall  continue to be taxable under subchapter two for
 all taxable years beginning on or  after  January  first,  two  thousand
 three  and  before  January  first, two thousand four provided, however,
 this shall not apply to any taxable year during which  such  corporation
 is  a  banking  corporation described in paragraphs one through eight of
 subdivision (a) of this section. Notwithstanding anything to the contra-
 ry contained in this section other than subdivision (m) of this section,
 a banking corporation that was in existence before  January  first,  two
 thousand three and was subject to tax under this subchapter for its last
 taxable  year  beginning before January first, two thousand three, shall
 continue to be taxable under  this  subchapter  for  all  taxable  years
 beginning on or after January first, two thousand three and before Janu-
 ary  first,  two  thousand four. Provided, however, that nothing in this
 subdivision shall prohibit a corporation that elected pursuant to subdi-
 vision (d) of this section to be taxable under subchapter  two  of  this
 chapter  from  revoking that election in accordance with subdivision (d)
 of this section.
   For purposes of this paragraph, a corporation shall be  considered  to
 be  subject  to  tax  under subchapter two of this chapter for a taxable
 year if such corporation was not a taxpayer but was properly included in
 a combined report filed pursuant to subdivision four of  section  11-605
 of this chapter for such taxable year and a corporation shall be consid-
 ered  to  be  subject to tax under this subchapter for a taxable year if
 such corporation was not a taxpayer  but  was  properly  included  in  a
 combined  report  filed  pursuant  to  subdivision (f) or (g) of section
 11-646 of this chapter for such taxable year. A corporation that was  in
 existence  before  January first, two thousand three but first becomes a
 taxpayer in a taxable year beginning on  or  after  January  first,  two
 thousand  three  and  before  January first, two thousand four, shall be
 considered for purposes of this paragraph to have been  subject  to  tax
 under subchapter two of this chapter for its last taxable year beginning
 before  January first, two thousand three if such corporation would have
 been subject to tax under such subchapter for such taxable  year  if  it
 had  been a taxpayer during such taxable year. A corporation that was in
 existence before January first, two thousand three but first  becomes  a
 taxpayer  in  a  taxable  year  beginning on or after January first, two
 thousand three and before January first, two  thousand  four,  shall  be
 considered  for  purposes  of this paragraph to have been subject to tax
 under this subchapter for its last taxable year beginning before January
 first, two thousand three if such corporation would have been subject to
 tax under this subchapter for such taxable year if it had been a taxpay-
 er during such taxable year.
   (2) Notwithstanding anything to the contrary contained in this section
 other than subdivision (m) of this section, a corporation formed  on  or
 after  January  first,  two thousand three and before January first, two
 thousand four may elect to be subject to tax under  this  subchapter  or
 under  subchapter  two of this chapter for its first taxable year begin-
 ning on or after January first, two thousand three  and  before  January
 first,  two thousand four in which either (i) sixty-five percent or more
 of its voting stock is owned or controlled, directly or indirectly by  a
 S. 8474                            531
 
 financial  holding  company, provided the corporation whose voting stock
 is so owned or controlled is principally engaged in activities that  are
 described  in paragraphs four or five of subdivision (k) of section four
 of  the  federal bank holding company act of nineteen hundred fifty-six,
 as amended and the regulations promulgated pursuant to the authority  of
 such  section  or  (ii)  it is a financial subsidiary. An election under
 this paragraph may not be made by a corporation described in  paragraphs
 one  through  eight of subdivision (a) of this section or in subdivision
 (e) of this section. In addition, an election under this  paragraph  may
 not  be  made  by  a corporation that is a party to a reorganization, as
 defined in subsection (a) of section three hundred  sixty-eight  of  the
 internal  revenue  code of nineteen hundred eighty-six, as amended, of a
 corporation described in paragraph  one  of  this  subdivision  if  both
 corporations  were  sixty-five  percent  or  more  owned  or controlled,
 directly or indirectly by the same interests at the time of the reorgan-
 ization.
   An election under this paragraph must be made by the  taxpayer  on  or
 before  the  due  date  for filing its return, determined with regard to
 extensions of time for filing, for  the  applicable  taxable  year.  The
 election  to be taxed under subchapter two of this chapter shall be made
 by the taxpayer by filing the return required  pursuant  to  subdivision
 one of section 11-605 of this chapter and the election to be taxed under
 this  subchapter  shall  be  made  by  the taxpayer by filing the return
 required pursuant to subdivision (a) of section 11-646 of this  chapter.
 Any  election  made  pursuant to this paragraph shall be irrevocable and
 shall apply to each subsequent taxable year beginning on or after  Janu-
 ary  first,  two  thousand  three and before January first, two thousand
 four, provided  that  the  stock  ownership  requirements  described  in
 subparagraph (i) of this paragraph are met or such corporation described
 in  subparagraph (ii) of this paragraph continues as a financial subsid-
 iary.
   (3) For purposes of this  section,  a  financial  subsidiary  means  a
 corporation  (i)  sixty-five  percent  or  more of whose voting stock is
 owned or controlled, directly or indirectly  by  a  banking  corporation
 described  in  paragraph  one,  two  or three of subdivision (a) of this
 section and (ii) is described in subdivision (g) of section  five  thou-
 sand  one  hundred  thirty-six-A  of  the revised statutes of the United
 States or section forty-six of the federal deposit  insurance  act.  For
 purposes  of  this  subchapter,  the  term  "banking  corporation" shall
 include a corporation electing to be taxed under this subchapter  pursu-
 ant  to  paragraph  two of this subdivision for so long as such election
 shall be in effect.
   (j) Transitional provisions relating to the enactment and  implementa-
 tion of the federal Gramm-Leach-Bliley act. (1) Notwithstanding anything
 to  the contrary contained in this section other than subdivision (m) of
 this section, a corporation that was in existence before January  first,
 two  thousand  four  and was subject to tax under subchapter two of this
 chapter for its last taxable year beginning before  January  first,  two
 thousand four, shall continue to be taxable under subchapter two for all
 taxable years beginning on or after January first, two thousand four and
 before January first, two thousand six. The preceding sentence shall not
 apply  to  any  taxable  year during which such corporation is a banking
 corporation described in paragraphs one through eight of subdivision (a)
 of this section. Notwithstanding anything to the contrary  contained  in
 this  section  other  than  subdivision  (m)  of this section, a banking
 corporation that was in existence before  January  first,  two  thousand
 S. 8474                            532
 
 four  and  was subject to tax under this subchapter for its last taxable
 year beginning before January first, two thousand four,  shall  continue
 to  be  taxable under this subchapter for all taxable years beginning on
 or  after January first, two thousand four and before January first, two
 thousand six.  Provided, however, that nothing in this subdivision shall
 prohibit a corporation that elected pursuant to subdivision (d) of  this
 section to be taxable under subchapter two of this chapter from revoking
 that election in accordance with subdivision (d) of this section.
   For  purposes  of this paragraph, a corporation shall be considered to
 be subject to tax under subchapter two of this  chapter  for  a  taxable
 year if such corporation was not a taxpayer but was properly included in
 a  combined  report filed pursuant to subdivision four of section 11-605
 of this chapter for such taxable year and a corporation shall be consid-
 ered to be subject to tax under this subchapter for a  taxable  year  if
 such  corporation  was  not  a  taxpayer  but was properly included in a
 combined report filed pursuant to subdivision  (f)  or  (g)  of  section
 11-646  of this chapter for such taxable year. A corporation that was in
 existence before January first, two thousand four but  first  becomes  a
 taxpayer  in  a  taxable  year  beginning on or after January first, two
 thousand four and before January  first,  two  thousand  six,  shall  be
 considered  for  purposes  of this paragraph to have been subject to tax
 under subchapter two of this chapter for its last taxable year beginning
 before January first, two thousand four if such corporation  would  have
 been  subject  to  tax under such subchapter for such taxable year if it
 had been a taxpayer during such taxable year. A corporation that was  in
 existence  before  January  first, two thousand four but first becomes a
 taxpayer in a taxable year beginning on  or  after  January  first,  two
 thousand  four  and  before  January  first,  two thousand six, shall be
 considered for purposes of this paragraph to have been  subject  to  tax
 under this subchapter for its last taxable year beginning before January
 first,  two thousand four if such corporation would have been subject to
 tax under this subchapter for such taxable year if it had been a taxpay-
 er during such taxable year.
   (2) Notwithstanding anything to the contrary contained in this section
 other than subdivision (m) of this section, a corporation formed  on  or
 after  January  first,  two  thousand four and before January first, two
 thousand six may elect to be subject to tax  under  this  subchapter  or
 under  subchapter  two of this chapter for its first taxable year begin-
 ning on or after January first, two thousand  four  and  before  January
 first,  two  thousand six in which either (i) sixty-five percent or more
 of its voting stock is owned or controlled, directly or indirectly by  a
 financial  holding  company, provided the corporation whose voting stock
 is so owned or controlled is principally engaged in activities that  are
 described  in  paragraph four or five of subdivision (k) of section four
 of the federal bank holding company act of nineteen  hundred  fifty-six,
 as  amended and the regulations promulgated pursuant to the authority of
 such section or (ii) it is a financial  subsidiary.  An  election  under
 this  paragraph may not be made by a corporation described in paragraphs
 one through eight of subdivision (a) of this section or  in  subdivision
 (e)  of  this section. In addition, an election under this paragraph may
 not be made by a corporation that is a party  to  a  reorganization,  as
 defined  in  subsection  (a) of section three hundred sixty-eight of the
 internal revenue code of nineteen hundred eighty-six, as amended,  of  a
 corporation  described  in  paragraph  one  of  this subdivision if both
 corporations were  sixty-five  percent  or  more  owned  or  controlled,
 S. 8474                            533
 
 directly or indirectly by the same interests at the time of the reorgan-
 ization.
   An  election  under  this paragraph must be made by the taxpayer on or
 before the due date for filing its return,  determined  with  regard  to
 extensions  of  time  for  filing,  for the applicable taxable year. The
 election to be taxed under subchapter two of this chapter shall be  made
 by  the  taxpayer  by filing the return required pursuant to subdivision
 one of section 11-605 of this chapter and the election to be taxed under
 this subchapter shall be made by  the  taxpayer  by  filing  the  return
 required  pursuant to subdivision (a) of section 11-646 of this chapter.
 Any election made pursuant to this paragraph shall  be  irrevocable  and
 shall  apply to each subsequent taxable year beginning on or after Janu-
 ary first, two thousand four and before January first, two thousand six,
 provided that the stock ownership requirements described in subparagraph
 (i) of this paragraph are met or such corporation described in  subpara-
 graph (ii) of this paragraph continues as a financial subsidiary.
   (3)  For  purposes  of  this  section,  a financial subsidiary means a
 corporation (i) sixty-five percent or more  of  whose  voting  stock  is
 owned  or  controlled,  directly  or indirectly by a banking corporation
 described in paragraph one, two or three  of  subdivision  (a)  of  this
 section  and  (ii) is described in subdivision (g) of section five thou-
 sand one hundred thirty-six-A of the  revised  statutes  of  the  United
 States  or  section  forty-six of the federal deposit insurance act. For
 purposes of  this  subchapter,  the  term  "banking  corporation"  shall
 include  a corporation electing to be taxed under this subchapter pursu-
 ant to paragraph two of this subdivision for so long  as  such  election
 shall be in effect.
   (k)  Transitional provisions relating to the enactment and implementa-
 tion of the federal Gramm-Leach-Bliley act. (1) Notwithstanding anything
 to the contrary contained in this section other than subdivision (m)  of
 this  section, a corporation that was in existence before January first,
 two thousand six and was subject to tax under  subchapter  two  of  this
 chapter  for  its  last taxable year beginning before January first, two
 thousand six, shall continue to be taxable under subchapter two of  this
 chapter  for  all taxable years beginning on or after January first, two
 thousand six and before January first,  two  thousand  eight,  provided,
 however,  this  shall  not  apply  to any taxable year during which such
 corporation is a banking corporation described in paragraphs one through
 eight of subdivision (a) of this section.   Notwithstanding anything  to
 the  contrary  contained  in  this section other than subdivision (m) of
 this section, a banking corporation that was in existence before January
 first, two thousand six and was subject to tax under this subchapter for
 its last taxable year beginning before January first, two thousand  six,
 shall continue to be taxable under this subchapter for all taxable years
 beginning on or after January first, two thousand six and before January
 first,  two  thousand  eight.  Provided,  however,  that nothing in this
 subdivision shall prohibit a corporation that elected pursuant to subdi-
 vision (d) of this section to be taxable under subchapter  two  of  this
 chapter  from  revoking that election in accordance with subdivision (d)
 of this section.
   For purposes of this paragraph, a corporation shall be  considered  to
 be  subject  to  tax  under subchapter two of this chapter for a taxable
 year if such corporation was not a taxpayer but was properly included in
 a combined report filed pursuant to subdivision four of  section  11-605
 of this chapter for such taxable year and a corporation shall be consid-
 ered  to  be  subject to tax under this subchapter for a taxable year if
 S. 8474                            534
 
 such corporation was not a taxpayer  but  was  properly  included  in  a
 combined  report  filed  pursuant  to  subdivision (f) or (g) of section
 11-646 of this part for such taxable year. A  corporation  that  was  in
 existence  before  January  first,  two thousand six but first becomes a
 taxpayer in a taxable year beginning on  or  after  January  first,  two
 thousand  six  and  before  January  first, two thousand eight, shall be
 considered for purposes of this paragraph to have been  subject  to  tax
 under subchapter two of this chapter for its last taxable year beginning
 before  January  first,  two thousand six if such corporation would have
 been subject to tax under such subchapter for such taxable  year  if  it
 had  been a taxpayer during such taxable year. A corporation that was in
 existence before January first, two thousand six  but  first  becomes  a
 taxpayer  in  a  taxable  year  beginning on or after January first, two
 thousand six and before January first,  two  thousand  eight,  shall  be
 considered  for  purposes  of this paragraph to have been subject to tax
 under this subchapter for its last taxable year beginning before January
 first, two thousand six if such corporation would have been  subject  to
 tax under this subchapter for such taxable year if it had been a taxpay-
 er during such taxable year.
   (2) Notwithstanding anything to the contrary contained in this section
 other  than  subdivision (m) of this section, a corporation formed on or
 after January first, two thousand six  and  before  January  first,  two
 thousand  eight  may elect to be subject to tax under this subchapter or
 under subchapter two of this chapter for its first taxable  year  begin-
 ning  on  or  after  January  first, two thousand six and before January
 first, two thousand eight in which either (i) sixty-five percent or more
 of its voting stock is owned or controlled, directly or indirectly by  a
 financial  holding  company, provided the corporation whose voting stock
 is so owned or controlled is principally engaged in activities that  are
 described  in  paragraph four or five of subdivision (k) of section four
 of the federal bank holding company act of nineteen  hundred  fifty-six,
 as  amended and the regulations promulgated pursuant to the authority of
 such section or (ii) it is a financial  subsidiary.  An  election  under
 this  paragraph may not be made by a corporation described in paragraphs
 one through eight of subdivision (a) of this section or  in  subdivision
 (e)  of  this section. In addition, an election under this paragraph may
 not be made by a corporation that is a party  to  a  reorganization,  as
 defined  in  subsection  (a) of section three hundred sixty-eight of the
 internal revenue code of nineteen hundred eighty-six, as amended,  of  a
 corporation  described  in  paragraph  one  of  this subdivision if both
 corporations were  sixty-five  percent  or  more  owned  or  controlled,
 directly or indirectly by the same interests at the time of the reorgan-
 ization.
   An  election  under  this paragraph must be made by the taxpayer on or
 before the due date for filing its return,  determined  with  regard  to
 extensions  of  time  for  filing,  for the applicable taxable year. The
 election to be taxed under subchapter two of this chapter shall be  made
 by  the  taxpayer  by filing the return required pursuant to subdivision
 one of section 11-605 of this chapter and the election to be taxed under
 this subchapter shall be made by  the  taxpayer  by  filing  the  return
 required pursuant to subdivision (a) of section 11-646 of this part. Any
 election  made pursuant to this paragraph shall be irrevocable and shall
 apply to each subsequent taxable year  beginning  on  or  after  January
 first,  two  thousand  six and before January first, two thousand eight,
 provided that the stock ownership requirements described in subparagraph
 S. 8474                            535
 
 (i) of this paragraph are met or such corporation described in  subpara-
 graph (ii) of this paragraph continues as a financial subsidiary.
   (3)  For  purposes  of  this  section,  a financial subsidiary means a
 corporation (i) sixty-five percent or more  of  whose  voting  stock  is
 owned  or  controlled,  directly  or indirectly by a banking corporation
 described in paragraph one, two or three  of  subdivision  (a)  of  this
 section  and  (ii) is described in subdivision (g) of section five thou-
 sand one hundred thirty-six-A of the  revised  statutes  of  the  United
 States  or  section  forty-six of the federal deposit insurance act. For
 purposes of  this  subchapter,  the  term  "banking  corporation"  shall
 include  a corporation electing to be taxed under this subchapter pursu-
 ant to paragraph two of this subdivision for so long  as  such  election
 shall be in effect.
   (l)  Transitional provisions relating to the enactment and implementa-
 tion of the federal Gramm-Leach-Bliley act. (1) Notwithstanding anything
 to the contrary contained in this section other than subdivision (m)  of
 this  section, a corporation that was in existence before January first,
 two thousand fourteen and was subject to tax  under  subchapter  two  of
 this  chapter  for its last taxable year beginning before January first,
 two thousand fourteen, shall continue to be taxable under such  subchap-
 ter for all taxable years beginning on or after January first, two thou-
 sand   fourteen  and  before  January  first,  two  thousand  seventeen,
 provided, however, this shall not apply to any taxable year during which
 such corporation is a banking corporation described  in  paragraphs  one
 through  eight  of  subdivision  (a)  of  this  section. Notwithstanding
 anything to the contrary contained in this section other  than  subdivi-
 sion  (m) of this section, a banking corporation or corporation that was
 in existence before January first, two thousand fourteen and was subject
 to tax under this subchapter for its last taxable year beginning  before
 January first, two thousand fourteen, shall continue to be taxable under
 this  subchapter  for  all  taxable  years beginning on or after January
 first, two thousand fourteen and  before  January  first,  two  thousand
 seventeen only if the corporation is a banking corporation as defined in
 subdivision  (a)  of  this  section  or  the  corporation  satisfies the
 requirements for a  corporation  to  elect  to  be  taxable  under  this
 subchapter.  Provided  further,  that  nothing in this subdivision shall
 prohibit a corporation that elected pursuant to subdivision (d) of  this
 section to be taxable under subchapter two of this chapter from revoking
 that  election  in  accordance with subdivision (d) of this section. For
 purposes of this paragraph, a corporation  shall  be  considered  to  be
 subject  to  tax under subchapter two of this chapter for a taxable year
 if such corporation was not a taxpayer but was properly  included  in  a
 combined  report filed pursuant to subdivision four of section 11-605 of
 this chapter for such taxable year and a corporation shall be considered
 to be subject to tax under this subchapter for a taxable  year  if  such
 corporation  was  not a taxpayer but was properly included in a combined
 report filed pursuant to subdivision (f) or (g)  of  section  11-646  of
 this  part  for  such  taxable year. A corporation that was in existence
 before January first, two thousand fourteen but first becomes a taxpayer
 in a taxable year beginning on or  after  January  first,  two  thousand
 fourteen  and  before  January  first,  two thousand seventeen, shall be
 considered for purposes of this paragraph to have been  subject  to  tax
 under subchapter two of this chapter for its last taxable year beginning
 before  January  first,  two thousand fourteen if such corporation would
 have been subject to tax under such subchapter for such taxable year  if
 it  had been a taxpayer during such taxable year. A corporation that was
 S. 8474                            536
 
 in existence before January  first,  two  thousand  fourteen  but  first
 becomes  a  taxpayer  in  a  taxable  year beginning on or after January
 first, two thousand fourteen and  before  January  first,  two  thousand
 seventeen,  shall  be  considered for purposes of this paragraph to have
 been subject to tax under this subchapter  for  its  last  taxable  year
 beginning  before  January  first,  two thousand fourteen if such corpo-
 ration would have been subject to tax under  this  subchapter  for  such
 taxable year if it had been a taxpayer during such taxable year.
   (2) Notwithstanding anything to the contrary contained in this section
 other  than  subdivision (m) of this section, a corporation formed on or
 after January first, two thousand fourteen and before January first, two
 thousand seventeen may elect to be subject to tax under this  subchapter
 or  under  subchapter  two  of  this  chapter for its first taxable year
 beginning on or after January first, two thousand  fourteen  and  before
 January  first,  two  thousand  seventeen in which either (i) sixty-five
 percent or more of its voting stock is owned or controlled, directly  or
 indirectly  by  a  financial  holding  company, provided the corporation
 whose voting stock is so owned or controlled is principally  engaged  in
 activities  that  are described in paragraph four or five of subdivision
 (k) of section four of the federal bank holding company act of  nineteen
 hundred  fifty-six,  as amended and the regulations promulgated pursuant
 to the authority of such section or (ii) it is a  financial  subsidiary.
 An  election  under  this  paragraph  may  not  be made by a corporation
 described in paragraphs one through eight of  subdivision  (a)  of  this
 section  or in subdivision (e) of this section. In addition, an election
 under this paragraph may not be made by a corporation that is a party to
 a reorganization, as defined in subsection (a) of section three  hundred
 sixty-eight of the internal revenue code of nineteen hundred eighty-six,
 as amended, of a corporation described in paragraph one of this subdivi-
 sion  if  both  corporations  were  sixty-five  percent or more owned or
 controlled, directly or indirectly by the same interests at the time  of
 the reorganization.
   An  election  under  this paragraph must be made by the taxpayer on or
 before the due date for filing its return,  determined  with  regard  to
 extensions  of  time  for  filing,  for the applicable taxable year. The
 election to be taxed under subchapter two of this chapter shall be  made
 by  the  taxpayer  by filing the return required pursuant to subdivision
 one of section 11-605 of this chapter and the election to be taxed under
 this subchapter shall be made by  the  taxpayer  by  filing  the  return
 required pursuant to subdivision (a) of section 11-646 of this part. Any
 election  made pursuant to this paragraph shall be irrevocable and shall
 apply to each subsequent taxable year  beginning  on  or  after  January
 first,  two  thousand  fourteen  and  before January first, two thousand
 seventeen, provided that the stock ownership and activities requirements
 described in subparagraph (i) of this paragraph are met or  such  corpo-
 ration  described  in subparagraph (ii) of this paragraph continues as a
 financial subsidiary.
   (3) For purposes of this  section,  a  financial  subsidiary  means  a
 corporation  (i)  sixty-five  percent  or  more of whose voting stock is
 owned or controlled, directly or indirectly  by  a  banking  corporation
 described  in  paragraph  one,  two  or three of subdivision (a) of this
 section and (ii) is described in subdivision (g) of section  five  thou-
 sand  one  hundred  thirty-six-A  of  the revised statutes of the United
 States or section forty-six of the federal deposit  insurance  act.  For
 purposes  of  this  subchapter,  the  term  "banking  corporation" shall
 include a corporation electing to be taxed under this subchapter  pursu-
 S. 8474                            537
 
 ant  to  paragraph  two of this subdivision for so long as such election
 shall be in effect.
   (m)  (1) Notwithstanding anything in this part to the contrary, if any
 of the conditions described in paragraph three of this subdivision apply
 to a corporation that has made either the election to be  taxable  under
 subchapter two of chapter six of this title pursuant to the Gramm-Leach-
 Bliley transitional provisions in this section, or the election pursuant
 to  subdivision  (d)  of  this  section  to continue to be taxable under
 subchapter two of chapter six of this title, hereinafter  the  "electing
 corporation",  then such corporation shall be deemed to have revoked the
 election as of the first day of the taxable year in which such condition
 applied.
   (2) Notwithstanding anything in this part to the contrary, if  any  of
 the conditions described in paragraph three of this subdivision apply to
 a corporation required to be taxable under subchapter two of chapter six
 of this title pursuant to the Gramm-Leach-Bliley transitional provisions
 in  this  section,  hereinafter  the  "grandfathered  corporation", such
 corporation, if it is otherwise described in  subdivision  (a)  of  this
 section,  shall  be  taxable  under this part as of the first day of the
 taxable year in which such condition applied.
   (3) The provisions of paragraph one and paragraph two of this subdivi-
 sion shall apply if any of the following conditions exist or occur  with
 respect  to the electing corporation or the grandfathered corporation in
 a taxable year, including any short taxable year, beginning on or  after
 January first, two thousand nine:
   (A)  the  corporation  ceases to be a taxpayer under subchapter two of
 chapter six of this title;
   (B) the corporation becomes subject to the fixed  dollar  minimum  tax
 under  clause four of subparagraph a of paragraph (E) of subdivision one
 of section 11-604 of this chapter;
   (C) the corporation has no wages or receipts  allocable  to  the  city
 pursuant  to  subdivision three of section 11-604 of this chapter, or is
 otherwise inactive; provided that this subparagraph shall not apply to a
 corporation which is engaged in the active conduct of a trade  or  busi-
 ness,  or substantially all of the assets of which are stock and securi-
 ties of corporations which are directly or indirectly controlled  by  it
 and are engaged in the active conduct of a trade or business;
   (D)  sixty-five percent or more of the voting stock of the corporation
 becomes owned or controlled directly by a corporation that acquired  the
 stock  in  a transaction, or series of related transactions, that quali-
 fies as a purchase within the meaning of paragraph three  of  subsection
 (h)  of  section three hundred thirty-eight of the internal revenue code
 unless the corporation whose stock  was  acquired  and  the  corporation
 acquiring the stock were, immediately prior to such purchase, members of
 the  same  affiliated  group, as such term is defined in section fifteen
 hundred four of the internal revenue code without regard to  the  exclu-
 sions provided for in subsection (b) of such section; or
   (E)  the  corporation,  in  a  transaction or series of related trans-
 actions, acquires assets, whether by contribution, purchase,  or  other-
 wise, having an average value, determined in accordance with subdivision
 two  of  section  11-604  of  this  chapter, or, if greater, a total tax
 basis, in excess of forty percent of the average value, or, if  greater,
 the  total  tax  basis, of all the assets of the corporation immediately
 prior to such acquisition and as a result of such acquisition the corpo-
 ration is principally engaged in a business that is different  from  the
 business  immediately  prior  to  such  acquisition,  provided that such
 S. 8474                            538
 
 different business is described in subparagraph (i) or (ii) of paragraph
 nine of subdivision (a) of this section.
   (n)  Transitional provisions relating to the enactment and implementa-
 tion of the federal Gramm-Leach-Bliley act. (1) Notwithstanding anything
 to the contrary contained in this section other than subdivision (m)  of
 this  section, a corporation that was in existence before January first,
 two thousand seventeen and was subject to tax under  subchapter  two  of
 this  chapter  for its last taxable year beginning before January first,
 two thousand seventeen, shall continue to be taxable under such subchap-
 ter for all taxable years beginning on or after January first, two thou-
 sand seventeen and before January first, two thousand twenty,  provided,
 however,  this  shall  not  apply  to any taxable year during which such
 corporation is a banking corporation described in paragraphs one through
 eight of subdivision (a) of this section.  Notwithstanding  anything  to
 the  contrary  contained  in  this section other than subdivision (m) of
 this section, a banking corporation or corporation that was in existence
 before January first, two thousand seventeen  and  was  subject  to  tax
 under this subchapter for its last taxable year beginning before January
 first,  two  thousand seventeen, shall continue to be taxable under this
 subchapter for all taxable years beginning on or  after  January  first,
 two  thousand  seventeen  and  before January first, two thousand twenty
 only if the corporation is a banking corporation as defined in  subdivi-
 sion  (a)  of this section or the corporation satisfies the requirements
 for a corporation to elect to be taxable under this subchapter. Provided
 further, that nothing in this subdivision shall prohibit  a  corporation
 that  elected  pursuant to subdivision (d) of this section to be taxable
 under subchapter two of this chapter  from  revoking  that  election  in
 accordance with subdivision (d) of this section.
   For  purposes  of this paragraph, a corporation shall be considered to
 be subject to tax under subchapter two of this  chapter  for  a  taxable
 year if such corporation was not a taxpayer but was properly included in
 a  combined  report filed pursuant to subdivision four of section 11-605
 of this chapter for such taxable year and a corporation shall be consid-
 ered to be subject to tax under this subchapter for a  taxable  year  if
 such  corporation  was  not  a  taxpayer  but was properly included in a
 combined report filed pursuant to subdivision  (f)  or  (g)  of  section
 11-646  of  this  part  for such taxable year. A corporation that was in
 existence before January first, two thousand seventeen but first becomes
 a taxpayer in a taxable year beginning on or after  January  first,  two
 thousand  seventeen and before January first, two thousand twenty, shall
 be considered for purposes of this paragraph to have been subject to tax
 under subchapter two of this chapter for its last taxable year beginning
 before January first, two thousand seventeen if such  corporation  would
 have  been subject to tax under such subchapter for such taxable year if
 it had been a taxpayer during such taxable year. A corporation that  was
 in  existence  before  January  first,  two thousand seventeen but first
 becomes a taxpayer in a taxable  year  beginning  on  or  after  January
 first,  two  thousand  seventeen  and before January first, two thousand
 twenty, shall be considered for purposes of this paragraph to have  been
 subject to tax under this subchapter for its last taxable year beginning
 before  January  first, two thousand seventeen if such corporation would
 have been subject to tax under this subchapter for such taxable year  if
 it had been a taxpayer during such taxable year.
   (2) Notwithstanding anything to the contrary contained in this section
 other  than  subdivision (m) of this section, a corporation formed on or
 after January first, two thousand seventeen and  before  January  first,
 S. 8474                            539
 
 two thousand twenty may elect to be subject to tax under this subchapter
 or  under  subchapter  two  of  this  chapter for its first taxable year
 beginning on or after January first, two thousand seventeen  and  before
 January  first,  two  thousand  twenty  in  which  either (i) sixty-five
 percent or more of its voting stock is owned or controlled, directly  or
 indirectly  by  a  financial  holding  company, provided the corporation
 whose voting stock is so owned or controlled is principally  engaged  in
 activities  that are described in paragraphs four or five of subdivision
 (k) of section four of the federal bank holding company act of  nineteen
 hundred  fifty-six, as amended, and the regulations promulgated pursuant
 to the authority of such section or (ii) it is a  financial  subsidiary.
 An  election  under  this  paragraph  may  not  be made by a corporation
 described in paragraphs one through eight of  subdivision  (a)  of  this
 section  or in subdivision (e) of this section. In addition, an election
 under this paragraph may not be made by a corporation that is a party to
 a reorganization, as defined in subsection (a) of section three  hundred
 sixty-eight of the internal revenue code of nineteen hundred eighty-six,
 as amended, of a corporation described in paragraph one of this subdivi-
 sion  if  both  corporations  were  sixty-five  percent or more owned or
 controlled, directly or indirectly, by the same interests at the time of
 the reorganization.
   An election under this paragraph shall be made by the taxpayer  on  or
 before  the  due  date  for filing its return, determined with regard to
 extensions of time for filing, for  the  applicable  taxable  year.  The
 election  to be taxed under subchapter two of this chapter shall be made
 by the taxpayer by filing the return required  pursuant  to  subdivision
 one of section 11-605 of this chapter and the election to be taxed under
 this  subchapter  shall  be  made  by  the taxpayer by filing the return
 required pursuant to subdivision (a) of section 11-646 of this part. Any
 election made pursuant to this paragraph shall be irrevocable and  shall
 apply  to  each  subsequent  taxable  year beginning on or after January
 first, two thousand seventeen and before  January  first,  two  thousand
 twenty,  provided  that  the stock ownership and activities requirements
 described in subparagraph (i) of this paragraph are met or  such  corpo-
 ration  described  in subparagraph (ii) of this paragraph continues as a
 financial subsidiary.
   (3) For purposes of this subdivision, a financial subsidiary  means  a
 corporation  (i)  sixty-five  percent  or  more of whose voting stock is
 owned or controlled, directly or indirectly  by  a  banking  corporation
 described  in  paragraph  one,  two  or three of subdivision (a) of this
 section and (ii) is described in subdivision (g) of section  five  thou-
 sand  one  hundred  thirty-six-A  of  the revised statutes of the United
 States or section forty-six of the federal deposit  insurance  act.  For
 purposes  of  this  subchapter,  the  term  "banking  corporation" shall
 include a corporation electing to be taxed under this subchapter  pursu-
 ant  to  paragraph  two of this subdivision for so long as such election
 shall be in effect.
   § 11-641 Computations of entire net  income.  (a)  Entire  net  income
 means  total  net income from all sources which shall be the same as the
 entire taxable income, but not alternative minimum taxable income,
   (1) which the taxpayer is required to  report  to  the  United  States
 treasury department, or
   (2)  which  the taxpayer, in the case of a corporation which is exempt
 from federal income tax, other than the tax on unrelated business  taxa-
 ble  income  imposed  under  section five hundred eleven of the internal
 revenue code, but which is subject to tax under this  part,  would  have
 S. 8474                            540

 been required to report to the United States treasury department but for
 such exemption, or
   (3)  which, in the case of a corporation organized under the laws of a
 country other than the United States, is effectively connected with  the
 conduct  of  a  trade or business within the United States as determined
 under section eight hundred eighty-two of the internal revenue code, or
   (4) which the taxpayer would have  been  required  to  report  to  the
 United  States treasury department if the taxpayer had not elected to be
 taxed under subchapter s of chapter one of the internal revenue code, or
   (5) which the taxpayer would have  been  required  to  report  to  the
 United  States treasury department if no election had been made to treat
 the taxpayer as a qualified  subchapter  s  subsidiary  under  paragraph
 three  of  subsection  (b)  of section thirteen hundred sixty-one of the
 internal revenue code, subject  to  the  modifications  and  adjustments
 provided in this section.
   (b)  Entire  net  income  shall  be  computed without the deduction or
 exclusion of:
   (1) (A) in the case of a corporation organized under  the  laws  of  a
 country  other  than  the United States, (i) any part of any income from
 dividends or interest on any kind of stock, securities or  indebtedness,
 but  only  if  such  income is treated as effectively connected with the
 conduct of a trade or business in the United States pursuant to  section
 eight  hundred  sixty-four of the internal revenue code, (ii) any income
 exempt from federal taxable income under any treaty  obligation  of  the
 United  States,  but only if such income would be treated as effectively
 connected in the absence of such exemption, provided  that  such  treaty
 obligation  does not preclude the taxation of such income by a state, or
 (iii) any income which would be treated as effectively connected if such
 income were not excluded from gross income pursuant to subsection (a) of
 section one hundred three of the internal revenue code; (B) in the  case
 of  any  other  corporation,  any  part  of any income from dividends or
 interest on any kind of stock, securities or  indebtedness;  (C)  except
 that  for  purposes of subparagraphs (A) and (B) of this paragraph there
 shall be excluded any amounts treated as dividends pursuant  to  section
 seventy-eight  of the internal revenue code and any amounts described in
 paragraphs eleven and twelve of subdivision (e) of this section;
   (2) taxes on or measured by income or profits paid or  accrued  within
 the  taxable  year to the United States, or any of its possessions or to
 any foreign country, taxes on or measured by income or profits  paid  or
 accrued to the state or any subdivision thereof, including taxes imposed
 under  article nine, nine-A, thirteen-A, twenty-four-A, twenty-four-B of
 the tax law, or under article thirty-two of the tax law as such  article
 was  in  effect  on December thirty-first, two thousand fourteen and any
 tax imposed under this part or subchapter two or three-A of  this  chap-
 ter;
   (4)  for taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, any  amount
 which the taxpayer claimed as a deduction in computing its federal taxa-
 ble  income  solely  as  a  result  of  an election made pursuant to the
 provisions of such paragraph eight as it was in  effect  for  agreements
 entered into prior to January first, nineteen hundred eighty-four;
   (5)  for taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 S. 8474                            541
 
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, any  amount
 which  the  taxpayer would have been required to include in the computa-
 tion of its federal taxable income had it not made the election  permit-
 ted  pursuant to such paragraph eight as it was in effect for agreements
 entered into prior to January first, nineteen hundred eighty-four;
   (6) in the case of property placed in service in taxable years  begin-
 ning  before  nineteen  hundred ninety-four, for taxable years beginning
 after December thirty-first, nineteen hundred  eighty-one,  except  with
 respect  to  property  subject  to the provisions of section two hundred
 eighty-F of the internal  revenue  code  and  property  subject  to  the
 provisions  of  section  one hundred sixty-eight of the internal revenue
 code which is placed in service in this state in taxable years beginning
 after December thirty-first, nineteen hundred  eighty-four,  the  amount
 allowable  as  a  deduction  determined under section one hundred sixty-
 eight of the internal revenue code;
   (7) upon the disposition of  property  to  which  paragraph  seven  of
 subdivision  (e)  of  this section applies, the amount, if any, by which
 the aggregate of the amounts described in such paragraph seven attribut-
 able to such property exceeds the aggregate of the amounts described  in
 paragraph six of this subdivision attributable to such property;
   (11)  for  taxable  years beginning before January first, two thousand
 ten, in the case of a taxpayer subject to the provisions of  subdivision
 (c)  of  section  five hundred eighty-five of the internal revenue code,
 the amount allowed as  a  deduction  pursuant  to  section  one  hundred
 sixty-six of such code; and
   (12)  for  taxable  years beginning before January first, two thousand
 ten, for taxpayers subject to the provisions of subdivision (i) of  this
 section,  twenty  percent  of  the  excess  of (A) the amount determined
 pursuant to such subdivision (i) over (B) the amount  which  would  have
 been  allowable had such institution maintained its bad debt reserve for
 all taxable years on the basis of actual experience.
   (13) for taxable years ending after September tenth, two thousand one,
 in the  case  of  qualified  property  described  in  paragraph  two  of
 subsection  k of section one hundred sixty-eight of the internal revenue
 code, other than qualified resurgence zone property defined in  subdivi-
 sion (p) of this section, and other than qualified New York Liberty Zone
 property  described in paragraph two of subsection b of section fourteen
 hundred-L of the internal revenue code, without regard to clause (i)  of
 subparagraph  (C) of such paragraph, the amount allowable as a deduction
 under section one hundred sixty-seven of the internal revenue code.
   (14) for taxable years beginning on or after January first, two  thou-
 sand  four,  in the case of a taxpayer that is not an eligible farmer as
 defined in subsection (n) of section six hundred six of the tax law, the
 amount allowable as a deduction under sections one hundred seventy-nine,
 one hundred sixty-seven and one  hundred  sixty-eight  of  the  internal
 revenue  code  with  respect  to  a  sport utility vehicle that is not a
 passenger automobile as defined in paragraph five of subsection  (d)  of
 section two hundred eighty-F of the internal revenue code.
   (15)  The  amount  of  any  deduction  allowed pursuant to section one
 hundred ninety-nine of the internal revenue code.
   (16) The amount of any federal deduction for taxes imposed under arti-
 cle twenty-three of the tax law.
   (17) For taxable years beginning in  two  thousand  nineteen  and  two
 thousand  twenty,  the  amount  of  the increase in the federal interest
 S. 8474                            542
 
 deduction allowed pursuant  to  paragraph  ten  of  subdivision  (j)  of
 section one hundred sixty-three of the internal revenue code.
   (c)(1)  Except  as  otherwise  provided in paragraphs two and three of
 this subdivision, in the case of the sale or exchange of property  by  a
 taxpayer  which  has  been subject to part one or two of this subchapter
 three where the property has  a  higher  adjusted  basis  for  city  tax
 purposes  than  for  federal  tax  purposes, there shall be allowed as a
 deduction from entire net income, the portion of any  gain  or  loss  on
 such sale which equals the difference in such basis.
   (2)  In  case  of  property  of a taxpayer, other than a savings bank,
 acquired  prior  to  January  first,  nineteen  hundred  sixty-six,  and
 disposed  of  thereafter,  the computation of entire net income shall be
 modified as follows:
   (i) no gain shall be deemed to have been derived if either the cost or
 the fair market price  or  value  on  January  first,  nineteen  hundred
 sixty-six, exceeds the value realized;
   (ii) no loss shall be deemed to have been sustained if either the cost
 or  the  fair  market  price or value on January first, nineteen hundred
 sixty-six, is less than the value realized;
   (iii) where both the cost and the fair market price or value on  Janu-
 ary first, nineteen hundred sixty-six, are less than the value realized,
 the  basis for computing gain shall be the cost or the fair market price
 or value on such date, whichever is higher;
   (iv) where both the cost and the fair market price or value on January
 first, nineteen hundred sixty-six, are in excess of the value  realized,
 the  basis for computing loss shall be the cost or the fair market price
 or value on such date, whichever is lower.
   (3) In case of property of a savings bank acquired  prior  to  January
 first,  nineteen  hundred  sixty-six,  and  disposed  of  thereafter, in
 computing entire net income the basis of such property shall be the fair
 market price or value on January first, nineteen hundred sixty-six.
   (d) Entire net income shall not include any refund or credit of a  tax
 for  which  no  exclusion  or  deduction  was allowed in determining the
 taxpayer's entire net income under this subchapter or subchapter two  of
 this  chapter, or imposed by article twenty-three of the tax law for any
 prior year.
   (e) There shall be allowed as a deduction in  determining  entire  net
 income,  to  the  extent  not  deductible in determining federal taxable
 income:
   (1) interest on indebtedness incurred  or  continued  to  purchase  or
 carry  obligations or securities the income from which is subject to tax
 under this part but exempt from federal income tax,
   (2) ordinary and necessary expenses paid or incurred during the  taxa-
 ble  year attributable to income which is subject to tax under this part
 but exempt from federal income tax,
   (3) the amortizable bond premium for the taxable year on any bond  the
 interest  on  which  is  subject  to tax under this part but exempt from
 federal income tax,
   (4) that portion of wages or salaries paid or incurred for the taxable
 year for which a deduction is not allowed pursuant to the provisions  of
 section two hundred eighty-C of the internal revenue code,
   (5)  for taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, any  amount
 S. 8474                            543
 
 which  is  included in the taxpayer's federal taxable income solely as a
 result of an election made pursuant to the provisions of such  paragraph
 eight  as  it was in effect for agreements entered into prior to January
 first, nineteen hundred eighty-four,
   (6)  for taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, any  amount
 which  the  taxpayer could have excluded from federal taxable income had
 it not made the election provided for in such paragraph eight as it  was
 in  effect  for agreements entered into prior to January first, nineteen
 hundred eighty-four,
   (7) in the case of property placed in service in taxable years  begin-
 ning  before  nineteen  hundred ninety-four, for taxable years beginning
 after December thirty-first, nineteen hundred  eighty-one,  except  with
 respect  to  property  subject  to the provisions of section two hundred
 eighty-F of the internal  revenue  code  and  property  subject  to  the
 provisions  of  section  one hundred sixty-eight of the internal revenue
 code which is placed in service in this state in taxable years beginning
 after December thirty-first, nineteen hundred eighty-four, and  provided
 a  deduction  has  not  been excluded from entire net income pursuant to
 paragraph four of subdivision  (b)  of  this  section,  an  amount  with
 respect  to  property  which is subject to the provisions of section one
 hundred sixty-eight of the internal revenue code  equal  to  the  amount
 allowable  as  the  depreciation  deduction  under  section  one hundred
 sixty-seven of the internal revenue code  as  such  section  would  have
 applied to property placed in service on December thirty-first, nineteen
 hundred eighty,
   (8)  upon the disposition of property to which paragraph seven of this
 subdivision applies, the amount, if any, by which the aggregate  of  the
 amounts  described  in  paragraph six of subdivision (b) of this section
 attributable to such property  exceeds  the  aggregate  of  the  amounts
 described  in  paragraph  seven of this subdivision attributable to such
 property,
   (9) any amount of money or other property received  from  the  federal
 deposit  insurance  corporation  pursuant  to  subsection (c) of section
 thirteen of the federal deposit insurance act, as amended, regardless of
 whether any note or other instrument is issued in exchange therefor,
   (10) any amount of money or other property received from  the  federal
 savings  and  loan insurance corporation pursuant to paragraph one, two,
 three or four of subsection (f) of  section  four  hundred  six  of  the
 federal national housing act, as amended, regardless of whether any note
 or other instrument is issued in exchange therefor,
   (11) (i) seventeen percent of interest income from subsidiary capital,
 and
   (ii) sixty percent of dividend income from subsidiary capital, and
   (iii) sixty percent of the amount by which gains from subsidiary capi-
 tal  exceed losses from subsidiary capital, to the extent such gains and
 losses were taken into account in determining the entire taxable  income
 referred to in subdivision (a) of this section,
   (12) twenty-two and one-half percent of interest income on obligations
 of  New York state, or of any political subdivision thereof, or on obli-
 gations of the United States, other than obligations held for resale  in
 connection with regular trading activities,
 S. 8474                            544
 
   (13)  for  the taxable years beginning before January first, two thou-
 sand ten, in the case of a taxpayer which recaptures its balance of  the
 reserve  for losses on loans for federal income tax purposes pursuant to
 subdivision (c) of section  five  hundred  eight-five  of  the  internal
 revenue  code,  any  amount  which is included in federal taxable income
 pursuant to subdivision (c) of section five hundred eighty-five of  such
 code,
   (14)  for  taxable  years beginning before January first, two thousand
 ten, in the case of a taxpayer subject to the provisions of  subdivision
 (c)  of  section  five hundred eighty-five of the internal revenue code,
 any amount which is included in federal taxable income as a result of  a
 recovery of a loan,
   (15)  for  taxable  years beginning before January first, two thousand
 ten, in the case of a taxpayer which is currently or has previously been
 subject to subdivision (h) of this section, any amount which is included
 in federal taxable income pursuant to paragraph two of  subdivision  (e)
 of  section  five hundred ninety-three of the internal revenue code, and
 any other amount so included as a result of a recovery of or termination
 from the use of a bad debt reserve as defined in  section  five  hundred
 ninety-three  of  such  code  as  in existence on December thirty-first,
 nineteen hundred ninety-five as a result of federal legislation  enacted
 after December thirty-first, nineteen hundred ninety-five,
   (16)  one  hundred  percent of dividend income from subsidiary capital
 received during the taxable year if that  dividend  income  is  directly
 attributable  to a dividend from a captive REIT or captive RIC for which
 the captive REIT  or  captive  RIC  claimed  a  federal  dividends  paid
 deduction and that captive REIT or captive RIC is included in a combined
 report  or  return under subchapter two or part four of subchapter three
 of this chapter.
   (f) Provided the taxpayer has not made an election pursuant  to  para-
 graph two of subdivision (b) of section 11-642 of this part, there shall
 be  allowed  as  a  deduction  in  determining entire net income, to the
 extent  not  deductible  in  determining  federal  taxable  income,  the
 adjusted eligible net income of an international banking facility deter-
 mined as follows:
   (1) The eligible net income of an international banking facility shall
 be the amount remaining after subtracting from the eligible gross income
 the applicable expenses.
   (2)  Eligible  gross  income  shall  be the gross income derived by an
 international banking facility from:
   (A) making, arranging for,  placing  or  servicing  loans  to  foreign
 persons,  provided,  however, that in the case of a foreign person which
 is an individual, or which is a foreign  branch  of  a  domestic  corpo-
 ration,  other than a bank, or which is a foreign corporation or foreign
 partnership which is eighty per centum  or  more  owned  or  controlled,
 either  directly  or  indirectly,  by one or more domestic corporations,
 other  than  banks,  domestic  partnerships  or  resident   individuals,
 substantially  all the proceeds of the loan are intended for use outside
 of the United States;
   (B) making or placing deposits with foreign persons which are banks or
 foreign branches of banks, including  foreign  subsidiaries  or  foreign
 branches  of  the  taxpayer, or with other international banking facili-
 ties; or
   (C) entering into foreign exchange  trading  or  hedging  transactions
 related to any of the transactions described in this paragraph.
 S. 8474                            545

   (3)  Applicable  expenses  shall  be  any expenses or other deductions
 attributable, directly or  indirectly,  to  the  eligible  gross  income
 described in paragraph two of this subdivision.
   (4)  Adjusted  eligible  net income shall be determined by subtracting
 from eligible net income the ineligible funding amount, and by subtract-
 ing from the amount then remaining the floor amount.
   (5) The ineligible funding amount shall be the amount, if any,  deter-
 mined by multiplying eligible net income by a fraction, the numerator of
 which  is  the  average  aggregate  amount  for  the taxable year of all
 liabilities, including deposits, and  other  sources  of  funds  of  the
 international  banking  facility which were not owed to or received from
 foreign persons, and the denominator of which is the  average  aggregate
 amount  for  the taxable year of all liabilities, including deposits and
 other sources of funds of the international banking facility.
   (6) The floor amount shall be the amount, if any, determined by multi-
 plying the amount remaining after  subtracting  the  ineligible  funding
 amount from the eligible net income by a fraction, not greater than one,
 which is determined as follows:
   (A) The numerator shall be
   (i)  the  percentage,  as  set forth in subparagraph (C) of this para-
 graph, of the average  aggregate  amount  of  the  taxpayer's  loans  to
 foreign  persons  and  deposits  with foreign persons which are banks or
 foreign branches of banks, including  foreign  subsidiaries  or  foreign
 branches  of the taxpayer, which loans and deposits were recorded in the
 financial accounts of  the  taxpayer  for  its  branches,  agencies  and
 offices  within  the  state  for taxable years nineteen hundred seventy-
 five, nineteen hundred seventy-six and nineteen  hundred  seventy-seven,
 minus
   (ii)  the average aggregate amount of such loans and such deposits for
 the taxable year of the taxpayer, other than such loans and deposits  of
 an  international  banking  facility, provided, however, that in no case
 shall the amount determined in this clause exceed the amount  determined
 in clause (i) of this subparagraph; and
   (B) The denominator shall be the average aggregate amount of the loans
 to  foreign persons and deposits with foreign persons which are banks or
 foreign branches of banks, including  foreign  subsidiaries  or  foreign
 branches  of the taxpayer, which loans and deposits were recorded in the
 financial accounts of the taxpayer's international banking facility  for
 the taxable year.
   (C)  The percentage shall be one hundred percent for the first taxable
 year in which the taxpayer establishes an international banking facility
 and for the next succeeding four taxable years. The percentage shall  be
 eighty percent for the fifth, sixty percent for the sixth, forty percent
 for  the  seventh,  and  twenty percent for the eighth taxable year next
 succeeding the year such taxpayer establishes such international banking
 facility, and zero in the ninth succeeding year and thereafter.
   (7) In the event adjusted eligible net income is  a  loss,  such  loss
 shall be added to entire net income.
   (8) For purposes of this subdivision, the term "foreign person" means:
   (A) an individual who is not a resident of the United States,
   (B)  a  foreign corporation, a foreign partnership or a foreign trust,
 as defined in section seventy-seven hundred one of the internal  revenue
 code, other than a domestic branch thereof,
   (C)  a foreign branch of a domestic corporation, including the taxpay-
 er,
 S. 8474                            546
 
   (D) a foreign government or an international organization or an agency
 of either, or
   (E) an international banking facility.
   For  purposes  of  this  paragraph, the terms "foreign" and "domestic"
 shall have the same  meaning  as  set  forth  in  section  seventy-seven
 hundred one of the internal revenue code.
   (g)  Entire  net  income  shall  be  computed  without  regard  to the
 reduction in the basis of property that is  required  by  section  three
 hundred sixty-two of the internal revenue code, because of any amount of
 money  or  other  property  received  from the federal deposit insurance
 corporation pursuant to subsection (c) of section thirteen of the feder-
 al deposit insurance act, as amended, or from the  federal  savings  and
 loan insurance corporation pursuant to paragraph one, two, three or four
 of  subsection  (f)  of section four hundred six of the federal national
 housing act, as amended.
   (h)(1) For purposes of this subdivision, a "thrift institution"  is  a
 banking  corporation  which  satisfies the requirements of subparagraphs
 (A) and (B) of this paragraph.
   (A) Such banking corporation must be  (i)  a  banking  corporation  as
 defined  in  paragraph  one of subdivision (a) of section 11-640 of this
 part created or authorized to do business under article six  or  ten  of
 the  banking law, (ii) a banking corporation as defined in paragraph two
 or seven of subdivision (a) of section 11-640  of  this  part  which  is
 doing  a  business  substantially similar to the business which a corpo-
 ration or association may be created to do under article six or  ten  of
 the  banking  law  or any business which a corporation or association is
 authorized by such article to do, or  (iii)  a  banking  corporation  as
 defined  in  paragraph four or five of subdivision (a) of section 11-640
 of this part.
   (B) At least sixty percent of the amount of the total assets,  at  the
 close  of  the taxable year, of such banking corporation must consist of
 (i) cash; (ii) obligations of the United States or of a state  or  poli-
 tical  subdivision  thereof,  and  stock or obligations of a corporation
 which is an instrumentality of the United States or of a state or  poli-
 tical subdivision thereof, but not including obligations the interest on
 which is excludable from gross income under section one hundred three of
 the  internal revenue code; (iii) loans secured by a deposit or share of
 a member; (iv) loans secured by an interest in real property  which  is,
 or from the proceeds of the loan, will become, residential real property
 or  real property used primarily for church purposes, loans made for the
 improvement of residential real property or real property used primarily
 for church purposes, provided that for purposes of this clause, residen-
 tial real property shall include single or multifamily dwellings, facil-
 ities in residential developments dedicated to public  use  or  property
 used  on a nonprofit basis for residents, and mobile homes not used on a
 transient basis;  (v)  property  acquired  through  the  liquidation  of
 defaulted  loans described in clause (iv) of this subparagraph; (vi) any
 regular or residual interest in a REMIC, as  such  term  is  defined  in
 section eight hundred sixty-D of the internal revenue code and any regu-
 lar  interest  in  a  FASIT,  as  such  term is defined in section eight
 hundred sixty-L of the internal revenue code, but only in the proportion
 which the assets of such REMIC or FASIT consist of property described in
 clauses (i) through (v) of this subparagraph, except that if ninety-five
 percent or more of  the  assets  of  such  REMIC  or  FASIT  are  assets
 described  in  clauses  (i) through (v) of this subparagraph, the entire
 interest in the REMIC or FASIT shall qualify; (vii) any  mortgage-backed
 S. 8474                            547
 
 security  which  represents ownership of a fractional undivided interest
 in a trust, the assets of which consist  primarily  of  mortgage  loans,
 provided  that  the real property which serves as security for the loans
 is,  or from the proceeds of the loan, will become, the type of property
 described in clause (iv) of this  subparagraph  and  any  collateralized
 mortgage  obligation, the security for which consists primarily of mort-
 gage loans, provided that the real property which serves as security for
 the loans is, or from the proceeds of the loan, will become, the type of
 property described in clause (iv) of this subparagraph;  (viii)  certif-
 icates of deposit in, or obligations of, a corporation organized under a
 state  law  which specifically authorizes such corporation to insure the
 deposits or share accounts of member associations; (ix) loans secured by
 an interest in real property located within any urban renewal area to be
 developed for predominantly residential use under an urban renewal  plan
 approved  by the Secretary of Housing and Urban Development under part A
 or part B of title I of the Housing Act of nineteen hundred  forty-nine,
 as amended, or located within any area covered by a program eligible for
 assistance  under  section one hundred three of the Demonstration Cities
 and Metropolitan Development  Act  of  nineteen  hundred  sixty-six,  as
 amended,  and  loans made for the improvement of any such real property;
 (x) loans secured by an interest  in  educational,  health,  or  welfare
 institutions or facilities, including structures designed or used prima-
 rily for residential purposes for students, residents, and persons under
 care, employees, or members of the staff of such institutions or facili-
 ties;  (xi) loans made for the payment of expenses of college or univer-
 sity education or  vocational  training;  (xii)  property  used  by  the
 taxpayer  in  the  conduct  of  business  which  consists principally of
 acquiring the savings of the public and investing in loans; (xiii) loans
 for which the taxpayer is the creditor and which are wholly  secured  by
 loans described in clause (iv) of this subparagraph, but excluding loans
 for  which  the  taxpayer  is  the  creditor  to any banking corporation
 described in paragraphs one through seven of subdivision (a) of  section
 11-640  of  this part or a real estate investment trust, as such term is
 defined in section eight hundred fifty-six of the internal revenue code,
 and excluding loans which are treated  by  the  taxpayer  as  subsidiary
 capital  for  purposes of the deductions provided by paragraph eleven of
 subdivision (e) of this section; (xiv) small  business  loans  or  small
 farm  loans  located  in  low-income or moderate-income census tracts or
 block numbering areas delineated by the  United  States  bureau  of  the
 census  in the most recent decennial census; and (xv) community develop-
 ment loans or community development investments. For purposes of  clause
 (xv) of this subparagraph, a "community development loan" is a loan that
 (I)  has as its primary purpose community development, (II) has not been
 reported or collected by the taxpayer for consideration in  the  taxpay-
 er's  community  reinvestment  act  evaluation  pursuant  to the federal
 community  reinvestment  act  of  nineteen  hundred  seventy-seven,   as
 amended, or section twenty-eight-b of the banking law as a mortgage loan
 described  in clause (iv) of this subparagraph or a small business loan,
 small farm loan, or consumer loan, (III) benefits the taxpayer's assess-
 ment area or areas for purposes of the  federal  community  reinvestment
 act  of  nineteen  hundred  seventy-seven, as amended or section twenty-
 eight-b of the banking law or a broader statewide or regional area  that
 includes  the  taxpayer's assessment area, and (IV) is identified in the
 taxpayer's books  and  records  as  a  community  development  loan  for
 purposes  of  its  community reinvestment act evaluation pursuant to the
 federal community reinvestment act of nineteen hundred seventy-seven, as
 S. 8474                            548
 
 amended or section twenty-eight-b of the banking law.  For  purposes  of
 clause  (xv)  of this subparagraph, a "community development investment"
 is an investment in a security which has as its primary purpose communi-
 ty  development  and  which  is  identified  in the taxpayer's books and
 records as a qualified investment for purposes of  its  community  rein-
 vestment  act  evaluation pursuant to the federal community reinvestment
 act of nineteen hundred seventy-seven, as  amended  or  section  twenty-
 eight-b of the banking law. For purposes of this subparagraph, "communi-
 ty  development"  means  (I)  affordable  housing, including multifamily
 rental housing  for  low-income  or  moderate-income  individuals;  (II)
 community  services  targeted  to low-income or moderate-income individ-
 uals; (III) activities that promote economic  development  by  financing
 businesses  or  farms  that  meet  the size eligibility standards of the
 small business administration's development company  or  small  business
 investment company programs or have gross annual revenues of one million
 dollars or less; (IV) activities that revitalize or stabilize low-income
 or  moderate-income census tracts or block numbering areas delineated by
 the United States bureau of the census  in  the  most  recent  decennial
 census;  or (V) activities that seek to prevent defaults and/or foreclo-
 sures in loans included in items (I) and (III) of this subclause.
   (C) At the election of  the  taxpayer,  the  percentage  specified  in
 subparagraph  (B) of this paragraph shall be applied on the basis of the
 average assets outstanding during the taxable year, in lieu of the close
 of the taxable year. For purposes of clause (iv) of subparagraph (B)  of
 this  paragraph,  if  a multifamily structure securing a loan is used in
 part for nonresidential use purposes, the entire loan is deemed a  resi-
 dential real property loan if the planned residential use exceeds eighty
 percent  of  the  property's  planned use, determined as of the time the
 loan is made. Also, for purposes of clause (iv) of subparagraph  (B)  of
 this  paragraph, loans made to finance the acquisition or development of
 land shall be deemed to be loans secured by an interest  in  residential
 real  property if there is a reasonable assurance that the property will
 become residential real property within a period of three years from the
 date of acquisition of such land; but this shall not apply for any taxa-
 ble year unless, within such three year period, such land becomes  resi-
 dential  real property. For purposes of determining whether any interest
 in a REMIC qualifies under clause (vi) of subparagraph (B) of this para-
 graph, any regular interest in another REMIC held by such REMIC shall be
 treated as a loan described in clauses (i), (ii), (iii), (iv) or (v)  of
 subparagraph (B) of this paragraph under principles similar to the prin-
 ciple  of  such  clause  (vi);  except that if such REMICS are part of a
 tiered structure, they shall be treated as one  REMIC  for  purposes  of
 such clause (vi).
   (2)  For  taxable  years  beginning before January first, two thousand
 ten, a thrift institution must  exclude  from  the  computation  of  its
 entire  net  income any amount allowed as a deduction for federal income
 tax purposes pursuant to section one  hundred  sixty-six,  five  hundred
 eight-five or five hundred ninety-three of the internal revenue code.
   (3)  For  taxable  years  beginning before January first, two thousand
 ten, a thrift institution shall be allowed as a deduction  in  computing
 entire net income the amount of a reasonable addition to its reserve for
 bad debts. This amount shall be equal to the sum of:
   (A)  the  amount determined to be a reasonable addition to the reserve
 for losses on nonqualifying loans, computed in the  same  manner  as  is
 provided  with  respect to additions to the reserves for losses on loans
 of banks under paragraph one of subdivision (i) of this section, plus
 S. 8474                            549
 
   (B) the amount determined by the taxpayer to be a reasonable  addition
 to  the  reserve  for losses on qualifying real property loans, but such
 amount shall not exceed the amount determined under  paragraph  four  or
 five of this subdivision, whichever is the larger, but the amount deter-
 mined under this subparagraph shall in no case be greater than the larg-
 er of:
   (i) the amount determined under paragraph five of this subdivision, or
   (ii)  the  amount  which,  when  added  to the amount determined under
 subparagraph (A) of this paragraph, equals the amount  by  which  twelve
 percent  of the total deposits or withdrawable accounts of depositors of
 the taxpayer at the close of such year exceeds the sum of  its  surplus,
 undivided  profits  and  reserves  at the beginning of such year, taking
 into account any portion thereof attributable to the period  before  the
 first  taxable  year  beginning  after  December  thirty-first, nineteen
 hundred fifty-one.
   The taxpayer must include in its tax return for each year  a  computa-
 tion  of  the  amount of the addition to the bad debt reserve determined
 under this subdivision. The use of a particular method in the return for
 a taxable year is not a binding election by the taxpayer.
   (4)(A) Subject to subparagraphs (B) and (C)  of  this  paragraph,  the
 amount  determined under this paragraph for the taxable year shall be an
 amount equal to thirty-two percent of the entire  net  income  for  such
 year.
   (B)  The  amount  determined  under subparagraph (A) of this paragraph
 shall be reduced, but not below zero, by  the  amount  determined  under
 subparagraph (A) of paragraph three of this subdivision.
   (C)  The  amount  determined under this paragraph shall not exceed the
 amount necessary to increase the balance at the  close  of  the  taxable
 year  of the reserve for losses on qualifying real property loans to six
 percent of such loans outstanding at such time.
   (D) For purposes  of  this  paragraph,  entire  net  income  shall  be
 computed
   (i)  by excluding from income any amount included therein by reason of
 subparagraph (B) of paragraph eight of this subdivision,
   (ii) without regard to any deduction allowable for any addition to the
 reserve for bad debts, and
   (iii) by excluding from income an amount equal to the net gain for the
 taxable year arising from the sale or exchange of stock of a corporation
 or of obligations the interest on which is excludable from gross  income
 under section one hundred three of the internal revenue code.
   (iv)  Whenever  a  thrift  institution  is  properly  includable  in a
 combined return, entire net income,  for  purposes  of  this  paragraph,
 shall  not  exceed  the  lesser  of  the thrift institution's separately
 computed entire net income as adjusted pursuant to clauses  (i)  through
 (iii)  of this subparagraph or the combined group's entire net income as
 adjusted pursuant to clauses (i) through (iii) of this subparagraph.
   (5) The amount determined under this paragraph for  the  taxable  year
 shall  be computed in the same manner as is provided under paragraph one
 of subdivision (i) of this section with respect to additions to reserves
 for losses on loans of banks. Provided, however, that  for  any  taxable
 year  beginning after nineteen hundred ninety-five, for purposes of such
 computation, the base year shall be the later of (A)  the  last  taxable
 year  beginning  in nineteen hundred ninety-five or (B) the last taxable
 year before the current year in which the amount  determined  under  the
 provisions  of  subparagraph  (B) of paragraph three of this subdivision
 exceeded the amount allowable under this paragraph.
 S. 8474                            550
 
   (6) (A) (i) Each taxpayer described in paragraph one of this  subdivi-
 sion shall establish and maintain a New York reserve for losses on qual-
 ifying real property loans, a New York reserve for losses on nonqualify-
 ing  loans and a supplemental reserve for losses on loans. Such reserves
 shall  be maintained for all subsequent taxable years that this subdivi-
 sion applies to the taxpayer.
   (ii) For purposes of this subdivision, such reserves shall be  treated
 as  reserves  for  bad  debts, but no deduction shall be allowed for any
 addition to the supplemental reserve for losses on loans.
   (iii) Except as provided in this clause, the  balances  of  each  such
 reserve  at  the  beginning  of  the first day of the first taxable year
 beginning after  December  thirty-first,  nineteen  hundred  ninety-five
 shall  be  the  same  as  the balances maintained for federal income tax
 purposes in accordance with paragraph one of subdivision (c) of  section
 five  hundred  ninety-three of the internal revenue code as in existence
 on December thirty-first, nineteen hundred ninety-five for the last  day
 of  the  last  tax year beginning before January first, nineteen hundred
 ninety-six. A taxpayer which maintained a  New  York  reserve  for  loan
 losses  on qualifying real property loans in the last tax year beginning
 before January first, nineteen hundred ninety-six shall have a continua-
 tion of such New York reserve balance in lieu of the  amount  determined
 under this clause.
   (iv)  Notwithstanding  clause  (ii)  of  this subparagraph, any amount
 allocated to the reserve for losses on qualifying  real  property  loans
 pursuant  to  paragraph  five of subdivision (c) of section five hundred
 ninety-three of the internal revenue code as in effect immediately prior
 to the enactment of the Tax Reform Act of nineteen hundred  seventy  six
 shall  not  be  treated as a reserve for bad debts for any purpose other
 than determining the amount referred to in subparagraph (B) of paragraph
 three of this subdivision, and for such purpose  such  amount  shall  be
 treated as remaining in such reserve.
   (B) Any debt becoming worthless or partially worthless in respect of a
 qualifying real property loan shall be charged to the reserve for losses
 on  such loans and any debt becoming worthless or partially worthless in
 respect of a nonqualifying loan shall be  charged  to  the  reserve  for
 losses  on  nonqualifying  loans,  except that any such debt may, at the
 election of the taxpayer, be charged in whole or in part to the  supple-
 mental reserve for losses on loans.
   (C)  The New York reserve for losses on qualifying real property loans
 shall be increased by the amount determined under  subparagraph  (B)  of
 paragraph  three of this subdivision and the New York reserve for losses
 on nonqualifying loans shall be increased by the amount determined under
 subparagraph (A) of paragraph three of this subdivision.
   (7)(A) For purposes of this subdivision,  the  term  "qualifying  real
 property  loan"  shall  mean any loan secured by an interest in improved
 real property or secured by an interest in real property which is to  be
 improved  out  of  the proceeds of the loan. Such term shall include any
 mortgage-backed security which  represents  ownership  of  a  fractional
 undivided  interest in a trust, the assets of which consist primarily of
 mortgage loans, provided that the real property which serves as security
 for the loans is, or from the proceeds of the  loan,  will  become,  the
 type  of  property  described in clauses (i) through (v) of subparagraph
 (B) of paragraph one of this subdivision. However, such term  shall  not
 include:  (i)  any  loan evidenced by a security, as defined in subpara-
 graph (C) of paragraph two of subdivision (g)  of  section  one  hundred
 sixty-five  of  the internal revenue code; (ii) any loan, whether or not
 S. 8474                            551

 evidenced by a security, as defined in such subparagraph  (C)  of  para-
 graph  two  of  subdivision  (g)  of section one hundred sixty-five, the
 primary obligor of which is (I) a government or political subdivision or
 instrumentality thereof, (II) a banking corporation, or (III) any corpo-
 ration  sixty-five  percent  or  more  of whose voting stock is owned or
 controlled, directly or indirectly, by the  taxpayer  or  by  a  banking
 corporation  or  bank holding company that owns or controls, directly or
 indirectly, sixty-five percent or  more  of  the  voting  stock  of  the
 taxpayer; (iii) any loan, to the extent secured by a deposit in or share
 of  the  taxpayer;  or  (iv)  any  loan which, within a sixty-day period
 beginning in one taxable year of the creditor and  ending  in  its  next
 taxable year, is made or acquired and then repaid or disposed of, unless
 the transactions by which such loan was made or acquired and then repaid
 or disposed of are established to be for bona fide business purposes.
   (B)  For  purposes  of this subdivision, the term "nonqualifying loan"
 shall mean any loan which is not a qualifying real property loan.
   (C) For purposes of this subdivision, the term "loan" shall mean debt,
 as the term "debt" is used in  section  one  hundred  sixty-six  of  the
 internal revenue code.
   (D) A regular or residual interest in a REMIC, as such term is defined
 in  section eight hundred sixty-D of the internal revenue code, shall be
 treated as a qualifying real property loan, except that,  if  less  than
 ninety-five  percent  of  the  assets  of such REMIC are qualifying real
 property loans, determined as if the taxpayer held  the  assets  of  the
 REMIC,  such  interest  shall be so treated only in the proportion which
 the assets of such REMIC consist of such loans. For purposes  of  deter-
 mining whether any interest in a REMIC qualifies under the provisions of
 this  paragraph,  any interest in another REMIC held by such REMIC shall
 be treated as a qualifying real property loan under  principles  similar
 to the principles of this paragraph, except that if such REMICS are part
 of  a  tiered structure, they shall be treated as one REMIC for purposes
 of this paragraph.
   (8)(A) Any distribution of property, as defined in subdivision (a)  of
 section  three  hundred  seventeen  of  the  internal revenue code, by a
 thrift institution to a shareholder with respect to its stock,  if  such
 distribution  is not allowable as a deduction under section five hundred
 ninety-one of such code, shall be treated as made
   (i) first out of its New York  earnings  and  profits  accumulated  in
 taxable  years  beginning  after December thirty-first, nineteen hundred
 fifty-one, to the extent thereof,
   (ii) then out of the New York reserve for losses  on  qualifying  real
 property loans, to the extent additions to such reserve exceed the addi-
 tions  which would have been allowed under paragraph five of this subdi-
 vision,
   (iii) then out of the supplemental reserve for losses on loans, to the
 extent thereof,
   (iv) then out of such other accounts as may be proper.
 This subparagraph shall apply in the case of any distribution in redemp-
 tion of stock or in partial or complete liquidation of a thrift institu-
 tion, except that any such distribution shall be treated as  made  first
 out  of  the  amount  referred  to  in clause (ii) of this subparagraph,
 second out of the amount referred to in clause (iii)  of  this  subpara-
 graph, third out of the amount referred to in clause (i) of this subpar-
 agraph  and  then  out  of  such  other  accounts as may be proper. This
 subparagraph shall not apply to any transaction to which  section  three
 hundred  eighty-one  of  such  code,  relating to carryovers and certain
 S. 8474                            552
 
 corporate acquisitions, applies, or to any distribution to  the  federal
 savings  and loan insurance corporation or the federal deposit insurance
 corporation in redemption of an interest in an association  or  institu-
 tion,  if  such  interest was originally received by the federal savings
 and loan insurance corporation or the federal deposit  insurance  corpo-
 ration  in exchange for financial assistance pursuant to subdivision (f)
 of section four hundred six of  the  federal  national  housing  act  or
 pursuant  to  subsection  (c) of section thirteen of the federal deposit
 insurance act.
   (B) If any distribution is treated  under  subparagraph  (A)  of  this
 paragraph  as  having been made out of the reserves described in clauses
 (ii) and (iii) of such subparagraph, the  amount  charged  against  such
 reserve  shall  be  the  amount which, when reduced by the amount of tax
 imposed under the internal revenue code and attributable to  the  inclu-
 sion  of  such  amount  in  gross income, is equal to the amount of such
 distribution; and the amount so charged against such  reserve  shall  be
 included in the entire net income of the taxpayer.
   (C)  (i) For purposes of clause (ii) of subparagraph (A) of this para-
 graph, additions to the New York reserve for losses on  qualifying  real
 property  loans  for  the  taxable year in which the distribution occurs
 shall be taken into account.
   (ii) For purposes of computing under this subdivision the amount of  a
 reasonable  addition  to  the  New York reserve for losses on qualifying
 real property loans for any taxable year, the amount charged during  any
 year  to  such reserve pursuant to the provisions of subparagraph (B) of
 this paragraph shall not be taken into account.
   (9) A taxpayer which maintains a New York reserve for losses on quali-
 fying real property loans and which ceases to meet the definition  of  a
 thrift institution as defined in paragraph one of this subdivision, must
 include  in  its  entire net income for the last taxable year such para-
 graph applied the excess of its New York reserve for losses on  qualify-
 ing  real  property loans over the greater of (A) its reserve for losses
 on qualifying real property loans as of the last day of the last taxable
 year such reserve is maintained for federal income tax purposes  or  (B)
 the  balance of the New York reserve for losses on qualifying real prop-
 erty loans which would be allowable to the taxpayer for the last taxable
 year such taxpayer met such definition of a thrift  institution  if  the
 taxpayer  had  computed  its  reserve  balance  pursuant  to  the method
 described in subparagraph (A) of paragraph one  of  subdivision  (i)  of
 this section.
   (i) (1) For taxable years beginning before January first, two thousand
 ten,  a taxpayer subject to the provisions of subdivision (c) of section
 five hundred eighty-five of the internal revenue code and not subject to
 subdivision (h) of this section may, in  computing  entire  net  income,
 deduct an amount equal to or less than the amount determined pursuant to
 subparagraph  (A)  of  this  paragraph or subparagraph (B) of this para-
 graph, whichever is greater.  Provided, however, in no event  shall  the
 deduction  be  less than the amount determined pursuant to such subpara-
 graph (A).
   (A) The amount determined pursuant to this subparagraph shall  be  the
 amount  necessary  to  increase  the balance of its New York reserve for
 losses on loans, at the close of the taxable year, to the  amount  which
 bears  the  same  ratio to loans outstanding at the close of the taxable
 year as (i) the total bad debts sustained during the  taxable  year  and
 the  five  preceding taxable years, or, with the approval of the commis-
 sioner of finance, a shorter period,  adjusted  for  recoveries  of  bad
 S. 8474                            553
 
 debts during such period, bears to (ii) the sum of the loans outstanding
 at the close of such six or fewer taxable years.
   (B)(i)  The  amount  determined pursuant to this subparagraph shall be
 the amount necessary to increase the balance of its New York reserve for
 losses on loans, at the close of the taxable year, to the lower of:
   (I) the balance of the reserve at the close of the base year, or
   (II) if the amount of loans outstanding at the close  of  the  taxable
 year  is  less  than the amount of loans outstanding at the close of the
 base year, the amount which bears the same ratio to loans outstanding at
 the close of the taxable year as the balance of the reserve at the close
 of the base year bears to the amount of loans outstanding at  the  close
 of the base year.
   (ii)  For  purposes  of this paragraph, the base year shall be (I) for
 taxable years beginning in nineteen hundred eighty-seven, the last taxa-
 ble year before the most recent adoption of the  experience  method  for
 federal  income  tax purposes or for purposes of this part, whichever is
 earlier, and (II) for taxable years  beginning  after  nineteen  hundred
 eighty-seven,  the  last  taxable year beginning before nineteen hundred
 eighty-eight.
   (2) (A) For taxable years beginning before January first, two thousand
 ten, each taxpayer described in paragraph one of this subdivision  shall
 establish  and  maintain  a  New York reserve for losses on loans.  Such
 reserve shall be  maintained  for  all  subsequent  taxable  years.  The
 balance  of the New York reserve for losses on loans at the beginning of
 the first day of the first taxable year the taxpayer becomes subject  to
 this  subdivision  shall  be the same as the balance at the beginning of
 such day of the reserve for  losses  on  loans  maintained  for  federal
 income  tax  purposes. The New York reserve for losses on loans shall be
 reduced by an amount equal to the deduction allowed, but not  more  than
 the  amount  allowable,  for  worthless  debts  for  federal  income tax
 purposes pursuant to section  one  hundred  sixty-six  of  the  internal
 revenue  code  plus  the amount, if any, charged against its reserve for
 losses on loans pursuant to paragraph four of subdivision (c) of section
 five hundred eighty-five of such code.
   (B) For purposes of subparagraph (A) of  this  paragraph,  a  taxpayer
 which  had  previously been subject to the provisions of subdivision (h)
 of this section shall establish a New York reserve for losses  on  loans
 equal  to  the  sum of (i) the greater of (I) the balance of its federal
 reserve for losses on qualifying real property loans as of the first day
 of the first taxable year the taxpayer becomes subject to the provisions
 of this subdivision or (II) the greater of the amounts determined  under
 subparagraphs  (A)  and (B) of paragraph nine of subdivision (h) of this
 section in the year such paragraph applied to  the  taxpayer,  (ii)  the
 greater of (I) the balance in its federal reserve for losses on nonqual-
 ifying  loans as of the first day of the first taxable year the taxpayer
 becomes subject to this subdivision or (II) the balance in its New  York
 reserve  for  losses  on  nonqualifying  loans  as  of the last date the
 taxpayer was subject to  the  provisions  of  subdivision  (h)  of  this
 section, and (iii) the balance in its supplemental reserve for losses on
 loans  as of the last date the taxpayer was subject to the provisions of
 subdivision (h) of this section.
   (3) The determination and treatment of the New York  reserve  balance,
 including  any  additions  thereto, subtractions therefrom, or recapture
 thereof, for:
 S. 8474                            554
 
   (A) any banking corporation which  was  subject  to  tax  for  federal
 income  tax  purposes  but  not subject to tax under this part for prior
 taxable years,
   (B) any taxpayer which ceases to be subject to tax under this part, or
   (C) any other unusual circumstances,
   shall be determined by the commissioner of finance. Provided, however,
 any  banking corporation which was subject to tax for federal income tax
 purposes but not subject to tax under this part for prior taxable  years
 shall  have  as  its  opening  New  York reserve for losses on loans the
 amount determined by applying the  provisions  of  subparagraph  (A)  of
 paragraph  one  of this subdivision to loans outstanding at the close of
 its last taxable year for federal income tax purposes  ending  prior  to
 the  first  taxable  year for which the taxpayer is subject to tax under
 this part and provided, further, that the provisions of subparagraph (B)
 of paragraph one of this subdivision shall not apply.
   (j) (1) For any taxable year beginning in  nineteen  hundred  seventy-
 three or for any period for which a tax is imposed under subdivision (b)
 of  section  11-639  of  this  part, entire net income shall be computed
 without regard to the amount allowable as a deduction for bad  debts  or
 an  addition  to  a  reserve  for bad debts in computing federal taxable
 income for the taxable year, but, in lieu thereof, a deduction shall  be
 allowed  to  the extent and in the manner authorized by subdivision five
 of section 11-621 or subdivision (e) of section 11-629 of this  subchap-
 ter  as  if  such  provisions were set forth in full in this part and by
 treating such provisions as applicable under this part.
   (2) In the case of property placed in service prior to January  first,
 nineteen  hundred seventy-three, for which the taxpayer properly adopted
 a different method of computing depreciation  under  section  11-621  or
 section  11-629  of  this subchapter than was adopted for federal income
 tax purposes with respect to such property, entire net income under this
 part shall be computed without regard  to  the  amount  allowable  as  a
 deduction for depreciation of such property in computing federal taxable
 income  for  the taxable year but, in lieu thereof, shall be computed as
 if such deduction were determined by the method of depreciation  adopted
 with  respect  to  such  property under section 11-621 or 11-629 of this
 subchapter.
   (3) In  computing  entire  net  income,  the  amount  allowable  as  a
 deduction  for  charitable contributions for federal income tax purposes
 shall be:  (a) increased for the first taxable year or period  beginning
 in  nineteen  hundred  seventy-three  by the amount of any contributions
 made during such taxable year or period which were not  allowable  as  a
 deduction  for  charitable contributions for federal income tax purposes
 for such taxable year or period because of an election pursuant to para-
 graph two of subsection (a) of section one hundred seventy of the inter-
 nal revenue code and which were not deductible in computing the tax  due
 under  part  one  or  two  of  this subchapter, and (b) decreased by any
 amount allowed as a deduction for federal income tax  purposes  for  the
 taxable  year  under section one hundred seventy of the internal revenue
 code as a carryover of excess contributions which are not made  in  such
 taxable  year  and  which were deductible in computing the tax due under
 part one or two of this subchapter.
   (4) There shall be excluded from the computation of entire net  income
 any  amount  allowed  as a deduction for federal income tax purposes for
 the taxable year under section twelve hundred  twelve  of  the  internal
 revenue  code as a capital loss carry forward to the taxable year, which
 S. 8474                            555
 
 was deductible as a loss in computing the tax due under part one or  two
 of this subchapter.
   (5)  There shall be excluded from the computation of entire net income
 the amount of any income or gain from the sale of real or personal prop-
 erty which is includible in determining federal taxable income  for  the
 taxable  year  pursuant  to  the  installment  method under section four
 hundred fifty-three of the internal revenue code,  to  the  extent  that
 such  income  or  gain  was includible in the computation of the tax due
 under part one or two of this subchapter.
   (6) To the extent not otherwise provided in this part, there shall  be
 excluded  from  entire  net  income  the amount necessary to prevent the
 taxation under this part of any other amount of income or gain which was
 properly included in income or gain and was taxable under  part  one  or
 two  of  this subchapter and there shall be disallowed as a deduction in
 computing entire net income any amount which was allowed as a  deduction
 in computing the tax due under such parts.
   (k)  (1) At the election of the taxpayer, there shall be deducted from
 the portion of its entire net income allocated within the city, depreci-
 ation with respect to any property such as described in paragraph two of
 this subdivision, not exceeding  twice  the  depreciation  allowed  with
 respect  to  the  same  property  for  federal income tax purposes. Such
 deduction shall be allowed only upon condition that entire net income be
 computed without any deduction for depreciation or amortization  of  the
 same  property,  and the total of all deductions allowed under parts one
 and two of this subchapter three and this part in any  taxable  year  or
 years  with  respect  to  the depreciaton of any such property shall not
 exceed its cost or other basis.
   (2) Such deduction shall be allowed  only  with  respect  to  tangible
 property which is depreciable pursuant to section one hundred sixty-sev-
 en of the internal revenue code, having a situs in this city and used in
 the taxpayer's business, (i) constructed, reconstructed or erected after
 December  thirty-first,  nineteen  hundred  sixty-five,  pursuant  to  a
 contract which was, on or before December thirty-first, nineteen hundred
 sixty-seven, and at all times thereafter, binding on  the  taxpayer  or,
 property, the physical construction, reconstruction or erection of which
 began  on  or before December thirty-first, nineteen hundred sixty-seven
 or which began after such date pursuant to an order placed on or  before
 December  thirty-first, nineteen hundred sixty-seven, and then only with
 respect to that portion of the basis thereof which is properly attribut-
 able to such construction, reconstruction  or  erection  after  December
 thirty-first, nineteen hundred sixty-five, or (ii) acquired after Decem-
 ber  thirty-first,  nineteen  hundred sixty-five, pursuant to a contract
 which was, on or before December thirty-first, nineteen  hundred  sixty-
 seven,  and at all times thereafter, binding on the taxpayer or pursuant
 to an order placed on or before December thirty-first, nineteen  hundred
 sixty-seven,  by  purchase  as defined in subdivision (d) of section one
 hundred seventy-nine of the internal revenue code, if the  original  use
 of such property commenced with the taxpayer, commenced in this city and
 commenced  after  December thirty-first, nineteen hundred sixty-five, or
 (iii) acquired, constructed, reconstructed,  or  erected  subsequent  to
 December  thirty-first,  nineteen  hundred sixty-seven, if such acquisi-
 tion, construction, reconstruction or erection is pursuant to a plan  of
 the  taxpayer  which  was  in  existence December thirty-first, nineteen
 hundred sixty-seven and not thereafter substantially modified, and  such
 acquisition,  construction,  reconstruction  or  erection  would qualify
 under the rules in paragraph four, five or  six  of  subsection  (h)  of
 S. 8474                            556
 
 section forty-eight of the internal revenue code provided all references
 in  such  paragraphs four, five and six to the dates October nine, nine-
 teen hundred sixty-six, and October  ten,  nineteen  hundred  sixty-six,
 shall  be read as December thirty-first, nineteen hundred sixty-seven. A
 taxpayer shall be allowed a deduction under clause (i), (ii) or (iii) of
 this paragraph only if the tangible property shall be delivered  or  the
 construction, reconstruction or erection shall be completed on or before
 December  thirty-first,  nineteen hundred sixty-nine, except in the case
 of tangible property which is acquired,  constructed,  reconstructed  or
 erected  pursuant to a contract which was, on or before December thirty-
 first, nineteen hundred sixty-seven, and at all times thereafter,  bind-
 ing  on  the taxpayer. Provided, however, for any taxable year beginning
 on or after January first,  nineteen  hundred  sixty-eight,  a  taxpayer
 shall not be allowed a deduction under paragraph one of this subdivision
 with  respect  to  tangible  personal property leased by it to any other
 person or corporation, provided, that any contract or agreement to lease
 or rent or for a license to use such  property  shall  be  considered  a
 lease.  With  respect  to  property  which  the taxpayer uses itself for
 purposes other than leasing for part of a taxable year and leases for  a
 part  of a taxable year, the taxpayer shall be allowed a deduction under
 paragraph one of this subdivision in proportion to the part of the  year
 it uses such property.
   (3)  If  the deduction allowable for any taxable year pursuant to this
 subdivision exceeds the portion of  the  taxpayer's  entire  net  income
 allocated  to this city for such year, the excess may be carried over to
 the following taxable year or years and may be deducted from the portion
 of the taxpayer's entire net income allocated to this city for such year
 or years.
   (4) In any taxable year when property is sold  or  otherwise  disposed
 of,  with respect to which a deduction has been allowed pursuant to this
 subdivision, subdivision twelve of section 11-621 or subdivision (j)  of
 section  11-629  of  this subchapter, the gain or loss entering into the
 computation of federal taxable income shall be disregarded in  computing
 entire  net  income,  and  there  shall  be added or subtracted from the
 portion of entire net income allocated within the city the gain or  loss
 upon  such sale or other disposition. In computing such gain or loss the
 basis of the property sold or disposed of shall be adjusted  to  reflect
 the  deduction  allowed  with respect to such property pursuant to para-
 graph one of this subdivision. Provided, however, that no loss shall  be
 recognized  for the purposes of this paragraph with respect to a sale or
 other disposition of property to a person whose acquisition  thereof  is
 not  a  purchase  as  defined  in subdivision (d) of section one hundred
 seventy-nine of the internal revenue code.
   (k-1) A net operating loss deduction shall be allowed which  shall  be
 presumably  the  same  as the net operating loss deduction allowed under
 section one hundred seventy-two of the  internal  revenue  code,  except
 that  in  every  instance  where  such  deduction  is allowed under this
 subchapter:
   (1) any net operating loss  included  in  determining  such  deduction
 shall  be  adjusted to reflect the inclusions and exclusions from entire
 net income required by the other provisions of this section;
   (2) such deduction shall not include any net operating loss  sustained
 during  any  taxable year beginning prior to January first, two thousand
 nine, or during any taxable year in which the taxpayer was  not  subject
 to the tax imposed by this subchapter;
 S. 8474                            557
 
   (3) such deduction shall not exceed the deduction for the taxable year
 allowed  under  section  one hundred seventy-two of the internal revenue
 code augmented by the excess of the amount allowed as a deduction pursu-
 ant to subdivision (h) or (i) of this section, whichever is  applicable,
 over  the  amount allowed as a deduction pursuant to section one hundred
 sixty-six or five hundred eighty-five of the internal revenue code,  for
 each  taxable  year in which the taxpayer had a net operating loss which
 is carried to the taxable year of the deduction under this provision, in
 the aggregate, except to the extent such excess was previously  deducted
 in computing entire net income; and
   (4) the net operating loss deduction allowed under section one hundred
 seventy-two  of  the  internal  revenue  code shall for purposes of this
 subdivision be determined as if the  taxpayer  had  elected  under  such
 section  to  relinquish  the entire carryback period with respect to net
 operating losses.
   (k-2) Notwithstanding any other  provision  of  this  section  to  the
 contrary, for taxable years beginning before January first, two thousand
 twenty-one,  any  amendment  to  section  one hundred seventy-two of the
 internal revenue code made after March first, two thousand twenty  shall
 not apply to this part.
   (1)  If  the  period covered by a return under this part is other than
 the period covered by the return to the United States  treasury  depart-
 ment,  entire  net  income  and  alternative  entire net income shall be
 determined by multiplying the taxable income reported  to  such  depart-
 ment, as adjusted pursuant to the provisions of this part, by the number
 of  calendar  months  or major parts thereof covered by the return under
 this part and dividing by the number of calendar months or  major  parts
 thereof  covered  by  the  return to such department. If it shall appear
 that such method of determining entire net income or alternative  entire
 net  income  does  not properly reflect the taxpayer's income during the
 period covered by the  return  under  this  part,  the  commissioner  of
 finance  shall  be authorized in his or her discretion to determine such
 entire net income or alternative entire net income solely on  the  basis
 of  the  taxpayer's income during the period covered by its return under
 this part.
   (m) The commissioner of finance, may, whenever necessary in  order  to
 properly  reflect  the  entire net income of any taxpayer, determine the
 year or period in which  any  item  of  income  or  deduction  shall  be
 included,  without  regard  to  the method of accounting employed by the
 taxpayer.
   (n) Notwithstanding any other provision of this subchapter, for  taxa-
 ble  years  beginning on or after August first, two thousand two, in the
 case of a taxpayer that is a partner in a partnership subject to the tax
 imposed by chapter eleven of this title as  a  utility,  as  defined  in
 subdivision  six  of  section 11-1101 of such chapter, entire net income
 shall not include the taxpayer's distributive  or  pro  rata  share  for
 federal  income  tax  purposes  of  any  item  of  income, gain, loss or
 deduction of such partnership, or any item  of  income,  gain,  loss  or
 deduction of such partnership that the taxpayer is required to take into
 account separately for federal income tax purposes.
   (n-1)  for  taxable  years  ending after September tenth, two thousand
 one, in the case of qualified property described  in  paragraph  two  of
 subsection  k of section one hundred sixty-eight of the internal revenue
 code, other than qualified resurgence zone property described in  subdi-
 vision  (p)  of  this section, and other than qualified New York Liberty
 Zone property described in paragraph two  of  subsection  b  of  section
 S. 8474                            558
 
 fourteen  hundred-L  of  the  internal  revenue  code, without regard to
 clause (i) of subparagraph (C) of such paragraph, a  taxpayer  shall  be
 allowed  with respect to such property the depreciation deduction allow-
 able  under  section  one hundred sixty-seven as such section would have
 applied to such property had it been acquired by the taxpayer on Septem-
 ber tenth, two thousand one, provided, however, that for  taxable  years
 beginning on or after January first, two thousand four, in the case of a
 passenger  motor  vehicle  or  a  sport  utility  vehicle subject to the
 provisions of subdivision (r) of  this  section,  the  limitation  under
 clause  (i)  of  subparagraph (A) of paragraph one of subdivision (a) of
 section two hundred eighty-F of the internal revenue code applicable  to
 the  amount  allowed as a deduction under this paragraph shall be deter-
 mined as of the date such vehicle was placed in service and  not  as  of
 September tenth, two thousand one.
   (o)  for taxable years ending after September tenth, two thousand one,
 upon the disposition of  property  to  which  subdivision  (n)  of  this
 section applies, the amount of any gain or loss includible in entire net
 income  shall  be adjusted to reflect the inclusions and exclusions from
 entire net income pursuant to paragraph thirteen of subdivision (b)  and
 subdivision (n) of this section attributable to such property.
   (p)  for  purposes of subdivisions (n) and (o) of this section, quali-
 fied resurgence zone property shall mean qualified property described in
 paragraph two of subsection k of section one hundred sixty-eight of  the
 internal  revenue  code  substantially all of the use of which is in the
 resurgence zone, as defined below, and is in the  active  conduct  of  a
 trade  or business by the taxpayer in such zone, and the original use of
 which in the resurgence zone commences with the taxpayer after September
 tenth, two thousand one. The resurgence zone shall mean the area of  New
 York county bounded on the south by a line running from the intersection
 of  the Hudson River with the Holland Tunnel, and running thence east to
 Canal Street, then running along the centerline of Canal Street  to  the
 intersection  of the Bowery and Canal Street, running thence in a south-
 easterly direction diagonally across  Manhattan  Bridge  Plaza,  to  the
 Manhattan  Bridge,  and  thence  along  the  centerline of the Manhattan
 Bridge to the point where the centerline of the Manhattan  Bridge  would
 intersect  with  the easterly bank of the East River, and bounded on the
 north by a line running from the intersection of the Hudson  River  with
 the  Holland  Tunnel  and  running thence north along West Avenue to the
 intersection of Clarkson Street then running east along  the  centerline
 of  Clarkson  Street  to  the  intersection  of  Washington Avenue, then
 running south along the centerline of Washington Avenue  to  the  inter-
 section  of  West Houston Street, then east along the centerline of West
 Houston Street, then at the intersection of the Avenue of  the  Americas
 continuing east along the centerline of East Houston Street to the east-
 erly bank of the East River.
   (q)  Related  members  expense  add back. (1) Definitions. (A) Related
 member.  "Related member" means a related person as defined in  subpara-
 graph  (c)  of paragraph three of subsection (b) of section four hundred
 sixty-five of the internal revenue code,  except  that  "fifty  percent"
 shall be substituted for "ten percent".
   (B)  Effective  rate  of tax. "Effective rate of tax" means, as to any
 city, the maximum statutory rate of tax imposed by the city on or  meas-
 ured  by  a  related member's net income multiplied by the apportionment
 percentage, if any, applicable to the related member under the  laws  of
 said  jurisdiction.  For purposes of this definition, the effective rate
 of tax as to any city is zero where the related member's net income  tax
 S. 8474                            559

 liability  in said city is reported on a combined or consolidated return
 including both the taxpayer and the related member  where  the  reported
 transactions  between the taxpayer and the related member are eliminated
 or  offset.  Also,  for  purposes of this definition, when computing the
 effective rate of tax for a city in which a related member's net  income
 is  eliminated  or  offset  by  a  credit  or similar adjustment that is
 dependent upon the related member either maintaining or managing  intan-
 gible  property  or collecting interest income in that city, the maximum
 statutory rate of tax imposed by said city shall be decreased to reflect
 the statutory rate of tax that applies to the related member  as  effec-
 tively reduced by such credit or similar adjustment.
   (C) Royalty payments. Royalty payments are payments directly connected
 to  the  acquisition,  use,  maintenance or management, ownership, sale,
 exchange, or any other disposition of licenses, trademarks,  copyrights,
 trade  names,  trade  dress,  service  marks, mask works, trade secrets,
 patents and any other similar types of intangible assets  as  determined
 by  the commissioner of finance, and include amounts allowable as inter-
 est deductions under section one hundred  sixty-three  of  the  internal
 revenue  code to the extent such amounts are directly or indirectly for,
 related to or in connection with the acquisition,  use,  maintenance  or
 management,  ownership, sale, exchange or disposition of such intangible
 assets.
   (D) Valid business purpose. A valid business purpose is  one  or  more
 business  purposes,  other  than the avoidance or reduction of taxation,
 which alone or in combination constitute the primary motivation for some
 business activity or transaction, which activity or transaction  changes
 in  a  meaningful  way, apart from tax effects, the economic position of
 the taxpayer. The economic position of the taxpayer includes an increase
 in the market share of the taxpayer, or the entry by the  taxpayer  into
 new business markets.
   (2) Royalty expense add backs. (A) For the purpose of computing entire
 net  income, a taxpayer must add back royalty payments directly or indi-
 rectly paid, accrued, or incurred in connection with one or more  direct
 or  indirect  transactions  with  one or more related members during the
 taxable year to the extent deductible  in  calculating  federal  taxable
 income.
   (B)  Exceptions. (i) The adjustment required in this subdivision shall
 not apply to the portion of the royalty payment that the taxpayer estab-
 lishes, by clear and convincing evidence of the type  and  in  the  form
 specified  by  the  commissioner  of finance, meets all of the following
 requirements: (I) the related member was subject to tax in this city  or
 another city within the United States or a foreign nation or some combi-
 nation  thereof  on  a  tax base that included the royalty payment paid,
 accrued or incurred by the taxpayer; (II) the related member during  the
 same  taxable year directly or indirectly paid, accrued or incurred such
 portion to a person that is not a related member; and (III)  the  trans-
 action  giving  rise to the royalty payment between the taxpayer and the
 related member was undertaken for a valid business purpose.
   (ii) The adjustment required in this subdivision shall  not  apply  if
 the  taxpayer  establishes, by clear and convincing evidence of the type
 and in the form specified by the commissioner of finance, that: (I)  the
 related  member  was  subject to tax on or measured by its net income in
 this city or another city within the United States, or some  combination
 thereof;  (II)  the  tax  base for such tax included the royalty payment
 paid, accrued or incurred by  the  taxpayer;  and  (III)  the  aggregate
 effective  rate  of tax applied to the related member in those jurisdic-
 S. 8474                            560
 
 tions is no less than eighty percent of the statutory rate of  tax  that
 applied  to  the  taxpayer  under  section 11-643.5 of this part for the
 taxable year.
   (iii)  The  adjustment required in this subdivision shall not apply if
 the taxpayer establishes, by clear and convincing evidence of  the  type
 and  in the form specified by the commissioner of finance, that: (I) the
 royalty payment was paid, accrued or incurred to a related member organ-
 ized under the laws of a country other than the United States; (II)  the
 related member's income from the transaction was subject to a comprehen-
 sive income tax treaty between such country and the United States; (III)
 the  related member was subject to tax in a foreign nation on a tax base
 that included the royalty payment  paid,  accrued  or  incurred  by  the
 taxpayer;  (IV)  the  related  member's  income from the transaction was
 taxed in such country at an effective rate of tax at least equal to that
 imposed by this city; and (V) the royalty payment was paid,  accrued  or
 incurred pursuant to a transaction that was undertaken for a valid busi-
 ness purpose and using terms that reflect an arm's length relationship.
   (iv)  The  adjustment  required in this subdivision shall not apply if
 the taxpayer and the commissioner of finance agree  in  writing  to  the
 application  or  use  of  alternative  adjustments  or computations. The
 commissioner of finance may, in his or  her  discretion,  agree  to  the
 application or use of alternative adjustments or computations when he or
 she  concludes  that  in the absence of such agreement the income of the
 taxpayer would not be properly reflected.
   (r) For taxable years beginning on or after January first,  two  thou-
 sand  four,  in the case of a taxpayer that is not an eligible farmer as
 defined in subsection (n) of section six hundred six of the tax  law,  a
 taxpayer  shall  be allowed with respect to a sport utility vehicle that
 is not a passenger automobile as defined in paragraph five of subsection
 (d) of section two hundred eighty-F of the internal  revenue  code,  the
 deductions  allowable  under  sections  one  hundred  seventy-nine,  one
 hundred sixty-seven and one hundred sixty-eight of the internal  revenue
 code, determined as if such sport utility vehicle were a passenger auto-
 mobile as defined in such paragraph five.
   (s)  Upon the disposition of property to which subdivision (r) of this
 section applies, the amount of any gain or loss includible in entire net
 income shall be adjusted to reflect the modification  provided  in  such
 subdivision attributable to such property.
   (t)  Entire  net  income  shall  not  include  the amount of any grant
 received through either the COVID-19 pandemic  small  business  recovery
 grant  program,  pursuant  to  section  sixteen-ff of the New York state
 urban development corporation act,  or  the  small  business  resilience
 grant program administered by the department of small business services,
 to  the  extent  the  amount of either such grant is included in federal
 taxable income.
   § 11-641.1 Computation of alternative entire net income. (a)  Alterna-
 tive entire net income means entire net income as determined pursuant to
 section  11-641  of  this  part, except that the deductions described in
 paragraphs eleven and twelve of subdivision (e)  of  section  11-641  of
 this part shall not be allowed.
   (b)  Any election made pursuant to paragraph two of subdivision (b) of
 section 11-642 of this part with respect to  the  modification  provided
 for in subdivision (f) of section 11-641 of this part shall be deemed to
 have been made for purposes of computing alternative entire net income.
   §  11-642  Allocation.  (a)  In  general.  If  a taxpayer's entire net
 income, alternative entire net income, or  taxable  assets  are  derived
 S. 8474                            561
 
 from business carried on within and without the city, the taxpayer shall
 for  purposes  of  computing  allocation  percentages  compute  payroll,
 receipts, and deposits percentages  in  accordance  with  the  following
 rules:
   (1)  The  taxpayer shall ascertain the percentage which eighty percent
 of the total wages, salaries and  other  personal  service  compensation
 during  the  taxable  year  of  employees within the city, except wages,
 salaries and other personal service compensation  of  general  executive
 officers,  bears to the total wages, salaries and other personal service
 compensation during the taxable year of  all  the  taxpayer's  employees
 within  and  without the city, except wages, salaries and other personal
 service compensation of general executive officers.
   (2) (A) The taxpayer shall ascertain the percentage which the receipts
 of the taxpayer arising during the taxable year from:
   (i) loans, including a taxpayer's portion  of  a  participation  in  a
 loan,  and  financing  leases  within  the  city, and all other business
 receipts earned within the city, bear to
   (ii) the total amount of the taxpayer's receipts from loans, including
 a taxpayer's portion of a participation in a loan, and financing  leases
 and all other business receipts within and without the city.
   (B)  All interest from loans and financing leases is located where the
 greater portion of income producing activity  related  to  the  loan  or
 financing lease occurred; provided, however:
   (i)  In the case of a taxpayer described in paragraph one, two, three,
 four, five or seven of subdivision (a) of section 11-640 of this part, a
 loan or financing lease attributed by such taxpayer to a branch  without
 the  city  shall  be presumed to be properly so attributed provided that
 such presumption may be rebutted if the commissioner of  finance  demon-
 strates that the greater portion of income producing activity related to
 the  loan  or  financing lease did not occur at such branch.  Where such
 presumption has been rebutted, the loan  or  financing  lease  shall  be
 presumed  to  be within the city if the taxpayer had a branch within the
 city at the time the loan or financing lease was made. The taxpayer  may
 rebut  such  presumption  by  demonstrating  that the greater portion of
 income producing activity related to the loan or financing lease did not
 occur within the city. In the case of a loan or financing lease which is
 recorded on the books of a place without the city which is not a branch,
 it shall be presumed that the greater portion of income producing activ-
 ity related to such loan or financing lease occurred within the city  if
 the  taxpayer  had  a  branch  within  the  city at the time the loan or
 financing lease was made. The taxpayer may  rebut  such  presumption  by
 demonstrating  that  the  greater  portion  of income producing activity
 related to the loan or financing lease did not occur within the city.
   (ii) In the case of a taxpayer described in paragraph six or  nine  of
 subdivision  (a)  of  section  11-640  of this part, a loan or financing
 lease attributed by such taxpayer to a bona fide office without the city
 shall be presumed to  be  properly  so  attributed  provided  that  such
 presumption  may be rebutted if the commissioner of finance demonstrates
 that the greater portion of income producing  activity  related  to  the
 loan or financing lease did not occur without the city.
   (C)  Receipts  from  lease  transactions  other  than financing leases
 referred to in subparagraph (B) are located where the  property  subject
 to the lease is located.
   (D)  (i)  Interest,  and fees and penalties in the nature of interest,
 from bank, credit, travel and entertainment card receivables are  earned
 S. 8474                            562
 
 within the city if the mailing address of the card holder in the records
 of the taxpayer is in the city; and
   (ii)  Service  charges  and fees from such cards are earned within the
 city if the card is serviced in the city; and
   (iii) Receipts from merchant discounts are earned within the  city  if
 the merchant is located within the city.
   (E)  The  portion  of  total  net  gains and other income from trading
 activities, including but not limited to foreign exchange,  options  and
 financial  futures,  and  from investment activities which is attributed
 within the city shall be ascertained by multiplying such total net gains
 and other income by a fraction the numerator of  which  is  the  average
 value  of  the  trading assets and investment assets attributable to the
 city and the denominator of which is the average value  of  all  trading
 and  investment assets. A trading asset or investment asset is attribut-
 able to the city if the greater portion  of  income  producing  activity
 related  to  the  trading  asset or investment asset occurred within the
 city.
   (F) Fees or charges from the issuance of letters of credit,  travelers
 checks  and  money  orders are earned within the city if such letters of
 credit, travelers checks or money orders are issued within the city.
   (G) Rules for receipts from certain services to investment  companies.
 (1)  For taxable years beginning on or after January first, two thousand
 one, the portion of receipts received from an investment company arising
 from the sale of management, administration or distribution services  to
 such investment company determined in accordance with clause two of this
 subparagraph shall be deemed to arise from services performed within the
 city, such portion referred to herein as the Staten Island city portion.
   (2)  The  Staten  Island  city portion shall be the product of (i) the
 total of such receipts from the sale of such services and (ii)  a  frac-
 tion.  The numerator of that fraction is the sum of the monthly percent-
 ages, as defined hereinafter, determined for each month of  the  invest-
 ment  company's  taxable  year  for  federal  income  tax purposes which
 taxable year ends within the taxable year of the taxpayer, but excluding
 any month during which the investment company had no outstanding shares.
 The monthly percentage for each such month is determined by dividing (i)
 the number of shares in the investment company which are  owned  on  the
 last  day of the month by shareholders that are domiciled in the city by
 (ii) the total number of shares in the investment company outstanding on
 that date. The denominator of the fraction is the number of such monthly
 percentages.
   (3)(i) For purposes of this subparagraph, the term "domicile", in  the
 case of an individual, shall have the meaning as in chapter seventeen of
 this  title; an estate or trust is domiciled in the city if it is a city
 resident estate or trust as defined in paragraph  three  of  subdivision
 (b)  of  section 11-1705 of this code; a business entity is domiciled in
 the city if the location of the actual seat of management or control  is
 in  the  city.  It shall be presumed that the domicile of a shareholder,
 with respect to any month, is his, her or its  mailing  address  on  the
 records of the investment company as of the last day of such month.
   (ii)  For purposes of this subparagraph, the term "investment company"
 means a regulated  investment  company,  as  defined  in  section  eight
 hundred  fifty-one  of  the  internal revenue code, and a partnership to
 which subdivision (a) of section seven thousand seven  hundred  four  of
 the  internal  revenue  code  applies,  by  virtue of paragraph three of
 subdivision (c) of section seven thousand seven  hundred  four  of  such
 code,  and  that  meets  the  requirements of subdivision (b) of section
 S. 8474                            563

 eight hundred fifty-one of such code.   This shall  be  applied  to  the
 taxable year for federal income tax purposes of the business entity that
 is  asserted  to  constitute  an investment company that ends within the
 taxable year of the taxpayer.
   (iii)  For  purposes  of this subparagraph, the term "receipts from an
 investment company" includes amounts received directly from  an  invest-
 ment  company  as well as amounts received from the shareholders in such
 investment company in their capacity as such.
   (iv) For purposes of this subparagraph, the term "management services"
 means the rendering of  investment  advice  to  an  investment  company,
 making  determinations  as to when sales and purchases of securities are
 to be made on behalf  of  an  investment  company,  or  the  selling  or
 purchasing  of  securities constituting assets of an investment company,
 and related activities, but only where such activity or  activities  are
 performed  pursuant  to  a  contract with the investment company entered
 into pursuant to subdivision (a)  of  section  fifteen  of  the  federal
 investment company act of nineteen hundred forty, as amended.
   (v)   For  purposes  of  this  subparagraph,  the  term  "distribution
 services"  means  the  services  of  advertising,   servicing   investor
 accounts,  including  redemptions, marketing shares or selling shares of
 an investment company, but, in the case of advertising, servicing inves-
 tor accounts, including redemptions, or  marketing  shares,  only  where
 such  service  is performed by a person who is, or was, in the case of a
 closed end company, also engaged in the service of selling such  shares.
 In  the case of an open end company, such service of selling shares must
 be performed pursuant to a contract entered into pursuant to subdivision
 (b) of section fifteen of the federal investment company act of nineteen
 hundred forty, as amended.
   (vi) For purposes  of  this  subparagraph,  the  term  "administration
 services"  includes  clerical, accounting, bookkeeping, data processing,
 internal auditing, legal and tax services performed  for  an  investment
 company  but only if the provider of such service or services during the
 taxable year in which such service  or  services  are  sold  also  sells
 management  or  distribution  services, as defined in clause (v) of this
 subparagraph, to such investment company.
   (H) All receipts from the performance of  services  not  described  in
 this  paragraph are earned within the city if the services are performed
 in the city.  When a service is performed both within  and  without  the
 city,  the  receipts  shall  be allocated within and without the city in
 accordance with rules and regulations of the commissioner of finance.
   (I) All other receipts not described in subparagraphs (B) through  (H)
 of  this  paragraph shall be attributable within and without the city in
 accordance with rules and regulations  issued  by  the  commissioner  of
 finance.
   (3)  The  taxpayer  shall  ascertain  the percentage which the average
 value of deposits maintained at branches  within  the  city  during  the
 taxable  year, bears to the average value of all the taxpayer's deposits
 maintained at branches within and without the city  during  the  taxable
 year.
   (4)  Each  percentage  computed  pursuant  to this subsection shall be
 computed on a cash or accrual basis according to the method of  account-
 ing  used  for  the  taxable year. The receipts percentage shall include
 only receipts which are included in alternative entire  net  income  for
 the  taxable  year.  The  deposits and payroll percentages shall include
 only deposits and payroll the expenses of  which  are  included  in  the
 computation of alternative entire net income for the taxable year.
 S. 8474                            564
 
   (5) For purposes of this section:
   (A)  The term "bona fide office" means an office at which the taxpayer
 carries on its business in a regular and systematic manner and which  is
 continuously maintained, occupied and used by employees of the taxpayer.
   (B)  The  term  "branch" means a bona fide office which is used by the
 taxpayer on a regular and systematic basis to (i) approve loans, regard-
 less of whether the approval of certain classes of loans requires review
 or final approval by another office of the taxpayer,  (ii)  accept  loan
 repayments,  (iii)  disburse  funds,  and (iv) conduct one or more other
 functions of a banking business.
   (6) If it shall appear to the commissioner of finance that  the  allo-
 cation  percentage  determined  in  subdivision (b), (c), or (d) of this
 section does not properly reflect  the  activity,  business,  income  or
 assets  of a taxpayer within the city, the commissioner of finance shall
 be authorized in his discretion to adjust it by  (1)  excluding  one  or
 more of the factors therein, (2) including one or more other factors, or
 (3)  any  other  similar or different method calculated to effect a fair
 and proper allocation of the income or assets reasonably attributable to
 the city.
   (7) The commissioner of finance from time to time  shall  publish  all
 rulings  of  general  public interest with respect to any application of
 the provisions of paragraph six of this subdivision.
   (b) Allocation of entire net income.
   (1) If a taxpayer's entire net income is derived from business carried
 on both within and without  the  city,  the  portion  thereof  which  is
 derived  from business carried on within the city shall be determined by
 multiplying its entire net income by the  income  allocation  percentage
 determined  as follows: add the percentages ascertained under paragraphs
 one, two and three of subdivision (a) of this  section,  plus  an  addi-
 tional  percentage  equal  to  the receipts percentage ascertained under
 paragraph two of such subdivision and an additional percentage equal  to
 the deposits percentage ascertained under paragraph three of such subdi-
 vision,  and  divide  the  result  by the number of percentages so added
 together.
   (1-a) Notwithstanding the provisions of paragraph one of this subdivi-
 sion, each banking corporation described in paragraph nine  of  subdivi-
 sion  (a)  of  section 11-640 of this part subject to the tax imposed by
 this part that  substantially  provides  management,  administrative  or
 distribution  services  to  an  investment  company,  as  such terms are
 defined in subparagraph (G) of paragraph two of subdivision (a) of  this
 section,  shall  determine  the portion of its entire net income derived
 from business carried on within the city by multiplying such  income  by
 an income allocation percentage obtained as follows:
   (A) For taxable years beginning in two thousand nine, the income allo-
 cation  percentage  shall be determined by adding together the following
 percentages:
   (i) the product of eighteen  percent  and  the  percentage  determined
 under paragraph one of subdivision (a) of this section,
   (ii)  the  product  of forty-six percent and the percentage determined
 under paragraph two of subdivision (a) of this section, and
   (iii) the product of thirty-six percent and the percentage  determined
 under paragraph three of subdivision (a) of this section.
   (B)  For taxable years beginning in two thousand ten, the income allo-
 cation percentage shall be determined by adding together  the  following
 percentages:
 S. 8474                            565
 
   (i) the product of sixteen percent and the percentage determined under
 paragraph one of subdivision (a) of this section,
   (ii)  the  product  of fifty-two percent and the percentage determined
 under paragraph two of subdivision (a) of this section, and
   (iii) the product of thirty-two percent and the percentage  determined
 under paragraph three of subdivision (a) of this section.
   (C)  For  taxable  years  beginning in two thousand eleven, the income
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i) the product of fourteen  percent  and  the  percentage  determined
 under paragraph one of subdivision (a) of this section,
   (ii)  the product of fifty-eight percent and the percentage determined
 under paragraph two of subdivision (a) of this section, and
   (iii) the product of twenty-eight percent and  the  percentage  deter-
 mined under paragraph three of subdivision (a) of this section.
   (D)  For  taxable  years  beginning in two thousand twelve, the income
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i) the product of twelve percent and the percentage determined  under
 paragraph one of subdivision (a) of this section,
   (ii)  the  product of sixty-four percent and the percentage determined
 under paragraph two of subdivision (a) of this section, and
   (iii) the product of twenty-four percent and the percentage determined
 under paragraph three of subdivision (a) of this section.
   (E) For taxable years beginning in two thousand thirteen,  the  income
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i)  the  product  of  ten percent and the percentage determined under
 paragraph one of subdivision (a) of this section,
   (ii) the product of seventy  percent  and  the  percentage  determined
 under paragraph two of subdivision (a) of this section, and
   (iii)  the  product  of  twenty  percent and the percentage determined
 under paragraph three of subdivision (a) of this section.
   (F) For taxable years beginning in two thousand fourteen,  the  income
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i)  the  product of eight percent and the percentage determined under
 paragraph one of subdivision (a) of this section,
   (ii) the product of seventy-six percent and the percentage  determined
 under paragraph two of subdivision (a) of this section, and
   (iii)  the  product  of  sixteen percent and the percentage determined
 under paragraph three of subdivision (a) of this section.
   (G) For taxable years beginning in two thousand  fifteen,  the  income
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i)  the  product  of  six percent and the percentage determined under
 paragraph one of subdivision (a) of this section,
   (ii) the product of eighty-two percent and the  percentage  determined
 under paragraph two of subdivision (a) of this section, and
   (iii)  the  product  of  twelve  percent and the percentage determined
 under paragraph three of subdivision (a) of this section.
   (H) For taxable years beginning in two thousand  sixteen,  the  income
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i)  the  product  of four percent and the percentage determined under
 paragraph one of subdivision (a) of this section,
 S. 8474                            566
 
   (ii) the product of eighty-eight percent and the percentage determined
 under paragraph two of subdivision (a) of this section, and
   (iii) the product of eight percent and the percentage determined under
 paragraph three of subdivision (a) of this section.
   (I)  For taxable years beginning in two thousand seventeen, the income
 allocation percentage shall be determined by adding together the follow-
 ing percentages:
   (i) the product of two percent and  the  percentage  determined  under
 paragraph one of subdivision (a) of this section,
   (ii)  the product of ninety-four percent and the percentage determined
 under paragraph two of subdivision (a) of this section, and
   (iii) the product of four percent and the percentage determined  under
 paragraph three of subdivision (a) of this section.
   (J)  For  taxable  years  beginning  after two thousand seventeen, the
 income allocation percentage shall be the  percentage  determined  under
 paragraph two of subdivision (a) of this section.
   (K) The commissioner shall promulgate rules necessary to implement the
 provisions  of  this paragraph under such circumstances where any of the
 percentages to be determined under paragraph one, two or three of subdi-
 vision (a) of this section cannot be determined because the taxpayer has
 no compensation, receipts or deposits within or without the city.
   (2) (A) In lieu of the modification provided for in subdivision (f) of
 section 11-641 of this part, relating to a modification for the adjusted
 eligible net income of an international  banking  facility,  a  taxpayer
 may,  in  the manner prescribed by the commissioner of finance, elect to
 modify on an annual basis its income allocation percentage in the manner
 described in clauses (i), (ii) and (iii) of this paragraph below:
   (i) wages, salaries and other personal service  compensation  properly
 attributable  to  the production of eligible gross income of the taxpay-
 er's international banking facility shall not be included in the  compu-
 tation  of  wages,  salaries  and other personal service compensation of
 employees within the city,
   (ii) receipts properly attributable  to  the  production  of  eligible
 gross  income of the taxpayer's international banking facility shall not
 be included in the computation of receipts within the city, and
   (iii) deposits from foreign persons which are properly attributable to
 the production of eligible gross income of the taxpayer's  international
 banking  facility  shall  not be included in the computation of deposits
 maintained at branches within the city.
   (B) For purposes of this paragraph, the term "eligible  gross  income"
 refers  to  such term as set out in subdivision (f) of section 11-641 of
 this part except that the term "foreign person" as defined in  paragraph
 eight  of such subdivision (f) shall not include a foreign branch of the
 taxpayer and in no  event  shall  transactions  between  the  taxpayer's
 international banking facility and its foreign branches be considered.
   (c)  Allocation  of  alternative  entire  net  income. If a taxpayer's
 alternative entire net income is derived from business carried  on  both
 within  and  without the city, the portion thereof which is derived from
 business carried on within the city shall be determined  by  multiplying
 its  alternative  entire net income by the alternative entire net income
 allocation percentage determined as follows:
   (1) Recompute the payroll percentage under paragraph one  of  subdivi-
 sion  (a)  of  this  section  without giving consideration to the phrase
 "eighty percent of," add to the  resulting  percentage  the  percentages
 ascertained  under  paragraphs  two  and  three of such subdivision, and
 divide the result by the  number of percentages so added together.
 S. 8474                            567
 
   (2) When an election has been made pursuant to paragraph two of subdi-
 vision (b) of this section, relating to  international  banking  facili-
 ties,  the taxpayer shall make the modifications described in such para-
 graph for purposes of  its  alternative  entire  net  income  allocation
 percentage.
   (d) Allocation of taxable assets. If the taxpayer's taxable assets are
 derived  from  business carried on both within and without the city, the
 portion thereof which is derived from business  carried  on  within  the
 city  shall  be determined by multiplying its taxable assets by an asset
 allocation percentage determined in the same manner as the income  allo-
 cation  percentage  under  subdivision (b) of this section is determined
 when the election provided for in paragraph two of such subdivision  has
 been  made, except that the modifications described in clauses (i), (ii)
 and (iii) of subparagraph (A) of such paragraph shall not be made.
   § 11-643   Computation of tax for taxable years ending  on  or  before
 December  thirty-first,  nineteen  hundred  seventy-three.   For taxable
 years ending on or before December thirty-first, nineteen hundred seven-
 ty-three, the tax imposed by section 11-639 of this part  shall  be  the
 greater of the following computations:
   (a)  Basic  tax.    Five and sixty-three one-hundredths percent of the
 taxpayer's entire net income, or the portion thereof allocated  to  this
 city, for the taxable year or part thereof.
   (b) Alternative minimum tax.  If the tax under subdivision (a) of this
 section  is less than any of the following amounts, the tax shall be the
 largest of the following amounts:
   (1) Except for a savings bank and savings and  loan  association,  one
 and  one-quarter  mills  upon each dollar of such part of the taxpayer's
 issued capital stock on the last day of the taxable year,  at  its  face
 value,  but  if  such  taxpayer  has stock without par value, such stock
 shall be taken at its actual or market value, and  not  less  than  five
 dollars  per share, as may be determined by the commissioner of finance,
 as the gross income of such taxpayer derived from  business  carried  on
 within  the  city,  during  such taxable year, bears to its gross income
 derived from all business, both within and without the city during  said
 year;  except  that  if  the  period covered by the return is other than
 twelve months, the tax shall be prorated on the basis of the  number  of
 months or major portions thereof included in the return. For purposes of
 this  paragraph,  the term "gross income" shall have the same meaning as
 it has in the laws of the  United  States  relating  to  federal  income
 taxes.
   (2)  For  a  savings  bank  and  savings and loan association, one and
 forty-three one-hundredths percent of the interest or dividends credited
 by it to depositors or shareholders during the  taxable  year,  provided
 that,  in determining such amount, each interest or dividend credit to a
 depositor or shareholder shall be deemed to be the interest or  dividend
 actually  credited  or  the  interest  or dividend which would have been
 credited if it had been computed and credited at the rate of  three  and
 one-half percent per annum, whichever is less.
   (3) Twelve and one-half dollars.
   §  11-643.1 Computation of tax for taxable years beginning on or after
 January first, nineteen hundred seventy-four and  ending  on  or  before
 December thirty-first, nineteen hundred seventy-four.  For taxable years
 beginning  on  or after January first, nineteen hundred seventy-four and
 ending on or before December  thirty-first,  nineteen  hundred  seventy-
 four, the tax imposed by section 11-639 of this part shall be the great-
 er of the following computations:
 S. 8474                            568
 
   (a)  Basic  tax.    Six  and  seven  hundred fifty-six one-thousandths
 percent of the taxpayer's entire net  income,  or  the  portion  thereof
 allocated to this city, for the taxable year, or part thereof.
   (b)    Alternative  minimum tax.   If the tax under subdivision (a) of
 this section is less than any of the following amounts, the tax shall be
 the largest of the following amounts:
   (1) Except for a savings bank and savings and  loan  association,  one
 and  one-half  mills  upon  each  dollar  of such part of the taxpayer's
 issued capital stock on the last day of the taxable year,  at  its  face
 value,  but  if  such  taxpayer  has stock without par value, such stock
 shall be taken at its actual or market value, and  not  less  than  five
 dollars  per share, as may be determined by the commissioner of finance,
 as the gross income of such taxpayer derived from  business  carried  on
 within  the  city,  during  such  taxable year bears to its gross income
 derived from all business, both within and without the city during  said
 year;  except  that  if  the  period covered by the return is other than
 twelve months, the tax shall be prorated on the basis of the  number  of
 months  or  major portions thereof included in the return.  For purposes
 of this paragraph, the term "gross income" shall have the  same  meaning
 as  it  has  in the laws of the United States relating to federal income
 taxes.
   (2) For a savings bank and savings and loan association, one and seven
 hundred sixteen one-thousandths percent of  the  interest  or  dividends
 credited  by  it  to depositors or shareholders during the taxable year,
 provided that, in determining such amount,  each  interest  or  dividend
 credit  to a depositor or shareholder shall be deemed to be the interest
 or dividend actually credited or the interest or  dividend  which  would
 have  been  credited if it had been computed and credited at the rate of
 three and one-half percent per annum, whichever is less.
   (3) Fifteen dollars.
   § 11-643.2  Computation of tax for taxable years beginning in nineteen
 hundred seventy-three and ending in nineteen hundred seventy-four.   For
 each taxable year beginning in nineteen hundred seventy-three and ending
 in nineteen hundred seventy-four, two tentative taxes shall be computed,
 the  first  as  provided in section 11-643 and the second as provided in
 section 11-643.1 of this part, and the tax for each such year  shall  be
 the  sum  of  that  proportion of each tentative tax which the number of
 days in nineteen hundred seventy-three and the number of days  in  nine-
 teen  hundred  seventy-four, respectively, which fall within the taxable
 year, bears to the number of days in the entire taxable year.
   § 11-643.3  Computation of tax for taxable years beginning on or after
 January first, nineteen hundred seventy-five and before  January  first,
 nineteen  hundred  eighty-five.  For taxable years beginning on or after
 January first, nineteen hundred seventy-five and before  January  first,
 nineteen  hundred eighty-five, the tax imposed by section 11-639 of this
 part shall be the greater of the following computations:
   (a) Basic tax. (1) Except for a savings  bank  and  savings  and  loan
 association,  thirteen  and  eight  hundred twenty-three one-thousandths
 percent of the taxpayer's entire net  income,  or  the  portion  thereof
 allocated to this city, for the taxable year, or part thereof.
   (2)    For a savings bank and savings and loan association, twelve and
 one hundred thirty-four thousandths percent of the taxpayer's entire net
 income, or the portion thereof allocated to this city, for  the  taxable
 year, or part thereof.
 S. 8474                            569
 
   (b)    Alternative  minimum tax.   If the tax under subdivision (a) of
 this section is less than any of the following amounts, the tax shall be
 the largest of the following amounts:
   (1)    Except for a savings bank and savings and loan association, two
 and six-tenths mills upon each dollar of such  part  of  the  taxpayer's
 issued  capital  stock  on the last day of the taxable year, at its face
 value, but if such taxpayer has stock  without  par  value,  such  stock
 shall  be  taken  at  its actual or market value, and not less than five
 dollars per share, as may be determined by the commissioner of  finance,
 as  the  gross  income of such taxpayer derived from business carried on
 within the city during such taxable  year  bears  to  its  gross  income
 derived  from all business, both within and without the city during said
 year; except that if the period covered by  the  return  is  other  than
 twelve  months,  the tax shall be prorated on the basis of the number of
 months or major portions thereof included in the return.   For  purposes
 of  this  paragraph, the term "gross income" shall have the same meaning
 as it has in the laws of the United States relating  to  federal  income
 taxes.
   (2)  Except  as otherwise provided in paragraph three of this subdivi-
 sion, for a savings bank and savings and loan association, two and  five
 hundred  seventy-four  one-thousandths  percent of the interest or divi-
 dends credited by it to depositors or shareholders  during  any  taxable
 year,  provided that, in determining such amount, each interest or divi-
 dend credit to a depositor or shareholder shall  be  deemed  to  be  the
 interest or dividend actually credited or the interest or dividend which
 would  have  been  credited  if it had been computed and credited at the
 rate of three and one-half percent per annum, whichever is less.
   (3) (i) For a savings bank and savings and loan association,  for  any
 quarterly  accounting  period  in which such savings bank or savings and
 loan association credits or pays dividends to its depositors  or  share-
 holders  on  or after the first day of October, nineteen hundred eighty-
 one but before the first day of July, nineteen hundred  eighty-six,  and
 after  such  credit  or  payment  the  net worth of such savings bank or
 savings and loan association is less than five percent of the amount due
 depositors, one and eight hundred twenty-four one-thousandths percent of
 the interest or dividends credited by it to a depositor  or  shareholder
 during  such  accounting  period,  provided  that,  in  determining such
 amount, each interest or dividend credit to depositors  or  shareholders
 shall  be deemed to be the interest or dividend actually credited or the
 interest or dividend which would have  been  credited  if  it  had  been
 computed  and  credited  at  the  rate of three and one-half percent per
 annum, whichever is less. In determining the lesser  of  the  amount  of
 interest or dividends actually credited to depositors or shareholders or
 the  amount  of  interest or dividends which would have been credited if
 such interest or dividends had been computed and credited at the rate of
 three and one-half percent per annum,  the  provisions  of  subparagraph
 (ii) of this paragraph shall not be considered.
   (ii)  For purposes of the computation provided for in subparagraph (i)
 of this paragraph, except where the tax computed under subparagraph  (i)
 of  this  paragraph  is  computed  as  if the interest or dividends were
 computed and credited at the rate of  three  and  one-half  percent  per
 annum,  that  portion  of the interest or dividends credited on or after
 the first day of October, nineteen hundred  eighty-one  but  before  the
 first day of July, nineteen hundred eighty-six by:
   (A) a savings bank to a depositor or shareholder which is attributable
 to an increase or a deemed increase in the gross earnings, surplus fund,
 S. 8474                            570
 
 or  net  worth  of the savings bank, which increase became available for
 interest or dividends upon the prior written approval of the superinten-
 dent of banks pursuant to the provisions of subdivision four of  section
 two hundred forty-four of the banking law; or
   (B) a savings and loan association to a depositor or shareholder which
 is  attributable  to  an  increase or a deemed increase in gross income,
 undivided profits, surplus account or net worth of the savings and  loan
 association,  which  increase became available for interest or dividends
 upon the prior written approval of the superintendent of banks  pursuant
 to  the  provisions  of subdivision two of section three hundred eighty-
 seven of the banking law; or
   (C) a federal savings bank or a federal savings and  loan  association
 to  a  depositor  or shareholder, which would have required and received
 prior written approval of the superintendent  of  banks  in  respect  to
 increases  in  gross  income, gross earnings, undivided profits, surplus
 funds, surplus accounts or net worth available for dividends pursuant to
 the provisions of subdivision four of section two hundred forty-four  of
 the banking law and subdivision two of section three hundred eighty-sev-
 en of the banking law, respectively, were the provisions of sections two
 hundred  forty-four  and  three  hundred eighty-seven of the banking law
 applicable to federal savings banks and federal savings and loan associ-
 ations shall not be considered to have been credited  to  depositors  or
 shareholders.  Where  the  tax  computed  under subparagraph (i) of this
 paragraph is computed as if the interest or dividends were computed  and
 credited at the rate of three and one-half percent per annum, the amount
 of  interest  or  dividends  which  shall not be considered to have been
 credited to depositors or shareholders is an amount which bears the same
 ratio to the interest or dividends which would have been credited at the
 rate of three and one-half percent per  annum  as  the  amount  of  that
 portion  of  the  interest or dividends paid or credited on or after the
 first day of October, nineteen hundred eighty-one but before  the  first
 day  of  July,  nineteen hundred eighty-six, which is attributable to an
 increase or deemed increase in gross income, gross  earnings,  undivided
 profits, surplus funds, surplus account or net worth available for divi-
 dends  pursuant  to  the  provisions  of subdivision four of section two
 hundred forty-four of the banking law  or  subdivision  two  of  section
 three  hundred  eighty-seven  of the banking law, bears to the amount of
 interest or dividends actually credited.  For purposes of  this  clause,
 the  determination  of whether a federal savings bank or federal savings
 and loan association would have  required  and  received  prior  written
 approval of the superintendent of banks shall be made by the superinten-
 dent  of  banks,  upon  application and upon such forms as he or she may
 require, by applying the provision of subdivision four  of  section  two
 hundred forty-four of the banking law, as if such provisions were appli-
 cable  to  federal  savings  banks, and subdivision two of section three
 hundred eighty-seven of the banking law,  as  if  such  provisions  were
 applicable to federal savings and loan associations, and the superinten-
 dent  of banks may require and examine such information as he or she may
 deem necessary to make such determinations.
   (4) (i) Except for a savings bank and savings  and  loan  association,
 twenty-five dollars.
   (ii)  For  a  savings  bank  and  savings and loan association, twenty
 dollars.
   § 11-643.4  Computation of tax for taxable years beginning in nineteen
 hundred seventy-four and ending in nineteen  hundred  seventy-five.  For
 each  taxable year beginning in nineteen hundred seventy-four and ending
 S. 8474                            571
 
 in nineteen hundred seventy-five, two tentative taxes shall be computed,
 the first as provided in section 11-643.1 and the second as provided  in
 section  11-643.3  of this part, and the tax for each such year shall be
 the  sum  of  that  proportion of each tentative tax which the number of
 days in nineteen hundred seventy-four and the number of days in nineteen
 hundred seventy-five, respectively, which fall within the taxable  year,
 bears to the number of days in the entire taxable year.
   §  11-643.5 Computation of tax for taxable years beginning on or after
 January first, nineteen hundred eighty-five. For taxable years beginning
 on or after January first, nineteen hundred eighty-five, the tax imposed
 by section 11-639 of this part shall be the  greater  of  the  following
 computations:
   (a)  Basic  tax.  Nine percent of the taxpayer's entire net income, or
 the portion thereof allocated to the city, for the taxable year or  part
 thereof.
   (b)  Alternative minimum tax. If the tax under subdivision (a) of this
 section is less than any of the following amounts, the tax shall be  the
 larger of the following amounts:
   (1)  For taxable years beginning before two thousand eleven, except in
 the case of a corporation organized under the laws of  a  country  other
 than  the United States, one-tenth of a mill upon each dollar of taxable
 assets, or the portion thereof allocated to the city. For taxable  years
 beginning  after  two  thousand  ten,  except  in the case of a taxpayer
 described in clause (i), (ii), or (iii) of this subparagraph,  one-tenth
 of  a  mill  upon  each dollar of taxable assets, or the portion thereof
 allocated to the city.
   (i) In the case of a taxpayer whose net worth ratio is less than  five
 percent but greater than or equal to four percent and whose total assets
 are  comprised of thirty-three percent or more of mortgages, one-twenty-
 fifth of a mill upon each dollar of taxable assets, or the portion ther-
 eof allocated to the city.
   (ii) In the case of a taxpayer whose net worth ratio is less than four
 percent and whose total assets are comprised of thirty-three percent  or
 more  of  mortgages,  one-fiftieth of a mill upon each dollar of taxable
 assets, or the portion thereof allocated to the city.
   (iii) A taxpayer, whether or not a qualified institution as defined in
 subparagraph (B) of paragraph five of subsection  (f)  of  section  four
 hundred  six  of  the  federal  national  housing act, as amended, or as
 defined in paragraph two of subsection (i) of section  thirteen  of  the
 federal  deposit  insurance act, as amended, shall not be subject to the
 provisions of this paragraph for that portion of  the  taxable  year  in
 which  it  had  outstanding  net worth certificates issued in accordance
 with paragraph five of subsection (f) of section four hundred six of the
 federal national housing act, as amended, or issued in  accordance  with
 subsection (i) of section thirteen of the federal deposit insurance act,
 as amended.
   (iv)  For  the  purposes  of  this part: (A) the term "taxable assets"
 shall mean the average value of total assets reduced by  any  amount  of
 money  or  other  property  received  from  or  attributable  to amounts
 received from the federal  deposit  insurance  corporation  pursuant  to
 subsection (c) of section thirteen of the federal deposit insurance act,
 as amended, or the federal savings and loan insurance corporation pursu-
 ant  to  paragraph  one, two, three or four of subsection (f) of section
 four hundred six of the federal national housing act, as amended.  Total
 assets  are those assets which are properly reflected on a balance sheet
 the income or expenses of which are properly reflected,  or  would  have
 S. 8474                            572
 
 been properly reflected if not fully depreciated or expensed or depreci-
 ated  or expensed to a nominal amount, in the computation of alternative
 entire net income for the taxable year or  in  the  computation  of  the
 eligible net income of the taxpayer's international banking facility for
 the taxable year.
   (B)  The term "net worth ratio" shall mean the percentage of net worth
 to assets on the last day of the taxable  year.  The  term  "net  worth"
 means  the  sum  of  preferred  stock,  common  stock,  surplus, capital
 reserves, undivided profits, mutual capital  certificates,  reserve  for
 contingencies,  reserve  for loan losses and reserve for security losses
 minus assets classified loss. The term "assets" means the sum  of  mort-
 gage  loans, nonmortgage loans, repossessed assets, real estate held for
 development or investment or resale, cash, deposits, investment  securi-
 ties, fixed assets and other assets, such as financial futures, goodwill
 and  other  intangible assets, minus assets classified loss. In no event
 shall assets be reduced by reserves for losses.
   (C) The term "mortgages" shall mean loans  secured  by  real  property
 within  or without the state, participations in and securities collater-
 alized by pools of residential mortgages, whether or not issued or guar-
 anteed by a United States government agency, and loans secured by  stock
 in  a  cooperative  housing  corporation. The percentage of total assets
 comprised of mortgages shall be an amount equal  to  the  ratio  of  the
 average  of  the four quarterly balances of such mortgages ending within
 the taxable year, to the average of the four quarterly balances  of  all
 assets  ending within the taxable year. Such quarterly balances shall be
 computed in the same manner as the  report  of  condition  required  for
 federal deposit insurance corporation or federal savings and loan insur-
 ance  corporation  purposes, whether or not such report is required. For
 taxable periods of less than one year, the taxpayer shall  compute  such
 ratio  using  the  number  of such quarterly balances ending within such
 taxable period.
   (2) For taxable years beginning before two  thousand  eleven,  in  the
 case  of  a corporation organized under the laws of a country other than
 the United States, (i) two and six-tenths mills upon each dollar of such
 part of the taxpayer's issued capital stock on the last day of the taxa-
 ble year, at its face value, but if such taxpayer has stock without  par
 value,  such stock shall be taken at its actual or market value, and not
 less than five dollars per share, as may be determined  by  the  commis-
 sioner  of finance, or (ii) if the taxpayer does not have issued capital
 stock, two and six-tenths mills upon each dollar of  such  part  of  the
 amount  by  which  its  average  total  assets exceeds its average total
 liabilities, as the gross income of such taxpayer derived from  business
 carried  on  within the city during such taxable year bears to its gross
 income derived from all business,  both  within  and  without  the  city
 during  said  year;  except  that if the period covered by the return is
 other than twelve months, the tax shall be prorated on the basis of  the
 number  of  months or major portions thereof included in the return. For
 purposes of this paragraph, the term "gross income" shall have the  same
 meaning  as  it has in the laws of the United States relating to federal
 income taxes.
   (3) Three percent of the taxpayer's alternative entire net income,  or
 portion  thereof  allocated  to  the city, for the taxable year, or part
 thereof.
   (4) One hundred twenty-five dollars.
   § 11-643.7. Relocation and employment assistance credit.  (a) In addi-
 tion to any other credit allowed by  this  part,  a  taxpayer  that  has
 S. 8474                            573
 
 obtained  the  certifications required by chapter six-B of title twenty-
 two of the code of the preceding municipality shall be allowed a  credit
 against  the tax imposed by this part. The amount of the credit shall be
 the  amount  determined  by  multiplying five hundred dollars or, in the
 case of a taxpayer that has obtained pursuant to chapter six-B  of  such
 title  twenty-two  a certification of eligibility dated on or after July
 first, nineteen hundred ninety-five, one thousand  dollars  or,  in  the
 case of an eligible business that has obtained pursuant to chapter six-B
 of  such  title  twenty-two  a  certification of eligibility dated on or
 after July first, two thousand, for a relocation  to  eligible  premises
 located  within  a  revitalization  area  defined  in subdivision (n) of
 section 22-621 of the code of the preceding municipality, three thousand
 dollars, by the number of eligible  aggregate  employment  shares  main-
 tained  by  the taxpayer during the taxable year with respect to partic-
 ular premises to which the taxpayer has  relocated;  provided,  however,
 with  respect to a relocation for which no application for a certificate
 of eligibility is submitted prior to July first, two thousand  three  to
 eligible premises that are not within a revitalization area, if the date
 of  such relocation as determined pursuant to subdivision (j) of section
 22-621 of the code of the preceding municipality is before  July  first,
 nineteen  hundred ninety-five, the amount to be multiplied by the number
 of eligible aggregate employment shares shall be five  hundred  dollars,
 and  with respect to a relocation for which no application for a certif-
 icate of eligibility is submitted prior  to  July  first,  two  thousand
 three,  to  eligible  premises that are within a revitalization area, if
 the date of such relocation as determined pursuant to subdivision (j) of
 such section is before July first,  nineteen  hundred  ninety-five,  the
 amount  to  be multiplied by the number of eligible aggregate employment
 shares shall be five hundred dollars, and if the date of such relocation
 as determined pursuant to subdivision (j) of such section is on or after
 July first, nineteen hundred ninety-five, and  before  July  first,  two
 thousand,  one thousand dollars; provided, however, that no credit shall
 be allowed for the relocation of any retail activity or hotel  services;
 and  provided that in the case of an eligible business that has obtained
 pursuant to chapter six-B of such  title  twenty-two  certifications  of
 eligibility  for  more  than  one  relocation,  the portion of the total
 amount of eligible aggregate employment shares to be multiplied  by  the
 dollar  amount specified in this subdivision for each such certification
 of a relocation shall be the number of total attributed eligible  aggre-
 gate employment shares determined with respect to such relocation pursu-
 ant  to  subdivision  (o) of section 22-621 of the code of the preceding
 municipality.  For purposes of this section, the terms "eligible  aggre-
 gate  employment  shares,"  "relocate,"  "retail  activity"  and  "hotel
 services" shall have the meanings ascribed by section 22-621 of the code
 of the preceding municipality.
   (b) The credit allowed under this section  with  respect  to  eligible
 aggregate  employment shares maintained with respect to particular prem-
 ises to which the taxpayer has relocated shall be allowed for the  first
 taxable  year during which such eligible aggregate employment shares are
 maintained with respect to such premises  and  for  any  of  the  twelve
 succeeding  taxable  years  during  which  eligible aggregate employment
 shares are maintained with respect to such premises; provided  that  the
 credit  allowed  for the twelfth succeeding taxable year shall be calcu-
 lated by multiplying the number of eligible aggregate employment  shares
 maintained with respect to such premises in the twelfth succeeding taxa-
 ble  year  by the lesser of one and a fraction the numerator of which is
 S. 8474                            574
 
 such number of days in the taxable year of relocation less the number of
 days the eligible business maintained employment shares in the  eligible
 premises  in the taxable year of relocation and the denominator of which
 is  the  number  of  days in such twelfth succeeding taxable year during
 which such eligible aggregate  employment  shares  are  maintained  with
 respect  to such premises. Except as provided in subdivision (d) of this
 section, if the amount of the credit allowable under  this  section  for
 any  taxable  year exceeds the tax imposed for such year, the excess may
 be carried over, in order, to the five  immediately  succeeding  taxable
 years and, to the extent not previously deductible, may be deducted from
 the taxpayer's tax for such years.
   (c)  The  credit  allowable under this section shall be deducted after
 the credit allowed by section 11-643.8, but prior to  the  deduction  of
 any other credit allowed by this part.
   (d)  In  the  case  of a taxpayer that has obtained a certification of
 eligibility pursuant to chapter six-B of title twenty-two of the code of
 the preceding municipality dated on or after July  first,  two  thousand
 for  a relocation to eligible premises located within the revitalization
 area defined in subdivision (n) of section 22-621 of  the  code  of  the
 preceding  municipality,  the  credits allowed under this section, or in
 the case of a taxpayer that has relocated more than once, the portion of
 such credits attributed to such certification of eligibility pursuant to
 subdivision (a) of this section, against the tax imposed by this chapter
 for the taxable year of such relocation and for the four  taxable  years
 immediately  succeeding  the  taxable  year of such relocation, shall be
 deemed to be overpayments of tax by  the  taxpayer  to  be  credited  or
 refunded, without interest, in accordance with the provisions of section
 11-677 of this chapter. For such taxable years, such credits or portions
 thereof  may  not  be  carried  over  to  any  succeeding  taxable year;
 provided, however, that this subdivision shall not apply  to  any  relo-
 cation  for  which an application for a certification of eligibility was
 not submitted prior to July first, two thousand three, unless  the  date
 of such relocation is on or after July first, two thousand.
   § 11-643.8 Credit relating to certain distributions from partnerships.
 (a)  If a banking corporation is a partner in an unincorporated business
 taxable under chapter five of this title, and is required to include  in
 entire  net  income  its  distributive  share  of income, gain, loss and
 deductions of, or guaranteed payments from,  such  unincorporated  busi-
 ness, such banking corporation shall be allowed a credit against the tax
 imposed  by  this  part equal to the lesser of the amounts determined in
 paragraphs one and two of this subdivision:
   (1) The amount determined in this paragraph is the product of (A)  the
 sum of (i) the tax imposed by chapter five of this title on the unincor-
 porated  business for its taxable year ending within or with the taxable
 year of the banking corporation and paid by the unincorporated  business
 and (ii) the amount of any credit or credits taken by the unincorporated
 business  under  section 11-503 of this title, except the credit allowed
 by subdivision (b) of such section, for its taxable year  ending  within
 or  with the taxable year of the banking corporation, to the extent that
 such credits do not reduce  such  unincorporated  business's  tax  below
 zero, and (B) a fraction, the numerator of which is the net total of the
 banking  corporation's  distributive  share  of  income,  gain, loss and
 deductions of, and guaranteed payments from, the unincorporated business
 for such taxable year and the denominator of which is the sum, for  such
 taxable year, of the net total distributive shares of income, gain, loss
 and deductions of, and guaranteed payments to, all partners of the unin-
 S. 8474                            575
 
 corporated  business  for  whom  or  which such net total, as separately
 determined for each partner, is greater than zero.
   (2)  The amount determined in this paragraph is the product of (A) the
 excess of (i) the basic tax computed  pursuant  to  subdivision  (a)  of
 section  11-643.5 of this part, without allowance of any credits allowed
 by this part, over (ii) the basic tax so computed, determined as if  the
 banking  corporation  had  no  such  distributive  share  or  guaranteed
 payments with respect to the unincorporated business, and  (B)  a  frac-
 tion,  the  numerator  of  which is four and the denominator of which is
 nine, provided, however, that the amounts computed in  clauses  (i)  and
 (ii)  of  this  paragraph shall be computed with the following modifica-
 tions:
   (I) if, prior to taking into account any distributive share or guaran-
 teed payments from any unincorporated business, the entire net income of
 the partner is less than zero, such entire net income shall  be  treated
 as zero; and
   (II)  if  such partner's net total distributive share of income, gain,
 loss and deductions of, and guaranteed payments from any  unincorporated
 business is less than zero, such net total shall be treated as zero.
   The amount determined in this paragraph shall not be less than zero.
   (b) (1) Notwithstanding anything to the contrary in subdivision (a) of
 this  section,  in  the  case  of a banking corporation that, before the
 application of this section or any other credit allowed by this part, is
 liable for the basic tax  computed  under  subdivision  (a)  of  section
 11-643.5  of this part, the credit or the sum of the credits that may be
 taken by such banking corporation for a taxable year under this  section
 with  respect to an unincorporated business or unincorporated businesses
 in which it is a partner shall not exceed the tax so  computed,  without
 allowance  of any credits allowed by this part, multiplied by a fraction
 the numerator of which is four and the denominator of which is nine.  If
 the  credit  allowed  under  this subdivision or the sum of such credits
 exceeds the product of such tax and such fraction,  the  amount  of  the
 excess may be carried forward, in order, to each of the seven immediate-
 ly  succeeding  taxable  years  and, to the extent not previously taken,
 shall be allowed as a credit in each of such  years.  In  applying  such
 provisions, the credit determined for the taxable year under subdivision
 (a) of this section shall be taken before taking any credit carryforward
 pursuant  to  this paragraph and the credit carryforward attributable to
 the earliest taxable year shall be taken before taking a  credit  carry-
 forward attributable to a subsequent taxable year.
   (2)  Notwithstanding  anything  to  the contrary in subdivision (a) of
 this section, in the case of a  banking  corporation  that,  before  the
 application of this section or any other credit allowed by this part, is
 liable  for the alternative minimum tax on alternative entire net income
 under paragraph three of subdivision (b) of  section  11-643.5  of  this
 part,  the  maximum  credit that may be taken in any taxable year is the
 amount that will reduce the tax so computed, without  allowance  of  any
 credits  allowed  by this part, to zero.  For purposes of this paragraph
 each dollar of credit shall be applied so  as  to  reduce  such  tax  by
 seventy-five  cents.  If the amount of credit allowed under this section
 or the sum of such credits exceeds the amount that may be taken  against
 such  tax, the amount of the excess may be carried forward, in order, to
 each of the seven immediately  succeeding  taxable  years  and,  to  the
 extent  not  previously  taken,  shall be allowed as a credit in each of
 such years. In applying such provisions, the credit determined  for  the
 taxable year under subdivision (a) of this section shall be taken before
 S. 8474                            576
 
 taking  any  credit  carryforward  pursuant  to this subdivision and the
 credit carryforward attributable to the earliest taxable year  shall  be
 taken  before  taking a credit carryforward attributable to a subsequent
 taxable year.
   (3)  No  credit under this section may be taken in a taxable year by a
 taxpayer that, in the absence of such credit, would be  liable  for  the
 tax  computed on the basis of taxable assets under paragraph one of this
 subdivision, the tax computed on the basis of issued capital stock under
 paragraph two of this subdivision or the fixed-dollar minimum tax  under
 paragraph four of subdivision (b) of section 11-643.5 of this part.
   (c)  For  banking  corporations that file a report on a combined basis
 pursuant to subdivision (f) of section 11-646 of this part,  the  credit
 allowed  by this section shall be computed as if the combined group were
 the partner in each  unincorporated  business  from  which  any  of  the
 members  of  such group had a distributive share or guaranteed payments,
 provided, however, if more than one member of the combined  group  is  a
 partner  in the same unincorporated business, for purposes of the calcu-
 lation required in paragraph one of subdivision (a) of this section, the
 numerator of the fraction described in subparagraph (B)  of  such  para-
 graph  one  shall  be  the  sum  of the net total distributive shares of
 income, gain, loss and deductions of, and guaranteed payments from,  the
 unincorporated  business  of  all  of the partners of the unincorporated
 business within the combined group for which such net  total,  as  sepa-
 rately determined for each partner, is greater than zero, and the denom-
 inator  of  such fraction shall be the sum of the net total distributive
 shares of income, gain, loss and deductions of, and guaranteed  payments
 from,  the unincorporated business of all partners in the unincorporated
 business for whom or which such net total, as separately determined  for
 each partner, is greater than zero.
   (d) The credit allowed by this section shall not be allowed to a part-
 ner  in  an  unincorporated business with respect to any tax paid by the
 unincorporated business under chapter five of this title for any taxable
 year beginning before July first, nineteen hundred ninety-four.
   (e) Notwithstanding any other provisions  of  this  part,  the  credit
 allowable  under  this section shall be taken prior to the taking of any
 other credit allowed by this part.  Notwithstanding any other provisions
 of this part, the application of this section shall not change the basis
 on which the taxpayer's tax is computed under subdivision (a) or (b)  of
 section 11-643.5 of this part.
   § 11-644  Declarations of estimated tax.  (a) Requirements of declara-
 tion.    Every taxpayer subject to the tax imposed by subdivision (a) of
 section 11-639 of this part shall make a declaration  of  its  estimated
 tax  for  the  current  taxable year, containing such information as the
 commissioner of finance may prescribe by regulations or instructions, if
 such estimated tax can reasonably be expected  to  exceed  one  thousand
 dollars.
   (b)  Definition  of estimated tax.  The term "estimated tax" means the
 amount which a taxpayer estimates to be the tax imposed  by  subdivision
 (a)  of  section  11-639 of this part for the current taxable year, less
 the amount which it estimates to be the sum  of  any  credits  allowable
 against the tax.
   (c) Time for filing declaration.  A declaration of estimated tax shall
 be  filed on or before June fifteenth of the current taxable year in the
 case of a taxpayer which reports on the basis of a calendar year, except
 that if the requirements of subdivision (a) of this  section  are  first
 met:
 S. 8474                            577
 
   (1)  after May thirty-first and before September first of such current
 taxable year, the declaration shall be  filed  on  or  before  September
 fifteenth, or
   (2)  after  August  thirty-first  and  before  December  first of such
 current taxable year, the declaration shall be filed on or before Decem-
 ber fifteenth.
   (d) Amendments of declaration.   A taxpayer may  amend  a  declaration
 under regulations of the commissioner of finance.
   (e) Return as declaration.  If, on or before February fifteenth of the
 succeeding year in the case of a taxpayer whose taxable year is a calen-
 dar  year, a taxpayer files its return for the year for which the decla-
 ration is required, and pays therewith the balance, if any, of the  full
 amount of the tax shown to be due on the return:
   (1)  such return shall be considered as its declaration if no declara-
 tion was required to be filed during the taxable year for which the  tax
 was imposed, but is otherwise required to be filed on or before December
 fifteenth  pursuant to paragraph two of subdivision (c) of this section,
 and
   (2) such return shall be considered  as  the  amendment  permitted  by
 subdivision  (d)  of  this  section  to  be  filed on or before December
 fifteenth if the tax shown on the return is greater than  the  estimated
 tax shown on a declaration previously made.
   (f)  Fiscal year.  This section shall apply to taxable years of twelve
 months other than a calendar year by the substitutions of the months  of
 such fiscal year for the corresponding months specified in this section.
   (g)  Short  taxable period.   If the taxable period for which a tax is
 imposed by subdivision (a) of section 11-639 of this part is  less  than
 twelve  months,  every  taxpayer required to make a declaration of esti-
 mated tax for such taxable period  shall  make  such  a  declaration  in
 accordance with regulations of the commissioner of finance.
   (h)  Extension  of  time.    The  commissioner  of finance may grant a
 reasonable extension of time, not to exceed three months, for the filing
 of any declaration required pursuant to this section, on such terms  and
 conditions as the commissioner may require.
   §  11-645    Payments of estimated tax.  (a) Every taxpayer subject to
 the tax imposed by section 11-639 of this part shall pay an amount equal
 to twenty-five percent of the preceding year's tax,  if  such  preceding
 year's  tax  exceeded  one thousand dollars.   Such amount shall be paid
 with the return required to be filed for the preceding taxable  year  or
 with  an  application  for  the  extension  of  the time for filing such
 return.  Provided, however, that for the first taxable  year  or  period
 commencing  on  or  after January first, nineteen hundred seventy-three,
 the installment required by this subdivision  shall  be  paid  with  the
 return  required to be filed for the tax imposed pursuant to part one or
 two of this subchapter three computed on the basis of net income for the
 calendar year nineteen hundred seventy-two, or  under  the  minimum  tax
 provisions of section 11-612 of this subchapter.
   (b)  Other installments.  The estimated tax for each taxable year with
 respect to which a declaration of estimated tax is required to be  filed
 under  this  part shall be paid, in the case of a taxpayer which reports
 on the basis of a calendar year, as follows:
   (1) If the declaration is filed on or before June fifteenth, the esti-
 mated tax shown thereon, after applying thereto the amount, if any, paid
 during the same  taxable  year  pursuant  to  subdivision  (a)  of  this
 section,  shall  be  paid  in  three  equal  installments.   One of such
 installments shall be paid at the time of the filing of the declaration,
 S. 8474                            578
 
 one shall be paid on the following September fifteenth, and one  on  the
 following December fifteenth.
   (2)    If  the declaration is filed after June fifteenth and not after
 September fifteenth of such taxable year, and  is  not  required  to  be
 filed  on or before June fifteenth of such year, the estimated tax shown
 on such declaration, after applying thereto the  amount,  if  any,  paid
 during  the  same  taxable  year  pursuant  to  subdivision  (a) of this
 section, shall be paid in two equal installments. One of  such  install-
 ments shall be paid at the time of the filing of the declaration and one
 shall be paid on the following December fifteenth.
   (3)  If  the  declaration  is  filed after September fifteenth of such
 taxable year, and is not required to be filed  on  or  before  September
 fifteenth  of  such  year,  the estimated tax shown on such declaration,
 after applying thereto the amount, if any, paid in respect of such  year
 pursuant  to  subdivision  (a) of this section, shall be paid in full at
 the time of the filing of the declaration.
   (4)  If the declaration is filed after the time  prescribed  therefor,
 or  after  the  expiration of any extension of time therefor, paragraphs
 two and three of this subdivision shall not apply  and  there  shall  be
 paid  at the time of such filing all installments of estimated tax paya-
 ble at or before such time, and the remaining installments shall be paid
 at the times at which, and in the amounts in which, they would have been
 payable if the declaration had been filed when due.
   (c) Amendments of declarations.  If any amendment of a declaration  is
 filed, the remaining installments, if any, shall be ratably increased or
 decreased,  as  the  case may be, to reflect any increase or decrease in
 the estimated tax by reason of such amendment, and if any  amendment  is
 made  after September fifteenth of the taxable year, any increase in the
 estimated tax by reason thereof shall be paid at the time of making such
 amendment.
   (d) Application of installments based on  the  preceding  year's  tax.
 Any  amount  paid  pursuant  to subdivision (a) of this section shall be
 applied as a first installment against the estimated tax of the taxpayer
 for the taxable year shown on  the  declaration  required  to  be  filed
 pursuant  to  section 11-644 of this part, or if no declaration of esti-
 mated tax is required to be filed  by  the  taxpayer  pursuant  to  such
 section, any such amount shall be considered a payment on account of the
 tax  shown  on  the return required to be filed by the taxpayer for such
 taxable year.
   (e) Interest on certain installments based  on  the  preceding  year's
 tax. Notwithstanding the provisions of section 11-679 of this chapter or
 of  section  three-a  of  the  general  municipal law, if an amount paid
 pursuant to subdivision (a) of this section exceeds the tax shown on the
 return required to be filed by the taxpayer for the taxable year  during
 which  the  amount  was  paid, interest shall be allowed and paid on the
 amount by which the amount so paid pursuant to such subdivision  exceeds
 such  tax,  at  the  overpayment rate set by the commissioner of finance
 pursuant to section 11-687 of this chapter, or, if no rate  is  set,  at
 the rate of six percent per annum from the date of payment of the amount
 so  paid  pursuant to such subdivision to the fifteenth day of the third
 month following the close of the taxable year, provided,  however,  that
 no  interest  shall  be  allowed  or  paid under this subdivision if the
 amount thereof is less than one dollar.
   (f) The preceding year's tax defined.  As used in this  section,  "the
 preceding  year's tax" means the tax imposed upon the taxpayer by subdi-
 vision (a) of section 11-639 of this  part  for  the  preceding  taxable
 S. 8474                            579
 
 year,  or,  for purposes of computing the first installment of estimated
 tax when an application has been filed for extension  of  the  time  for
 filing  the return required to be filed for such preceding taxable year,
 the amount properly estimated pursuant to paragraph one of subdivision b
 of  section 11-647 of this part as the tax imposed upon the taxpayer for
 such taxable year.  Provided, however, that for the first  taxable  year
 or  period commencing on or after January first, nineteen hundred seven-
 ty-three, the term "preceding year's tax" as used in this section  shall
 mean  the  tax  imposed upon the taxpayer pursuant to part one or two of
 this subchapter three which was computed on the basis of net income  for
 the calendar year nineteen hundred seventy-two, or under the minimum tax
 provisions  of  subdivision two of section 11-612 of this subchapter, or
 for purposes of computing the first installment  of  estimated  tax  for
 such first taxable year or period when an application has been filed for
 an  extension of the time for filing the return required to be filed for
 the tax imposed pursuant to part one or two  of  this  subchapter  three
 which  was  computed  on  the  basis of net income for the calendar year
 nineteen hundred seventy-two, or under the  minimum  tax  provisions  of
 section  11-612 of this subchapter, the amount of tax properly estimated
 for purposes of such part one or two pursuant to section 11-635 of  this
 subchapter.
   (g)  Application to short taxable period.  This section shall apply to
 a taxable period of less than twelve months  in  accordance  with  regu-
 lations of the commissioner of finance.
   (h)  Fiscal year.  The provisions of this section shall apply to taxa-
 ble  years  of  twelve  months other than a calendar year by the substi-
 tution of the months of such fiscal year for  the  corresponding  months
 specified in such provisions.
   (i)  Extension  of  time.    The  commissioner  of finance may grant a
 reasonable extension of time, not to exceed six months, for  payment  of
 any  installment  of estimated tax required pursuant to this section, on
 such terms and conditions as the commissioner may require, including the
 furnishing of a bond or other security by the taxpayer in an amount  not
 exceeding  twice  the amount for which any extension of time for payment
 is granted, provided, however that interest at the underpayment rate set
 by the commissioner of finance pursuant to section 11-687 of this  chap-
 ter,  or,  if  no rate is set, at the rate of seven and one-half percent
 per annum for the period of the extension shall be charged and collected
 on the amount for which any extension of time  for  payment  is  granted
 under this subdivision.
   (j)  Payment  of installments in advance.  A taxpayer may elect to pay
 any installment of estimated tax prior to the date  prescribed  in  this
 section for payment thereof.
   §  11-646   Returns.   (a)  Every taxpayer shall annually on or before
 the fifteenth day of the third month following the close of each of  its
 taxable years transmit to the commissioner of finance a return in a form
 prescribed  by  the  commissioner  setting forth such information as the
 commissioner of finance may prescribe and every taxpayer which ceases to
 exercise its franchise in the city or to be subject to the  tax  imposed
 by  this  part shall transmit to the commissioner of finance a return on
 the date of such cessation or at such other time as the commissioner  of
 finance may require covering each year or period for which no return was
 therefore filed.
   (b)  Every  taxpayer  shall  also transmit such other returns and such
 facts and information as the commissioner of finance may require in  the
 administration of this part.
 S. 8474                            580

   (c)  The  commissioner  of finance may grant a reasonable extension of
 time for filing returns whenever good cause exists.  An automatic exten-
 sion of six months for the filing of its annual return shall be  allowed
 any  taxpayer,  if within the time prescribed by subdivision (a) of this
 section,  such taxpayer files with the commissioner of finance an appli-
 cation for extension in such form as said commissioner  of  finance  may
 prescribe  by  regulation  and pays on or before the date of such filing
 the amount properly estimated as its tax.
   (d) Every return shall have annexed thereto  a  certification  by  the
 president,   vice   president,  treasurer,  assistant  treasurer,  chief
 accounting officer or any other officer of the taxpayer duly  authorized
 so  to act to the effect that the statements contained therein are true.
 The fact that an individual's name is signed on a certification  of  the
 return  shall be prima facie evidence that such individual is authorized
 to sign and certify the return on behalf of the corporation.
   (e) If the amount  of  taxable  income,  alternative  minimum  taxable
 income  or  other  basis  of tax for any year of any taxpayer, or of any
 shareholder of any taxpayer that has elected to be taxed under  subchap-
 ter  s of chapter one of the internal revenue code or of any shareholder
 of any taxpayer with respect to which an election has been  made  to  be
 treated  as a qualified subchapter s subsidiary under paragraph three of
 subsection (b) of section thirteen hundred  sixty-one  of  the  internal
 revenue code as returned to the United States treasury department or the
 New  York  state  commissioner  of  taxation  and  finance is changed or
 corrected by the commissioner of internal revenue or  other  officer  of
 the  United  States  or  the New York state commissioner of taxation and
 finance or other competent authority, or if a taxpayer  or  such  share-
 holder  of  a  taxpayer, pursuant to subsection (d) of section sixty-two
 hundred thirteen of the internal revenue  code,  executes  a  notice  of
 waiver  of  the restrictions provided in subsection (a) of said section,
 or if a  taxpayer  or  such  shareholder  of  a  taxpayer,  pursuant  to
 subsection  (f)  of  section  one  thousand  eighty-one  of the tax law,
 executes a notice of waiver of the restrictions provided  in  subsection
 (c)  of  such  section,  such  taxpayer  shall  report  such  changed or
 corrected taxable income, alternative minimum taxable  income  or  other
 basis  of tax or such execution of such notice of waiver and the changes
 or corrections of the taxpayer's  federal  or  New  York  state  taxable
 income,  alternative  minimum  taxable  income  or other basis of tax on
 which it is based, within ninety days, or one hundred  twenty  days,  in
 the  case  of  a taxpayer making a combined return under this subchapter
 for such year, after such execution or the final determination  of  such
 change or correction, or as required by the commissioner of finance, and
 shall  concede the accuracy of such determination or state wherein it is
 erroneous. The allowance of a tentative carryback adjustment based  upon
 a  net  capital  loss  carryback  pursuant to section sixty-four hundred
 eleven of the internal revenue code, shall be treated as a final  deter-
 mination  for  purposes  of  this  subdivision.  Any  taxpayer filing an
 amended return with such department shall also file within ninety  days,
 or  one hundred twenty days, in the case of a taxpayer making a combined
 return under this subchapter for such year, thereafter an amended return
 with the commissioner of finance which shall contain such information as
 the commissioner shall require.
   (f) (1) For purposes of  this  subdivision,  the  term  "bank  holding
 company" means any corporation subject to article three-A of the banking
 law,  or  registered under the federal bank holding company act of nine-
 teen hundred fifty-six, as amended, or registered as a savings and  loan
 S. 8474                            581
 
 holding  company,  but  excluding a diversified savings and loan holding
 company, under the federal national housing act, as amended.
   (2) (i) Any banking corporation or bank holding company which is doing
 business in the city in a corporate or organized capacity, and
   (A)  which owns or controls, directly or indirectly, eighty percent or
 more of the voting stock of one or more  banking  corporations  or  bank
 holding companies, or
   (B)  whose voting stock is eighty percent or more owned or controlled,
 directly or indirectly, by a  banking  corporation  or  a  bank  holding
 company,
   shall  make  a  return  on  a  combined basis under this part covering
 itself and such corporations described in clause  (A)  or  (B)  of  this
 subparagraph and shall set forth such information as the commissioner of
 finance  may  require unless the taxpayer or the commissioner of finance
 shows that the inclusion of such a corporation in  the  combined  return
 fails  to  properly  reflect the tax liability of such corporation under
 this part. Provided, however, that no banking corporation or bank  hold-
 ing  company not a taxpayer shall be subject to the requirements of this
 subparagraph unless the commissioner of finance deems that the  applica-
 tion  of such requirements is necessary in order to properly reflect the
 tax liability under this part, because of intercompany  transactions  or
 some  agreement,  understanding,  arrangement or transaction of the type
 referred to in subdivision (g) of this section.
   (ii) In the discretion of the commissioner  of  finance,  any  banking
 corporation  or bank holding company which is doing business in the city
 in a corporate or organized capacity, and
   (A) which owns or controls, directly or indirectly, sixty-five percent
 or more of the voting stock of one or more banking corporations or  bank
 holding companies, or
   (B)  whose  voting  stock  is  sixty-five  percent  or  more  owned or
 controlled, directly or indirectly, by a banking corporation or  a  bank
 holding  company,  may  be  required  or permitted to make a return on a
 combined basis under this part covering  itself  and  such  corporations
 described  in clause (A) or (B) of this subparagraph and shall set forth
 such information as the commissioner of finance may  require;  provided,
 however,  that  no combined return shall be required or permitted unless
 the commissioner of finance deems such  report  necessary  in  order  to
 properly reflect the tax liability under this part of any one or more of
 such banking corporations or bank holding companies.
   (iii) In the discretion of the commissioner of finance, banking corpo-
 rations  or  bank holding companies which are each sixty-five percent or
 more owned or controlled, directly or indirectly, by the  same  interest
 may  be permitted or required to make a return on a combined basis under
 this part and shall set forth such information as  the  commissioner  of
 finance  may  require,  if at least one such banking corporation or bank
 holding company is doing business in the city in a corporate  or  organ-
 ized  capacity. No combined return shall be required or permitted unless
 the commissioner of finance deems such  report  necessary  in  order  to
 properly reflect the tax liability under this part of any one or more of
 such banking corporations or bank holding companies.
   (iv)  (A)  Notwithstanding  any  provision of this paragraph, any bank
 holding company exercising its corporate franchise or doing business  in
 the  city  may  make  a  return  on a combined basis without seeking the
 permission of the commissioner with any banking  corporation  exercising
 its  corporate franchise or doing business in the city in a corporate or
 organized capacity sixty-five percent or more of whose voting  stock  is
 S. 8474                            582
 
 owned or controlled, directly or indirectly, by such bank holding compa-
 ny,  for the first taxable year beginning on or after January first, two
 thousand and before January first, two thousand twenty during which such
 bank holding company registers for the first time under the federal bank
 holding company act, as amended, and also elects to be a financial hold-
 ing  company.  In  addition,  for each subsequent taxable year beginning
 after January first, two thousand and before January first, two thousand
 twenty, any such bank holding company may file on a combined basis with-
 out seeking the permission of the commissioner with any  banking  corpo-
 ration  that  is exercising its corporate franchise or doing business in
 the city and sixty-five percent or more of whose voting stock  is  owned
 or  controlled,  directly or indirectly, by such bank holding company if
 either such banking corporation is exercising its corporate franchise or
 doing business in the city in a corporate or organized capacity for  the
 first time during such subsequent taxable year, or sixty-five percent or
 more  of  the  voting  stock  of  such  banking  corporation is owned or
 controlled, directly or indirectly, by such bank holding company for the
 first time during such subsequent taxable year.  Provided  however,  for
 each subsequent taxable year beginning after January first, two thousand
 and  before  January  first,  two thousand twenty, a banking corporation
 described in this clause which filed on a combined basis with  any  such
 bank  holding  company in a previous taxable year, must continue to file
 on a combined basis with such  bank  holding  company  if  such  banking
 corporation,  during such subsequent taxable year, continues to exercise
 its corporate franchise or do business in the city  in  a  corporate  or
 organized capacity and sixty-five percent or more of such banking corpo-
 ration's  voting  stock continues to be owned or controlled, directly or
 indirectly, by such bank holding company, unless the permission  of  the
 commissioner  has  been  obtained  to  file on a separate basis for such
 subsequent taxable year. Provided further, however, for each  subsequent
 taxable  year  beginning  after  January  first, two thousand and before
 January first, two thousand twenty, a banking corporation  described  in
 this  clause  which  did not file on a combined basis with any such bank
 holding company in a previous taxable year, may not file on  a  combined
 basis  with such bank holding company during any such subsequent taxable
 year unless the permission of the commissioner has been obtained to file
 on a combined basis for such subsequent taxable year.
   (B) Notwithstanding any provision of this paragraph other than  clause
 (A)  of this subparagraph, the commissioner may not require a bank hold-
 ing company which, during a taxable year beginning on or  after  January
 first,  two  thousand  and  before  January  first, two thousand twenty,
 registers for the first time during such taxable year under the  federal
 bank  holding company act, as amended, and also elects to be a financial
 holding company, to make a return on a combined basis  for  any  taxable
 year  beginning on or after January first, two thousand and before Janu-
 ary first, two thousand twenty with  a  banking  corporation  sixty-five
 percent  or  more of whose voting stock is owned or controlled, directly
 or indirectly, by such bank holding company.
   (v)(A) For purposes of this subparagraph, the term  "closest  control-
 ling stockholder" means the corporation that indirectly owns or controls
 over fifty percent of the voting stock of a captive REIT or captive RIC,
 is  subject  to  tax  under  this subchapter or otherwise required to be
 included in a combined return under this chapter and is the fewest tiers
 of corporations away in the ownership structure from the captive REIT or
 captive RIC. The commissioner is authorized to prescribe  by  regulation
 S. 8474                            583
 
 or  published guidance the criteria for determining the closest control-
 ling stockholder.
   (B)  A  captive  REIT  or a captive RIC must be included in a combined
 return with the banking corporation or bank holding company that direct-
 ly owns or controls over fifty  percent  of  the  voting  stock  of  the
 captive  REIT or captive RIC if that banking corporation or bank holding
 company is subject to tax or required  to  be  included  in  a  combined
 return under this subchapter.
   (C)  If  over  fifty  percent of the voting stock of a captive REIT or
 captive RIC is not directly owned or controlled by a banking corporation
 or bank holding company that  is  subject  to  tax  or  required  to  be
 included  in  a  combined return under this subchapter, then the captive
 REIT or captive RIC must be included  in  a  combined  return  with  the
 corporation  that  is the closest controlling stockholder of the captive
 REIT or captive RIC. If  the  closest  controlling  stockholder  of  the
 captive  REIT  or  captive  RIC is a banking corporation or bank holding
 company that is subject to tax or otherwise required to be included in a
 combined return under this subchapter, then the captive REIT or  captive
 RIC must be included in a combined return under this subchapter.
   (D)  If  the  corporation  which  directly owns or controls the voting
 stock of the captive REIT or captive RIC is  described  in  subparagraph
 (ii)  of paragraph four of this subdivision as a corporation not permit-
 ted to make a combined return, then the provisions in clause (C) of this
 subparagraph must be applied  to  determine  the  corporation  in  whose
 combined  return the captive REIT or captive RIC should be included. If,
 under clause (C) of this subparagraph, the corporation that is the clos-
 est controlling stockholder of  the  captive  REIT  or  captive  RIC  is
 described  in subparagraph (ii) or (iv) of paragraph four of this subdi-
 vision as a corporation not permitted to make a  combined  return,  then
 that  corporation  is deemed to not be in the ownership structure of the
 captive REIT or captive RIC, and  the  closest  controlling  stockholder
 will be determined without regard to that corporation.
   (E)  If  a captive REIT owns the stock of a qualified REIT subsidiary,
 as defined in paragraph two of subsection (i) of section  eight  hundred
 fifty-six  of the internal revenue code, then the qualified REIT subsid-
 iary must be included in any combined return required to be made by  the
 captive REIT that owns its stock.
   (F) If a captive REIT or a captive RIC is required under this subpara-
 graph  to be included in a combined return with another corporation, and
 that other corporation is required to be included in a  combined  return
 with another corporation under other provisions of this subdivision, the
 captive  REIT  or  captive  RIC must be included in that combined return
 with those corporations.
   (G) If the banking corporation or bank holding company  that  directly
 or indirectly owns or controls over fifty percent of the voting stock of
 the  captive  REIT  or captive RIC and is the closest controlling stock-
 holder of the captive REIT or captive RIC is a member of  an  affiliated
 group  (1)  that  does  not include any corporation that is engaged in a
 business that a subsidiary of  a  bank  holding  company  would  not  be
 permitted  to  engage  in,  unless  such business is de minimis, and (2)
 whose members own assets the combined average value of  which  does  not
 exceed  eight billion dollars, then the captive REIT or captive RIC must
 not be included in a combined return  under  this  subchapter.  In  that
 instance,  the  captive REIT or captive RIC is subject to the provisions
 of subdivision seven or eight of section 11-603  of  this  chapter.  The
 term  "affiliated  group" means "affiliated group" as defined in section
 S. 8474                            584
 
 fifteen hundred four of the internal revenue code, but without regard to
 the exceptions provided for in subsection (b) of such section.
   (vi)  For  taxable years beginning on or after January first two thou-
 sand eleven, a banking corporation doing business  in  the  city  solely
 because  it  meets one or more of the tests in subparagraphs (i) through
 (v) of paragraph one of subdivision (c) of section 11-639 of this  chap-
 ter,  referred  to  in this subparagraph as the "credit card bank", will
 not be included in a combined return pursuant  to  subparagraph  (i)  of
 this  paragraph with another banking corporation or bank holding company
 which is doing business in the city unless the credit card bank  or  the
 commissioner  shows  that  the  inclusion of the credit card bank in the
 combined return is necessary to properly reflect the  tax  liability  of
 the  credit  card  bank, the banking corporation or bank holding company
 under this subchapter. However, any banking corporation that  meets  one
 or  more  of the tests in subparagraphs (i) through (v) of paragraph one
 of subsection (c) of section 11-639 of this chapter and was included  in
 a  combined  return  for  its last taxable year beginning before January
 first, two thousand eleven may continue to be  included  in  a  combined
 return  for future taxable years, provided that once that banking corpo-
 ration has been included in a  combined  return  for  any  taxable  year
 beginning  on  or  after  January  first,  two  thousand eleven, it must
 continue to be included in  a  combined  return  until  it  obtains  the
 consent of the commissioner to cease being included in a combined return
 because  the combined return no longer properly reflects the tax liabil-
 ity under this subchapter of any of the  corporations  included  in  the
 combined  return.  Further,  the  credit card bank will be included in a
 combined return with (A) any banking  corporation  not  subject  to  tax
 under  this  subchapter sixty-five percent or more of whose voting stock
 is owned or controlled, directly or indirectly, by the credit card bank,
 or (B) any banking corporation or bank holding company  not  subject  to
 tax  under this subchapter which owns or controls, directly or indirect-
 ly, sixty-five percent or more of the voting stock of  the  credit  card
 bank,  or  (C)  any  banking  corporation  not subject to tax under this
 subchapter sixty-five percent or more of the voting stock  of  which  is
 owned  or controlled, directly or indirectly, by the same corporation or
 corporations that own or control,  directly  or  indirectly,  sixty-five
 percent  or  more  of  the  voting stock of the credit card bank, if the
 corporation or corporations described in clauses (A),  (B)  and  (C)  of
 this  subparagraph  provide  services  for or support to the credit card
 bank's operations, unless the credit card bank or the commissioner shows
 that the inclusion of any of those corporations in the  combined  return
 fails to properly reflect the tax liability of the credit card bank. For
 purposes  of  this  subparagraph,  services for or support to the credit
 card bank's operations include such activities as billing, credit inves-
 tigation  and  reporting,  marketing,  research,  advertising,  mailing,
 customer   service,   information   technology,  lending  and  financing
 services, and communications services, but will not include  accounting,
 legal or personnel services.
   (3) (i) In the case of a combined return, the tax shall be measured by
 the  combined  entire net income, combined alternative entire net income
 or combined assets of all  the  corporations  included  in  the  return,
 including  any  captive  REIT or captive RIC.  The allocation percentage
 shall be computed based on the combined factors with respect to all  the
 corporations  included  in  the  combined  return. In computing combined
 entire net income and alternative entire net income intercorporate divi-
 dends and all other intercorporate transactions shall be eliminated  and
 S. 8474                            585
 
 in  computing combined assets intercorporate stockholdings and intercor-
 porate bills, notes and accounts receivable and payable and other inter-
 corporate indebtedness shall be eliminated.
   (ii)  In the case of a captive REIT required under this subdivision to
 be included in a combined return, "entire net income" means "real estate
 investment trust taxable income" as defined in paragraph two of subdivi-
 sion (b) of section eight hundred fifty-seven, as  modified  by  section
 eight hundred fifty-eight, of the internal revenue code, plus the amount
 taxable  under  paragraph  three  of  subdivision  (b)  of section eight
 hundred fifty-seven of that code, subject to the modifications  required
 by section 11-641 of this chapter. In the case of a captive RIC required
 under  this subdivision to be included in a combined return, "entire net
 income" means "investment company taxable income" as  defined  in  para-
 graph  two  of  subdivision  (b)  of section eight hundred fifty-two, as
 modified by section eight hundred fifty-five, of  the  internal  revenue
 code,  plus  the amount taxable under paragraph three of subdivision (b)
 of section eight hundred fifty-two of such code, subject to the  modifi-
 cations  required  by  section  11-641  of  this  chapter.  However, the
 deduction under the internal revenue code  for  dividends  paid  by  the
 captive  REIT  or captive RIC to any member of the affiliated group that
 includes the corporation that directly or  indirectly  owns  over  fifty
 percent  of the voting stock of the captive REIT or captive RIC shall be
 limited to twenty-five percent for taxable years beginning on  or  after
 January  first, two thousand nine and before January first, two thousand
 eleven and shall not be allowed for taxable years beginning on or  after
 January  first,  two thousand eleven.  The term "affiliated group" means
 "affiliated group" as defined in section fifteen  hundred  four  of  the
 internal revenue code, but without regard to the exceptions provided for
 in subsection (b) of such section.
   (4)  (i)  In  no  event shall an item of income or expense of a corpo-
 ration organized under the laws of  a  country  other  than  the  United
 States  be  included  in  a  combined  return unless it is includible in
 entire net income or alternative entire net income, as the case may  be,
 nor  shall  an  asset  of  such  a corporation be included in a combined
 return unless it is included in taxable assets.
   (ii) In no event shall a corporation organized under the laws  of  the
 United  States, this state or any other state, be included in a combined
 return with a corporation organized under the laws of  a  country  other
 than the United States.
   (iii)  In  no  event  shall  a  corporation which has made an election
 pursuant to subdivision (d) of section 11-640 of this part to be subject
 to the tax imposed by subchapter two of this chapter be  included  in  a
 combined  return  for those taxable years for which it is subject to the
 tax imposed by subchapter two of this chapter.
   (5) Tax liability under this part  may  be  deemed  to  be  improperly
 reflected because of intercompany transactions or some agreement, under-
 standing,  arrangement  or transaction referred to in subdivision (g) of
 this section.
   (g) In case it shall appear to the commissioner of  finance  that  any
 agreement,  understanding or arrangement exists between the taxpayer and
 any other corporation or any person or firm, whereby the activity, busi-
 ness, income or assets of the taxpayer within the city is improperly  or
 inaccurately  reflected,  the  commissioner of finance is authorized and
 empowered, in his or her discretion and in such manner as he or she  may
 determine,  to  adjust items of income or deductions in computing entire
 net income or alternative entire net income and to adjust assets, and to
 S. 8474                            586
 
 adjust wages, salaries and other personal service compensation, receipts
 or deposits in computing any allocation percentage, provided  only  that
 entire  net  income or alternative entire net income be adjusted accord-
 ingly  and  that  any asset directly traceable to the elimination of any
 receipt be eliminated from assets so as to accurately determine the tax.
 If however, in the determination of the commissioner  of  finance,  such
 adjustments  do  not,  or  cannot  effectively  provide for the accurate
 determination of the tax, the commissioner of finance shall  be  author-
 ized  to require the filing of a combined report by the taxpayer and any
 such other corporations. Where (1) any taxpayer conducts its activity or
 business under any  agreement,  arrangement  or  understanding  in  such
 manner as either directly or indirectly to benefit its members or stock-
 holders, or any of them, or any person or persons directly or indirectly
 interested  in  such  activity  or business, by entering into any trans-
 action at more or less than a fair price which, but for such  agreement,
 arrangement or understanding, might have been paid or received therefor,
 or (2) any taxpayer enters into any transaction with another corporation
 on  such  terms as to create an improper loss or net income, the commis-
 sioner of finance may include in the entire net  income  or  alternative
 entire  net  income of the taxpayer the fair profits which, but for such
 agreement, arrangement or understanding, the taxpayer might have derived
 from such transaction.
   § 11-647  Payment of tax.   (a) To the  extent  the  tax  imposed  for
 section 11-639 of this part shall not have been previously paid pursuant
 to section 11-645 of this part:
   (1)  such tax, or the balance thereof, shall be payable to the commis-
 sioner of finance in full at the time  its  return  is  required  to  be
 filed, and
   (2)  such  tax,  or the balance thereof, imposed on any taxpayer which
 ceased to exercise its franchise or to be subject to the tax imposed  by
 this  part  shall  be payable to the commissioner of finance at the time
 the return is required to be filed, provided  such  tax  of  a  domestic
 corporation which continues to possess its franchise shall be subject to
 adjustment as the circumstances may require; all other taxes of any such
 taxpayer,  which  pursuant  to  the provisions of this subdivision would
 otherwise be payable subsequent to the time such return is  required  to
 be filed, shall nevertheless be payable at such time.
   (b)  If the taxpayer, within the time prescribed by subdivision (c) of
 section 11-646 of this part, shall have applied for an automatic  exten-
 sion  of  time  to  file  its  annual  return and shall have paid to the
 commissioner of finance  on or before the date of  such  application  is
 filed  an  amount properly estimated as provided by said subdivision the
 only amount payable in addition to the tax  shall  be  interest  at  the
 underpayment rate set by the commissioner of finance pursuant to section
 11-687  of this chapter, or, if no rate is set, at the rate of seven and
 one-half percent per annum upon the amount by which the tax, or  portion
 thereof  payable  on  or  before  the date the return was required to be
 filed, exceeds the amount so paid, provided that:
   (1) an amount so paid shall be deemed  properly  estimated  if  it  is
 either:  (i)  not less than ninety per cent of the tax as finally deter-
 mined, or (ii) not less than the tax shown on the taxpayer's return  for
 the preceding taxable year, if such preceding year was a taxable year of
 twelve months; and
   (2) the time when a return is required to be filed shall be determined
 without regard to any extension of time for filing such return.
 S. 8474                            587
 
   (c)  The  commissioner  of finance may grant a reasonable extension of
 time for payment of any tax imposed by this part under  such  conditions
 as the commissioner deems just and proper.
 
                              SUBCHAPTER 3-A
                           CORPORATE TAX OF 2015
 Section 11-651   Applicability.
         11-652   Definitions.
         11-653   Imposition of tax; exemptions.
         11-654   Computation of tax.
         11-654.1 Net operating loss.
         11-654.2 Receipts allocation.
         11-654.3 Combined reports.
         11-655   Reports.
         11-656   Payment and lien of tax.
         11-657   Declaration of estimated tax.
         11-658   Payments on account of estimated tax.
         11-659   Collection of taxes.
         11-660   Limitations of time.
   § 11-651 Applicability. 1. Notwithstanding anything to the contrary in
 this  chapter, this subchapter shall apply to corporations for tax years
 commencing on or after January first, two thousand fifteen, except  that
 it shall not apply to any corporation that (a) has an election in effect
 under subsection (a) of section thirteen hundred sixty-two of the inter-
 nal revenue code, as amended, or (b) is a qualified subchapter S subsid-
 iary  within the meaning of paragraph three of subsection (b) of section
 thirteen hundred sixty-one of the internal revenue code, as amended,  in
 any tax year commencing on or after such date. Subchapters two and three
 of this chapter shall not apply to corporations to which this subchapter
 applies for tax years commencing on or after January first, two thousand
 fifteen,  except  to  the  extent provided in this subchapter and to the
 extent that the effect of the application of subchapters two  and  three
 to  tax  years  commencing  prior to January first, two thousand fifteen
 carries over to tax years commencing on  or  after  January  first,  two
 thousand fifteen.
   2.  Each  reference  in the tax law or this code to subchapters two or
 three of this chapter, or any of the provisions thereof, shall be deemed
 a  reference  also  to  this  subchapter,  and  any  of  the  applicable
 provisions  thereof,  where appropriate and with all necessary modifica-
 tions.
   § 11-652 Definitions. 1. (a) The term "corporation"  includes  (1)  an
 association  within  the meaning of paragraph three of subsection (a) of
 section seventy-seven hundred one of the internal revenue code,  includ-
 ing,  when  applicable,  a  limited liability company, (2) a joint-stock
 company or association, (3) a publicly traded partnership treated  as  a
 corporation  for  purposes  of  the  internal  revenue  code pursuant to
 section  seventy-seven  hundred  four  thereof  and  (4)  any   business
 conducted  by  a  trustee  or  trustees wherein interest or ownership is
 evidenced by certificate or other written instrument;
   (b) (1) Notwithstanding paragraph (a) of this subdivision, an unincor-
 porated organization that (i) is described in subparagraph one or  three
 of paragraph (a) of this subdivision, (ii) was subject to the provisions
 of chapter five of this title for its taxable year beginning in nineteen
 hundred ninety-five, and (iii) made a one-time election not to be treat-
 ed  as  a  corporation  and,  instead,  to continue to be subject to the
 provisions of chapter five of this title for its taxable years beginning
 S. 8474                            588
 
 in nineteen hundred ninety-six and  thereafter,  shall  continue  to  be
 subject  to the provisions of chapter five of this title for its taxable
 years beginning in nineteen hundred ninety-six.
   (2)  An  election  under this paragraph shall continue to be in effect
 until revoked by the unincorporated organization. An election under this
 paragraph shall be revoked by the filing of a return under this subchap-
 ter for the first taxable year with respect to which such revocation  is
 to  be  effective. Such return shall be filed on or before the due date,
 determined with regard to extensions, for  filing  such  return.  In  no
 event shall such election or revocation be for a part of a taxable year.
   (c)  Notwithstanding  paragraph (a) of this subdivision, a corporation
 shall not include an entity classified  as  a  partnership  for  federal
 income tax purposes.
   2.  The  term "subsidiary" means a corporation of which over fifty per
 centum of the number of shares of stock entitling the holders thereof to
 vote for the election of directors or trustees is owned by the taxpayer.
   2-a. The term "taxpayer" means any corporation subject  to  tax  under
 this subchapter.
   3. Intentionally omitted.
   3-a.  The  term  "stock"  means  an  interest in a corporation that is
 treated as equity for federal income tax purposes.
   4. (a) The term "investment capital" means investments in stocks that:
 (i) satisfy the definition of a capital asset under section one thousand
 two hundred twenty-one of the internal revenue code  at  all  times  the
 taxpayer owned such stocks during the taxable year; (ii) are held by the
 taxpayer  for  investment for more than one year; (iii) the dispositions
 of which are, or would be, treated by the taxpayer as  generating  long-
 term  capital  gains or losses under the internal revenue code; (iv) for
 stocks acquired on or after January first, two thousand fifteen, at  any
 time  after  the close of the day in which they are acquired, have never
 been held for sale to customers in the regular course of  business;  and
 (v)  before  the  close  of the day on which the stock was acquired, are
 clearly identified in the taxpayer's records as stock held  for  invest-
 ment  in  the same manner as required under paragraph one of subdivision
 (a) of section one thousand  two  hundred  thirty-six  of  the  internal
 revenue  code for the stock of a dealer in securities to be eligible for
 capital gain treatment, whether or not the taxpayer is a dealer of secu-
 rities subject to section one thousand two hundred thirty-six, provided,
 however, that for stock acquired prior to October  first,  two  thousand
 fifteen  that was not subject to subdivision (a) of section one thousand
 two hundred thirty-six of the internal revenue code, such identification
 in the taxpayer's records must occur before October first, two  thousand
 fifteen.  Stock  in  a corporation that is conducting a unitary business
 with the taxpayer, stock in a corporation that is included in a combined
 report with the taxpayer pursuant to the commonly owned  group  election
 in  subdivision  three of section 11-654.3 of this subchapter, and stock
 issued by the taxpayer shall  not  constitute  investment  capital.  For
 purposes of this subdivision, if the taxpayer owns or controls, directly
 or indirectly, less than twenty percent of the voting power of the stock
 of  a  corporation, that corporation will be presumed to be conducting a
 business that is not unitary with the business of the taxpayer.
   (b) There shall be deducted from investment  capital  any  liabilities
 which  are directly or indirectly attributable to investment capital. If
 the amount of those liabilities exceeds the amount of  investment  capi-
 tal, the amount of investment capital shall be zero.
 S. 8474                            589
 
   (c)  Investment  capital  shall  not  include any such investments the
 income from which is excluded from entire net  income  pursuant  to  the
 provisions  of paragraph (c-1) of subdivision eight of this section, and
 that investment capital shall be computed without regard to  liabilities
 directly or indirectly attributable to such investments, but only if air
 carriers  organized  in  the  United States and operating in the foreign
 country or countries in which the taxpayer has its major base  of  oper-
 ations  and  in which it is organized, resident or headquartered, if not
 in the same country as its major base of operations, are not subject  to
 any  tax based on or measured by capital imposed by such foreign country
 or countries or any political subdivision  thereof,  or  if  taxed,  are
 provided  an exemption, equivalent to that provided for herein, from any
 tax based on or measured by capital imposed by such foreign  country  or
 countries  and  from  any  such tax imposed by any political subdivision
 thereof.
   (d) If a taxpayer acquires stock that is a capital asset under section
 one thousand two hundred twenty-one of the internal revenue code  during
 the  taxable  year  and  owns  that stock on the last day of the taxable
 year, it will be presumed, solely for the purposes of determining wheth-
 er that stock should be classified as investment  capital  after  it  is
 acquired,  that  the  taxpayer  held  that stock for more than one year.
 However, if the taxpayer does not in fact own that stock at the time  it
 actually  files  its  original  report  for the taxable year in which it
 acquired the stock, then such presumption shall not apply and the actual
 period of time during which the taxpayer owned the stock shall  be  used
 to  determine whether the stock should be classified as investment capi-
 tal after it is acquired. If the taxpayer relies on such presumption but
 does not own the stock  for  more  than  one  year,  the  taxpayer  must
 increase  its total business capital in the immediately succeeding taxa-
 ble year by the amount included in investment capital  for  that  stock,
 net  of  any liabilities attributable to that stock computed as provided
 in paragraph (b) of this subdivision  and  must  increase  its  business
 income  in  the  immediately  succeeding  taxable  year by the amount of
 income and net gains, but not less than zero, from that  stock  included
 in investment income, less any interest deductions directly or indirect-
 ly  attributable  to that stock, as provided in subdivision five of this
 section.
   (e) When income or gain from  a  debt  obligation  or  other  security
 cannot be allocated to the city using the business allocation percentage
 as  a  result  of  the United States constitutional principles, the debt
 obligation or other security will be included in investment capital.
   5. (a)(i) The term "investment income" means income, including capital
 gains in excess of capital  losses,  from  investment  capital,  to  the
 extent  included in computing entire net income, less, in the discretion
 of the commissioner of finance, any  interest  deductions  allowable  in
 computing  entire  net income which are directly or indirectly attribut-
 able to investment capital or investment income, provided, however, that
 in no case shall investment income exceed entire net income.
   (ii) If the amount of interest deductions  subtracted  under  subpara-
 graph  (i)  of  this  paragraph exceeds investment income, the excess of
 such amount over investment income must be  added  back  to  entire  net
 income.
   (iii) If the taxpayer's investment income determined without regard to
 the  interest deductions subtracted under subparagraph (i) of this para-
 graph comprises more than eight percent of  the  taxpayer's  entire  net
 income,  investment  income  determined  without regard to such interest
 S. 8474                            590
 
 deductions cannot exceed eight percent  of  the  taxpayer's  entire  net
 income.
   (b)  In lieu of subtracting from investment income the amount of those
 interest deductions, the taxpayer  may  make  a  revocable  election  to
 reduce  its total investment income, determined after applying the limi-
 tation in subparagraph (iii) of paragraph (a) of  this  subdivision,  by
 forty  percent.  If  the taxpayer makes this election, the taxpayer must
 also make the elections provided for in paragraphs (b) and (c) of subdi-
 vision five-a of this section. If the taxpayer subsequently revokes this
 election, the taxpayer must revoke the elections provided for  in  para-
 graphs  (b)  and  (c)  of subdivision five-a of this section. A taxpayer
 that does not make this election because it has  no  investment  capital
 will not be precluded from making those other elections.
   (c)  Investment  income  shall not include any amount treated as divi-
 dends pursuant to section seventy-eight of the internal revenue code.
   5-a. (a) The term "other exempt income" means the sum  of  exempt  CFC
 income and exempt unitary corporation dividends.
   (b)  "Exempt  CFC  income" means (i) except to the extent described in
 subparagraph (ii) of this paragraph, the income required to be  included
 in  the  taxpayer's  federal  gross income pursuant to subsection (a) of
 section nine hundred fifty-one of the internal  revenue  code,  received
 from  a  corporation  that  is  conducting  a  unitary business with the
 taxpayer but is not included in a combined report with the taxpayer, and
 (ii) such income required to be included in the taxpayer's federal gross
 income pursuant to subsection (a) of such section nine hundred fifty-one
 of the internal revenue code by reason of subsection (a) of section nine
 hundred  sixty-five  of  the  internal  revenue  code,  as  adjusted  by
 subsection (b) of section nine hundred sixty-five of the internal reven-
 ue  code, and without regard to subsection (c) of such section, received
 from a corporation that is not included in a combined  report  with  the
 taxpayer,  less, (iii) in the discretion of the commissioner of finance,
 any interest deductions directly  or  indirectly  attributable  to  that
 income.  In lieu of subtracting from its exempt CFC income the amount of
 those interest deductions, the taxpayer may make a revocable election to
 reduce its total exempt CFC income by forty  percent.  If  the  taxpayer
 makes  this election, the taxpayer must also make the elections provided
 for in paragraph (b) of subdivision five of this section  and  paragraph
 (c)  of  this  subdivision.  If  the  taxpayer subsequently revokes this
 election, the taxpayer must revoke the elections provided for  in  para-
 graph  (b) of subdivision five of this section and paragraph (c) of this
 subdivision. A taxpayer which does not make this election because it has
 no exempt CFC income will not  be  precluded  from  making  those  other
 elections.  The  income described in subparagraph (ii) of this paragraph
 shall not constitute investment income.
   (c) "Exempt unitary corporate dividends" means those dividends from  a
 corporation  that is conducting a unitary business with the taxpayer but
 is not included in a combined report with the  taxpayer,  less,  in  the
 discretion  of  the  commissioner  of  finance,  any interest deductions
 directly or indirectly attributable to such income. Other than  dividend
 income  received from corporations that are taxable under chapter eleven
 of this title, except for vendors of  utility  services  that  are  also
 taxable  under this subchapter, or would be taxable under chapter eleven
 of this title, except for vendors of  utility  services  that  are  also
 taxable  under  this subchapter, if subject to tax and corporations that
 would have been taxable as insurance corporations under former part  IV,
 title R, chapter forty-six of the administrative code of the city of New
 S. 8474                            591

 York  as  in effect on June thirtieth, nineteen hundred seventy-four, in
 lieu of subtracting from this dividend income those interest deductions,
 the taxpayer may make a revocable election to reduce the total amount of
 this  dividend  income  by  forty  percent.  If  the taxpayer makes this
 election, the taxpayer must also make  the  elections  provided  for  in
 paragraph  (b)  of subdivision five of this section and paragraph (b) of
 this subdivision. If the taxpayer subsequently  revokes  this  election,
 the  taxpayer must revoke the elections provided for in paragraph (b) of
 subdivision five of this section and paragraph (b) of this  subdivision.
 A  taxpayer that does not make this election because it has not received
 any exempt unitary corporation dividends or  is  precluded  from  making
 this  election for dividends received from corporations that are taxable
 under chapter eleven of  this  title,  except  for  vendors  of  utility
 services  that are also taxable under this subchapter, or would be taxa-
 ble under chapter eleven of this title if subject  to  tax,  except  for
 vendors of utility services that are also taxable under this subchapter,
 shall not be precluded from making those other elections.
   (d)  If  the  taxpayer  attributes interest deductions to other exempt
 income and the amount deducted exceeds other exempt income,  the  excess
 of  the  interest deductions over other exempt income must be added back
 to entire net income. In no case shall other exempt income exceed entire
 net income.
   (e) Other exempt income shall not include any amount treated as  divi-
 dends pursuant to section seventy-eight of the internal revenue code.
   6.  (a)  The  term  "business  capital"  means  all assets, other than
 investment capital and stock issued by the  taxpayer,  less  liabilities
 not  deducted from investment capital; provided, however, business capi-
 tal shall include only those assets the income, loss or expense of which
 are properly reflected, or would have been  properly  reflected  if  not
 fully  depreciated  or  expensed or depreciated or expensed to a nominal
 amount, in the computation of entire net income for the taxable year.
   (b) Provided, further, "business capital" shall not include assets  to
 the  extent  employed  for  the  purpose  of  generating income which is
 excluded from entire net income pursuant to the provisions of  paragraph
 (c-1) of subdivision eight of this section and shall be computed without
 regard  to  liabilities  directly  or  indirectly  attributable  to such
 assets, but only if air carriers organized  in  the  United  States  and
 operating  in the foreign country or countries in which the taxpayer has
 its major base of operations and in which it is organized,  resident  or
 headquartered,  if  not  in  the same country as its major base of oper-
 ations, are not subject to any tax  based  on  or  measured  by  capital
 imposed  by  such foreign country or countries or any political subdivi-
 sion thereof, or if taxed, are provided an exemption, equivalent to that
 provided for herein, from any  tax  based  on  or  measured  by  capital
 imposed  by  such  foreign  country  or  countries and from any such tax
 imposed by any political subdivision thereof.
   7. The term "business income" means entire net income minus investment
 income and other exempt income. In no event shall the sum of  investment
 income and other exempt income exceed entire net income. If the taxpayer
 makes  the election provided for in subparagraph one of paragraph (a) of
 subdivision five of section 11-654.2 of this subchapter, then all income
 from qualified financial instruments shall constitute business income.
   8. The term "entire net income" means total net income from all sourc-
 es, which shall be presumably the same as  the  entire  taxable  income,
 which, except as hereafter provided in this subdivision,
 S. 8474                            592
 
   (i)  the  taxpayer is required to report to the United States treasury
 department, or
   (ii)  the  taxpayer,  in the case of a corporation that is exempt from
 federal income tax, other than the tax  on  unrelated  business  taxable
 income imposed under section five hundred eleven of the internal revenue
 code, but which is subject to tax under this subchapter, would have been
 required to report to the United States treasury department but for such
 exemption, or
   (iii)  in the case of an alien corporation that under any provision of
 the internal revenue code is not treated as a "domestic corporation"  as
 defined  in  section  seven  thousand seven hundred one of such code, is
 effectively connected with the conduct of a trade or business within the
 United States as determined under section eight  hundred  eighty-two  of
 the internal revenue code.
   (a) Entire net income shall not include:
   (1) Intentionally omitted;
   (2) Intentionally omitted;
   (2-a)  any  amounts  treated as dividends pursuant to section seventy-
 eight of the internal revenue code to the extent such dividends are  not
 deducted under section two hundred fifty of such code;
   (3) bona fide gifts;
   (4) income and deductions with respect to amounts received from school
 districts and from corporations and associations, organized and operated
 exclusively  for  religious, charitable or educational purposes, no part
 of the net earnings of which inures to the benefit of any private share-
 holder or individual, for the operation of school buses;
   (5) any refund or credit of a  tax  imposed  under  this  chapter,  or
 imposed  by  article nine, nine-A, twenty-three, or former article thir-
 ty-two of the tax law, for which  tax  no  exclusion  or  deduction  was
 allowed  in  determining  the  taxpayer's  entire  net income under this
 subchapter, subchapter two, or subchapter three of this chapter for  any
 prior year;
   (6) Intentionally omitted;
   (7)  that portion of wages and salaries paid or incurred for the taxa-
 ble year for which a deduction is not allowed pursuant to the provisions
 of section two hundred eighty-C of the internal revenue code;
   (8) except with respect to property which is a qualified mass  commut-
 ing  vehicle  described  in  subparagraph  (D)  of  paragraph  eight  of
 subsection (f) of section one hundred sixty-eight of the internal reven-
 ue code, relating to qualified mass commuting vehicles, and property  of
 a taxpayer principally engaged in the conduct of an aviation, steamboat,
 ferry  or  navigation business, or two or more of such businesses, which
 is placed in service before taxable years beginning in nineteen  hundred
 eighty-nine,  any  amount  which  is  included in the taxpayer's federal
 taxable income solely as a result of an election made  pursuant  to  the
 provisions  of  such  paragraph eight as it was in effect for agreements
 entered into prior to January first, nineteen hundred eighty-four;
   (9) except with respect to property which is a qualified mass  commut-
 ing  vehicle  described  in  subparagraph  (D)  of  paragraph  eight  of
 subsection (f) of section one hundred sixty-eight of the internal reven-
 ue code, relating to qualified mass commuting vehicles, and property  of
 a taxpayer principally engaged in the conduct of an aviation, steamboat,
 ferry  or  navigation business, or two or more of such businesses, which
 is placed in service before taxable years beginning in nineteen  hundred
 eighty-nine,  any  amount  which  the  taxpayer could have excluded from
 federal taxable income had it not made the election provided for in such
 S. 8474                            593
 
 paragraph eight as it was in effect for agreements entered into prior to
 January first, nineteen hundred eighty-four;
   (10)  the amount deductible pursuant to paragraph (j) of this subdivi-
 sion;
   (11) upon the disposition of property to which paragraph (j)  of  this
 subdivision  applies,  the amount, if any, by which the aggregate of the
 amounts described in subparagraph eleven of paragraph (b) of this subdi-
 vision attributable to  such  property  exceeds  the  aggregate  of  the
 amounts  described  in paragraph (j) of this subdivision attributable to
 such property;
   (12) the amount deductible pursuant to paragraph (k) of this  subdivi-
 sion;
   (13)  the amount deductible pursuant to paragraph (o) of this subdivi-
 sion;
   (14) the amount computed pursuant to paragraph (q), (r) or (s) of this
 subdivision, but only the amount determined  pursuant  to  one  of  such
 paragraphs; and
   (15)  the  amount  computed pursuant to paragraph (t) of this subdivi-
 sion.
   (16) The amount of any gain added back to determine entire net  income
 in  a  previous  taxable  year  pursuant to subparagraph twenty-three of
 paragraph (b) of subdivision eight of this section is included in feder-
 al gross income for the taxable year.
   (17) The amount of any grant  received  through  either  the  COVID-19
 pandemic  small  business  recovery  grant  program, pursuant to section
 sixteen-ff of the New York state urban development corporation  act,  or
 the  small business resilience grant program administered by the depart-
 ment of small business services, to the extent the amount of either such
 grant is included in federal taxable income.
   (a-1) Notwithstanding any other provision of this subchapter,  in  the
 case of a taxpayer that is a partner in a partnership subject to the tax
 imposed  by  chapter  eleven  of  this title as a utility, as defined in
 subdivision six of section 11-1101 of such chapter,  entire  net  income
 shall  not  include  the  taxpayer's  distributive or pro rata share for
 federal income tax purposes  of  any  item  of  income,  gain,  loss  or
 deduction  of  such  partnership,  or  any item of income, gain, loss or
 deduction of such partnership that the taxpayer is required to take into
 account separately for federal income tax purposes.
   (b) Entire net income  shall  be  determined  without  the  exclusion,
 deduction or credit of:
   (1)  in  the  case of an alien corporation that under any provision of
 the internal revenue code is not treated as a "domestic corporation"  as
 defined  in  section  seven thousand seven hundred one of such code, (i)
 any part of any income from dividends or interest on any kind of  stock,
 securities or indebtedness, but only if such income is treated as effec-
 tively  connected  with the conduct of a trade or business in the United
 States pursuant to section eight  hundred  sixty-four  of  the  internal
 revenue  code,  (ii) any income exempt from federal taxable income under
 any treaty obligation of the United States,  but  only  if  such  income
 would  be  treated  as  effectively  connected  in  the  absence of such
 exemption provided that such treaty obligation  does  not  preclude  the
 taxation  of  such income by a state, or (iii) any income which would be
 treated as effectively connected if such income were not  excluded  from
 gross  income pursuant to subsection (a) of section one hundred three of
 the internal revenue code;
 S. 8474                            594
 
   (2) any part of any income from dividends or interest of any  kind  of
 stock, securities, or indebtedness;
   (3)  taxes  on or measured by profits or income paid or accrued to the
 United States, any of its  possessions,  territories  or  commonwealths,
 including taxes in lieu of any of the foregoing taxes otherwise general-
 ly  imposed  by  any possession, territory or commonwealth of the United
 States, or taxes paid or  accrued  to  the  state  under  article  nine,
 nine-A, thirteen-A or thirty-two of the tax law as in effect on December
 thirty-first, two thousand fourteen;
   (3-a)  taxes  on  or  measured  by profits or income, or which include
 profits or income as a measure, paid or accrued to any  other  state  of
 the  United  States,  or  any  political  subdivision thereof, or to the
 District of Columbia, including taxes expressly in lieu of  any  of  the
 foregoing  taxes  otherwise  generally imposed by any other state of the
 United States, or any political subdivision thereof, or the District  of
 Columbia;
   (4) taxes imposed under this chapter;
   (4-a) Intentionally omitted;
   (4-b) the amount allowed as an exclusion or a deduction imposed by the
 tax  law  in  determining  the  entire  taxable  income for a relocation
 described in subdivision thirteen of section 11-654 of  this  subchapter
 which  the  taxpayer is required to report to the United States treasury
 department but only such portion of such exclusion or deduction which is
 not in excess of the amount of the credit allowed pursuant  to  subdivi-
 sion thirteen of section 11-654 of this subchapter;
   (4-c) the amount allowed as an exclusion or a deduction imposed by the
 tax  law  for  a relocation described in subdivision fourteen of section
 11-654 of this subchapter in determining the entire taxable income which
 the taxpayer is required to report to the United States treasury depart-
 ment but only such portion of such exclusion or deduction which  is  not
 in  excess  of  the amount of the credit allowed pursuant to subdivision
 fourteen of section 11-654 of this subchapter;
   (4-d) Intentionally omitted;
   (4-e) Intentionally omitted;
   (5) Intentionally omitted;
   (6) any amount allowed as a  deduction  for  the  taxable  year  under
 section  one hundred seventy-two of the internal revenue code, including
 carryovers of deductions from prior taxable years;
   (7) any amount by reason of the granting, issuing  or  assuming  of  a
 restricted  stock  option,  as  defined  in the internal revenue code of
 nineteen hundred fifty-four, or by reason of the transfer of  the  share
 of  stock upon the exercise of the option, unless such share is disposed
 of by the grantee of the option within two years from the  date  of  the
 granting  of  the option or within six months after the transfer of such
 share to the grantee;
   (8) Intentionally omitted;
   (9) except with respect to property which is a qualified mass  commut-
 ing  vehicle  described  in  subparagraph  (D)  of  paragraph  eight  of
 subsection (f) of section one hundred sixty-eight of the internal reven-
 ue code, relating to qualified mass commuting vehicles, and property  of
 a taxpayer principally engaged in the conduct of an aviation, steamboat,
 ferry  or  navigation business, or two or more of such businesses, which
 is placed in service before taxable years beginning in nineteen  hundred
 eighty-nine,  any  amount  which  the taxpayer claimed as a deduction in
 computing its federal taxable income solely as a result of  an  election
 made  pursuant  to  the  provisions of such paragraph eight as it was in
 S. 8474                            595
 
 effect for agreements entered into  prior  to  January  first,  nineteen
 hundred eighty-four;
   (10) except with respect to property which is a qualified mass commut-
 ing  vehicle  described  in  subparagraph  (D)  of  paragraph  eight  of
 subsection (f) of section one hundred sixty-eight of the internal reven-
 ue code, relating to qualified mass commuting vehicles, and property  of
 a taxpayer principally engaged in the conduct of an aviation, steamboat,
 ferry  or  navigation business, or two or more of such businesses, which
 is placed in service before taxable years beginning in nineteen  hundred
 eighty-nine,  any  amount which the taxpayer would have been required to
 include in the computation of its federal taxable income had it not made
 the election permitted pursuant to such paragraph eight  as  it  was  in
 effect  for  agreements  entered  into  prior to January first, nineteen
 hundred eighty-four;
   (11) in the case of property placed in service in taxable years begin-
 ning before nineteen hundred ninety-four, for  taxable  years  beginning
 after  December  thirty-first,  nineteen hundred eighty-one, except with
 respect to property subject to the provisions  of  section  two  hundred
 eighty-F   of  the  internal  revenue  code,  property  subject  to  the
 provisions of section one hundred sixty-eight of  the  internal  revenue
 code which is placed in service in this state in taxable years beginning
 after  December  thirty-first, nineteen hundred eighty-four and property
 of a taxpayer principally engaged in the conduct of an aviation,  steam-
 boat,  ferry  or navigation business, or two or more of such businesses,
 which is placed in service before taxable years  beginning  in  nineteen
 hundred  eighty-nine,  the  amount  allowable  as a deduction determined
 under section one hundred sixty-eight of the internal revenue code;
   (12) upon the disposition of property to which paragraph (j)  of  this
 subdivision  applies,  the amount, if any, by which the aggregate of the
 amounts described in such paragraph (j) attributable  to  such  property
 exceeds the aggregate of the amounts described in subparagraph eleven of
 this paragraph attributable to such property;
   (13) Intentionally omitted;
   (14) Intentionally omitted;
   (15) Intentionally omitted;
   (16)  in  the case of qualified property described in paragraph two of
 subsection (k) of section one hundred sixty-eight of the internal reven-
 ue code, other than qualified  resurgence  zone  property  described  in
 paragraph  (m)  of  this  subdivision, and other than qualified New York
 Liberty Zone property described in paragraph two of  subsection  (b)  of
 section  fourteen hundred-L of the internal revenue code, without regard
 to clause (i) of subparagraph (C) of such paragraph, the  amount  allow-
 able  as a deduction under section one hundred sixty-seven of the inter-
 nal revenue code;
   (17) in the case of a taxpayer that  is  not  an  eligible  farmer  as
 defined in subsection (n) of section six hundred six of the tax law, the
 amount allowable as a deduction under sections one hundred seventy-nine,
 one  hundred  sixty-seven  and  one  hundred sixty-eight of the internal
 revenue code with respect to a sport  utility  vehicle  that  is  not  a
 passenger  automobile  as defined in paragraph five of subsection (d) of
 section two hundred eighty-F of the internal revenue code;
   (18) the amount of any  deduction  allowed  pursuant  to  section  one
 hundred ninety-nine of the internal revenue code;
   (19) the amount of any federal deduction for taxes imposed under arti-
 cle twenty-three of the tax law;
 S. 8474                            596
 
   (20)   the  amount  of  any  federal  deduction  allowed  pursuant  to
 subsection (c) of section nine hundred sixty-five of the internal reven-
 ue code;
   (21)  the amount of any federal deduction allowed pursuant to subpara-
 graph (A) of paragraph one of subdivision (a)  of  section  two  hundred
 fifty of the internal revenue code.
   (22)  For  taxable  years  beginning  in two thousand nineteen and two
 thousand twenty, the amount of the  increase  in  the  federal  interest
 deduction  allowed  pursuant  to  paragraph  ten  of  subdivision (j) of
 section one hundred sixty-three of the internal revenue code.
   (23) The amount of any gain excluded from federal gross income for the
 taxable year by subparagraph (A) of paragraph (1) of subsection  (a)  of
 section one thousand four hundred-Z-two of the internal revenue code.
   (c) Intentionally omitted.
   (c-1)(1)  Notwithstanding  any  other provision of this subchapter, in
 the case of a taxpayer which is a foreign air carrier holding a  foreign
 air carrier permit issued by the United States department of transporta-
 tion pursuant to section four hundred two of the federal aviation act of
 nineteen  hundred  fifty-eight, as amended, and which is qualified under
 subparagraph two of this paragraph, entire net income shall not include,
 and shall be computed without the  deduction  of,  amounts  directly  or
 indirectly  attributable  to,  (i)  any income derived from the interna-
 tional operation  of  aircraft  as  described  in  and  subject  to  the
 provisions of section eight hundred eighty-three of the internal revenue
 code,  (ii)  income  without the United States which is derived from the
 operation of aircraft, and (iii) income without the United States  which
 is  of  a  type  described  in  subdivision (a) of section eight hundred
 eighty-one of the internal revenue code except that it is  derived  from
 sources  without  the  United  States.  Entire  net income shall include
 income described in clauses (i), (ii) and (iii) of this subparagraph  in
 the case of taxpayers not described in the previous sentence;
   (2)  A  taxpayer  is qualified under this subparagraph if air carriers
 organized in the United States and operating in the foreign  country  or
 countries  in which the taxpayer has its major base of operations and in
 which it is organized, resident or headquartered, if  not  in  the  same
 country  as  its major base of operations, are not subject to any income
 tax or other tax based on or measured by income or receipts  imposed  by
 such  foreign country or countries or any political subdivision thereof,
 or if so subject to such tax, are provided an exemption  from  such  tax
 equivalent to that provided for herein.
   (d)  The  commissioner  of finance may, whenever necessary in order to
 properly reflect the entire net income of any  taxpayer,  determine  the
 year  or  period  in  which  any  item  of  income or deduction shall be
 included, without regard to the method of  accounting  employed  by  the
 taxpayer.
   (e)  The  entire net income of any bridge commission created by act of
 congress to construct a bridge across an  international  boundary  means
 its gross income less the expense of maintaining and operating its prop-
 erties,  the  annual  interest upon its bonds and other obligations, and
 the annual charge for the retirement of such  bonds  or  obligations  at
 maturity.
   (f) Intentionally omitted.
   (g)  At the election of the taxpayer, a deduction shall be allowed for
 expenditures  paid  or  incurred  during  the  taxable  year   for   the
 construction,  reconstruction,  erection  or  improvement  of industrial
 waste treatment facilities and air pollution control facilities.
 S. 8474                            597

   (1)(i) The term "industrial waste  treatment  facilities"  shall  mean
 facilities  for the treatment, neutralization or stabilization of indus-
 trial waste, as the  term  "industrial  waste"  is  defined  in  section
 17-0105  of the environmental conservation law, from a point immediately
 preceding  the  point of such treatment, neutralization or stabilization
 to the point of disposal, including the necessary pumping and  transmit-
 ting facilities, but excluding such facilities installed for the primary
 purpose  of  salvaging  materials  which are usable in the manufacturing
 process or are marketable.
   (ii) The term "air pollution control facilities" shall mean facilities
 which remove, reduce, or render less noxious  air  contaminants  emitted
 from  an  air  contamination  source, as the terms "air contaminant" and
 "air contamination source" are defined in section 19-0107 of  the  envi-
 ronmental conservation law, from a point immediately preceding the point
 of  such  removal,  reduction  or rendering to the point of discharge of
 air, meeting emission standards as  established  by  the  air  pollution
 control  board,  but excluding such facilities installed for the primary
 purpose of salvaging materials which are  usable  in  the  manufacturing
 process  or are marketable and excluding those facilities which rely for
 their efficacy on dilution, dispersion or assimilation  of  air  contam-
 inants in the ambient air after emission.
   (2)  However, such deduction shall be allowed only (i) with respect to
 tangible property which is depreciable, pursuant to section one  hundred
 sixty-seven of the internal revenue code, having a situs in the city and
 used  in  the  taxpayer's  trade  or  business, the construction, recon-
 struction, erection or improvement of which, in the case  of  industrial
 waste  treatment  facilities,  is  initiated  on or after January first,
 nineteen hundred sixty-six, and only for expenditures paid  or  incurred
 prior  to  January first, nineteen hundred seventy-two, or which, in the
 case of air pollution control facilities, is initiated on or after Janu-
 ary first, nineteen hundred sixty-six, and
   (ii) on condition that such facilities  have  been  certified  by  the
 state  commissioner  of  environmental conservation or the state commis-
 sioner's designated representative, in the same manner as  provided  for
 in  section 17-0707 or 19-0309 of the environmental conservation law, as
 applicable, as complying with applicable provisions of the environmental
 conservation law, the state sanitary code and  regulations,  permits  or
 orders issued pursuant thereto, and
   (iii) on condition that entire net income for the taxable year and all
 succeeding  taxable  years  be  computed without any deductions for such
 expenditures or for depreciation of the same  property  other  than  the
 deductions allowed by this paragraph except to the extent that the basis
 of  the property may be attributable to factors other than such expendi-
 tures, or in case a deduction is allowable pursuant  to  this  paragraph
 for  only  a  part of such expenditures, on condition that any deduction
 allowed for federal income tax purposes for  such  expenditures  or  for
 depreciation  of the same property be proportionately reduced in comput-
 ing entire net income for the taxable year and  all  succeeding  taxable
 years, and
   (iv)  where  the election provided for in paragraph (d) of subdivision
 three of section 11-604 of this chapter or the election provided for  in
 subdivision (k) of section 11-641 of this chapter has not been exercised
 in respect to the same property.
   (3)(i)  If  expenditures  in  respect to an industrial waste treatment
 facility or an air pollution control  facility  have  been  deducted  as
 provided herein and if within ten years from the end of the taxable year
 S. 8474                            598
 
 in which such deduction was allowed such property or any part thereof is
 used  for the primary purpose of salvaging materials which are usable in
 the manufacturing process or are marketable, the taxpayer  shall  report
 such change of use in its report for the first taxable year during which
 it occurs, and the commissioner of finance may recompute the tax for the
 year  or years for which such deduction was allowed and any carryback or
 carryover year, and may assess any additional tax  resulting  from  such
 recomputation  within  the  time  fixed  by paragraph (h) of subdivision
 three of section 11-674 of this chapter.
   (ii) If a deduction is allowed as  herein  provided  for  expenditures
 paid  or  incurred  during  any taxable year on the basis of a temporary
 certificate of compliance issued pursuant to the environmental conserva-
 tion law and if the taxpayer fails to obtain a permanent certificate  of
 compliance  upon completion of the facilities with respect to which such
 temporary certificate was issued, the taxpayer shall report such failure
 in its report for the taxable year  during  which  such  facilities  are
 completed, and the commissioner of finance may recompute the tax for the
 year  or years for which such deduction was allowed and any carryback or
 carryover year, and may assess any additional tax  resulting  from  such
 recomputation  within  the  time  fixed  by paragraph (h) of subdivision
 three of section 11-674 of this chapter.
   (4) In any taxable year when property is sold  or  otherwise  disposed
 of,  with respect to which a deduction has been allowed pursuant to this
 paragraph, such deduction shall be  disregarded  in  computing  gain  or
 loss,  and  the  gain  or  loss on the sale or other disposition of such
 property shall be the gain or loss  entering  into  the  computation  of
 entire  taxable  income  which the taxpayer is required to report to the
 United States treasury for such taxable year;
   (h) With respect to gain derived from the sale or other disposition of
 any property acquired prior to January first,  nineteen  hundred  sixty-
 six;  which had a federal adjusted basis on such date, or on the date of
 its sale or other disposition prior to January first,  nineteen  hundred
 sixty-six,  lower  than its fair market value on January first, nineteen
 hundred sixty-six or the date of its sale  or  other  disposition  prior
 thereto,  except  property  described  in  subsections  one  and four of
 section twelve hundred twenty-one of the internal  revenue  code,  there
 shall be deducted from entire net income, the difference between (1) the
 amount  of  the taxpayer's federal taxable income, and (2) the amount of
 the taxpayer's federal  taxable  income,  if  smaller  than  the  amount
 described  in  subparagraph  one  of  this paragraph, computed as if the
 federal adjusted basis of each such  property,  on  the  sale  or  other
 disposition  of which gain was derived, on the date of the sale or other
 disposition had been equal to either (i) its fair market value on  Janu-
 ary  first,  nineteen hundred sixty-six or the date of its sale or other
 disposition prior to January first, nineteen hundred sixty-six, plus  or
 minus  all  adjustments  to basis made with respect to such property for
 federal income tax purposes for periods  on  and  after  January  first,
 nineteen  hundred sixty-six or (ii) the amount realized from its sale or
 disposition, whichever is  lower;  provided,  however,  that  the  total
 modification  provided  by this paragraph shall not exceed the amount of
 the taxpayer's net gain from the sale or other disposition of  all  such
 property.
   (i)  If  the period covered by a report under this subchapter is other
 than the period covered by the report  of  the  United  States  treasury
 department,  entire  net  income  shall be determined by multiplying the
 federal taxable income, as adjusted pursuant to the provisions  of  this
 S. 8474                            599
 
 subchapter,  by  the  number  of  calendar months or major parts thereof
 covered by the report under this subchapter and dividing by  the  number
 of  calendar months or major parts thereof covered by the report to such
 department.  If  it  shall appear that such method of determining entire
 net income does not properly reflect the taxpayer's  income  during  the
 period  covered by the report under this subchapter, the commissioner of
 finance shall be authorized in his or her discretion to  determine  such
 entire  net  income  solely on the basis of the taxpayer's income during
 the period covered by its report under this subchapter.
   (j) In the case of property placed in service in taxable years  begin-
 ning  before  nineteen  hundred ninety-four, for taxable years beginning
 after December thirty-first, nineteen hundred  eighty-one,  except  with
 respect  to  property  subject  to the provisions of section two hundred
 eighty-F of the internal  revenue  code  and  property  subject  to  the
 provisions  of  section  one hundred sixty-eight of the internal revenue
 code which is placed in service in this state in taxable years beginning
 after December thirty-first, nineteen hundred eighty-four, and  provided
 a  deduction  has  not  been excluded from entire net income pursuant to
 subparagraph nine of paragraph (b) of this subdivision, a taxpayer shall
 be allowed with respect to property which is subject to  the  provisions
 of  section  one  hundred  sixty-eight  of the internal revenue code the
 depreciation deduction allowable under section one  hundred  sixty-seven
 of the internal revenue code as such section would have applied to prop-
 erty  placed  in  service  on  December  thirty-first,  nineteen hundred
 eighty.  This paragraph shall not apply to property of a taxpayer  prin-
 cipally engaged in the conduct of an aviation, steamboat, ferry or navi-
 gation  business,  or two or more of such businesses, which is placed in
 service before taxable years beginning in nineteen hundred eighty-nine.
   (k) In the case of qualified property described in  paragraph  two  of
 subsection (k) of section one hundred sixty-eight of the internal reven-
 ue  code,  other  than  qualified  resurgence zone property described in
 paragraph (m) of this subdivision, and other  than  qualified  New  York
 Liberty  Zone  property  described in paragraph two of subsection (b) of
 section fourteen hundred-L of the internal revenue code, without  regard
 to  clause  (i)  of subparagraph (C) of such paragraph, the depreciation
 deduction allowable  under  section  one  hundred  sixty-seven  as  such
 section  would have applied to such property had it been acquired by the
 taxpayer on September tenth, two thousand one, provided,  however,  that
 for  taxable  years  beginning  on  or after January first, two thousand
 four, in the case of a passenger motor vehicle or a sport utility  vehi-
 cle  subject to the provisions of paragraph (o) of this subdivision, the
 limitation under clause (i) of subparagraph  (A)  of  paragraph  one  of
 subdivision  (a) of section two hundred eighty-F of the internal revenue
 code applicable to the amount allowed as a deduction  under  this  para-
 graph  shall  be  determined  as  of the date such vehicle was placed in
 service and not as of September tenth, two thousand one.
   (l) Upon the disposition of property to which paragraph  (k)  of  this
 subdivision applies, the amount of any gain or loss includible in entire
 net  income  shall  be adjusted to reflect the inclusions and exclusions
 from entire net income pursuant to subparagraph twelve of paragraph  (a)
 and  subparagraph sixteen of paragraph (b) of this subdivision attribut-
 able to such property.
   (m) For purposes of this paragraph and paragraph (l) of this  subdivi-
 sion,  qualified  resurgence zone property shall mean qualified property
 described in paragraph two of subsection  (k)  of  section  one  hundred
 sixty-eight of the internal revenue code substantially all of the use of
 S. 8474                            600
 
 which  is in the resurgence zone, as defined below, and is in the active
 conduct of a trade or business by the taxpayer in  such  zone,  and  the
 original use of which in the resurgence zone commences with the taxpayer
 after  September tenth, two thousand one. The resurgence zone shall mean
 the area of New York county bounded on the south by a line running  from
 the  intersection  of  the  Hudson  River  with  the Holland Tunnel, and
 running thence east to Canal Street, then running along  the  centerline
 of  Canal  Street  to  the  intersection of the Bowery and Canal Street,
 running thence in a southeasterly direction diagonally across  Manhattan
 Bridge  Plaza,  to the Manhattan Bridge, and thence along the centerline
 of the Manhattan Bridge to the point where the centerline of the Manhat-
 tan Bridge would intersect with the easterly bank of the East River, and
 bounded on the north by a line running  from  the  intersection  of  the
 Hudson River with the Holland Tunnel and running thence north along West
 Avenue  to  the  intersection of Clarkson Street then running east along
 the centerline of Clarkson Street  to  the  intersection  of  Washington
 Avenue,  then running south along the centerline of Washington Avenue to
 the intersection of West Houston Street, then east along the  centerline
 of  West  Houston  Street, then at the intersection of the Avenue of the
 Americas continuing east along the centerline of East Houston Street  to
 the easterly bank of the East River.
   (n)  Related  members expense add back. (1) For purposes of this para-
 graph: (i) "Related member" means a related person as defined in subpar-
 agraph (c) of paragraph three of subsection (b) of section four  hundred
 sixty-five  of  the  internal  revenue code, except that "fifty percent"
 shall be substituted for "ten percent".
   (ii) "Effective rate of tax" means, as to any city, the maximum statu-
 tory rate of tax imposed by  the  city  on  or  measured  by  a  related
 member's  net  income  multiplied  by the allocation percentage, if any,
 applicable to the related member under the laws  of  said  jurisdiction.
 For  purposes  of  this  definition, the effective rate of tax as to any
 city is zero where the related member's net income tax liability in said
 city is reported on a combined or consolidated return including both the
 taxpayer and the related member where the reported transactions  between
 the  taxpayer and the related member are eliminated or offset. Also, for
 purposes of this definition, when computing the effective  rate  of  tax
 for  a  city  in  which  a  related member's net income is eliminated or
 offset by a credit or similar adjustment  that  is  dependent  upon  the
 related  member  either  maintaining  or managing intangible property or
 collecting interest income in that city, the maximum statutory  rate  of
 tax  imposed  by  said  city shall be decreased to reflect the statutory
 rate of tax that applies to the related member as effectively reduced by
 such credit or similar adjustment.
   (iii) Royalty payments are payments directly connected to the acquisi-
 tion, use, maintenance or management, ownership, sale, exchange, or  any
 other  disposition  of  licenses,  trademarks,  copyrights, trade names,
 trade dress, service marks, mask works, trade secrets, patents  and  any
 other  similar  types  of intangible assets as determined by the commis-
 sioner of finance, and include amounts allowable as interest  deductions
 under  section  one  hundred sixty-three of the internal revenue code to
 the extent such amounts are directly or indirectly for, related to or in
 connection with the acquisition, use, maintenance or management,  owner-
 ship, sale, exchange or disposition of such intangible assets.
   (iv)  A valid business purpose is one or more business purposes, other
 than the avoidance or reduction of taxation, which alone or in  combina-
 tion  constitute  the  primary  motivation for some business activity or
 S. 8474                            601
 
 transaction, which activity or transaction changes in a meaningful  way,
 apart  from  tax  effects,  the  economic  position of the taxpayer. The
 economic position of the taxpayer includes an  increase  in  the  market
 share  of  the  taxpayer, or the entry by the taxpayer into new business
 markets.
   (2) Royalty expense add backs. (i) Except where a taxpayer is included
 in a combined report pursuant to section  11-654.3  of  this  subchapter
 with  the applicable related member, for the purpose of computing entire
 net income or other applicable taxable basis, a taxpayer must  add  back
 royalty  payments  directly  or indirectly paid, accrued, or incurred in
 connection with one or more direct or indirect transactions with one  or
 more related members during the taxable year to the extent deductible in
 calculating federal taxable income.
   (ii)  Exceptions.  (A) The adjustment required in this paragraph shall
 not apply to the portion of the royalty payment that the taxpayer estab-
 lishes, by clear and convincing evidence of the type  and  in  the  form
 specified  by  the  commissioner  of finance, meets all of the following
 requirements: (I) the related member was subject to tax in this city  or
 another city within the United States or a foreign nation or some combi-
 nation  thereof  on  a  tax base that included the royalty payment paid,
 accrued or incurred by the taxpayer; (II) the related member during  the
 same  taxable year directly or indirectly paid, accrued or incurred such
 portion to a person that is not a related member; and (III)  the  trans-
 action  giving  rise to the royalty payment between the taxpayer and the
 related member was undertaken for a valid business purpose.
   (B) The adjustment required in this paragraph shall not apply  if  the
 taxpayer  establishes,  by clear and convincing evidence of the type and
 in the form specified by the commissioner  of  finance,  that:  (I)  the
 related  member  was  subject to tax on or measured by its net income in
 this city or another city within the United States, or some  combination
 thereof;  (II)  the  tax  base for said tax included the royalty payment
 paid, accrued or incurred by  the  taxpayer;  and  (III)  the  aggregate
 effective  rate  of tax applied to the related member in those jurisdic-
 tions is no less than eighty percent of the statutory rate of  tax  that
 applied  to  the  taxpayer  under section 11-604 of this chapter for the
 taxable year.
   (C) The adjustment required in this paragraph shall not apply  if  the
 taxpayer  establishes,  by clear and convincing evidence of the type and
 in the form specified by the commissioner  of  finance,  that:  (I)  the
 royalty payment was paid, accrued or incurred to a related member organ-
 ized  under the laws of a country other than the United States; (II) the
 related member's income from the transaction was subject to a comprehen-
 sive income tax treaty between such country and the United States; (III)
 the related member was subject to tax in a foreign nation on a tax  base
 that  included  the  royalty  payment  paid,  accrued or incurred by the
 taxpayer; (IV) the related member's  income  from  the  transaction  was
 taxed in such country at an effective rate of tax at least equal to that
 imposed  by  this city; and (V) the royalty payment was paid, accrued or
 incurred pursuant to a transaction that was undertaken for a valid busi-
 ness purpose and using terms that reflect an arm's length relationship.
   (D) The adjustment required in this paragraph shall not apply  if  the
 taxpayer  and the commissioner of finance agree in writing to the appli-
 cation or use of alternative adjustments or  computations.  The  commis-
 sioner  of  finance may, in his or her discretion, agree to the applica-
 tion or use of alternative adjustments or computations when  he  or  she
 S. 8474                            602
 
 concludes  that  in  the  absence  of  such  agreement the income of the
 taxpayer would not be properly reflected.
   (o)  In  the  case  of  a  taxpayer  that is not an eligible farmer as
 defined in subsection (n) of section six hundred six of the tax law, the
 deductions  allowable  under  sections  one  hundred  seventy-nine,  one
 hundred  sixty-seven and one hundred sixty-eight of the internal revenue
 code with respect to a sport utility vehicle that  is  not  a  passenger
 automobile as defined in paragraph five of subsection (d) of section two
 hundred  eighty-F  of  the  internal revenue code, determined as if such
 sport utility vehicle were a passenger automobile  as  defined  in  such
 paragraph  five.  For  purposes of subparagraph sixteen of paragraph (b)
 and paragraph (k) of this subdivision, the  terms  qualified  resurgence
 zone  property and qualified New York Liberty Zone property described in
 paragraph two of subsection b  of  section  fourteen  hundred-L  of  the
 internal  revenue  code shall not include any sport utility vehicle that
 is not a passenger automobile as defined in paragraph five of subsection
 (d) of section two hundred eighty-F of the internal revenue code.
   (p) Upon the disposition of property to which paragraph  (o)  of  this
 subdivision applies, the amount of any gain or loss includible in entire
 net  income  shall  be adjusted to reflect the inclusions and exclusions
 from entire net income pursuant to subparagraph  thirteen  of  paragraph
 (a)  and  subparagraph  seventeen  of  paragraph (b) of this subdivision
 attributable to such property.
   (q) Subtraction modification for community banks  and  small  thrifts.
 (1) A taxpayer that is a qualified community bank as defined in subpara-
 graph  two of this paragraph or a small thrift institution as defined in
 subparagraph two-a of this paragraph shall be  allowed  a  deduction  in
 computing  entire net income equal to the amount computed under subpara-
 graph three of this paragraph.
   (2) To be a qualified community bank,  a  taxpayer  must  satisfy  the
 following conditions:
   (i)  It  is  a bank or trust company organized under or subject to the
 provisions of article three of the banking law or a comparable provision
 of the laws of another state, or a national banking association.
   (ii) The average value during the taxable year of the  assets  of  the
 taxpayer,  or,  if  the  taxpayer  is included in a combined report, the
 assets of the combined reporting group of  the  taxpayer  under  section
 11-654.3 of this subchapter, must not exceed eight billion dollars.
   (2-a)  To  be  a small thrift institution, a taxpayer must satisfy the
 following conditions:
   (i) It is a savings bank, a savings and  loan  association,  or  other
 savings  institution  chartered  and supervised as such under federal or
 state law.
   (ii) The average value during the taxable year of the  assets  of  the
 taxpayer,  or,  if  the  taxpayer  is included in a combined report, the
 assets of the combined reporting group of  the  taxpayer  under  section
 11-654.3 of this subchapter, must not exceed eight billion dollars.
   (3)(i) The subtraction modification shall be computed as follows:
   (A)  Multiply the taxpayer's net interest income from loans during the
 taxable year by a fraction, the numerator of which is the gross interest
 income during the taxable year from qualifying loans and the denominator
 of which is the gross interest income during the taxable year  from  all
 loans.
   (B)  Multiply the amount determined in subclause (A) of this clause by
 fifty percent. This product is the amount of the deduction allowed under
 this paragraph.
 S. 8474                            603
 
   (ii)(A) Net interest income  from  loans  shall  mean  gross  interest
 income from loans less gross interest expense from loans. Gross interest
 expense  from  loans is determined by multiplying gross interest expense
 by a fraction, the numerator of which is  the  average  total  value  of
 loans owned by the thrift institution or community bank during the taxa-
 ble year and the denominator of which is the average total assets of the
 thrift institution or community bank during the taxable year.
   (B)  Measurement  of  assets.  For  purposes of this clause: (I) Total
 assets are those assets that are properly reflected on a balance  sheet,
 computed  in  the same manner as is required by the banking regulator of
 the taxpayers included in the combined return. In addition, total assets
 includes leased real property  that  is  not  properly  reflected  on  a
 balance sheet.
   (II)  Assets  will only be included if the income or expenses of which
 are properly reflected, or would have been  properly  reflected  if  not
 fully  depreciated  or expensed, or depreciated or expensed to a nominal
 amount, in the computation of the taxpayer's entire net income  for  the
 taxable year. Assets will not include deferred tax assets and intangible
 assets identified as "goodwill".
   (III)  Tangible  real  and personal property, such as buildings, land,
 machinery, and equipment, shall be valued at cost. Leased real  property
 that  is  not  properly reflected on the balance sheet will be valued at
 the annual lease payment multiplied by eight. Intangible property,  such
 as  loans  and  investments,  shall be valued at book value exclusive of
 reserves.
   (IV) Average assets are computed using  the  assets  measured  on  the
 first  day  of  the taxable year, and on the last day of each subsequent
 quarter of the taxable year or month or day during the taxable year.
   (iii) A qualifying loan is a loan that meets the conditions  specified
 in subclause (A) of this clause and subclause (B) of this clause.
   (A)  The  loan  is originated by the qualified community bank or small
 thrift institution or purchased by the qualified community bank or small
 thrift institution immediately after its origination in connection  with
 a commitment to purchase made by the bank or thrift institution prior to
 the loan's origination.
   (B)  The loan is a small business loan or a residential mortgage loan,
 the principal amount of which loan is five million dollars or less,  and
 either  the borrower is located in this city as determined under section
 11-654.2 of this subchapter and the loan is not secured by real  proper-
 ty, or the loan is secured by real property located in the city.
   (C)  A  loan that meets the definition of a qualifying loan in a prior
 taxable year, including years prior to the effective date of this  para-
 graph, remains a qualifying loan in taxable years during and after which
 such  loan is acquired by another corporation in the taxpayer's combined
 reporting group under section 11-654.3 of this subchapter.
   (r) A small thrift institution  or  a  qualified  community  bank,  as
 defined  in paragraph (q) of this subdivision, that maintained a captive
 REIT on  April  first,  two  thousand  fourteen  shall  utilize  a  REIT
 subtraction  equal  to  one  hundred sixty percent of the dividends paid
 deductions allowed to that captive REIT for the taxable year for federal
 income tax purposes and shall not be allowed to utilize the  subtraction
 modification  for  community banks and small thrifts under paragraph (q)
 of this subdivision or the subtraction modification for qualified  resi-
 dential  loan  portfolios under paragraph (s) of this subdivision in any
 tax year in which such thrift institution or  community  bank  maintains
 that captive REIT.
 S. 8474                            604

   (s)  Subtraction  modification  for qualified residential loan portfo-
 lios. (1)(i) A taxpayer that is either a thrift institution  as  defined
 in subparagraph three of this paragraph or a qualified community bank as
 defined  in  subparagraph  two  of paragraph (q) of this subdivision and
 maintains  a qualified residential loan portfolio as defined in subpara-
 graph two of this paragraph shall be allowed as a deduction in computing
 entire net income the amount, if any, by which (A) thirty-two percent of
 its entire net  income  determined  without  regard  to  this  paragraph
 exceeds  (B)  the  amounts deducted by the taxpayer pursuant to sections
 one hundred sixty-six and  five  hundred  eighty-five  of  the  internal
 revenue  code  less  any amounts included in federal taxable income as a
 result of a recovery of a loan.
   (ii)(A) If the taxpayer is in a combined report under section 11-654.3
 of this subchapter, this deduction will be computed on a combined basis.
 In that instance, the entire net income of the combined reporting  group
 for  purposes  of  this paragraph shall be multiplied by a fraction, the
 numerator of which is the average total assets of all the thrift  insti-
 tutions  and  qualified  community banks included in the combined report
 and the denominator of which is the average  total  assets  of  all  the
 corporations included in the combined report.
   (B)  Measurement  of assets. For purposes of this paragraph: (I) Total
 assets are those assets that are properly reflected on a balance  sheet,
 computed  in  the same manner as is required by the banking regulator of
 the taxpayers included in the combined return. In addition, total assets
 includes leased real property  that  is  not  properly  reflected  on  a
 balance sheet.
   (II)  Assets  will only be included if the income or expenses of which
 are properly reflected, or would have been  properly  reflected  if  not
 fully  depreciated  or expensed, or depreciated or expensed to a nominal
 amount, in the computation of the combined group's entire net income for
 the taxable year. Assets will not include deferred tax assets and intan-
 gible assets identified as "goodwill".
   (III) Tangible real and personal property, such  as  buildings,  land,
 machinery,  and  equipment shall be valued at cost. Leased real property
 that is not properly reflected on a balance sheet will be valued at  the
 annual  lease  payment multiplied by eight. Intangible property, such as
 loans and investments, shall  be  valued  at  book  value  exclusive  of
 reserves.
   (IV)  Intercorporate  stockholdings  and  bills,  notes  and  accounts
 receivable, and other intercorporate  indebtedness  between  the  corpo-
 rations included in the combined report shall be eliminated.
   (V) Average assets are computed using the assets measured on the first
 day  of the taxable year, and on the last day of each subsequent quarter
 of the taxable year or month or day during the taxable year.
   (2) Qualified residential loan portfolio. (i) A taxpayer  maintains  a
 qualified  residential  loan  portfolio if at least sixty percent of the
 amount of the total assets at the close  of  the  taxable  year  of  the
 thrift  institution  or  qualified community bank consists of the assets
 described in subclauses (A) through (L) of this clause, with the  appli-
 cation of the rule in the last undesignated subclause of this clause. If
 the  taxpayer  is  a  member  of  a combined group, the determination of
 whether there is a qualified residential loan portfolio will be made  by
 aggregating the assets of the thrift institutions and qualified communi-
 ty banks that are members of the combined group. Assets: (A) cash, which
 includes  cash  and cash equivalents including cash items in the process
 of collection, deposits with  other  financial  institutions,  including
 S. 8474                            605
 
 corporate credit unions, balances with federal reserve banks and federal
 home  loan  banks,  federal funds sold, and cash and cash equivalents on
 hand. Cash shall not include any  balances  serving  as  collateral  for
 securities lending transactions; (B) obligations of the United States or
 of a state or political subdivision thereof, and stock or obligations of
 a  corporation  which  is  an  instrumentality or a government sponsored
 enterprise of the United States or of a state or  political  subdivision
 thereof;  (C) loans secured by a deposit or share of a member; (D) loans
 secured by an interest in real property which is, or, from the  proceeds
 of  the  loan,  will  become, residential real property or real property
 used primarily for church purposes, loans made for  the  improvement  of
 residential  real  property  or  real property used primarily for church
 purposes, provided that for purposes of this subclause, residential real
 property shall include single or multi-family dwellings,  facilities  in
 residential  developments  dedicated to public use or property used on a
 nonprofit basis for residents, and mobile homes not used on a  transient
 basis;  (E) property acquired through the liquidation of defaulted loans
 described in subclause (D) of this clause; (F) any regular  or  residual
 interest  in  a  REMIC, as such term is defined in section eight hundred
 sixty-D of the internal revenue code, but only in the  proportion  which
 the assets of such REMIC consist of property described in subclauses (A)
 through  (E)  of this clause, except that if ninety-five percent or more
 of the assets of such REMIC are assets described in such subclauses, the
 entire interest in the REMIC  shall  qualify;  (G)  any  mortgage-backed
 security  which  represents ownership of a fractional undivided interest
 in a trust, the assets of which consist  primarily  of  mortgage  loans,
 provided  that  the real property which serves as security for the loans
 is, or from the proceeds of the loan, will become, the type of  property
 described  in  subclause (D) of this clause and any collateralized mort-
 gage obligation, the security for which consists primarily  of  mortgage
 loans  that  maintain  as  security  the  type  of property described in
 subclause (D) of this clause; (H) certificates of deposit in,  or  obli-
 gations of, a corporation organized under a state law which specifically
 authorizes  such corporation to insure the deposits or share accounts of
 member associations; (I) loans secured by an  interest  in  educational,
 health,  or  welfare  institutions  or  facilities, including structures
 designed or used primarily for residential purposes for students,  resi-
 dents,  and  persons  under  care, employees, or members of the staff of
 such institutions or facilities; (J)  loans  made  for  the  payment  of
 expenses  of college or university education or vocational training; (K)
 property used by the taxpayer in  support  of  business  which  consists
 principally  of  acquiring  the  savings  of the public and investing in
 loans; and (L) loans for which the taxpayer is the  creditor  and  which
 are wholly secured by loans described in subclause (D) of this clause.
   The  value of accrued interest receivable and any loss-sharing commit-
 ment or other loan guaranty by a governmental agency will be  considered
 part  of  the  basis  in the loans to which the accrued interest or loss
 protection applies.
   (ii) At the election of the  taxpayer,  the  percentage  specified  in
 clause  (i)  of  this  subparagraph shall be applied on the basis of the
 average assets outstanding during the taxable year, in lieu of the close
 of the taxable year. The taxpayer can elect to compute an average  using
 the assets measured on the first day of the taxable year and on the last
 day of each subsequent quarter, or month or day during the taxable year.
 This election may be made annually.
 S. 8474                            606
 
   (iii)  For  purposes  of  subclause (D) of clause (i) of this subpara-
 graph, if a multifamily structure securing a loan is used  in  part  for
 nonresidential  use  purposes,  the  entire loan is deemed a residential
 real property loan if the planned residential use exceeds eighty percent
 of  the property's planned use, measured, at the taxpayer's election, by
 using square footage or gross rental revenue, and determined as  of  the
 time the loan is made.
   (iv) For purposes of subclause (D) of clause (i) of this subparagraph,
 loans  made  to  finance the acquisition or development of land shall be
 deemed to be loans secured by an interest in residential  real  property
 if  there  is a reasonable assurance that the property will become resi-
 dential real property within a period of three years from  the  date  of
 acquisition  of  such  land; provided, however, this shall not apply for
 any taxable year  unless,  within  such  three-year  period,  such  land
 becomes  residential  real property. For purposes of determining whether
 any interest in a REMIC qualifies under subclause (F) of clause  (i)  of
 this  subparagraph,  any  regular interest in another REMIC held by such
 REMIC shall be treated as a loan described in subclauses (A) through (E)
 under principles similar to the principle of such subclause (F),  except
 that if such REMICs are part of a tiered structure, they shall be treat-
 ed as one REMIC for purposes of such subclause (F).
   (3)  For  purposes  of  this  paragraph,  a  "thrift institution" is a
 savings bank, a savings and loan association, or other savings  institu-
 tion chartered and supervised as such under federal or state law.
   (t)  Subtraction modification for qualified affordable housing and low
 income community loans.
   (1) A taxpayer that owns a  qualifying  loan  within  the  meaning  of
 clause  (iii)  of  subparagraph two of this paragraph shall be allowed a
 deduction in computing entire net income equal to  the  amount  computed
 under subparagraph two of this paragraph.
   (2)(i)  The  deduction  allowed  in subparagraph one of this paragraph
 shall be equal to:
   (A) if the total average value during the taxable year of  the  assets
 of  the  taxpayer,  or if the taxpayer is included in a combined report,
 the assets of the combined reporting group of the taxpayer under section
 11-654.3 of  this  subchapter,  does  not  exceed  one  hundred  billion
 dollars, the taxpayer's net interest income from qualifying loans, or
   (B)  if  the total average value during the taxable year of the assets
 of the taxpayer, or if the taxpayer is included in  a  combined  report,
 the assets of the combined reporting group of the taxpayer under section
 11-654.3  of this subchapter, exceeds one hundred billion dollars but is
 less than one hundred fifty billion dollars, the taxpayer's net interest
 income from qualifying loans multiplied by a fraction, the numerator  of
 which is one hundred fifty billion dollars minus the total average value
 during the taxable year of the assets of the taxpayer, or if the taxpay-
 er  is included in a combined report, the assets of the combined report-
 ing group of the taxpayer under section 11-654.3 of this subchapter, and
 the denominator of which is fifty billion dollars.
   (ii)(A) Net interest income  from  qualifying  loans  shall  mean  the
 taxpayer's net interest income from loans during the taxable year multi-
 plied by a fraction, the numerator of which is the gross interest income
 during  the  taxable  year  from qualifying loans and the denominator of
 which is the gross interest income from all loans.
   (B) Net interest income from loans shall mean  gross  interest  income
 during  the  taxable  year  from  loans less gross interest expense from
 loans. Gross interest expense from loans is  determined  by  multiplying
 S. 8474                            607
 
 gross  interest  expense  by  a  fraction, the numerator of which is the
 average total value of loans owned by the taxpayer  during  the  taxable
 year  and  the  denominator  of which is the average total assets of the
 taxpayer for the year.
   (C) Measurement of assets. For purposes of this paragraph:
   (I)  Total  assets  are  those assets that are properly reflected on a
 balance sheet, computed in the same manner as is required by the banking
 regulator, if applicable, of the  taxpayers  included  in  the  combined
 return.  In addition, total assets includes leased real property that is
 not properly reflected on a balance sheet.
   (II) Assets will only be included if the income or expenses  of  which
 are  properly  reflected,  or  would have been properly reflected if not
 fully depreciated or expensed, or depreciated or expensed to  a  nominal
 amount,  in  the computation of the taxpayer's entire net income for the
 taxable year. Assets will not include deferred tax assets and intangible
 assets identified as "goodwill".
   (III) Tangible real and personal property, such  as  buildings,  land,
 machinery,  and equipment, shall be valued at cost. Leased real property
 that is not properly reflected on a balance sheet will be valued at  the
 annual  lease  payment multiplied by eight. Intangible property, such as
 loans and investments, shall  be  valued  at  book  value  exclusive  of
 reserves.
   (IV)  Average  assets  are  computed  using the assets measured on the
 first day of the taxable year, and on the last day  of  each  subsequent
 quarter of the taxable year or month or day during the taxable year.
   (iii)  A qualifying loan is a loan that meets the conditions specified
 in subclause (A) through subclause (E) of this clause.
   (A) The loan is originated by the taxpayer lender or purchased by  the
 taxpayer  immediately after its origination in connection with a commit-
 ment to purchase made by the taxpayer prior to the loan's origination.
   (B) Satisfies conditions of item (I) or (II) of this subclause.
   (I) The loan is secured by a housing accommodation located within  the
 city,  where  there  are rental units in such housing accommodation that
 are qualifying units, which for purposes of this subclause, means  units
 subject  to  rent  control, rent stabilization or to a regulatory agree-
 ment, provided that, each such loan will be considered a qualifying loan
 for purposes of this paragraph only in proportion to a percentage  equal
 to  the  number  of  qualifying units divided by the total number of all
 residential and commercial units located on the site of the real proper-
 ty securing the loan, as determined as of the date the loan is made.
   (II) To the extent not included in item (I) of this  subclause,  loans
 secured  by residential real property located in a low-income community.
 For purposes of this paragraph, low-income community  areas  are  census
 tracts  within  the  city in which the poverty rate for such tract is at
 least twenty percent and the median family income for  such  tract  does
 not  exceed  eighty  percent  of metropolitan area median family income.
 This determination will be made by reference to the poverty  and  median
 family income census data for application of section forty-five-D of the
 internal revenue code.
   (C) The loan is not treated as a qualifying loan in the computation of
 a  subtraction  from entire net income pursuant to paragraph (q) of this
 subdivision.
   (D) If the taxpayer applies a subtraction pursuant to paragraph (r) of
 this subdivision, the interest or net gains from the loan are not recog-
 nized by a captive REIT as defined in section 11-601 of this chapter.
 S. 8474                            608

   (E) A loan that meets the definition of a qualifying loan in  a  prior
 taxable  year, including years prior to the effective date of this para-
 graph, remains a qualifying loan in taxable years during and after which
 such loan is acquired by another corporation in the taxpayer's  combined
 reporting group under section 11-654.3 of this subchapter.
   (iv) For purposes of this paragraph, the following terms shall mean:
   (A)  "Housing  accommodations"  shall  mean  a  multiple dwelling that
 contains at least five dwelling units together with the  land  on  which
 such structure is situated.
   (B)  "Regulatory  agreement"  shall  mean  a written agreement with or
 approved by any local, municipal, state,  federal  or  other  government
 agency  that  requires the provision of housing accommodations for fami-
 lies and persons of low or moderate income, and binds the owner of  such
 real property and its successors and assigns. A regulatory agreement may
 include  such  other terms and conditions as the locality, municipality,
 state, or federal government shall determine.
   (C) "Rent stabilization" shall mean, collectively, the rent stabiliza-
 tion law of nineteen hundred sixty-nine, the  rent  stabilization  code,
 and  the  emergency  tenant  protection  act  of  nineteen seventy-four,
 together with any successor statutes or regulations addressing  substan-
 tially the same subject matter.
   9.  (a)  The  term  "calendar  year" means a period of twelve calendar
 months, or any shorter period beginning on the date the taxpayer becomes
 subject to the tax imposed by this subchapter,  ending  on  the  thirty-
 first  day  of  December,  provided  the taxpayer keeps its books on the
 basis of such period or on the basis of any period  ending  on  any  day
 other  than  the  last day of a calendar month, or provided the taxpayer
 does not keep books, and includes, in  case  the  taxpayer  changes  the
 period  on the basis of which it keeps its books from a fiscal year to a
 calendar year, the period from the close of its last old fiscal year  up
 to and including the following December thirty-first.
   (b)  The  term "fiscal year" means a period of twelve calendar months,
 or any shorter period beginning on the date the taxpayer becomes subject
 to the tax imposed by this subchapter, ending on the  last  day  of  any
 month  other than December, provided the taxpayer keeps its books on the
 basis of such period, and includes, in case  the  taxpayer  changes  the
 period  on the basis of which it keeps its books from a calendar year to
 a fiscal year or from one fiscal year to another fiscal year, the period
 from the close of its last old calendar or fiscal year up  to  the  date
 designated as the close of its new fiscal year.
   10.  The  term  "tangible  personal property" means corporeal personal
 property,  such  as  machinery,  tools,  implements,  goods,  wares  and
 merchandise,  and  does  not  mean  money,  deposits in banks, shares of
 stock, bonds, notes, credits or evidences of an  interest  property  and
 evidences of debt.
   11.  The  term "internal revenue code" means, unless otherwise specif-
 ically stated in this subchapter, the internal revenue code of 1986,  as
 amended.
   12.  The  term  "combinable captive insurance company" means an entity
 that is treated as an association taxable as  a  corporation  under  the
 internal revenue code:
   (a)  more  than fifty percent of the voting stock of which is owned or
 controlled, directly or indirectly, by a single entity that  is  treated
 as  an  association  taxable as a corporation under the internal revenue
 code and not exempt from federal income tax;
 S. 8474                            609
 
   (b) that is licensed as a captive insurance company under the laws  of
 this state or another jurisdiction;
   (c) whose business includes providing, directly and indirectly, insur-
 ance  or  reinsurance covering the risks of its parent and/or members of
 its affiliated group; and
   (d) fifty percent or less of whose gross receipts for the taxable year
 consist of premiums from  arrangements  that  constitute  insurance  for
 federal income tax purposes.
   For  purposes  of  this  subdivision,  "affiliated group" has the same
 meaning as that term is given in section fifteen  hundred  four  of  the
 internal  revenue code, except that the term "common parent corporation"
 in that section is deemed to mean any  person,  as  defined  in  section
 seven thousand seven hundred one of the internal revenue code and refer-
 ences  to  "at  least eighty percent" in section fifteen hundred four of
 the internal revenue code are to be read as  "fifty  percent  or  more;"
 section  fifteen hundred four of the internal revenue code is to be read
 without regard to the exclusions provided for in subsection (b) of  that
 section;  "premiums" has the same meaning as that term is given in para-
 graph one of subdivision (c) of section fifteen hundred ten of  the  tax
 law,  except  that  it  includes consideration for annuity contracts and
 excludes any part of the consideration  for  insurance,  reinsurance  or
 annuity  contracts  that do not provide bona fide insurance, reinsurance
 or annuity benefits; and "gross receipts" includes the amounts  included
 in gross receipts for purposes of paragraph fifteen of subsection (c) of
 section five hundred one of the internal revenue code, except that those
 amounts also include all premiums as defined in this subdivision.
   13.  The  term  "partnership" includes a syndicate, group, pool, joint
 venture, or other unincorporated organization, through or  by  means  of
 which  any  business, financial operation, or venture is carried on, and
 which is not a  corporation  as  defined  in  subdivision  one  of  this
 section, or a trust or estate that is separate from its owner under part
 one of subchapter J of chapter one of subtitle A of the internal revenue
 code; and the term "partner" includes a member in such syndicate, group,
 pool, joint venture, or organization.
   §  11-653  Imposition  of tax; exemptions. 1. (a) For the privilege of
 doing business, or of employing capital, or of owning or leasing proper-
 ty in the city in a corporate or organized capacity, or  of  maintaining
 an  office  in  the  city,  or of deriving receipts from activity in the
 city, for all or any part of each of its fiscal or calendar years, every
 domestic or foreign corporation, except corporations specified in subdi-
 vision four of this section, shall annually pay a tax, upon the basis of
 its business income, or upon such other basis as may  be  applicable  as
 hereinafter  provided, for such fiscal or calendar year or part thereof,
 on a report which shall be filed, except as hereinafter provided, on  or
 before the fifteenth day of March next succeeding the close of each such
 year,  or,  in  the  case  of a taxpayer which reports on the basis of a
 fiscal year, within two and one-half months  after  the  close  of  such
 fiscal year, and shall be paid as hereinafter provided.
   (b) A corporation is deriving receipts from activity in the city if it
 has receipts within the city of one million dollars or more in a taxable
 year.  For  purposes  of  this  section,  the  term "receipts" means the
 receipts that are subject to the allocation rules set forth  in  section
 11-654.2  of  this  subchapter,  and the term "receipts within the city"
 means the receipts included in the numerator of  the  receipts  fraction
 determined  under  section  11-654.2 of this subchapter. For purposes of
 S. 8474                            610
 
 this paragraph, receipts from processing credit  card  transactions  for
 merchants include merchant discount fees received by the corporation.
   (c)  A  corporation is doing business in the city if (1) it has issued
 credit cards to one thousand  or  more  customers  who  have  a  mailing
 address  within  the city as of the last day of its taxable year, (2) it
 has merchant customer contracts with merchants and the total  number  of
 locations  covered  by  those  contracts  equals  one  thousand  or more
 locations in the city to whom  the  corporation  remitted  payments  for
 credit  card transactions during the taxable year, or (3) the sum of the
 number of customers described in subparagraph one of this paragraph plus
 the number of locations covered by its contracts described  in  subpara-
 graph two of this paragraph equals one thousand or more. As used in this
 subdivision,  the  term  "credit card" includes bank, credit, travel and
 entertainment cards.
   (d)(1) A corporation with less than one million dollars but  at  least
 ten  thousand dollars of receipts within the city in a taxable year that
 is part of a unitary group that meets the ownership test  under  section
 11-654.3  of  this  subchapter is deriving receipts from activity in the
 city if the receipts within the city of the members of the unitary group
 that have at least ten thousand dollars of receipts within the  city  in
 the  aggregate  meet  the  threshold  set forth in paragraph (b) of this
 subdivision.
   (2) A corporation that does not meet any of the thresholds  set  forth
 in  paragraph (c) of this subdivision but has at least ten customers, or
 locations, or customers and locations, as described in paragraph (c)  of
 this  subdivision,  and is part of a unitary group that meets the owner-
 ship test under section 11-654.3 of this subchapter, is  doing  business
 in  the  city  if  the  number of customers, locations, or customers and
 locations, within the city of the members of the unitary group that have
 at least ten customers, locations, or customers  and  locations,  within
 the city in the aggregate meets any of the thresholds set forth in para-
 graph (c) of this subdivision.
   (3) For purposes of this paragraph, any corporation described in para-
 graph  (c)  of  subdivision  two  of section 11-654.3 of this subchapter
 shall not be considered.
   (e) At the end of each year, the commissioner shall review the cumula-
 tive percentage change in the consumer  price  index.  The  commissioner
 shall adjust the receipt thresholds set forth in this subdivision if the
 consumer  price  index  has changed by ten percent or more since January
 first, two thousand twenty-two, or since the date  that  the  thresholds
 were  last  adjusted  under  this  subdivision.  The thresholds shall be
 adjusted to reflect the cumulative percentage  change  in  the  consumer
 price index. The adjusted thresholds shall be rounded to the nearest one
 thousand  dollars.  As  used  in  this paragraph, "consumer price index"
 means the consumer price index for all urban consumers (CPI-U) available
 from the bureau of labor statistics of the United States  department  of
 labor.  Any  adjustment  shall apply to tax periods that begin after the
 adjustment is made.
   (f) If a partnership is doing business, employing capital,  owning  or
 leasing  property  in the city, or maintaining an office in the city, or
 deriving receipts from activity in the city, any corporation that  is  a
 partner  in such partnership shall be subject to tax under this subchap-
 ter as described in the regulations of the commissioner of finance.
   2. A foreign corporation shall not be deemed  to  be  doing  business,
 employing  capital, owning or leasing property, or maintaining an office
 S. 8474                            611
 
 in the city, or deriving receipts from activity in  the  city,  for  the
 purposes of this subchapter, by reason of:
   (a)  the maintenance of cash balances with banks or trust companies in
 the city, or
   (b) the ownership of shares of stock or securities kept in  the  city,
 if  kept  in  a safe deposit box, safe, vault or other receptacle rented
 for the purpose, or if pledged as collateral security, or  if  deposited
 with one or more banks or trust companies, or brokers who are members of
 a recognized security exchange, in safekeeping or custody accounts, or
   (c)  the  taking  of  any  action by any such bank or trust company or
 broker, which is incidental to the rendering of safekeeping or custodian
 service to such corporation, or
   (d) the maintenance of an office in the city by one or  more  officers
 or directors of the corporation who are not employees of the corporation
 if the corporation otherwise is not doing business in the city, and does
 not employ capital or own or lease property in the city, or
   (e)  the  keeping  of books or records of a corporation in the city if
 such books or records are not kept by employees of such corporation  and
 such  corporation does not otherwise do business, employ capital, own or
 lease property or maintain an office in the city, or
   (f) any combination of such activities.
   2-a. An alien corporation shall not be deemed to  be  doing  business,
 employing  capital, owning or leasing property, or maintaining an office
 in the city, or deriving receipts from activity in  the  city,  for  the
 purposes  of  this subchapter, if its activities in the city are limited
 solely to:
   (a) investing or trading in stocks and securities for its own  account
 within  the  meaning of clause (ii) of subparagraph (A) of paragraph (2)
 of subsection (b) of section eight hundred sixty-four  of  the  internal
 revenue code, or:
   (b) investing or trading in commodities for its own account within the
 meaning  of  clause  (ii)  of  subparagraph  (B)  of  paragraph  (2)  of
 subsection (b) of section  eight  hundred  sixty-four  of  the  internal
 revenue code, or
   (c)  any combination of activities described in paragraphs (a) and (b)
 of this subdivision.
   An alien corporation that under any provision of the internal  revenue
 code  is  not  treated as a "domestic corporation" as defined in section
 seven thousand seven hundred one of such code  and  has  no  effectively
 connected  income  for  the taxable year pursuant to clause three of the
 opening paragraph  of  subdivision  eight  of  section  11-652  of  this
 subchapter  shall  not  be subject to tax under this subchapter for that
 taxable year. For purposes of this subchapter, an alien corporation is a
 corporation organized under the laws of  a  country,  or  any  political
 subdivision  thereof,  other  than the United States, or organized under
 the laws of a  possession,  territory  or  commonwealth  of  the  United
 States.
   3. Any receiver, referee, trustee, assignee or other fiduciary, or any
 officer  or  agent  appointed by any court, who conducts the business of
 any corporation, shall be subject to the tax imposed by this  subchapter
 in  the  same  manner  and  to  the  same extent as if the business were
 conducted by the agents or officers of  such  corporation.  A  dissolved
 corporation which continues to conduct business shall also be subject to
 the tax imposed by this subchapter.
   4. (a) Corporations subject to tax under chapter eleven of this title,
 any  trust  company organized under a law of this state all of the stock
 S. 8474                            612
 
 of which is owned by not less than twenty savings banks organized  under
 a  law of this state, housing companies organized and operating pursuant
 to the provisions of article two of the  private  housing  finance  law,
 housing  development fund companies organized pursuant to the provisions
 of article eleven of  the  private  housing  finance  law,  corporations
 described  in  section  three  of the tax law, a corporation principally
 engaged in the operation of marine vessels whose activities in the  city
 are  limited exclusively to the use of property in interstate or foreign
 commerce, provided, however, such a corporation will not be  subject  to
 tax  under  this subchapter solely because it maintains an office in the
 city, or employs capital in the city, in connection  with  such  use  of
 property,  a  corporation  principally engaged in the conduct of a ferry
 business and operating between any of the boroughs of the city  under  a
 lease  granted  by the city and a corporation principally engaged in the
 conduct of an aviation, steamboat, ferry or navigation business, or  two
 or  more  of such businesses, all of the capital stock of which is owned
 by a municipal corporation of this state, shall not be  subject  to  tax
 under  this  subchapter;  provided, however, that any corporation, other
 than (1) a utility corporation subject to the supervision of  the  state
 department  of public service, and (2) for taxable years beginning on or
 after August first, two thousand two, a utility as defined  in  subdivi-
 sion six of section 11-1101 of this title, which is subject to tax under
 chapter  eleven  of this title as a vendor of utility services, shall be
 subject to tax under this subchapter, but in computing the  tax  imposed
 by this section pursuant to the provisions of clause (i) of subparagraph
 one  of  paragraph  (e)  of  subdivision  one  of section 11-654 of this
 subchapter, business income allocated to the city pursuant to  paragraph
 (a)  of  subdivision  three  of  such  section  shall  be reduced by the
 percentage which such corporation's gross operating  income  subject  to
 tax under chapter eleven of this title is of its gross operating income.
   (b)  The  term "gross operating income", when used in paragraph (a) of
 this subdivision, means receipts received in or by reason of any  trans-
 action  had  and  consummated  in  the city, including cash, credits and
 property of any kind or nature, whether or not such transaction is  made
 for  profit,  without  any deduction therefrom on account of the cost of
 the property sold, the cost of materials used, labor or other  services,
 delivery  costs or any other costs whatsoever, interest or discount paid
 or any other expenses whatsoever.
   (c) If it shall appear to the commissioner of finance that the  appli-
 cation  of the provisions of paragraph (a) of this subdivision, does not
 fairly and equitably reflect the  portion  of  the  taxpayer's  business
 income  allocable  to  the city which is attributable to its city activ-
 ities which are not taxable under chapter  eleven  of  this  title,  the
 commissioner  of  finance may prescribe other means or methods of deter-
 mining such portion, including the use of the books and records  of  the
 taxpayer,  if the commissioner of finance finds that such means or meth-
 ods used in keeping them fairly and equitably reflect such portion.
   5. Intentionally omitted.
   6. Intentionally omitted.
   7. For any taxable year of a real estate investment trust, as  defined
 in  section  eight  hundred  fifty-six  of the internal revenue code, in
 which such trust is subject to federal  income  taxation  under  section
 eight hundred fifty-seven of such code, such trust shall be subject to a
 tax  computed  under  either clause (i) of subparagraph one of paragraph
 (e) of subdivision one of section 11-654 of this subchapter,  or  clause
 (iv), whichever is greater. In the case of such a real estate investment
 S. 8474                            613
 
 trust,  including  a  captive  REIT as defined in section 11-601 of this
 chapter, the term "entire net  income"  means  "real  estate  investment
 trust  taxable income" as defined in paragraph two of subdivision (b) of
 section  eight hundred fifty-seven, as modified by section eight hundred
 fifty-eight, of the internal revenue code plus the amount taxable  under
 paragraph  three of subdivision (b) of section eight hundred fifty-seven
 of such code, subject to the modifications required by subdivision eight
 of  section  11-652  of  this  subchapter  including  the  modifications
 required  by  paragraphs  (d)  and  (e)  of subdivision three of section
 11-654 of this subchapter.
   8. For any taxable year of a regulated investment company, as  defined
 in  section  eight  hundred  fifty-one  of the internal revenue code, in
 which such company is subject to federal income taxation  under  section
 eight hundred fifty-two of such code, such company shall be subject to a
 tax  computed  under  either  clause  one or four of subparagraph (a) of
 paragraph E of subdivision one of section  11-654  of  this  subchapter,
 whichever  is greater. In the case of such a regulated investment compa-
 ny, including a captive RIC as defined in section 11-601 of  this  chap-
 ter,  the  term  "entire  net  income"  used  in subdivision one of this
 section means "investment company taxable income" as  defined  in  para-
 graph  two  of  subdivision  (b)  of section eight hundred fifty-two, as
 modified by section eight hundred fifty-five, of  the  internal  revenue
 code plus the amount taxable under paragraph three of subdivision (b) of
 section  eight  hundred  fifty-two of such code subject to the modifica-
 tions required by subdivision eight of section 11-652 of  this  subchap-
 ter,  including  the  modification required by paragraphs (d) and (e) of
 subdivision three of section 11-654 of this subchapter.
   9. An organization  described  in  paragraph  two  or  twenty-five  of
 subsection  (c) of section five hundred one of the internal revenue code
 shall be exempt from all taxes imposed by this subchapter.
   § 11-654 Computation of tax. 1. (a) Intentionally omitted.
   (b) Intentionally omitted.
   (c) Intentionally omitted.
   (d) Intentionally omitted.
   (e) The tax imposed by subdivision  one  of  section  11-653  of  this
 subchapter shall be, in the case of each taxpayer:
   (1) whichever of the following amounts is the greatest:
   (i)  an  amount computed on its business income or the portion of such
 business income allocated  within  the  city  as  hereinafter  provided,
 subject to the application of paragraphs (j) and (k) of this subdivision
 and  any  modification required by paragraphs (d) and (e) of subdivision
 three of this section, at the rate of (1) nine per centum for  financial
 corporations,  as  defined  in this clause, or (2) eight and eighty-five
 one hundredths per centum for all other corporations.  For  purposes  of
 this  clause,  "financial  corporation"  means  a corporation or, if the
 corporation is included in a combined group, a combined group, that  (A)
 has  total assets reflected on its balance sheet at the end of its taxa-
 ble year in excess of one hundred billion dollars, computed under gener-
 ally accepted accounting principles and (B)(I) allocates more than fifty
 percent of the receipts included in  the  denominator  of  its  receipts
 fraction, determined under section 11-654.2 of this subchapter, pursuant
 to subdivision five of section 11-654.2 of this subchapter for its taxa-
 ble  year, or (II) is itself or is included in a combined group in which
 more than fifty percent of the total assets  reflected  on  its  balance
 sheet  at  the  end  of  its taxable year are held by one or more corpo-
 rations that are classified as (a) registered under state law as a  bank
 S. 8474                            614
 
 holding company or registered under the Federal Bank Holding Company Act
 of  1956  (12  U.S.C.  §  1841, et seq., as amended), or registered as a
 savings and loan holding company under the Federal National Housing  Act
 (12 U.S.C. 1701, as amended), (b) a national bank organized and existing
 as  a  national  bank  association  pursuant  to  the  provisions of the
 National Bank Act, 12 U.S.C. 21 et. seq., (c) a savings  association  or
 federal savings bank as defined in the Federal Deposit Insurance Act, 12
 U.S.C. § 1813(b)(1), (d) a bank, savings association, or thrift institu-
 tion incorporated or organized under the laws of any state, (e) a corpo-
 ration organized under the provisions of 12 U.S.C. §§ 611 to 631, (f) an
 agency or branch or a foreign depository as defined in 12 U.S.C. § 3101,
 (g)  a  registered securities or commodities broker or dealer registered
 as such by the securities and exchange  commission  or  the  commodities
 futures trading commission, which shall include an OTC derivatives deal-
 er  as  defined under regulations of the securities and exchange commis-
 sion at title 17, part 240, section 3b-12 of the code of  federal  regu-
 lations (17 CFR 240.3b-12), or (h) any corporation whose voting stock is
 more  than fifty percent owned, directly or indirectly, by any person or
 business entity described in subitems (a)  through  (g)  of  this  item,
 other  than  an  insurance company taxable under article thirty-three of
 the tax law; or
   (ii) an amount computed by multiplying its total business capital,  or
 the portion thereof allocated within the city, as hereinafter provided,
   (A)  except  as  provided in subclauses (B) and (C) of this clause, by
 fifteen one-hundredths per centum;
   (B) in the case of a cooperative housing corporation as defined in the
 internal revenue code, by four one-hundredths per centum;
   (C) in the case of the portion  of  total  business  capital  directly
 attributable  to a corporation that is or would be taxable under chapter
 eleven of this title, except for a vendor of utility  services  that  is
 taxable  under both chapter eleven of this title and this subchapter, or
 a corporation that would have been taxable as an  insurance  corporation
 under  former  part IV, title R, chapter forty-six of the administrative
 code of the city of New York as in effect on  June  thirtieth,  nineteen
 hundred  seventy-four,  by seven and one-half one-hundredths per centum;
 and
   (D) subtracting ten thousand dollars from the sum of the amount of tax
 computed pursuant to  subclauses  (A),  (B)  and  (C)  of  this  clause,
 provided that if such amount of tax is less than zero it shall be deemed
 to be zero; and
   (E)  provided that in no event shall the amount of tax computed pursu-
 ant to subclause (D) of this clause on  the  taxpayer's  total  business
 capital,  or  the  portion thereof allocated within the city, exceed ten
 million dollars, or
   (iii) Intentionally omitted.

   (iv) If New York city receipts are:             Fixed dollar minimum
                                                        tax is:
 Not more than $100,000                                  $25
 More than $100,000 but not over $250,000                $75
 More than $250,000 but not over $500,000                $175
 More than $500,000 but not over $1,000,000              $500
 More than $1,000,000 but not over $5,000,000            $1,500
 More than $5,000,000 but not over $25,000,000           $3,500
 More than $25,000,000 but not over $50,000,000          $5,000
 More than $50,000,000 but not over $100,000,000         $10,000
 S. 8474                            615
 
 More than $100,000,000 but not over $250,000,000        $20,000
 More than $250,000,000 but not over $500,000,000        $50,000
 More than $500,000,000 but not over $1,000,000,000      $100,000
 Over $1,000,000,000                                     $200,000
 
   For  purposes  of this clause, New York city receipts are the receipts
 computed in accordance with section 11-654.2 of this subchapter for  the
 taxable year. If the taxable year is less than twelve months, the amount
 prescribed by this clause shall be reduced by twenty-five percent if the
 period  for which the taxpayer is subject to tax is more than six months
 but not more than nine months and by fifty percent  if  the  period  for
 which the taxpayer is subject to tax is not more than six months. If the
 taxable  year  is  less  than twelve months, the amount of New York city
 receipts for purposes of this  clause  is  determined  by  dividing  the
 amount  of  the receipts for the taxable year by the number of months in
 the taxable year and multiplying the result by twelve.
   (f) Intentionally omitted.
   (g) Intentionally omitted.
   (h) Intentionally omitted.
   (i) Intentionally omitted.
   (j) (1) If the amount of business income allocated within the city  as
 hereinafter  provided  is  less  than  one  million  dollars, the amount
 computed in clause (i) of subparagraph one  of  paragraph  (e)  of  this
 subdivision  shall  be  at the rate of six and five-tenths per centum of
 the amount of business income allocated within the city  as  hereinafter
 provided, subject to any modification required by paragraphs (d) and (e)
 of subdivision three of this section;
   (2)  Subject to subparagraph three of this paragraph, if the amount of
 business income allocated within the city as hereinafter provided is one
 million dollars or greater but less than one million five hundred  thou-
 sand  dollars,  the amount computed in clause (i) of subparagraph one of
 paragraph (e) of this subdivision shall be at the rate of  (i)  six  and
 five-tenths per centum, plus (ii) two and thirty-five one-hundredths per
 centum  multiplied  by  a  fraction  the numerator of which is allocated
 business income less one million dollars and the denominator of which is
 five hundred thousand dollars, of the amount of  business  income  allo-
 cated  within the city as hereinafter provided, subject to any modifica-
 tion required by paragraphs (d) and (e) of  subdivision  three  of  this
 section;
   (3)  Provided,  however,  notwithstanding anything to the contrary, if
 the amount of business income before allocation is two  million  dollars
 or greater but less than three million dollars, the rate of tax provided
 for in this paragraph shall not be less than (i) six and five-tenths per
 centum,  plus  (ii) two and thirty-five one-hundredths per centum multi-
 plied by a fraction the numerator of which  is  business  income  before
 allocation  less two million dollars and the denominator of which is one
 million dollars, and provided, however, notwithstanding anything to  the
 contrary,  if  the  amount of business income before allocation is three
 million dollars or greater, the rate of tax shall be eight  and  eighty-
 five  one-hundredths  percentum  or,  in  the case of a financial corpo-
 ration, as defined in clause (i) of subparagraph one of paragraph (e) of
 subdivision one of section 11-654, if  the  amount  of  business  income
 before  allocation  is  three million dollars or greater the rate of tax
 shall be nine per centum.
   (k)(1) For qualified New York manufacturing corporations as defined in
 subparagraph four of this paragraph, if the amount  of  business  income
 S. 8474                            616
 
 allocated  within  the  city  as  hereinafter  provided is less than ten
 million dollars, the amount computed in clause (i) of  subparagraph  one
 of  paragraph  (e)  of this subdivision shall be at the rate of four and
 four  hundred  twenty-five  one  thousandths per centum, of its business
 income allocated within the city as hereinafter provided, subject to any
 modification required by paragraphs (d) and (e) of subdivision three  of
 this section;
   (2)  Subject to subparagraph three of this paragraph for qualified New
 York manufacturing corporations as defined in subparagraph four of  this
 paragraph, if the amount of business income allocated within the city as
 hereinafter  provided  is  ten  million dollars or greater but less than
 twenty million dollars, the amount computed in clause  (i)  of  subpara-
 graph  one  of paragraph (e) of this subdivision shall be at the rate of
 (i) four and four hundred twenty-five one-thousandths per  centum,  plus
 (ii) four and four hundred twenty-five one-thousandths per centum multi-
 plied  by a fraction the numerator of which is allocated business income
 less ten million dollars and the denominator of  which  is  ten  million
 dollars,  of  its business income or the portion of such business income
 allocated within the  city  as  hereinafter  provided,  subject  to  any
 modification  required by paragraphs (d) and (e) of subdivision three of
 this section;
   (3) Notwithstanding anything to the contrary, if the amount  of  busi-
 ness  income  before allocation is twenty million dollars or greater but
 less than forty million dollars, the rate of tax provided  for  in  this
 paragraph  shall  not be less than (i) four and four hundred twenty-five
 one-thousandths per centum, plus (ii) four and four hundred  twenty-five
 one-thousandths  per  centum  multiplied  by a fraction the numerator of
 which is business income before allocation less twenty  million  dollars
 and  the  denominator  of which is twenty million dollars, and provided,
 however, notwithstanding anything to the  contrary,  if  the  amount  of
 business  income  before allocation is forty million dollars or greater,
 the rate of tax  shall  be  eight  and  eighty-five  one-hundredths  per
 centum.
   (4)(i)  As  used  in this subparagraph, the term "manufacturing corpo-
 ration" means a corporation principally engaged in the manufacturing and
 sale thereof of tangible personal property; and the term "manufacturing"
 includes the process, including the assembly process (A) of working  raw
 materials into wares suitable for use or (B) which gives new shapes, new
 qualities  or  new combinations to matter which already has gone through
 some artificial process, by the use of machinery, tools, appliances  and
 other  similar  equipment. Moreover, in the case of a combined report, a
 combined group shall be considered  a  "manufacturing  corporation"  for
 purposes  of  this  subparagraph  only  if the combined group during the
 taxable year is principally engaged in the activities set forth in  this
 paragraph,  or  any combination thereof. A taxpayer or, in the case of a
 combined report, a combined group, shall  be  "principally  engaged"  in
 activities  described  in this subparagraph if, during the taxable year,
 more than fifty percent  of  the  gross  receipts  of  the  taxpayer  or
 combined group, respectively, are derived from receipts from the sale of
 goods produced by such activities. In computing a combined group's gross
 receipts, intercorporate receipts shall be eliminated.
   (ii) A "qualified New York manufacturing corporation" is a manufactur-
 ing  corporation  that  has  property  in the state that is described in
 subparagraph five of this paragraph and either (A) the adjusted basis of
 such property for New York state tax purposes at the close of the  taxa-
 S. 8474                            617
 
 ble  year is at least one million dollars or (B) more than fifty percent
 of its real and personal property is located in the state.
   (5)  For purposes of subclause (A) of clause (ii) of subparagraph four
 of this paragraph, property  includes  tangible  personal  property  and
 other  tangible  property, including buildings and structural components
 of buildings, which are: depreciable pursuant  to  section  one  hundred
 sixty-seven  of  the  internal  revenue code, have a useful life of four
 years or more, are acquired by purchase as defined in subsection (d)  of
 section  one  hundred  seventy-nine of the internal revenue code, have a
 situs in the state and are principally  used  by  the  taxpayer  in  the
 production of goods by manufacturing. Property used in the production of
 goods  shall  include  machinery,  equipment  or other tangible property
 which is principally used in the repair and service of other  machinery,
 equipment  or other tangible property used principally in the production
 of goods and shall include all facilities used in the production  opera-
 tion,  including storage of material to be used in production and of the
 products that are produced.
   2. The amount of investment capital  and  business  capital  shall  be
 determined  by  taking  the  average  value of the gross assets included
 therein,  less  liabilities  deductible  therefrom   pursuant   to   the
 provisions  of  subdivisions  four  and  six  of  section 11-652 of this
 subchapter, and, if the period covered by the report  is  other  than  a
 period  of  twelve  calendar  months,  by  multiplying such value by the
 number of calendar months or major parts thereof included in such  peri-
 od,  and  dividing  the product thus obtained by twelve. For purposes of
 this subdivision, real  property  and  marketable  securities  shall  be
 valued  at  fair  market  value and the value of personal property other
 than marketable securities shall be the value thereof shown on the books
 and records of  the  taxpayer  in  accordance  with  generally  accepted
 accounting principles.
   3. The portion of the business income of a taxpayer to be allocated to
 the city shall be determined as follows:
   (a)  multiply  its business income by a business allocation percentage
 to be determined by:
   (1) ascertaining the percentage which the average value of the taxpay-
 er's real and tangible personal property, whether owned or rented to it,
 within the city during the period covered by its  report  bears  to  the
 average value of all the taxpayer's real and tangible personal property,
 whether owned or rented to it, wherever situated during such period. For
 the purpose of this subparagraph, the term "value of the taxpayer's real
 and  tangible  personal  property" shall mean the adjusted bases of such
 properties for federal income tax purposes, except that in the  case  of
 rented  property such value shall mean the product of (i) eight and (ii)
 the gross rents payable for the rental of such property during the taxa-
 ble year; provided, however, that the  taxpayer  may  make  a  one-time,
 revocable  election,  pursuant to regulations promulgated by the commis-
 sioner of finance to use fair market value as the value of  all  of  its
 real and tangible personal property, provided that such election is made
 on  or  before  the due date for filing a report under section 11-655 of
 this subchapter for the taxpayer's first taxable year commencing  on  or
 after  January  first,  two  thousand  fifteen  and  provided  that such
 election shall not apply to any taxable year with respect to  which  the
 taxpayer  is  included on a combined report unless each of the taxpayers
 included on such report has made  such  an  election  which  remains  in
 effect  for  such  year or to any taxpayer that was subject to tax under
 subchapter two of this chapter and did not have an  election  in  effect
 S. 8474                            618
 
 under  subparagraph one of paragraph (a) of subdivision three of section
 11-604 of this chapter on December thirty-first, two thousand fourteen;
   (2)  ascertaining  the percentage determined under section 11-654.2 of
 this subchapter;
   (3) ascertaining the percentage of the total wages, salaries and other
 personal service compensation, similarly computed, during such period of
 employees within the city, except general  executive  officers,  to  the
 total wages, salaries and other personal service compensation, similarly
 computed,  during such period of all the taxpayer's employees within and
 without the city, except general executive officers; and
   (4) adding together the percentages so  determined  and  dividing  the
 result by the number of percentages.
   (5) Intentionally omitted.
   (6) Intentionally omitted.
   (7) Intentionally omitted.
   (8) Intentionally omitted.
   (9) Intentionally omitted.
   (10) Notwithstanding subparagraphs one through four of this paragraph,
 the business allocation percentage, to the extent that it is computed by
 reference to the percentages determined under subparagraphs one, two and
 three  of  this  paragraph, shall be computed in the manner set forth in
 this subparagraph.
   (i) Intentionally omitted.
   (ii) Intentionally omitted.
   (iii) Intentionally omitted.
   (iv) Intentionally omitted.
   (v) Intentionally omitted.
   (vi) Intentionally omitted.
   (vii) For taxable years beginning in two thousand fifteen,  the  busi-
 ness  allocation  percentage  shall be determined by adding together the
 following percentages:
   (A) the product of ten percent and  the  percentage  determined  under
 subparagraph one of this paragraph;
   (B)  the product of eighty percent and the percentage determined under
 subparagraph two of this paragraph; and
   (C) the product of ten percent and  the  percentage  determined  under
 subparagraph three of this paragraph.
   (viii)  For taxable years beginning in two thousand sixteen, the busi-
 ness allocation percentage shall be determined by  adding  together  the
 following percentages:
   (A)  the product of six and one-half percent and the percentage deter-
 mined under subparagraph one of this paragraph;
   (B) the product of eighty-seven percent and the percentage  determined
 under subparagraph two of this paragraph; and
   (C)  the product of six and one-half percent and the percentage deter-
 mined under subparagraph three of this paragraph.
   (ix) For taxable years beginning in two thousand seventeen, the  busi-
 ness  allocation  percentage  shall be determined by adding together the
 following percentages:
   (A) the product of three  and  one-half  percent  and  the  percentage
 determined under subparagraph one of this paragraph;
   (B)  the product of ninety-three percent and the percentage determined
 under subparagraph two of this paragraph; and
   (C) the product of three  and  one-half  percent  and  the  percentage
 determined under subparagraph three of this paragraph.
 S. 8474                            619
 
   (x)  For  taxable  years  beginning  after two thousand seventeen, the
 business allocation percentage shall be the percentage determined  under
 subparagraph two of this paragraph.
   (xi)  The  commissioner of finance shall promulgate rules necessary to
 implement the provisions of this subparagraph under  such  circumstances
 where  any  of  the percentages to be determined under subparagraph one,
 two or three of this paragraph cannot be determined because the taxpayer
 has no property, receipts or wages within or without the city.
   (xii) Notwithstanding the provisions of clauses (viii), (ix), and  (x)
 of  this  subparagraph,  for taxable years beginning on or after January
 first, two thousand eighteen, a taxpayer that has fifty million  dollars
 or  less  of  receipts allocated to the city as determined under section
 11-654.2 of this subchapter, or,  if  the  taxpayer  is  included  in  a
 combined  group, a combined group that has fifty million dollars or less
 of receipts allocated to the city as determined under  section  11-654.2
 of  this subchapter, may make a one-time election to determine its busi-
 ness allocation percentage by adding together the following percentages:
   (A) the product of three  and  one-half  percent  and  the  percentage
 determined under subparagraph one of this paragraph;
   (B)  the product of ninety-three percent and the percentage determined
 under subparagraph two of this paragraph; and
   (C) the product of three  and  one-half  percent  and  the  percentage
 determined under subparagraph three of this paragraph.
   The  election  provided for in this clause must be made on an original
 or amended report filed pursuant to section 11-655  of  this  subchapter
 for  the taxpayer's or, if the taxpayer is included in a combined group,
 the combined group's, first taxable year commencing on or after  January
 first, two thousand eighteen and shall remain in effect until revoked by
 the  taxpayer,  or  if the taxpayer is included in a combined group, the
 combined group. An election shall be revoked under  this  clause  on  an
 original  or  amended  report  filed  pursuant to section 11-655 of this
 subchapter for the taxpayer's, or if  the  taxpayer  is  included  in  a
 combined group, the combined group's, first taxable year with respect to
 which such revocation is to be effective. If the taxpayer is a member of
 a  combined  group, an election or revocation by the taxpayer under this
 clause shall apply to all members of the combined group.
   (11) A foreign air carrier described in the first sentence of subpara-
 graph one of paragraph (c-1) of subdivision eight of section  11-652  of
 this  subchapter  shall  determine  its  business  allocation percentage
 pursuant to subparagraphs one through four of this paragraph,  as  modi-
 fied  by  subparagraph ten of this paragraph, except that the numerators
 and denominators involved in such computation shall exclude property  to
 the extent employed in generating income excluded from entire net income
 for the taxable year pursuant to paragraph (c-1) of subdivision eight of
 section 11-652 of this subchapter, exclude such receipts as are excluded
 from  entire net income for the taxable year pursuant to paragraph (c-1)
 of subdivision eight of section 11-652 of this subchapter,  and  exclude
 wages, salaries or other personal service compensation which are direct-
 ly  attributable  to  the  generation of income excluded from entire net
 income for the taxable year pursuant to paragraph (c-1)  of  subdivision
 eight of section 11-652 of this subchapter.
   (b) Intentionally omitted.
   (c) Intentionally omitted.
   (d)  In  any  taxable year when property is sold or otherwise disposed
 of, with respect to which a  deduction  has  been  allowed  pursuant  to
 subparagraph one or two of paragraph (d) of subdivision three of section
 S. 8474                            620
 
 11-604  of  this  chapter  or  subdivision (k) of section 11-641 of this
 chapter in any period in which the taxpayer was  subject  to  tax  under
 subchapter  two  of this chapter, the gain or loss thereon entering into
 the  computation  of  federal  taxable  income  shall  be disregarded in
 computing entire net income, and there shall be added to  or  subtracted
 from the portion of entire net income allocated within the city the gain
 or  loss  upon such sale or other disposition. In computing such gain or
 loss the basis of the property sold or disposed of shall be adjusted  to
 reflect  the deduction allowed with respect to such property pursuant to
 subparagraph one or two of paragraph (d) of subdivision three of section
 11-604 of this chapter. Provided, however, that no loss shall be  recog-
 nized  for  the  purposes of this subparagraph with respect to a sale or
 other disposition of property to a person whose acquisition  thereof  is
 not  a  purchase  as  defined  in  subsection (d) of section one hundred
 seventy-nine of the internal revenue code.
   (e) In any taxable year when property is sold  or  otherwise  disposed
 of,  with  respect  to  which  a  deduction has been allowed pursuant to
 subparagraph one or two of paragraph (e) of subdivision three of section
 11-604 of this chapter in any period the taxpayer  was  subject  to  tax
 under  subchapter two of this chapter, the gain or loss thereon entering
 into the computation of federal taxable income shall be  disregarded  in
 computing  entire  net income, and there shall be added to or subtracted
 from the portion of entire net income allocated within the city the gain
 or loss upon such sale or other disposition. In computing such  gain  or
 loss  the basis of the property sold or disposed of shall be adjusted to
 reflect the deduction allowed with respect to such property pursuant  to
 subparagraph one or two of paragraph (e) of subdivision three of section
 11-604  of this chapter. Provided, however, that no loss shall be recog-
 nized for the purposes of this subparagraph with respect to  a  sale  or
 other  disposition  of property to a person whose acquisition thereof is
 not a purchase as defined in  subsection  (d)  of  section  one  hundred
 seventy-nine of the internal revenue code.
   4.  The  portion of the business capital of a taxpayer to be allocated
 within the city shall be determined by multiplying the amount thereof by
 the business allocation percentage determined as hereinabove provided.
   4-a. A corporation that is a partner in a  partnership  shall  compute
 tax  under  this  subchapter  using  any method required or permitted in
 regulations of the commissioner of finance.
   5. Intentionally omitted.
   6. Intentionally omitted.
   7. Intentionally omitted.
   8. Intentionally omitted.
   9. If it shall appear to the commissioner of finance that any business
 allocation percentage determined as hereinabove provided does not  prop-
 erly  reflect  the  activity,  business, income or capital of a taxpayer
 within the city, the commissioner of finance shall be authorized in  his
 or  her  discretion  to  adjust it, or the taxpayer may request that the
 commissioner of finance adjust it, by (a) excluding one or more  of  the
 factors  therein,  (b)  including  one  or  more  other factors, such as
 expenses, purchases, contract  values,  minus  subcontract  values,  (c)
 excluding  one  or  more assets in computing such allocation percentage,
 provided the income therefrom, is also excluded  in  determining  entire
 net  income,  or (d) any other similar or different method calculated to
 effect a fair and proper allocation of the income and capital reasonably
 attributable to the city. The party seeking the  adjustment  shall  bear
 the burden of proof to demonstrate that the business allocation percent-
 S. 8474                            621
 
 age  determined  pursuant  to  this  section does not result in a proper
 reflection of the taxpayer's income or capital within the city and  that
 the proposed adjustment is appropriate. The commissioner of finance from
 time  to  time shall publish all rulings of general public interest with
 respect to any application of the provisions of this subdivision.
   10. Intentionally omitted.
   11. Intentionally omitted.
   12. Intentionally omitted.
   13. (a) In addition to any other credit allowed  by  this  section,  a
 taxpayer  shall  be  allowed  a  credit  against the tax imposed by this
 subchapter to be credited or refunded without interest,  in  the  manner
 hereinafter provided in this section.
   (1)(i)  Where  a  taxpayer  shall  have  relocated  to the city from a
 location outside the state, and by such relocation shall have created  a
 minimum  of  one  hundred  industrial  or commercial employment opportu-
 nities; and where such taxpayer shall have entered into a written  lease
 for  the  relocation  premises,  the  terms  of  which lease provide for
 increased additional payments to the landlord which are based solely and
 directly upon any increase or addition in real estate taxes  imposed  on
 the leased premises, the taxpayer upon approval and certification by the
 industrial  and commercial incentive board as hereinafter provided shall
 be entitled to a credit against the tax imposed by this subchapter.  The
 amount  of  such credit shall be an amount equal to the annual increased
 payments actually made by the taxpayer to the landlord which are  solely
 and  directly attributable to an increase or addition to the real estate
 tax imposed upon the leased premises. Such credit shall be allowed  only
 to the extent that the taxpayer has not otherwise claimed said amount as
 a deduction against the tax imposed by this subchapter.
   (ii)  The  industrial  and commercial incentive board in approving and
 certifying to the qualifications of the taxpayer  to  receive  such  tax
 credit shall first determine that the applicant has met the requirements
 of this section, and further, that the granting of the tax credit to the
 applicant  is in the "public interest". In determining that the granting
 of the tax credit is in the public interest, the board shall make affir-
 mative findings that: the granting of the tax credit  to  the  applicant
 will  not  effect an undue hardship on similar taxpayers already located
 within the city; the existence of this tax incentive  has  been  instru-
 mental  in  bringing  about the relocation of the applicant to the city;
 and the granting of the tax credit will foster the economic recovery and
 economic development of the city.
   (iii) The tax credit, if approved and certified by the industrial  and
 commercial  incentive  board,  must be utilized annually by the taxpayer
 for the length of the term of the lease or for a period  not  to  exceed
 ten years from the date of relocation whichever period is shorter.
   (2) When used in this subdivision:
   (i)  "Employment  opportunity" means the creation of a full time posi-
 tion of gainful employment for an industrial or commercial employee  and
 the actual hiring of such employee for the said position.
   (ii)  "Industrial  employee"  means  one engaged in the manufacture or
 assembling of tangible goods or the processing of raw materials.
   (iii) "Commercial employee" means one engaged in the  buying,  selling
 or  otherwise  providing  of  goods  or  services other than on a retail
 basis.
   (iv) "Retail" means the selling or otherwise disposing  or  furnishing
 of tangible goods or services directly to the ultimate user or consumer.
 S. 8474                            622
 
   (v)  "Full time position" means the hiring of an industrial or commer-
 cial employee in a position of gainful employment where  the  number  of
 hours  worked by such employees is not less than thirty hours during any
 given work week.
   (vi)  "Industrial  and  commercial  incentive  board"  means the board
 created pursuant to part three of subchapter two of chapter two of  this
 title.
   (b)  The  credit  allowed  under this subdivision for any taxable year
 shall be deemed to be an overpayment of tax by the taxpayer to be  cred-
 ited or refunded, without interest, in accordance with the provisions of
 section 11-677 of this chapter.
   14.  (a)  In  addition  to any other credit allowed by this section, a
 taxpayer shall be allowed a credit  against  the  tax  imposed  by  this
 subchapter  to  be  credited or refunded without interest, in the manner
 hereinafter provided in this section. The amount of  such  credit  shall
 be:
   (1)  A maximum of three hundred dollars for each commercial employment
 opportunity and a maximum of five hundred dollars  for  each  industrial
 employment  opportunity  relocated  to the city from an area outside the
 state. Such credit shall be allowed to a taxpayer who relocates a  mini-
 mum of ten employment opportunities. The credit shall be allowed against
 employment  opportunity  relocation costs incurred by the taxpayer. Such
 credit shall be allowed only to the extent that  the  taxpayer  has  not
 claimed  a  deduction  for  allowable  employment opportunity relocation
 costs. The credit allowed hereunder may be  taken  by  the  taxpayer  in
 whole  or  in  part  in  the year in which the employment opportunity is
 relocated by such taxpayer or either of the two  years  succeeding  such
 event, provided, however, no credit shall be allowed under this subdivi-
 sion  to a taxpayer for industrial employment opportunities relocated to
 premises (i) that are within an  industrial  business  zone  established
 pursuant to section 22-626 of the code of the preceding municipality and
 (ii) for which a binding contract to purchase or lease was first entered
 into by the taxpayer on or after July first, two thousand five.
   The commissioner of finance is empowered to promulgate rules and regu-
 lations and to prescribe the form of application to be used by a taxpay-
 er seeking the such credit.
   (2) When used in this subdivision:
   (i)  "Employment  opportunity" means the creation of a full time posi-
 tion of gainful employment for an industrial or commercial employee  and
 the actual hiring of such employee for the said position.
   (ii)  "Industrial  employee"  means  one engaged in the manufacture or
 assembling of tangible goods or the processing of raw materials.
   (iii) "Commercial employee" means one engaged in the  buying,  selling
 or  otherwise  providing  of  goods  or  services other than on a retail
 basis.
   (iv) "Retail" means the selling or  otherwise  disposing  of  tangible
 goods directly to the ultimate user or consumer.
   (v)  "Full time position" means the hiring of an industrial or commer-
 cial employee in a position of gainful employment where  the  number  of
 hours  worked  by such employee is not less than thirty hours during any
 given work week.
   (vi)  "Employment  opportunity  relocation  costs"  means  the   costs
 incurred  by  the taxpayer in moving furniture, files, papers and office
 equipment into the city from a location outside  the  state;  the  costs
 incurred by the taxpayer in the moving and installation of machinery and
 equipment  into the city from a location outside the state; the costs of
 S. 8474                            623
 
 installation of telephones and other communications  equipment  required
 as  a  result  of the relocation to the city from a location outside the
 state; the cost  incurred  in  the  purchase  of  office  furniture  and
 fixtures  required  as  a  result  of  the relocation to the city from a
 location outside the state; and the cost of renovation of  the  premises
 to  be  occupied  as a result of the relocation; provided, however, that
 such renovation costs shall be allowable only to the extent that they do
 not exceed seventy-five cents per square foot of the total area utilized
 by the taxpayer in the occupied premises.
   (b) The credit allowed under this section for any taxable  year  shall
 be  deemed to be an overpayment of tax by the taxpayer to be credited or
 refunded without interest in accordance with the provisions  of  section
 11-677 of this chapter.
   (c)  Notwithstanding  any  other  provision of this subdivision to the
 contrary, in the case of a taxpayer that has received, in a taxable year
 beginning before January first, two thousand  fifteen,  the  credit  set
 forth  in  subdivision fourteen of section 11-604 of this chapter for an
 eligible employment relocation, a credit shall be allowed to the taxpay-
 er under this subdivision for any tax year beginning on or after January
 first, two thousand fifteen, in the same amount and to the  same  extent
 that  a  credit,  or the unused portion thereof, would have been allowed
 under subdivision fourteen of section 11-604  of  this  chapter,  as  in
 effect on December thirty-first, two thousand fourteen, if such subdivi-
 sion continued to apply to the taxpayer for such taxable year.
   15. Intentionally omitted.
   16. Intentionally omitted.
   17.  (a)  In  addition  to any other credit allowed by this section, a
 taxpayer that has obtained the certifications required by chapter  six-B
 of  title  twenty-two of the code of the preceding municipality shall be
 allowed a credit against the tax imposed by this subchapter. The  amount
 of the credit shall be the amount determined by multiplying five hundred
 dollars  or,  in  the  case  of a taxpayer that has obtained pursuant to
 chapter six-B of such title twenty-two a  certification  of  eligibility
 dated on or after July first, nineteen hundred ninety-five, one thousand
 dollars or, in the case of an eligible business that has obtained pursu-
 ant  to chapter six-B of such title twenty-two a certification of eligi-
 bility dated on or after July first, two thousand, for a  relocation  to
 eligible premises located within a revitalization area defined in subdi-
 vision  (n) of section 22-621 of the code of the preceding municipality,
 three thousand dollars, by the number of eligible  aggregate  employment
 shares  maintained  by the taxpayer during the taxable year with respect
 to particular premises to which the taxpayer  has  relocated;  provided,
 however,  with  respect  to  a relocation for which no application for a
 certificate of eligibility is submitted prior to July first,  two  thou-
 sand  three,  to  eligible premises that are not within a revitalization
 area, if the date of such relocation as determined pursuant to  subdivi-
 sion  (j) of section 22-621 of the code of the preceding municipality is
 before July first, nineteen hundred ninety-five, the amount to be multi-
 plied by the number of eligible aggregate  employment  shares  shall  be
 five  hundred  dollars,  and  with  respect to a relocation for which no
 application for a certificate of eligibility is submitted prior to  July
 first,  two thousand three, to eligible premises that are within a revi-
 talization area, if the date of such relocation as  determined  pursuant
 to  subdivision  (j)  of  such  section  is  before July first, nineteen
 hundred ninety-five, the amount to be multiplied by the number of eligi-
 ble aggregate employment shares shall be five hundred  dollars,  and  if
 S. 8474                            624
 
 the date of such relocation as determined pursuant to subdivision (j) of
 such  section  is  on or after July first, nineteen hundred ninety-five,
 and before July first, two thousand,  one  thousand  dollars;  provided,
 however,  that  no  credit  shall  be  allowed for the relocation of any
 retail activity or hotel services; provided,  further,  that  no  credit
 shall be allowed under this subdivision to any taxpayer that has elected
 pursuant to subdivision (d) of section 22-622 of the code of the preced-
 ing  municipality  to  take  such  credit  against  a gross receipts tax
 imposed by chapter eleven of this title; and provided that in  the  case
 of  an  eligible business that has obtained pursuant to chapter six-B of
 such title twenty-two certifications of eligibility for  more  than  one
 relocation,  the  portion  of  the  total  amount  of eligible aggregate
 employment shares to be multiplied by the  dollar  amount  specified  in
 this  subdivision  for  each such certification of a relocation shall be
 the number of total  attributed  eligible  aggregate  employment  shares
 determined  with  respect to such relocation pursuant to subdivision (o)
 of section 22-621 of the  code  of  the  preceding  municipality.    For
 purposes  of  this subdivision, the terms "eligible aggregate employment
 shares," "relocate," "retail activity" and "hotel services"  shall  have
 the  meanings  ascribed  by  section 22-621 of the code of the preceding
 municipality.
   (b) The credit allowed under this subdivision with respect to eligible
 aggregate employment shares maintained with respect to particular  prem-
 ises  to which the taxpayer has relocated shall be allowed for the first
 taxable year during which such eligible aggregate employment shares  are
 maintained  with  respect  to  such  premises  and for any of the twelve
 succeeding taxable years  during  which  eligible  aggregate  employment
 shares  are  maintained with respect to such premises; provided that the
 credit allowed for the twelfth succeeding taxable year shall  be  calcu-
 lated  by multiplying the number of eligible aggregate employment shares
 maintained with respect to such premises in the twelfth succeeding taxa-
 ble year by the lesser of one and a fraction the numerator of  which  is
 such number of days in the taxable year of relocation less the number of
 days  the eligible business maintained employment shares in the eligible
 premises in the taxable year of relocation and the denominator of  which
 is  the  number  of  days in such twelfth succeeding taxable year during
 which such eligible aggregate  employment  shares  are  maintained  with
 respect  to  such  premises. Except as provided in paragraph (d) of this
 subdivision, if the amount of the credit allowable under  this  subdivi-
 sion  for  any  taxable  year exceeds the tax imposed for such year, the
 excess may be carried over, in order, to the five immediately succeeding
 taxable years and, to the  extent  not  previously  deductible,  may  be
 deducted from the taxpayer's tax for such years.
   (c)  The  credit  allowable  under  this subdivision shall be deducted
 after the credit allowed by subdivision eighteen of  this  section,  but
 prior to the deduction of any other credit allowed by this section.
   (d)  In  the  case  of a taxpayer that has obtained a certification of
 eligibility pursuant to chapter six-B of title twenty-two of the code of
 the preceding municipality dated on or after July  first,  two  thousand
 for  a relocation to eligible premises located within the revitalization
 area defined in subdivision (n) of section 22-621 of  the  code  of  the
 preceding  municipality,  the credits allowed under this subdivision, or
 in the case of a taxpayer that has relocated more than once, the portion
 of such credits attributed to such certification of eligibility pursuant
 to paragraph (a) of this subdivision, against the tax  imposed  by  this
 chapter for the taxable year of such relocation and for the four taxable
 S. 8474                            625
 
 years  immediately succeeding the taxable year of such relocation, shall
 be deemed to be overpayments of tax by the taxpayer to  be  credited  or
 refunded, without interest, in accordance with the provisions of section
 11-677 of this chapter. For such taxable years, such credits or portions
 thereof  may  not  be  carried  over  to  any  succeeding  taxable year;
 provided, however, that this paragraph shall not apply to any relocation
 for which an application for a  certification  of  eligibility  was  not
 submitted  prior  to  July first, two thousand three, unless the date of
 such relocation is on or after July first, two thousand.
   (e) Notwithstanding any other provision of  this  subdivision  to  the
 contrary, in the case of a taxpayer that has obtained, pursuant to chap-
 ter six-B of title twenty-two of the code of the preceding municipality,
 a  certification  of  eligibility  and  has  received, in a taxable year
 beginning before January first, two thousand  fifteen,  the  credit  set
 forth  in  subdivision  seventeen  of  section 11-604 of this chapter or
 section 11-643.7 of this chapter for the relocation of an eligible busi-
 ness, a credit shall be allowed under this subdivision to  the  taxpayer
 for  any  taxable year beginning on or after January first, two thousand
 fifteen in the same amount and to the same extent that  a  credit  would
 have  been allowed under subdivision seventeen of section 11-604 of this
 chapter or section 11-643.7 of this chapter, as in  effect  on  December
 thirty-first,  two  thousand  fourteen, if such subdivision continued to
 apply to the taxpayer for such taxable year.
   17-a. Intentionally omitted.
   17-b. (a) In addition to any other credit allowed by this section,  an
 eligible  business that first enters into a binding contract on or after
 July first, two thousand five to purchase or lease eligible premises  to
 which  it  relocates  shall be allowed a one-time credit against the tax
 imposed by this subchapter to be credited  or  refunded  in  the  manner
 hereinafter  provided  in  this  subdivision.  The amount of such credit
 shall be one thousand dollars per full-time employee; provided, however,
 that the amount of such credit shall not exceed  the  lesser  of  actual
 relocation costs or one hundred thousand dollars.
   (b)  When used in this subdivision, the following terms shall have the
 following meanings:
   (1) "Eligible business" means any business subject to tax  under  this
 subchapter  that (i) has been conducting substantial business operations
 and engaging primarily in industrial and manufacturing activities at one
 or more locations within the city of New York or outside  the  state  of
 New  York  continuously  during  the twenty-four consecutive full months
 immediately preceding relocation, (ii)  has  leased  the  premises  from
 which  it relocates continuously during the twenty-four consecutive full
 months immediately preceding relocation, (iii) first enters into a bind-
 ing contract on or after July first, two thousand five  to  purchase  or
 lease  eligible  premises to which such business will relocate, and (iv)
 will be engaged primarily in industrial and manufacturing activities  at
 such eligible premises.
   (2)  "Eligible  premises"  means  premises  located entirely within an
 industrial business zone. For any eligible business, an industrial busi-
 ness zone tax credit shall not be granted with respect to more than  one
 eligible premises.
   (3) "Full-time employee" means (i) one person gainfully employed in an
 eligible  premises  by  an  eligible  business where the number of hours
 required to be worked by such person is not less than thirty-five  hours
 per week; or (ii) two persons gainfully employed in an eligible premises
 by  an eligible business where the number of hours required to be worked
 S. 8474                            626
 
 by each such person is more than fifteen hours per week  but  less  than
 thirty-five hours per week.
   (4)  "Industrial  business  zone" means an area within the city of New
 York established pursuant to section 22-626 of the code of the preceding
 municipality.
   (5) "Industrial business zone tax credit" means a credit, as  provided
 for in this subdivision, against a tax imposed under this subchapter.
   (6) "Industrial and manufacturing activities" means activities involv-
 ing the assembly of goods to create a different article, or the process-
 ing,  fabrication,  or  packaging of goods. Industrial and manufacturing
 activities shall not include waste management or utility services.
   (7) "Relocation" means the physical relocation of furniture, fixtures,
 equipment, machinery and supplies directly to an eligible premises, from
 one or more locations of an eligible business, including  at  least  one
 location at which such business conducts substantial business operations
 and  engages  primarily  in industrial and manufacturing activities. For
 purposes of this subdivision, the date of relocation shall  be  (i)  the
 date  of  the  completion  of the relocation to the eligible premises or
 (ii) ninety days from the commencement of the relocation to the eligible
 premises, whichever is earlier.
   (8) "Relocation costs" means costs incurred in the relocation of  such
 furniture,  fixtures,  equipment, machinery and supplies, including, but
 not limited to, the cost of dismantling and reassembling  equipment  and
 the cost of floor preparation necessary for the reassembly of the equip-
 ment.  Relocation  costs shall include only such costs that are incurred
 during the ninety-day period immediately following the  commencement  of
 the  relocation  to  an  eligible  premises.  Relocation costs shall not
 include costs for structural or capital improvements or items  purchased
 in connection with the relocation.
   (c)  The  credit  allowed  under this subdivision for any taxable year
 shall be deemed to be an overpayment of tax by the taxpayer to be  cred-
 ited  or refunded without interest, in accordance with the provisions of
 section 11-677 of this chapter.
   (d) The number of full-time employees for the purposes of  calculating
 an  industrial  business tax credit shall be the average number of full-
 time employees, calculated on a weekly basis, employed in  the  eligible
 premises  by  the  eligible  business in the fifty-two week period imme-
 diately following the earlier of (1) the date of the completion  of  the
 relocation to eligible premises or (2) ninety days from the commencement
 of the relocation to the eligible premises.
   (e)  The  credit  allowed  under this subdivision must be taken by the
 taxpayer in the taxable year in which such twelve month period  selected
 by the taxpayer ends.
   (f)  For  the purposes of calculating entire net income in the taxable
 year that an industrial business tax credit is allowed, a taxpayer  must
 add back the amount of the credit allowed under this subdivision, to the
 extent of any relocation costs deducted in the current taxable year or a
 prior taxable year in calculating federal taxable income.
   (g) The credit allowed under this subdivision shall not be granted for
 an eligible business for more than one relocation, provided, however, an
 industrial  business  tax  credit  shall  not be granted if the eligible
 business receives benefits pursuant to chapter six-B or six-C  of  title
 twenty-two  of  the  code of the preceding municipality, through a grant
 program administered by the business relocation assistance  corporation,
 or through the New York city printers relocation fund grant.
 S. 8474                            627
 
   (h)  The commissioner of finance is authorized to promulgate rules and
 regulations and to prescribe forms necessary to effectuate the  purposes
 of this subdivision.
   18.  (a)  If  a corporation is a partner in an unincorporated business
 taxable under chapter five of this title, and is required to include  in
 entire  net  income  its  distributive  share  of income, gain, loss and
 deductions of, or guaranteed payments from,  such  unincorporated  busi-
 ness, such corporation shall be allowed a credit against the tax imposed
 by  this  subchapter  equal  to  the lesser of the amounts determined in
 subparagraphs one and two of this paragraph:
   (1) The amount determined in this subparagraph is the product  of  (i)
 the  sum  of  (A)  the  tax imposed by chapter five of this title on the
 unincorporated business for its taxable year ending within or  with  the
 taxable  year of the corporation and paid by the unincorporated business
 and (B) the amount of any credit or credits taken by the  unincorporated
 business  under  section 11-503 of this title, except the credit allowed
 by subdivision (b) of section 11-503 of this title, for its taxable year
 ending within or with the taxable year of the corporation, to the extent
 that such credits do not reduce such unincorporated business's tax below
 zero, and (ii) a fraction, the numerator of which is the  net  total  of
 the   corporation's   distributive  share  of  income,  gain,  loss  and
 deductions of, and guaranteed payments from, the unincorporated business
 for such taxable year, and the denominator of which is the sum, for such
 taxable year, of the net total distributive shares of income, gain, loss
 and deductions of, and guaranteed payments to, all partners in the unin-
 corporated business for whom or which  such  net  total,  as  separately
 determined for each partner, is greater than zero.
   (2)  The  amount determined in this subparagraph is the product of (i)
 the excess of (A) the tax computed under clause (i) of subparagraph  one
 of  paragraph  (e) of subdivision one of this section, without allowance
 of any credits allowed by this section, over (B) the  tax  so  computed,
 determined as if the corporation had no such distributive share or guar-
 anteed  payments with respect to the unincorporated business, and (ii) a
 fraction, the numerator of which is four and the denominator of which is
 eight and eighty-five one-hundredths, except  that  in  the  case  of  a
 financial  corporation  as  defined in clause (i) of subparagraph one of
 paragraph (e) of subdivision one of this section,  such  denominator  is
 nine,  and in the case of a taxpayer that is subject to paragraph (j) or
 (k) of subdivision one of this section, such denominator  shall  be  the
 rate  of  tax as determined by such paragraph (j) or (k) for the taxable
 year; provided that the amounts computed in subclauses (A)  and  (B)  of
 clause  (i)  of  this  subparagraph shall be computed with the following
 modifications:
   (A) such amounts shall be computed without  taking  into  account  any
 carryforward  or  carryback  by the partner of a net operating loss or a
 prior net operation loss conversion subtraction;
   (B) if, prior to taking into account any distributive share or guaran-
 teed payments from any unincorporated business or any net operating loss
 carryforward or carryback, the entire net income of the partner is  less
 than zero, such entire net income shall be treated as zero; and
   (C)  if  such  partner's net total distributive share of income, gain,
 loss and deductions of, and guaranteed payments from, any unincorporated
 business is less than zero, such net total shall be treated as zero. The
 amount determined in this subparagraph shall not be less than zero.
   (b) (1) Notwithstanding anything to the contrary in paragraph  (a)  of
 this subdivision, in the case of a corporation that, before the applica-
 S. 8474                            628
 
 tion of this subdivision or any other credit allowed by this section, is
 liable  for  the tax on business income under clause (i) of subparagraph
 one of paragraph (e) of subdivision one of this section, the  credit  or
 the sum of the credits that may be taken by such corporation for a taxa-
 ble  year under this subdivision with respect to an unincorporated busi-
 ness or unincorporated businesses in which it is  a  partner  shall  not
 exceed  the tax so computed, without allowance of any credits allowed by
 this section, multiplied by a fraction the numerator of  which  is  four
 and  the  denominator  of which is eight and eighty-five one-hundredths,
 except that in the case of a financial corporation as defined in  clause
 (i)  of  subparagraph  one  of  paragraph (e) of subdivision one of this
 section, such denominator is nine, and in the case of a taxpayer that is
 subject to paragraph (j) or (k) of subdivision one of this section, such
 denominator shall be the rate of tax as determined by such paragraph (j)
 or (k) for the taxable year. If the credit allowed under  this  subdivi-
 sion or the sum of such credits exceeds the product of such tax and such
 fraction,  the amount of the excess may be carried forward, in order, to
 each of the seven immediately  succeeding  taxable  years  and,  to  the
 extent  not  previously  taken,  shall be allowed as a credit in each of
 such years. In applying such provisions, the credit determined  for  the
 taxable  year  under  paragraph  (a)  of this subdivision shall be taken
 before taking any credit carryforward pursuant to this paragraph and the
 credit carryforward attributable to the earliest taxable year  shall  be
 taken  before  taking a credit carryforward attributable to a subsequent
 taxable year.
   (2) Intentionally omitted.
   (2-a) Notwithstanding any other provision of this subdivision  to  the
 contrary, in the case of a taxpayer that has received, in a taxable year
 beginning  before  January  first,  two thousand fifteen, the credit set
 forth in subdivision eighteen of section 11-604 of this  chapter  or  in
 section  11-643.8  of  this chapter for a tax paid under chapter five of
 this title in a taxable year beginning before January first,  two  thou-
 sand  fifteen, the taxpayer may carry forward the unused portion of such
 credit under this subdivision to any taxable year beginning on or  after
 January  first,  two thousand fifteen in the same amount and to the same
 extent, including the same limitations, that the credit, or  the  unused
 portion  thereof,  would  have  been allowed to be carried forward under
 subparagraph one of paragraph (b) of  subdivision  eighteen  of  section
 11-604  of  this  chapter or paragraph one of subdivision (b) of section
 11-643.8 of this chapter, as in effect  on  December  thirty-first,  two
 thousand fourteen, if such subdivision continued to apply to the taxpay-
 er for such taxable year.
   (3) No credit allowed under this subdivision may be taken in a taxable
 year  by a taxpayer that, in the absence of such credit, would be liable
 for the tax computed on the basis of business capital under clause  (ii)
 of  subparagraph one of paragraph (e) of subdivision one of this section
 or the fixed-dollar minimum tax under clause (iv) of subparagraph one of
 paragraph (e) of subdivision one of this section.
   (c) For corporations that file a report on a combined  basis  pursuant
 to  section  11-654.3  of  this  subchapter,  the credit allowed by this
 subdivision shall be computed as if the combined group were the  partner
 in  each  unincorporated  business from which any of the members of such
 group had a distributive share or guaranteed payments, provided,  howev-
 er,  if  more  than one member of the combined group is a partner in the
 same unincorporated business, for purposes of the  calculation  required
 in  subparagraph one of paragraph (a) of this subdivision, the numerator
 S. 8474                            629
 
 of the fraction described in clause (ii) of such subparagraph one  shall
 be  the  sum  of the net total distributive shares of income, gain, loss
 and deductions of, and  guaranteed  payments  from,  the  unincorporated
 business  of  all  of the partners of the unincorporated business within
 the combined group for which such net total,  as  separately  determined
 for  each  partner,  is  greater  than zero, and the denominator of such
 fraction shall be the sum  of  the  net  total  distributive  shares  of
 income,  gain, loss and deductions of, and guaranteed payments from, the
 unincorporated business of all partners in the  unincorporated  business
 for  whom  or  which  such  net total, as separately determined for each
 partner, is greater than zero.
   (d) Notwithstanding any other provision of this subchapter, the credit
 allowable under this subdivision shall be taken prior to the  taking  of
 any  other  credit  allowed  by  this section. Notwithstanding any other
 provision of this subchapter, the application of this subdivision  shall
 not change the basis on which the taxpayer's tax is computed under para-
 graph (e) of subdivision one of this section.
   19.  Lower  Manhattan relocation and employment assistance credit. (a)
 In addition to any other credit allowed by this section, a taxpayer that
 has obtained the certifications required by chapter six-C of title twen-
 ty-two of the code of the preceding  municipality  shall  be  allowed  a
 credit  against  the  tax  imposed by this subchapter. The amount of the
 credit shall be the amount  determined  by  multiplying  three  thousand
 dollars by the number of eligible aggregate employment shares maintained
 by  the  taxpayer during the taxable year with respect to eligible prem-
 ises to which the taxpayer has relocated;  provided,  however,  that  no
 credit  shall  be  allowed  for the relocation of any retail activity or
 hotel services; provided, further, that no credit shall be allowed under
 this subdivision to any taxpayer that has elected pursuant  to  subdivi-
 sion  (d) of section 22-624 of the code of the preceding municipality to
 take such credit against a gross  receipts  tax  imposed  under  chapter
 eleven  of  this  title.  For  purposes  of  this subdivision, the terms
 "eligible aggregate employment shares," "eligible premises," "relocate,"
 "retail activity" and "hotel services" shall have the meanings  ascribed
 by section 22-623 of the code of the preceding municipality.
   (b) The credit allowed under this subdivision with respect to eligible
 aggregate employment shares maintained with respect to eligible premises
 to  which  the  taxpayer  has relocated shall be allowed for the taxable
 year of the relocation and for any  of  the  twelve  succeeding  taxable
 years  during  which eligible aggregate employment shares are maintained
 with respect to eligible premises; provided that the credit allowed  for
 the  twelfth  succeeding taxable year shall be calculated by multiplying
 the number of  eligible  aggregate  employment  shares  maintained  with
 respect  to  eligible premises in the twelfth succeeding taxable year by
 the lesser of one and a fraction the numerator of which is  such  number
 of  days  in  the taxable year of relocation less the number of days the
 taxpayer maintained employment shares in eligible premises in the  taxa-
 ble  year  of  relocation  and the denominator of which is the number of
 days in such twelfth taxable year during which such  eligible  aggregate
 employment shares are maintained with respect to such premises.
   (c)  Except  as  provided in paragraph (d) of this subdivision, if the
 amount of the credit allowable under this subdivision  for  any  taxable
 year  exceeds  the  tax imposed for such year, the excess may be carried
 over, in order, to the five immediately succeeding taxable years and, to
 the extent not previously deductible, may be deducted from  the  taxpay-
 er's tax for such years.
 S. 8474                            630
 
   (d)  The  credits  allowed  under  this  subdivision,  against the tax
 imposed by this chapter for the taxable year of the relocation  and  for
 the  four  taxable years immediately succeeding the taxable year of such
 relocation, shall be deemed to be overpayments of tax by the taxpayer to
 be  credited  or  refunded,  without  interest,  in  accordance with the
 provisions of section 11-677 of this chapter. For  such  taxable  years,
 such credits or portions thereof may not be carried over to any succeed-
 ing taxable year.
   (e)  The  credit  allowable  under  this subdivision shall be deducted
 after the credits allowed by subdivisions seventeen and eighteen of this
 section, but prior to the deduction of any other credit allowed by  this
 section.
   (f)  Notwithstanding  any  other  provision of this subdivision to the
 contrary, in the case of a taxpayer that has obtained, pursuant to chap-
 ter six-C of title twenty-two of the code of the preceding municipality,
 a certification of eligibility and  has  received,  in  a  taxable  year
 beginning  before  January  first,  two thousand fifteen, the credit set
 forth in subdivision nineteen of  section  11-604  of  this  chapter  or
 section 11-643.9 of this chapter for the relocation of an eligible busi-
 ness,  a  credit shall be allowed under this subdivision to the taxpayer
 for any taxable year beginning on or after January first,  two  thousand
 fifteen  in  the  same amount and to the same extent that a credit would
 have been allowed under subdivision nineteen of section 11-604  of  this
 chapter  or  section  11-643.9 of this chapter, as in effect on December
 thirty-first, two thousand fourteen, if such  subdivision  continued  to
 apply to the taxpayer for such taxable year.
   20. Intentionally omitted.
   21.  Biotechnology  credit.  (a)  (1)  A  taxpayer that is a qualified
 emerging technology company, engages in biotechnologies, and  meets  the
 eligibility  requirements of this subdivision, shall be allowed a credit
 against the tax imposed by this subchapter. The amount of  credit  shall
 be  equal  to  the  sum of the amounts specified in subparagraphs three,
 four and five of this paragraph, subject to the limitations in  subpara-
 graphs  six  and seven of this paragraph, paragraph (b) of this subdivi-
 sion, and paragraph three of subdivision (d) of section  twelve  hundred
 one-a  of  the tax law. For the purposes of this subdivision, "qualified
 emerging technology company" shall mean a company located in  the  city:
 (i)  whose primary products or services are classified as emerging tech-
 nologies and whose total annual product sales are ten million dollars or
 less; or
   (ii) a company that has research and  development  activities  in  the
 city  and  whose  ratio  of  research and development funds to net sales
 equals or exceeds the average ratio for all surveyed  companies  classi-
 fied as determined by the National Science Foundation in the most recent
 published  results from its Survey of Industry Research and Development,
 or any comparable successor survey as determined by  the  department  of
 finance, and whose total annual product sales are ten million dollars or
 less.  For  the purposes of this subdivision, the definition of research
 and development funds shall be the same as that  used  by  the  National
 Science  Foundation  in  the  aforementioned survey. For the purposes of
 this subdivision, "biotechnologies" shall mean the technologies  involv-
 ing  the  scientific manipulation of living organisms, especially at the
 molecular and/or the sub-molecular genetic level,  to  produce  products
 conducive  to  improving  the  lives  and health of plants, animals, and
 humans; and the associated scientific research, pharmacological, mechan-
 ical, and computational applications and services connected  with  these
 S. 8474                            631
 
 improvements.  Activities  included  with such applications and services
 shall include, but not be limited to,  alternative  mRNA  splicing,  DNA
 sequence  amplification,  antigenetic  switching bioaugmentation, bioen-
 richment,  bioremediation,  chromosome walking, cytogenetic engineering,
 DNA diagnosis, fingerprinting,  and  sequencing,  electroporation,  gene
 translocation, genetic mapping, site-directed mutagenesis, bio-transduc-
 tion,  bio-mechanical  and bio-electrical engineering, and bio-informat-
 ics.
   (2) An eligible taxpayer shall (i) have no more than one hundred full-
 time employees, of which at least seventy-five percent are  employed  in
 the  city,  (ii)  have  a ratio of research and development funds to net
 sales, as referred to in section thirty-one hundred two-e of the  public
 authorities law, which equals or exceeds six percent during the calendar
 year  ending  with  or  within  the taxable year for which the credit is
 claimed, and (iii) have gross revenues, along with the gross revenues of
 its "affiliates" and "related  members"  not  exceeding  twenty  million
 dollars  for  the  calendar year immediately preceding the calendar year
 ending with or within the taxable year for which the credit is  claimed.
 For  the  purposes  of  this  subdivision, "affiliates" shall mean those
 corporations that are members of the same affiliated group,  as  defined
 in  section  fifteen  hundred  four of the internal revenue code, as the
 taxpayer. For the  purposes  of  this  subdivision,  the  term  "related
 members" shall mean a person, corporation, or other entity, including an
 entity  that  is  treated as a partnership or other pass-through vehicle
 for purposes of federal taxation, whether such  person,  corporation  or
 entity is a taxpayer or not, where one such person, corporation or enti-
 ty,  or  set  of  related persons, corporations or entities, directly or
 indirectly owns or controls a controlling interest  in  another  entity.
 Such  entity  or entities may include all taxpayers under chapters five,
 eleven and seventeen of this title, and this subchapter and  subchapters
 two and three of this chapter. A controlling interest shall mean, in the
 case  of  a  corporation,  either  thirty  percent  or more of the total
 combined voting power of all classes of stock of  such  corporation,  or
 thirty percent or more of the capital, profits or beneficial interest in
 such voting stock of such corporation; and in the case of a partnership,
 association,  trust or other entity, thirty percent or more of the capi-
 tal, profits or beneficial interest in  such  partnership,  association,
 trust or other entity.
   (3)  An  eligible  taxpayer shall be allowed a credit for eighteen per
 centum of the cost or other basis for federal  income  tax  purposes  of
 research  and  development  property that is acquired by the taxpayer by
 purchase as defined in subsection (d) of section  one  hundred  seventy-
 nine  of  the  internal  revenue  code  and placed in service during the
 calendar year that ends with or within the taxable year  for  which  the
 credit is claimed. Provided, however, for the purposes of this paragraph
 only, an eligible taxpayer shall be allowed a credit for such percentage
 of the (i) cost or other basis for federal income tax purposes for prop-
 erty  used  in the testing or inspection of materials and products, (ii)
 the costs or expenses associated with quality control  of  the  research
 and  development, (iii) fees for use of sophisticated technology facili-
 ties and processes, and (iv) fees for the production or eventual commer-
 cial distribution of materials and products resulting  from  the  activ-
 ities  of  an  eligible  taxpayer  as long as such activities fall under
 activities relating to biotechnologies. The costs,  expenses  and  other
 amounts  for  which a credit is allowed and claimed under this paragraph
 shall not be used in the calculation of any other credit  allowed  under
 S. 8474                            632
 
 this  subchapter.  For  the  purposes of this subdivision, "research and
 development property" shall mean property that is used for  purposes  of
 research  and  development in the experimental or laboratory sense. Such
 purposes  shall  not  be  deemed  to  include  the  ordinary  testing or
 inspection of materials or  products  for  quality  control,  efficiency
 surveys,  management studies, consumer surveys, advertising, promotions,
 or research in connection with literary, historical or similar projects.
   (4) An eligible taxpayer shall be allowed a credit for nine per centum
 of qualified research expenses paid or incurred by the taxpayer  in  the
 calendar  year  that  ends with or within the taxable year for which the
 credit is claimed. For the  purposes  of  this  subdivision,  "qualified
 research expenses" shall mean expenses associated with in-house research
 and  processes,  and  costs  associated  with  the  dissemination of the
 results of the products that directly  result  from  such  research  and
 development  activities;  provided,  however,  that such costs shall not
 include advertising or promotion through media. In addition, costs asso-
 ciated with the preparation of patent applications,  patent  application
 filing fees, patent research fees, patent examinations fees, patent post
 allowance  fees, patent maintenance fees, and grant application expenses
 and fees shall qualify as qualified research expenses. In no case  shall
 the  credit  allowed under this subparagraph apply to expenses for liti-
 gation or  the  challenge  of  another  entity's  intellectual  property
 rights, or for contract expenses involving outside paid consultants.
   (5) An eligible taxpayer shall be allowed a credit for qualified high-
 technology  training expenditures as described in this subparagraph paid
 or incurred by the taxpayer during the calendar year that ends  with  or
 within the taxable year for which the credit is claimed.
   (i)  The amount of credit shall be one hundred percent of the training
 expenses described in clause (iii) of this subparagraph,  subject  to  a
 limitation of no more than four thousand dollars per employee per calen-
 dar year for such training expenses.
   (ii)  Qualified  high-technology  training  shall  include a course or
 courses taken and satisfactorily completed by an employee of the taxpay-
 er at an accredited, degree granting post-secondary college or universi-
 ty in the city that (A) directly relates  to  biotechnology  activities,
 and  (B)  is intended to upgrade, retrain or improve the productivity or
 theoretical awareness of  the  employee.  Such  course  or  courses  may
 include,  but  are  not  limited to, instruction or research relating to
 techniques, meta, macro, or  micro-theoretical  or  practical  knowledge
 bases or frontiers, or ethical concerns related to such activities. Such
 course  or  courses  shall  not  include  classes  in the disciplines of
 management, accounting or the law or any class designed to  fulfill  the
 discipline  specific  requirements of a degree program at the associate,
 baccalaureate, graduate or  professional  level  of  these  disciplines.
 Satisfactory  completion  of  a course or courses shall mean the earning
 and granting of credit or equivalent unit,  with  the  attainment  of  a
 grade of "B" or higher in a graduate level course or courses, a grade of
 "C"  or higher in an undergraduate level course or courses, or a similar
 measure of competency for a course that is not measured according  to  a
 standard grade formula.
   (iii)  Qualified  high-technology  training expenditures shall include
 expenses for tuition and mandatory fees, software required by the insti-
 tution, fees for textbooks or other literature required by the  institu-
 tion  offering  the course or courses, minus applicable scholarships and
 tuition or fee waivers not granted by the taxpayer or any affiliates  of
 the  taxpayer,  that  are  paid or reimbursed by the taxpayer. Qualified
 S. 8474                            633
 
 high-technology expenditures do not include  room  and  board,  computer
 hardware or software not specifically assigned for such course or cours-
 es,  late-charges,  fines or membership dues and similar expenses.  Such
 qualified  expenditures shall not be eligible for the credit provided by
 this section unless the employee for whom the expenditures are disbursed
 is continuously employed by the taxpayer in a full-time, full-year posi-
 tion primarily located at a qualified site during  the  period  of  such
 coursework  and  lasting  through at least one hundred eighty days after
 the satisfactory completion of the qualifying  course-work.    Qualified
 high-technology  training  expenditures  shall  not include expenses for
 in-house or shared training outside of a city higher education  institu-
 tion  or  the  use  of  consultants  outside of credit granting courses,
 whether such consultants function inside of such higher education insti-
 tution or not.
   (iv) If a taxpayer  relocates  from  an  academic  business  incubator
 facility  partnered with an accredited post-secondary education institu-
 tion located within the city, which provides space and business  support
 services  to  taxpayers,  to  another  site, the credit provided in this
 subdivision shall be allowed for all expenditures referenced  in  clause
 (iii)  of this subparagraph paid or incurred in the two preceding calen-
 dar years that the taxpayer was located in such  an  incubator  facility
 for  employees  of  the  taxpayer  who also relocate from said incubator
 facility to such city site and are employed and primarily located by the
 taxpayer in the city. Such expenditures in the two preceding years shall
 be added to the amounts otherwise qualifying for the credit provided  by
 this  subdivision  that  were paid or incurred in the calendar year that
 the taxpayer relocates from such a  facility.  Such  expenditures  shall
 include expenses paid for an eligible employee who is a full-time, full-
 year employee of said taxpayer during the calendar year that the taxpay-
 er  relocated  from  an incubator facility notwithstanding (A) that such
 employee was employed full or part-time as an officer,  staff-person  or
 paid intern of the taxpayer when such taxpayer was located at such incu-
 bator  facility  or (B) that such employee was not continuously employed
 when such taxpayer was located at the incubator facility during the  one
 hundred  eighty  day period referred to in clause (iii) of this subpara-
 graph, provided such employee received wages or equivalent income for at
 least seven hundred fifty hours during any twenty-four month period when
 the taxpayer was located at the incubator  facility.  Such  expenditures
 shall  include  payments  made  to  such employee after the taxpayer has
 relocated from the incubator facility for qualified expenditures if such
 payments are made to reimburse an employee for expenditures paid by  the
 employee  during  such  two preceding years.   The credit provided under
 this paragraph shall be allowed in any taxable year  that  the  taxpayer
 qualifies as an eligible taxpayer.
   (v)  For  purposes  of this subdivision the term "academic year" shall
 mean the annual period  of  sessions  of  a  post-secondary  college  or
 university.
   (vi) For the purposes of this subdivision the term "academic incubator
 facility"  shall  mean  a  facility  providing low-cost space, technical
 assistance, support services and  educational  opportunities,  including
 but  not  limited  to  central  services  provided by the manager of the
 facility to the tenants of the facility, to an  entity  located  in  the
 city.  Such  entity's  primary  activity must be in biotechnologies, and
 such entity must be in the formative stage of development. The  academic
 incubator  facility  and  the  entity  must  act  in partnership with an
 accredited post-secondary college or university located in the city.  An
 S. 8474                            634
 
 academic  incubator facility's mission shall be to promote job creation,
 entrepreneurship, technology transfer, and provide support  services  to
 incubator  tenants,  including,  but  not limited to, business planning,
 management   assistance,   financial-packaging,  linkages  to  financing
 services, and coordinating with other sources of assistance.
   (6) An eligible taxpayer may claim credits under this subdivision  for
 three  consecutive  years.  In  no case shall the credit allowed by this
 subdivision to a taxpayer exceed two hundred fifty thousand dollars  per
 calendar year for eligible expenditures made during such calendar year.
   (7)  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 clause (iv) of subparagraph one of paragraph (e) of subdi-
 vision  one  of this section. Provided, however, if the amount of credit
 allowed under this subdivision for any taxable year reduces the  tax  to
 such  amount,  any  amount of credit not deductible in such taxable year
 shall be treated as an overpayment of tax to be credited or refunded  in
 accordance  with  the  provisions  of  section  11-677  of this chapter;
 provided, however, that notwithstanding the provisions of section 11-679
 of this chapter, no interest shall be paid thereon.
   (8) The credit allowed under this subdivision shall  only  be  allowed
 for taxable years beginning before January first, two thousand nineteen.
   (b)  (1) The percentage of the credit allowed to a taxpayer under this
 subdivision in any calendar year shall be:
   (i) If the average number of  individuals  employed  full  time  by  a
 taxpayer  in  the city during the calendar year that ends with or within
 the taxable year for which the credit is claimed is at least one hundred
 five percent  of  the  taxpayer's  base  year  employment,  one  hundred
 percent,  except  that  in  no  case shall the credit allowed under this
 clause exceed two hundred fifty  thousand  dollars  per  calendar  year.
 Provided,  however, the increase in base year employment shall not apply
 to a taxpayer allowed a credit under  this  subdivision  that  was,  (A)
 located outside of the city, (B) not doing business, or (C) did not have
 any  employees,  in the year preceding the first year that the credit is
 claimed. Any such taxpayer shall be eligible for one hundred percent  of
 the  credit  for  the  first  calendar year that ends with or within the
 taxable year for which the credit is claimed, provided that such taxpay-
 er locates in the city, begins doing  business  in  the  city  or  hires
 employees  in the city during such calendar year and is otherwise eligi-
 ble for the credit pursuant to the provisions of this subdivision.
   (ii) If the average number of individuals  employed  full  time  by  a
 taxpayer  in  the city during the calendar year that ends with or within
 the taxable year for which the  credit  is  claimed  is  less  than  one
 hundred  five  percent  of  the  taxpayer's  base year employment, fifty
 percent, except that in no case shall  the  credit  allowed  under  this
 clause  exceed  one  hundred  twenty-five  thousand dollars per calendar
 year. In the case of an entity located in the city receiving  space  and
 business  support  services  by  an  academic incubator facility, if the
 average number of individuals employed full time by such entity  in  the
 city  during  the  calendar  year in which the credit allowed under this
 subdivision is claimed is less than one  hundred  five  percent  of  the
 taxpayer's base year employment, the credit shall be zero.
   (2) For the purposes of this subdivision, "base year employment" means
 the  average number of individuals employed full-time by the taxpayer in
 the city in the year preceding the first calendar year that ends with or
 within the taxable year for which the credit is claimed.
 S. 8474                            635
 
   (3) For the purposes of this subdivision, average number  of  individ-
 uals  employed  full-time shall be computed by adding the number of such
 individuals employed by the taxpayer at the end of each  quarter  during
 each  calendar  year  or other applicable period and dividing the sum so
 obtained  by  the number of such quarters occurring within such calendar
 year or other applicable period.
   (4) Notwithstanding anything contained in this section to the  contra-
 ry, the credit provided by this subdivision shall be allowed against the
 taxes authorized by this chapter for the taxable year after reduction by
 all other credits permitted by this chapter.
   (c)  Notwithstanding  any  other  provision of this subdivision to the
 contrary, in the case of a taxpayer that has received, in a taxable year
 beginning before January first, two thousand  fifteen,  the  credit  set
 forth in subdivision twenty-one of section 11-604 of this chapter for an
 eligible  acquisition  of  property  and/or  expense paid or incurred, a
 credit shall be allowed to the taxpayer under this subdivision  for  any
 tax  year  beginning  on or after January first, two thousand fifteen in
 the same amount and to the same extent that a  credit  would  have  been
 allowed  under subdivision twenty-one of section 11-604 of this chapter,
 as in effect on December thirty-first, two thousand  fourteen,  if  such
 subdivision continued to apply to the taxpayer for such taxable year.
   22.  Beer  production credit. (a) A taxpayer subject to tax under this
 subchapter, that is registered as a distributor under  article  eighteen
 of the tax law, and that produces sixty million or fewer gallons of beer
 in this state in the taxable year, shall be allowed a credit against the
 tax  imposed by this subchapter in the amount specified in paragraph (b)
 of this subdivision. Provided, however, that no credit shall be  allowed
 for any beer produced in excess of fifteen million five hundred thousand
 gallons  in  the taxable year. Notwithstanding anything in this title to
 the contrary, if a partnership is allowed a credit under subdivision (p)
 of section 11-503 of this title, a taxpayer that is a  partner  in  such
 partnership shall not be allowed a credit under this subdivision for any
 taxable  year  that  includes the last day of the taxable year for which
 the partnership is allowed such credit.
   (b) The amount of the credit per taxpayer per taxable  year  for  each
 gallon  of  beer  produced  in  the city of New York on or after January
 first, two thousand seventeen shall be determined as follows:
   (1) for the first five hundred thousand gallons of  beer  produced  in
 the  city of New York in the taxable year, the credit shall equal twelve
 cents per gallon; and
   (2) for each gallon of beer produced in the city of New  York  in  the
 taxable  year  in  excess  of  five hundred thousand gallons, the credit
 shall equal three and eighty-six one-hundredths cents per gallon. In  no
 event  shall  the  credit allowed under this subdivision for any taxable
 year reduce the tax due for such year to less than the amount prescribed
 in subparagraph one of paragraph (e) of subdivision one of this section.
 However, if the amount of credit allowed under this subdivision for  any
 taxable  year  reduces the tax to such amount, any amount of credit thus
 not deductible in such taxable year shall be treated as  an  overpayment
 of  tax  to be credited or refunded in accordance with the provisions of
 section 11-677 of this chapter; provided, however, that  notwithstanding
 the  provisions  of section 11-679 of this chapter, no interest shall be
 paid thereon.
   23. Credit for the provision of child care. In addition to  any  other
 credit  allowed  under  this section, a taxpayer whose application for a
 credit authorized by section 11-144 of this title has been  approved  by
 S. 8474                            636
 
 the  department  of  finance  shall  be allowed a credit against the tax
 imposed by this chapter. The amount of the credit shall be determined as
 provided in such section. To the extent the amount of the credit allowed
 by  this  subdivision  exceeds  the  amount  of tax due pursuant to this
 subchapter, as calculated without such credit, such excess amount  shall
 be  treated  as  an  overpayment  of  tax  to be credited or refunded in
 accordance with the  provisions  of  section  11-677  of  this  chapter,
 provided,  however,  that  notwithstanding  the  requirements of section
 11-679 of this chapter to the contrary, no interest shall be paid there-
 on.
   § 11-654.1 Net operating loss. 1. In  computing  the  business  income
 subject  to  tax,  taxpayers shall be allowed both a prior net operating
 loss conversion subtraction under subdivision two of this section and  a
 net  operating  loss  deduction under subdivision three of this section.
 The prior net  operating  loss  conversion  subtraction  computed  under
 subdivision two of this section shall be applied against business income
 before the net operating loss deduction computed under subdivision three
 of this section.
   2.  Prior  net operating loss conversion subtraction. (a) Definitions.
 (1) "Base year" means the last taxable year beginning on or after  Janu-
 ary  first, two thousand fourteen and before January first, two thousand
 fifteen.
   (2) "Unabsorbed net operating loss" means the  unabsorbed  portion  of
 net  operating  loss  as  calculated  under paragraph (f) of subdivision
 eight of section 11-602 of this chapter or subdivision (k-1) of  section
 11-641  of  this  chapter,  as  such sections were in effect on December
 thirty-first, two thousand fourteen, that was not deductible in previous
 taxable years and was eligible for carryover on the last day of the base
 year subject to the  limitations  for  deduction  under  such  sections,
 including  any  net  operating loss sustained by the taxpayer during the
 base year.
   (3) "Base year BAP" means the taxpayer's business allocation  percent-
 age  as  calculated  under paragraph (a) of subdivision three of section
 11-604 of this chapter for the base year, or the  taxpayer's  allocation
 percentage  as  calculated  under  section  11-642  of  this chapter for
 purposes of calculating entire net income for the  base  year,  as  such
 sections were in effect on December thirty-first, two thousand fourteen.
   (4)  "Base  year  tax rate" means the taxpayer's tax rate for the base
 year as applied to entire net income and  calculated  under  subdivision
 one  of  section  11-604  of  this chapter or subdivision (a) of section
 11-643.5 of this chapter, as such provisions were in effect on  December
 thirty-first, two thousand fourteen.
   (b)  The  prior  net  operating  loss  conversion subtraction shall be
 calculated as follows:
   (1) The taxpayer shall first calculate the tax value of its unabsorbed
 net operating loss for the base year. The value is equal to the  product
 of  (i) the amount of the taxpayer's unabsorbed net operating loss, (ii)
 the taxpayer's base year BAP, and (iii) the  taxpayer's  base  year  tax
 rate.
   (2)  The  product  determined under subparagraph one of this paragraph
 shall then be divided by eight and eighty-five one-hundredths per centum
 or, in the case of a financial corporation, as defined in clause (i)  of
 subparagraph  one  of paragraph (e) of subdivision one of section 11-654
 of this subchapter, the product determined  under  subparagraph  one  of
 this  paragraph  shall  then  be divided by nine per centum. This result
 S. 8474                            637
 
 shall  equal  the  taxpayer's  prior  net  operating   loss   conversion
 subtraction pool.
   (3) The taxpayer's prior net operating loss conversion subtraction for
 the  taxable  year shall equal one-tenth of its prior net operating loss
 conversion subtraction pool, plus any amount of unused prior net operat-
 ing loss conversion subtraction from preceding taxable years.
   (4) In lieu of the prior net  operating  loss  conversion  subtraction
 described  in  subparagraph  three of this paragraph, if the taxpayer so
 elects, the taxpayer's prior net operating loss  conversion  subtraction
 for  its taxable years beginning on or after January first, two thousand
 fifteen and before January first, two thousand seventeen shall equal, in
 each year, not more than  one-half  of  its  prior  net  operating  loss
 conversion  subtraction pool until the pool is exhausted. If the pool is
 not exhausted at the end of such time period, the remainder of the  pool
 shall  be  forfeited. The taxpayer shall make such election, which shall
 be revocable, on its first return for the tax year beginning on or after
 January first, two thousand fifteen and before January first, two  thou-
 sand  sixteen by the due date for such return, determined with regard to
 extensions.
   (c) (1) Where a taxpayer was  properly  included  or  required  to  be
 included  in  a  combined  report  for the base year pursuant to section
 11-605 of this chapter or a combined return for the base  year  pursuant
 to  section  11-646  of this chapter, as such sections were in effect on
 December thirty-first, two thousand fourteen, and  the  members  of  the
 combined  group  for  the  base  year are the same as the members of the
 combined group for the taxable  year  immediately  succeeding  the  base
 year,  the  combined  group shall calculate its prior net operating loss
 conversion subtraction pool using the combined group's total  unabsorbed
 net operating loss, base year BAP, and base year tax rate.
   (2)  If  a  combined  group includes additional members in the taxable
 year immediately succeeding the base year that were not included in  the
 combined  group  during the base year, each base year combined group and
 each taxpayer that filed separately for the base year but is included in
 the combined group in the taxable year succeeding the  base  year  shall
 calculate  its prior net operating loss conversion subtraction pool, and
 the sum of the pools shall be the  combined  prior  net  operating  loss
 conversion subtraction pool of the combined group.
   (3)  If  a taxpayer was properly included in a combined report for the
 base year and files a separate report for  a  subsequent  taxable  year,
 then  the  amount  of  remaining  prior  net  operating  loss conversion
 subtraction allowed to the taxpayer filing such separate report shall be
 proportionate to the amount that such taxpayer contributed to the  prior
 net  operating loss conversion subtraction pool on a combined basis, and
 the remaining prior net operating loss conversion subtraction allowed to
 the remaining members of the combined group shall be reduced  according-
 ly.
   (4)  If  a  taxpayer  filed a separate report for the base year and is
 properly included in a combined report for a  subsequent  taxable  year,
 then  the  prior  net  operating loss conversion subtraction pool of the
 combined group shall be increased by the amount of the  remaining  prior
 net operating loss conversion subtraction allowed to the taxpayer at the
 time the taxpayer is properly included in the combined group.
   (d) The prior net operating loss conversion subtraction may be used to
 reduce  the taxpayer's tax on allocated business income to the higher of
 the tax on business capital under clause (ii)  of  subparagraph  one  of
 paragraph (e) of subdivision one of section 11-654 of this subchapter or
 S. 8474                            638

 the  fixed dollar minimum under clause (iv) of subparagraph one of para-
 graph (e) of subdivision one  of  section  11-654  of  this  subchapter.
 Unless  the  taxpayer has made the election provided for in subparagraph
 four  of  paragraph  (b) of this subdivision, any amount of unused prior
 net operating loss conversion subtraction shall be carried forward to  a
 subsequent  tax year or subsequent tax years until the prior net operat-
 ing loss conversion subtraction pool is exhausted,  but  for  no  longer
 than  twenty  taxable  years  or  the taxable year beginning on or after
 January first, two thousand thirty-five but before  January  first,  two
 thousand  thirty-six, whichever comes first. Such amount carried forward
 shall not be subject to the one-tenth limitation for the subsequent  tax
 year or years under subparagraph three of paragraph (b) of this subdivi-
 sion.   However, if the taxpayer elects to compute its prior net operat-
 ing loss conversion subtraction pursuant to subparagraph four  of  para-
 graph  (b) of this subdivision, the taxpayer shall not carry forward any
 unused amount of such prior net operating loss conversion subtraction to
 any tax year beginning on or after January first,  two  thousand  seven-
 teen.
   3.  In computing business income, a net operating loss deduction shall
 be allowed. A net operating loss deduction shall be the  amount  of  net
 operating loss or losses from one or more taxable years that are carried
 forward  or  carried  back to a particular taxable year. A net operating
 loss shall be the amount of a business loss incurred in a particular tax
 year multiplied by the business allocation percentage for that  year  as
 determined under subdivision three of section 11-654 of this subchapter.
 The  maximum  net  operating loss deduction that is allowed in a taxable
 year shall be the amount that reduces the taxpayer's  tax  on  allocated
 business  income  to  the  higher  of  the tax on business capital under
 clause (ii) of subparagraph one of paragraph (e) of subdivision  one  of
 section  11-654  of  this  subchapter or the fixed dollar minimum amount
 under clause (iv) of subparagraph one of paragraph  (e)  of  subdivision
 one  of  section  11-654  of  this  subchapter.  Such net operating loss
 deduction and net operating loss shall be determined in accordance  with
 the following:
   (a)  Such  net  operating  loss  deduction shall not be limited to the
 amount allowed under section one hundred  seventy-two  of  the  internal
 revenue  code or the amount that would have been allowed if the taxpayer
 did not have an election under subchapter S of chapter one of the inter-
 nal revenue code in effect for the applicable tax year.
   (b) Such net operating loss deduction shall not include any net  oper-
 ating  loss  incurred during any taxable year beginning prior to January
 first, two thousand fifteen, or during any taxable  year  in  which  the
 taxpayer was not subject to the tax imposed by this subchapter.
   (c) A taxpayer that files as part of a federal consolidated return but
 on  a  separate  basis for purposes of this subchapter shall compute its
 deduction and loss as if it were filing on a separate basis for  federal
 income tax purposes.
   (d)  A  net  operating  loss  may  be carried back three taxable years
 preceding the taxable year of the  loss  except  that  no  loss  may  be
 carried back to a taxable year beginning before January first, two thou-
 sand  fifteen.  The  loss  first shall be carried to the earliest of the
 three taxable years preceding the taxable year of the loss. If it is not
 entirely used in that year, it shall be carried to  the  second  taxable
 year  preceding  the  taxable year of the loss, and any remaining amount
 shall be carried to the taxable year immediately preceding  the  taxable
 year  of  the  loss.  Any  unused  amount  of loss then remaining may be
 S. 8474                            639
 
 carried forward for as many as twenty taxable years following the  taxa-
 ble  year  of the loss. Losses carried forward are carried forward first
 to the taxable year immediately following the taxable year of the  loss,
 then  to the second taxable year following the taxable year of the loss,
 and then to the next immediately subsequent taxable year or years  until
 the  loss is used up or the twentieth taxable year following the taxable
 year of the loss, whichever comes first.
   (e) Such net operating loss deduction shall not include any net  oper-
 ating  loss  incurred  during  any taxable year commencing after January
 first, two thousand fifteen if the taxpayer was  subject  to  tax  under
 subchapter two or three of this chapter in that year; provided, however,
 any  year  commencing after January first, two thousand fifteen that the
 taxpayer was subject to tax under subchapter two or three of this  chap-
 ter  in  that  year  must  be  treated as a taxable year for purposes of
 determining the number of taxable years to which a  net  operating  loss
 may be carried forward.
   (f)  Where  there  are  two or more allocated net operating losses, or
 portions thereof, carried back or carried forward to be deducted in  one
 particular  tax  year from allocated business income, the earliest allo-
 cated loss incurred must be applied first.
   (g) A taxpayer may elect to waive the  entire  carryback  period  with
 respect  to  a  net  operating  loss.  Such election must be made on the
 taxpayer's original timely  filed  return,  determined  with  regard  to
 extensions, for the taxable year of the net operating loss for which the
 election  is  to  be  in  effect. Once an election is made for a taxable
 year, it shall be irrevocable for that taxable year. A separate election
 must be made for each taxable year of the loss. This election applies to
 all members of a combined group.
   § 11-654.2 Receipts allocation. 1. The percentage of receipts  of  the
 taxpayer to be allocated to the city for purposes of subparagraph two of
 paragraph  (a) of subdivision three of section 11-654 of this subchapter
 shall be equal to the receipts  fraction  determined  pursuant  to  this
 section.  The  receipts  fraction is a fraction, determined by including
 only those receipts, net income, net gains, and other items described in
 this section that are included in  the  computation  of  the  taxpayer's
 business  income, determined without regard to the modification provided
 in subparagraph fourteen  of  paragraph  (a)  of  subdivision  eight  of
 section  11-652  of this subchapter, for the taxable year. The numerator
 of the receipts fraction shall be equal to the sum of  all  the  amounts
 required  to  be included in the numerator pursuant to the provisions of
 this section and the denominator of the receipts fraction shall be equal
 to the sum of all the amounts required to be included in the denominator
 pursuant to the provisions of this section.
   2. (a) Receipts from sales of tangible personal property  where  ship-
 ments are made to points within the city or the destination of the prop-
 erty  is  a  point within the city shall be included in the numerator of
 the receipts fraction. Receipts from sales of tangible personal property
 where shipments are made to points within and without the  city  or  the
 destination  is  within  and  without  the city shall be included in the
 denominator of the receipts fraction.
   (b) Receipts from sales of electricity delivered to points within  the
 city  shall  be  included  in  the  numerator  of the receipts fraction.
 Receipts from sales of electricity delivered to points within and  with-
 out  the city shall be included in the denominator of the receipts frac-
 tion.
 S. 8474                            640
 
   (c) Receipts from sales of tangible personal property and  electricity
 that  are  traded  as  commodities as the term "commodity" is defined in
 section four hundred seventy-five of the internal revenue code, shall be
 included in the receipts fraction in  accordance  with  clause  (ix)  of
 subparagraph two of paragraph (a) of subdivision five of this section.
   (d)  Net  gains,  not  less than zero, from the sales of real property
 located within the city shall  be  included  in  the  numerator  of  the
 receipts fraction. Net gains, not less than zero, from the sales of real
 property  located  within  and without the city shall be included in the
 denominator of the receipts fraction.
   3. (a) Receipts from rentals of real and  tangible  personal  property
 located  within  the  city  shall  be  included  in the numerator of the
 receipts fraction. Receipts from rentals of real and  tangible  personal
 property  located  within  and without the city shall be included in the
 denominator of the receipts fraction.
   (b) Receipts of royalties from the use of patents, copyrights,  trade-
 marks, and similar intangible personal property within the city shall be
 included  in  the numerator of the receipts fraction. Receipts of royal-
 ties from the use of patents, copyrights, trademarks, and similar intan-
 gible personal property within and without the city shall be included in
 the denominator of the receipts fraction. A  patent,  copyright,  trade-
 mark, or similar intangible personal property is used within the city to
 the  extent  that  the  activities  thereunder are carried on within the
 city.
   (c) Receipts from the sales of rights  for  closed-circuit  and  cable
 television  transmissions  of an event, other than events occurring on a
 regularly scheduled basis, taking place within the city as a  result  of
 the  rendition of services by employees of the corporation, as athletes,
 entertainers or performing artists, shall be included in  the  numerator
 of  the receipts fraction to the extent that such receipts are attribut-
 able to such  transmissions  received  or  exhibited  within  the  city.
 Receipts  from  all  sales  of rights for closed-circuit and cable tele-
 vision transmissions of an event, other than events occurring on a regu-
 larly scheduled basis, shall be  included  in  the  denominator  of  the
 receipts fraction.
   4.  (a)  For  purposes of determining the receipts fraction under this
 section, the term "digital product" means any property  or  service,  or
 combination  thereof,  of  whatever  nature  delivered  to the purchaser
 through the use of wire, cable,  fiber-optic,  laser,  microwave,  radio
 wave,  satellite or similar successor media, or any combination thereof.
 Digital product includes, but is not limited to, an  audio  work,  audi-
 ovisual  work,  visual  work, book or literary work, graphic work, game,
 information or entertainment service, storage of  digital  products  and
 computer  software  by whatever means delivered. The term "delivered to"
 includes furnished or provided to or  accessed  by.  A  digital  product
 shall  not  include legal, medical, accounting, architectural, research,
 analytical, engineering or consulting services provided by the taxpayer.
   (b) Receipts from the sale of, license to use, or granting  of  remote
 access  to digital products within the city, determined according to the
 hierarchy of methods set forth in  subparagraphs  one  through  four  of
 paragraph (c) of this subdivision, shall be included in the numerator of
 the  receipts  fraction.  Receipts  from the sale of, license to use, or
 granting of remote access to digital products  within  and  without  the
 city  shall be included in the denominator of the receipts fraction. The
 taxpayer must exercise due diligence  under  each  method  described  in
 paragraph  (c) of this subdivision before rejecting it and proceeding to
 S. 8474                            641
 
 the next method in the hierarchy, and must  base  its  determination  on
 information  known to the taxpayer or information that would be known to
 the taxpayer upon reasonable inquiry. If the receipt for a digital prod-
 uct is comprised of a combination of property and services, it cannot be
 divided  into  separate  components  and  shall  be considered to be one
 receipt regardless of  whether  it  is  separately  stated  for  billing
 purposes. The entire receipt must be allocated by this hierarchy.
   (c)  The  hierarchy of sourcing methods is as follows: (1) the custom-
 er's primary use location of the digital product; (2) the location where
 the digital product is received by the customer, or  is  received  by  a
 person designated for receipt by the customer; (3) the receipts fraction
 determined  pursuant  to this subdivision for the preceding taxable year
 for such digital product; or (4) the receipts fraction  in  the  current
 taxable  year  for  those digital products that can be sourced using the
 hierarchy of sourcing methods in subparagraphs one and two of this para-
 graph.
   5. (a) A financial instrument is a "nonqualified financial instrument"
 if it is not a qualified financial  instrument.  A  qualified  financial
 instrument  means  a financial instrument that is of a type described in
 any of clauses (i), (ii), (iii), (iv), (vii), (viii) or (ix) of subpara-
 graph two of this paragraph and that has been marked to  market  in  the
 taxable  year by the taxpayer under section four hundred seventy-five or
 section one thousand two hundred fifty-six of the internal revenue code.
 Further, if the taxpayer has in the taxable  year  marked  to  market  a
 financial  instrument of the type described in any of clauses (i), (ii),
 (iii), (iv), (vii), (viii) or (ix) of subparagraph  two  of  this  para-
 graph,  then  any financial instrument within that type described in the
 above specified clause or clauses that has not been marked to market  by
 the  taxpayer  under  section  four  hundred seventy-five or section one
 thousand two hundred fifty-six of the internal revenue code is a  quali-
 fied  financial instrument in the taxable year, provided, however, (i) a
 loan secured by real property shall not be a qualified financial instru-
 ment, (ii) if the only loans that are marked to market by  the  taxpayer
 under  section  four  hundred  seventy-five  or section one thousand two
 hundred fifty-six of the internal revenue code are loans secured by real
 property, then no loans shall be qualified financial instruments,  (iii)
 stock that is investment capital as defined in paragraph (a) of subdivi-
 sion  four of section 11-652 of this subchapter shall not be a qualified
 financial instrument, and (iv) stock that generates other exempt  income
 as  defined  in  subdivision five-a of section 11-652 of this subchapter
 and that is not marked to market under section four hundred seventy-five
 or section one thousand two hundred fifty-six of  the  internal  revenue
 code  shall not constitute a qualified financial instrument with respect
 to the income from that stock that  is  described  in  such  subdivision
 five-a.  If  a  corporation  is included in a combined report, the defi-
 nition of qualified  financial  instrument  shall  be  determined  on  a
 combined  basis.  In the case of RIC or a REIT that is not a captive RIC
 or a captive REIT, a qualified financial instrument  means  a  financial
 instrument  that  is  of  a  type described in any of clauses (i), (ii),
 (iii), (iv), (vii), (viii) or (ix) of subparagraph  two  of  this  para-
 graph,  other  than (i) a loan secured by real property, (ii) stock that
 is investment capital as defined in paragraph (a) of subdivision four of
 section 11-652 of this subchapter, and (iii) stock that generates  other
 exempt income as defined in subdivision five-a of section 11-652 of this
 subchapter  with respect to the income from that stock that is described
 in such subdivision five-a.
 S. 8474                            642
 
   (1) In determining the inclusion of receipts and net gains from quali-
 fied financial instruments in the receipts fraction, taxpayers may elect
 to use the fixed percentage method described in  this  subparagraph  for
 qualified financial instruments. The election is irrevocable, applies to
 all qualified financial instruments, and must be made on an annual basis
 on  the taxpayer's original, timely filed return, determined with regard
 to extensions. If the taxpayer elects the fixed percentage method,  then
 all  income,  gain  or  loss,  including  marked  to market net gains as
 defined in clause (x) of subparagraph two of this paragraph, from quali-
 fied financial instruments constitute business income, gain or loss.  If
 the taxpayer does not elect to use the  fixed  percentage  method,  then
 receipts  and net gains are included in the receipts fraction in accord-
 ance with the customer sourcing method described in subparagraph two  of
 this  paragraph. Under the fixed percentage method, eight percent of all
 net income, not less than zero,  from  qualified  financial  instruments
 shall  be  included  in the numerator of the receipts fraction.  All net
 income, not less than zero, from qualified financial  instruments  shall
 be included in the denominator of the receipts fraction.
   (2)  Receipts  and  net gains from qualified financial instruments, in
 cases where the taxpayer did not elect to use the fixed percentage meth-
 od described in subparagraph one of this paragraph, and  from  nonquali-
 fied financial instruments shall be included in the receipts fraction in
 accordance  with  this  subparagraph. For purposes of this paragraph, an
 individual is deemed to be located within the city if his or her billing
 address is within the city. A business entity is deemed  to  be  located
 within the city if its commercial domicile is located within the city.
   (i)(A) Receipts constituting interest from loans secured by real prop-
 erty  located  within the city shall be included in the numerator of the
 receipts fraction. Receipts constituting interest from loans secured  by
 real  property  located within and without the city shall be included in
 the denominator of the receipts fraction.
   (B) Receipts constituting interest from  loans  not  secured  by  real
 property  shall be included in the numerator of the receipts fraction if
 the borrower is located within the city. Receipts constituting  interest
 from loans not secured by real property, whether the borrower is located
 within  or without the city, shall be included in the denominator of the
 receipts fraction.
   (C) Net gains, not less than zero, from sales of loans secured by real
 property shall be included in the numerator of the receipts fraction  as
 provided  in  this  subclause. The amount of net gains from the sales of
 loans secured by real property included in the numerator of the receipts
 fraction shall be determined by multiplying the net gains by a fraction,
 the numerator of which shall be the amount of gross proceeds from  sales
 of loans secured by real property located within the city and the denom-
 inator  of which shall be the gross proceeds from sales of loans secured
 by real property located within and without  the  city.  Gross  proceeds
 shall  be determined after the deduction of any cost incurred to acquire
 the loans but shall not be less than zero.  Net  gains,  not  less  than
 zero,  from  sales  of loans secured by real property located within and
 without the city shall be included in the denominator  of  the  receipts
 fraction.
   (D)  Net gains, not less than zero, from sales of loans not secured by
 real property shall be included in the numerator of the  receipts  frac-
 tion  as  provided  in  this subclause. The amount of net gains from the
 sales of loans not secured by real property included in the numerator of
 the receipts fraction shall be determined by multiplying the  net  gains
 S. 8474                            643
 
 by  a  fraction,  the  numerator  of  which shall be the amount of gross
 proceeds from sales of loans not secured by real property to  purchasers
 located within the city and the denominator of which shall be the amount
 of  gross  proceeds  from sales of loans not secured by real property to
 purchasers located within and without the city. Gross proceeds shall  be
 determined after the deduction of any cost incurred to acquire the loans
 but  shall  not  be  less than zero. Net gains, not less than zero, from
 sales of loans not secured by real property shall  be  included  in  the
 denominator of the receipts fraction.
   (E)  For purposes of this subdivision, a loan is secured by real prop-
 erty if fifty percent or more of the value of  the  collateral  used  to
 secure  the  loan,  when  valued at fair market value as of the time the
 loan was entered into, consists of real property.
   (ii) Federal, state, and municipal debt. Receipts constituting  inter-
 est  and  net  gains from sales of debt instruments issued by the United
 States, any state, or political subdivision of  a  state  shall  not  be
 included  in the numerator of the receipts fraction. Receipts constitut-
 ing interest and net gains, not less  than  zero,  from  sales  of  debt
 instruments issued by the United States and the state of New York or its
 political  subdivisions,  including  the  city, shall be included in the
 denominator of the receipts fraction.  Fifty  percent  of  the  receipts
 constituting  interest  and net gains, not less than zero, from sales of
 debt instruments issued by other states or their political  subdivisions
 shall be included in the denominator of the receipts fraction.
   (iii) Asset backed securities and other government agency debt.  Eight
 percent  of  the  interest  income from asset backed securities or other
 securities issued by government agencies, including but not  limited  to
 securities  issued  by  the  government  national  mortgage  association
 (GNMA), the federal national mortgage association  (FNMA),  the  federal
 home  loan  mortgage corporation (FHLMC), or the small business adminis-
 tration, or eight percent of the interest income from asset backed secu-
 rities issued by other entities shall be included in  the  numerator  of
 the  receipts  fraction.  Eight  percent of the net gains, not less than
 zero, from (A) sales of asset  backed  securities  or  other  securities
 issued  by  government agencies, including but not limited to securities
 issued by GNMA, FNMA, FHLMC, or the small  business  administration,  or
 (B)  sales  of  other  asset  backed  securities that are sold through a
 registered securities broker or dealer or through a  licensed  exchange,
 shall  be included in the numerator of the receipts fraction. The amount
 of net gains, not less than zero, from sales of other asset backed secu-
 rities not referenced in subclause (A) or (B) of this clause included in
 the numerator of the receipts fraction shall be determined by  multiply-
 ing  such  net  gains by a fraction, the numerator of which shall be the
 amount of gross proceeds from such sales to purchasers  located  in  the
 city  and the denominator of which shall be the amount of gross proceeds
 from such sales to purchasers  located  within  and  without  the  city.
 Receipts  constituting  interest income from asset backed securities and
 other securities referenced in this clause and net gains, not less  than
 zero,  from sales of asset backed securities and other securities refer-
 enced in this clause  shall  be  included  in  the  denominator  of  the
 receipts   fraction.  Gross  proceeds  shall  be  determined  after  the
 deduction of any cost to acquire the securities but shall  not  be  less
 than zero.
   (iv)  Receipts  constituting  interest  from  corporate bonds shall be
 included in the numerator of the receipts  fraction  if  the  commercial
 domicile of the issuing corporation is within the city. Eight percent of
 S. 8474                            644
 
 the  net  gains,  not less than zero, from sales of corporate bonds sold
 through a registered securities broker or dealer or through  a  licensed
 exchange  shall  be  included in the numerator of the receipts fraction.
 The  amount of net gains, not less than zero, from other sales of corpo-
 rate bonds included in the numerator of the receipts fraction  shall  be
 determined by multiplying such net gains by a fraction, the numerator of
 which  is  the  amount  of  gross proceeds from such sales to purchasers
 located within the city and the denominator of which is  the  amount  of
 gross  proceeds  from sales to purchasers located within and without the
 city. Receipts constituting interest from corporate bonds,  whether  the
 issuing corporation's commercial domicile is within or without the city,
 and  net  gains,  not  less  than zero, from sales of corporate bonds to
 purchasers within and without the city shall be included in the  denomi-
 nator of the receipts fraction. Gross proceeds shall be determined after
 the  deduction  of  any  cost to acquire the bonds but shall not be less
 than zero.
   (v) Eight percent of net interest income, not  less  than  zero,  from
 reverse  repurchase agreements and securities borrowing agreements shall
 be included in the numerator of  the  receipts  fraction.  Net  interest
 income, not less than zero, from reverse repurchase agreements and secu-
 rities  borrowing agreements shall be included in the denominator of the
 receipts fraction. Net interest income from  reverse  repurchase  agree-
 ments  and  securities  borrowing  agreements  shall  be  determined for
 purposes of this subdivision after the deduction of the interest expense
 from the taxpayer's repurchase agreements and securities lending  agree-
 ments  but shall not be less than zero. For this calculation, the amount
 of such interest expense shall be the interest expense  associated  with
 the sum of the value of the taxpayer's repurchase agreements where it is
 the  seller/borrower plus the value of the taxpayer's securities lending
 agreements where it is the  securities  lender,  provided  such  sum  is
 limited  to  the  sum  of the value of the taxpayer's reverse repurchase
 agreements where it is  the  purchaser/lender  plus  the  value  of  the
 taxpayer's  securities  lending  agreements  where  it is the securities
 borrower.
   (vi) Eight percent of the net  interest,  not  less  than  zero,  from
 federal  funds  shall be included in the numerator of the receipts frac-
 tion. The net interest, not less than zero, from federal funds shall  be
 included  in the denominator of the receipts fraction. Net interest from
 federal funds shall be determined after deduction  of  interest  expense
 from federal funds.
   (vii)  Dividends from stock, net gains, not less than zero, from sales
 of stock and net gains, not less than zero, from  sales  of  partnership
 interests  shall  not be included in either the numerator or denominator
 of the receipts fraction unless the commissioner of  finance  determines
 pursuant  to  subdivision  eleven of this section that inclusion of such
 dividends and net gains, not less than zero, is  necessary  to  properly
 reflect the business income or capital of the taxpayer.
   (viii)(A)  Receipts constituting interest from other financial instru-
 ments shall be included in the numerator of the receipts fraction if the
 payor is located within the city. Receipts  constituting  interest  from
 other  financial instruments, whether the payor is within or without the
 city, shall be included in the denominator of the receipts fraction.
   (B) Net gains, not less than  zero,  from  sales  of  other  financial
 instruments  and  other income, not less than zero, from other financial
 instruments where the purchaser or payor  is  located  within  the  city
 shall  be  included  in the numerator of the receipts fraction, provided
 S. 8474                            645
 
 that, if the purchaser or payor is a  registered  securities  broker  or
 dealer  or  the  transaction  is  made through a licensed exchange, then
 eight percent of the net gains, not less than zero, or other income, not
 less than zero, shall be included in the numerator of the receipts frac-
 tion.  Net  gains,  not  less  than  zero, from sales of other financial
 instruments and other income, not less than zero, from  other  financial
 instruments  shall  be included in the denominator of the receipts frac-
 tion.
   (ix) Net income, not less than zero, from sales  of  physical  commod-
 ities  shall  be  included  in the numerator of the receipts fraction as
 provided in this clause. The amount of net income from sales of physical
 commodities included in the numerator of the receipts fraction shall  be
 determined  by multiplying the net income from sales of physical commod-
 ities by a fraction, the numerator of  which  shall  be  the  amount  of
 receipts from sales of physical commodities actually delivered to points
 within  the  city  or,  if  there  is no actual delivery of the physical
 commodity, sold to purchasers located within the city, and the denomina-
 tor of which shall be the amount of  receipts  from  sales  of  physical
 commodities actually delivered to points within and without the city or,
 if  there  is  no  actual  delivery  of  the physical commodity, sold to
 purchasers located within and without the city.  Net  income,  not  less
 than  zero,  from sales of physical commodities shall be included in the
 denominator of the receipts fraction. Net income, not  less  than  zero,
 from  sales  of  physical  commodities  shall  be  determined  after the
 deduction of the cost to acquire or produce the physical commodities.
   (x)(A) For purposes of this subdivision, "marked to market" means that
 a financial instrument is, under section four  hundred  seventy-five  or
 section  twelve  hundred fifty-six of the internal revenue code, treated
 by the taxpayer as sold for its fair market value on the  last  business
 day  of  the  taxpayer's  taxable  year. "Marked to market gain or loss"
 means the gain or loss recognized by the  taxpayer  under  section  four
 hundred seventy-five or section twelve hundred fifty-six of the internal
 revenue code because the financial instrument is treated as sold for its
 fair  market  value  on  the last business day of the taxpayer's taxable
 year.
   (B) The amount of marked to market net gains, not less than zero, from
 each type of financial instrument that is marked to market  included  in
 the  numerator of the receipts fraction shall be determined by multiply-
 ing the marked to market net gains, not less than zero, from  such  type
 of  financial  instrument by a fraction, the numerator of which shall be
 the numerator of the receipts fraction for net gains from that  type  of
 financial  instrument  determined  under  the  applicable clause of this
 subparagraph and the denominator of which shall be  the  denominator  of
 the  receipts fraction for net gains from that type of financial instru-
 ment determined under the applicable clause of this subparagraph. Marked
 to market net gains, not less than zero, from financial instruments  for
 which the numerator of the receipts fraction for net gains is determined
 under  this  subparagraph  shall  be  included in the denominator of the
 receipts fraction.
   (C) If the type of financial instrument that is marked  to  market  is
 not otherwise sourced by the taxpayer under this subparagraph, or if the
 taxpayer has a net loss from the sales of that type of financial instru-
 ment  under  the  applicable  clause of this subparagraph, the amount of
 marked to market net gains, not less than zero, from that type of finan-
 cial instrument included in the numerator of the receipts fraction shall
 be determined by multiplying the marked to market  net  gains,  but  not
 S. 8474                            646
 
 less  than  zero,  from that type of financial instrument by a fraction,
 the numerator of which shall be  the  sum  of  the  amount  of  receipts
 included  in  the  numerator  of the receipts fraction under clauses (i)
 through  (ix) of this subparagraph and subclause (B) of this clause, and
 the denominator of which shall be the sum  of  the  amount  of  receipts
 included  in  the denominator of the receipts fraction under clauses (i)
 through (ix) of this subparagraph and  subclause  (B)  of  this  clause.
 Marked  to market net gains, not less than zero, for which the amount to
 be included in the numerator of  the  receipts  fraction  is  determined
 under  this  subparagraph  shall  be  included in the denominator of the
 receipts fraction.
   (b) Receipts of a registered securities broker or dealer from  securi-
 ties  or commodities broker or dealer activities described in this para-
 graph shall be deemed to be generated within the city  as  described  in
 subparagraphs  one  through  eight of this paragraph. Receipts from such
 activities generated within the city shall be included in the  numerator
 of the receipts fraction. Receipts from such activities generated within
 and  without  the  city  shall  be  included  in  the denominator of the
 receipts fraction. For the purposes of this paragraph, the term "securi-
 ties" shall have the same meaning as in paragraph two of subsection  (c)
 of  section  four  hundred seventy-five of the internal revenue code and
 the term "commodities" shall have the same meaning as in  paragraph  two
 of  subsection  (e) of section four hundred seventy-five of the internal
 revenue code.
   (1) Receipts  constituting  brokerage  commissions  derived  from  the
 execution  of securities or commodities purchase or sales orders for the
 accounts of customers shall be deemed to be generated within the city if
 the mailing address in the records of the taxpayer of the  customer  who
 is responsible for paying such commissions is within the city.
   (2)  Receipts constituting margin interest earned on behalf of broker-
 age accounts shall be deemed to be generated  within  the  city  if  the
 mailing  address  in  the records of the taxpayer of the customer who is
 responsible for paying such margin interest is within the city.
   (3) (i) Receipts constituting fees earned by the taxpayer for advisory
 services to a customer in connection with the underwriting of securities
 for such customer, such customer being the entity that is  contemplating
 issuing  or  is  issuing  securities, or fees earned by the taxpayer for
 managing an underwriting shall be deemed to be generated within the city
 if the mailing address in the records of the taxpayer of  such  customer
 who is responsible for paying such fees is within the city.
   (ii)  Receipts  constituting  the primary spread of selling concession
 from underwritten securities shall be deemed to be generated within  the
 city if the customer is located within the city.
   (iii) The term "primary spread" means the difference between the price
 paid  by the taxpayer to the issuer of the securities being marketed and
 the price received from the subsequent sale of the underwritten  securi-
 ties  at  the initial public offering price, less any selling concession
 and any fees paid to the taxpayer for advisory services or any manager's
 fees, if such fees are not paid by the customer to  the  taxpayer  sepa-
 rately.  The term "public offering price" means the price agreed upon by
 the taxpayer and the issuer at which the securities are to be offered to
 the public. The term "selling concession" means the amount paid  to  the
 taxpayer  for  participating in the underwriting of a security where the
 taxpayer is not the lead underwriter.
   (4) Receipts constituting account maintenance fees shall be deemed  to
 be  generated  within  the city if the mailing address in the records of
 S. 8474                            647
 
 the taxpayer of the customer who is responsible for paying such  account
 maintenance fees is within the city.
   (5)  Receipts  constituting  fees for management or advisory services,
 including fees for advisory services in relation to merger  or  acquisi-
 tion activities, but excluding fees paid for services described in para-
 graph  (d)  of  this subdivision, shall be deemed to be generated within
 the city if the mailing address in the records of the  taxpayer  of  the
 customer who is responsible for paying such fees is within the city.
   (6) Receipts constituting interest earned by the taxpayer on loans and
 advances  made  by  the  taxpayer  to  a corporation affiliated with the
 taxpayer but with which the taxpayer is not  permitted  or  required  to
 file  a  combined report pursuant to section 11-654.3 of this subchapter
 shall be deemed to arise from services performed at the principal  place
 of business of such affiliated corporation.
   (7) If the taxpayer receives any of the receipts enumerated in subpar-
 agraphs  one  through four of this paragraph as a result of a securities
 correspondent relationship such taxpayer  has  with  another  broker  or
 dealer  with  the  taxpayer  acting in this relationship as the clearing
 firm, such receipts shall be deemed to be generated within the  city  to
 the  extent  set forth in each of such subparagraphs. The amount of such
 receipts shall exclude the amount the taxpayer is required to pay to the
 correspondent firm for such correspondent relationship. If the  taxpayer
 receives  any  of  the  receipts enumerated in subparagraphs one through
 four of this  paragraph  as  a  result  of  a  securities  correspondent
 relationship  such  taxpayer  has with another broker or dealer with the
 taxpayer acting in this  relationship  as  the  introducing  firm,  such
 receipts  shall  be deemed to be generated within the city to the extent
 set forth in each of such subparagraphs.
   (8) If, for the purposes of subparagraph one, subparagraph two, clause
 (i) of subparagraph three, subparagraph four, or  subparagraph  five  of
 this paragraph, the taxpayer is unable from its records to determine the
 mailing  address of the customer, eight percent of the receipts shall be
 included in the numerator of the receipts fraction.
   (c) Receipts relating to the bank, credit, travel,  and  entertainment
 card activities described in this paragraph shall be deemed to be gener-
 ated  within  the city as described in subparagraphs one through four of
 this paragraph. Receipts from such activities generated within the  city
 shall  be  included in the numerator of the receipts fraction.  Receipts
 from such activities generated within and  without  the  city  shall  be
 included in the denominator of the receipts fraction.
   (1)  Receipts  constituting  interest,  and  fees and penalties in the
 nature of interest, from bank, credit,  travel  and  entertainment  card
 receivables shall be deemed to be generated within the city if the mail-
 ing  address of the card holder in the records of the taxpayer is within
 the city;
   (2) Receipts from service charges and fees from such  cards  shall  be
 deemed  to  be  generated  within the city if the mailing address of the
 card holder in the records of the taxpayer is within the city;
   (3) Receipts from merchant discounts shall be deemed to  be  generated
 within  the city if the merchant is located within the city. In the case
 of a merchant with locations both within  and  without  the  city,  only
 receipts  from  merchant  discounts  attributable  to  sales  made  from
 locations within the city  are  allocated  to  the  city.  It  shall  be
 presumed  that  the  location  of  the  merchant  is  the address of the
 merchant shown on the invoice submitted by the merchant to the taxpayer;
 and
 S. 8474                            648
 
   (4) Receipts from credit card authorization processing,  and  clearing
 and  settlement  processing received by a credit card processor shall be
 deemed to be generated within the city if the location where the  credit
 card  processor's  customer accesses the credit card processor's network
 is located within the city. The amount of all other receipts received by
 a  credit  card processor not specifically addressed in subdivisions one
 through nine or subdivision twelve of this section deemed to  be  gener-
 ated within the city shall be determined by multiplying the total amount
 of  such other receipts by the average of (i) eight percent and (ii) the
 percent of Staten Island access points. The  percent  of  Staten  Island
 access  points  shall  be  the number of locations in Staten Island from
 which the credit card  processor's  customers  access  the  credit  card
 processor's  network  divided  by  the  total number of locations in the
 United States where the credit card  processor's  customers  access  the
 credit card processor's network.
   (d) Receipts received from an investment company arising from the sale
 of  management,  administration or distribution services to such invest-
 ment company shall be included in the denominator of the receipts  frac-
 tion.  The  portion  of  such  receipts included in the numerator of the
 receipts fraction, such portion referred to herein as the Staten  Island
 portion, shall be determined as provided in this paragraph.
   (1)  The  Staten  Island  portion shall be the product of the total of
 such receipts from the sale of such services and a fraction. The numera-
 tor of that fraction shall be the sum of  the  monthly  percentages,  as
 defined  hereinafter, determined for each month of the investment compa-
 ny's taxable year for federal income tax  purposes  which  taxable  year
 ends  within  the  taxable year of the taxpayer, but excluding any month
 during which the investment  company  had  no  outstanding  shares.  The
 monthly  percentage  for each such month shall be determined by dividing
 the number of shares in the investment company that  are  owned  on  the
 last  day  of  the month by shareholders that are located in the city by
 the total number of shares in the investment company outstanding on that
 date. The denominator of the fraction shall be the number of such month-
 ly percentages.
   (2)(i) For purposes of this paragraph, an individual, estate or  trust
 shall be deemed to be located within the city if his, her or its mailing
 address  in  the records of the investment company is located within the
 city. A business entity is deemed to be located within the city  if  its
 commercial domicile is located within the city.
   (ii)  For  purposes  of  this paragraph, the term "investment company"
 means a regulated  investment  company,  as  defined  in  section  eight
 hundred  fifty-one  of  the  internal revenue code, and a partnership to
 which subsection (a) of section seven thousand seven hundred four of the
 internal  revenue  code  applies,  by  virtue  of  paragraph  three   of
 subsection  (c)  of  section  seven  thousand seven hundred four of such
 code, and that meets the requirements of subsection (b) of section eight
 hundred fifty-one of such code.  The  provisions  of  this  subparagraph
 shall  be applied to the taxable year for federal income tax purposes of
 the business entity that is asserted to constitute an investment company
 that ends within the taxable year of the taxpayer.
   (iii) For purposes of this paragraph, the term "receipts received from
 an investment  company"  includes  amounts  received  directly  from  an
 investment  company as well as amounts received from the shareholders in
 such investment company, in their capacity as such.
   (iv) For purposes of this paragraph, the  term  "management  services"
 means  the  rendering  of  investment  advice  to an investment company,
 S. 8474                            649
 
 making determinations as to when sales and purchases of  securities  are
 to  be  made  on  behalf  of  an  investment  company, or the selling or
 purchasing of securities constituting assets of an  investment  company,
 and  related  activities, but only where such activity or activities are
 performed pursuant to a contract with  the  investment  company  entered
 into  pursuant  to  subsection  (a)  of  section  fifteen of the federal
 investment company act of nineteen hundred forty, as amended.
   (v) For purposes of this paragraph, the term  "distribution  services"
 means  the services of advertising, servicing investor accounts, includ-
 ing redemptions, marketing shares or selling  shares  of  an  investment
 company,  but,  in the case of advertising, servicing investor accounts,
 including redemptions, or marketing shares, only where such  service  is
 performed by a person who is, or was, in the case of a closed end compa-
 ny,  also  engaged in the service of selling such shares. In the case of
 an open end company, such service of selling shares  must  be  performed
 pursuant  to  a  contract  entered  into  pursuant  to subsection (b) of
 section fifteen of  the  federal  investment  company  act  of  nineteen
 hundred forty, as amended.
   (vi)   For  purposes  of  this  paragraph,  the  term  "administration
 services" includes clerical, accounting, bookkeeping,  data  processing,
 internal  auditing,  legal  and tax services performed for an investment
 company but only if the provider of such service or services during  the
 taxable  year  in  which  such  service  or services are sold also sells
 management or distribution services, as defined in subparagraph  (v)  of
 this paragraph, to such investment company.
   (e) For purposes of this subdivision, a taxpayer shall use the follow-
 ing hierarchy to determine the commercial domicile of a business entity,
 based on the information known to the taxpayer or information that would
 be known upon reasonable inquiry: (1) the seat of management and control
 of  the  business  entity;  and  (2) the billing address of the business
 entity in the taxpayer's records. The taxpayer must exercise  due  dili-
 gence before rejecting the first method in this hierarchy and proceeding
 to the next method.
   (f)  For purposes of this subdivision, the term "registered securities
 broker or dealer" means a broker or dealer registered  as  such  by  the
 securities  and  exchange commission or a broker or dealer registered as
 such by the commodities futures trading commission, and shall include an
 OTC derivatives dealer as defined under regulations  of  the  securities
 and exchange commission at title 17, part 240, section 3b-12 of the code
 of federal regulations (17 CFR 240.3b-12).
   5-a.  Notwithstanding  any other provision of this section, net global
 intangible low-taxed income shall be included in the  receipts  fraction
 as provided in this subdivision. Receipts constituting net global intan-
 gible  low-taxed  income  shall  not be included in the numerator of the
 receipts fraction. Receipts constituting net global intangible low-taxed
 income shall be included in the denominator of  the  receipts  fraction.
 For  purposes  of this subdivision, the term "net global intangible low-
 taxed income" means the amount required to be included in the taxpayer's
 federal gross income pursuant to subsection (a) of section nine  hundred
 fifty-one-D  of  the  internal  revenue  code  less  the  amount  of the
 deduction allowed under clause (i) of subparagraph (B) of paragraph  one
 of subdivision (a) of section two hundred fifty of such code.
   6. Receipts from the conduct of a railroad business, including surface
 railroad,  whether  or  not operated by steam, subway railroad, elevated
 railroad, palace car or sleeping car business, or  a  trucking  business
 shall  be included in the numerator of the receipts fraction as follows.
 S. 8474                            650
 
 The amount of receipts from the conduct of  a  railroad  business  or  a
 trucking  business  included  in  the numerator of the receipts fraction
 shall be determined by multiplying the  amount  of  receipts  from  such
 business  by  a  fraction,  the numerator of which shall be the miles in
 such business within the city during the period covered by  the  taxpay-
 er's  report  and  the  denominator  of which shall be the miles in such
 business within and without the city during such period.  Receipts  from
 the  conduct  of  the  railroad business or a trucking business shall be
 included in the denominator of the receipts fraction.
   7. (a) Receipts of a taxpayer acting as principal from the activity of
 air freight forwarding and like indirect air  carrier  receipts  arising
 from  such  activity  shall be included in the numerator of the receipts
 fraction as follows: one hundred percent of such receipts  if  both  the
 pickup  and  delivery  associated with such receipts are made within the
 city and fifty percent of such receipts if either the pickup or delivery
 associated with such receipts is made within this city.  Such  receipts,
 whether the pickup or delivery associated with the receipts is within or
 without  the  city, shall be included in the denominator of the receipts
 fraction.
   (b)(1)(i)  The  portion  of  receipts  of  a  taxpayer  from  aviation
 services,  other than services described in paragraph (a) of this subdi-
 vision, but including the receipts of a qualified air freight forwarder,
 to be included in the numerator of the receipts fraction shall be deter-
 mined by multiplying its receipts  from  such  aviation  services  by  a
 percentage  which  is  equal  to the arithmetic average of the following
 three percentages:
   (A) the percentage determined by dividing the  aircraft  arrivals  and
 departures  within the city by the taxpayer during the period covered by
 its report by the total aircraft  arrivals  and  departures  within  and
 without  the  city  during  such period; provided, however, arrivals and
 departures solely for maintenance or repair, refueling, where no  debar-
 kation  or  embarkation  of  traffic  occurs, arrivals and departures of
 ferry and personnel training flights or arrivals and departures  in  the
 event  of  emergency  situations shall not be included in computing such
 arrival and departure percentage; provided, further, the commissioner of
 finance may also exempt  from  such  percentage  aircraft  arrivals  and
 departures  of  all  non-revenue flights including flights involving the
 transportation of officers or employees receiving air transportation  to
 perform maintenance or repair services or where such officers or employ-
 ees  are  transported  in conjunction with an emergency situation or the
 investigation of an air disaster, other  than  on  a  scheduled  flight;
 provided,  however, that arrivals and departures of flights transporting
 officers and employees receiving air transportation for  purposes  other
 than  specified above, without regard to remuneration, shall be included
 in computing such arrival and departure percentage;
   (B) the percentage determined by dividing the revenue tons handled  by
 the taxpayer at airports within the city during such period by the total
 revenue  tons  handled  by  it  at  airports within and without the city
 during such period; and
   (C) the percentage determined by dividing the  taxpayer's  originating
 revenue within the city for such period by its total originating revenue
 within and without the city for such period.
   (ii)  As used herein the term "aircraft arrivals and departures" means
 the number of landings and takeoffs of the aircraft of the taxpayer  and
 the number of air pickups and deliveries by the aircraft of such taxpay-
 er;  the  term  "originating revenue" means revenue to the taxpayer from
 S. 8474                            651

 the transportation of revenue  passengers  and  revenue  property  first
 received  by the taxpayer either as originating or connecting traffic at
 airports; and  the  term  "revenue  tons  handled  by  the  taxpayer  at
 airports" means the weight in tons of revenue passengers, at two hundred
 pounds  per passenger, and revenue cargo first received either as origi-
 nating or connecting traffic or finally discharged by  the  taxpayer  at
 airports.
   (2)  All  such receipts of a taxpayer from aviation services described
 in this paragraph shall be included in the denominator of  the  receipts
 fraction.
   (3) A corporation is a qualified air freight forwarder with respect to
 another corporation:
   (i)  if  it  owns or controls either directly or indirectly all of the
 capital stock of such other corporation, or if all of its capital  stock
 is  owned  or  controlled  either  directly  or indirectly by such other
 corporation, or if all of the capital  stock  of  both  corporations  is
 owned or controlled either directly or indirectly by the same interests;
   (ii)  if  it  is  principally  engaged  in the business of air freight
 forwarding; and
   (iii) if its air freight forwarding business is carried on principally
 with the airline or airlines operated by such other corporation.
   8. (a) The amount of receipts from sales of advertising in  newspapers
 or  periodicals included in the numerator of the receipts fraction shall
 be determined by multiplying the total of such receipts by  a  fraction,
 the numerator of which shall be the number of newspapers and periodicals
 delivered  to  points within the city and the denominator of which shall
 be the number of newspapers and periodicals delivered to  points  within
 and without the city. The total of such receipts from sales of advertis-
 ing in newspapers or periodicals shall be included in the denominator of
 the receipts fraction.
   (b)  The amount of receipts from sales of advertising on television or
 radio included in the numerator of the receipts fraction shall be deter-
 mined by multiplying the total of  such  receipts  by  a  fraction,  the
 numerator  of  which  shall be the number of viewers or listeners within
 the city and the denominator of which shall be the number of viewers  or
 listeners  within  and without the city. The total of such receipts from
 sales of advertising on television or radio shall  be  included  in  the
 denominator of the receipts fraction.
   (c)  The amount of receipts from sales of advertising not described in
 paragraph (a) or (b) of this subdivision that is furnished, provided  or
 delivered  to,  or accessed by the viewer or listener through the use of
 wire, cable, fiber-optic, laser, microwave,  radio  wave,  satellite  or
 similar  successor  media  or  any  combination thereof, included in the
 numerator of the receipts fraction shall be  determined  by  multiplying
 the  total  of such receipts by a fraction, the numerator of which shall
 be the number of viewers or listeners within the city and the  denomina-
 tor  of  which  shall  be  the number of viewers or listeners within and
 without the city. The total of such receipts from sales  of  advertising
 described  in this paragraph shall be included in the denominator of the
 receipts fraction.
   9. Receipts from the transportation or  transmission  of  gas  through
 pipes  shall  be  included  in the numerator of the receipts fraction as
 follows. The amount of receipts from the transportation or  transmission
 of  gas through pipes included in the numerator of the receipts fraction
 shall be determined by multiplying the total amount of such receipts  by
 a  fraction,  the numerator of which shall be the taxpayer's transporta-
 S. 8474                            652
 
 tion units within the city and the denominator of  which  shall  be  the
 taxpayer's transportation units within and without the city. A transpor-
 tation  unit  is  the  transportation  of  one  cubic foot of gas over a
 distance  of one mile. The total amount of receipts from the transporta-
 tion or transmission of gas through  pipes  shall  be  included  in  the
 denominator of the receipts fraction.
   10.  (a)  Receipts  from  services  not  addressed in subdivisions one
 through nine or subdivision twelve of this section  and  other  business
 receipts  not  addressed  in  such subdivisions shall be included in the
 numerator of the receipts fraction if the location of  the  customer  is
 within  the  city.  Such  receipts from customers within and without the
 city shall be included in the  denominator  of  the  receipts  fraction.
 Whether the receipts are included in the numerator of the receipts frac-
 tion shall be determined according to the hierarchy of methods set forth
 in  paragraph  (b)  of  this subdivision. The taxpayer must exercise due
 diligence under each method described in such paragraph before rejecting
 it and proceeding to the next method in the hierarchy, and must base its
 determination on information known to the taxpayer or  information  that
 would be known to the taxpayer upon reasonable inquiry.
   (b)  The  hierarchy  of  methods  is  as  follows:  (1) the benefit is
 received in the city; (2) delivery destination; (3) the  receipts  frac-
 tion  for  such  receipts  within  the  city determined pursuant to this
 subdivision for the preceding taxable year; or (4) the receipts fraction
 in the current taxable year determined pursuant to this subdivision  for
 those receipts that can be sourced using the hierarchy of sourcing meth-
 ods in subparagraphs one and two of this paragraph.
   11.  If it shall appear that the receipts fraction determined pursuant
 to this section does not result in a proper reflection of the taxpayer's
 business income or capital within the city, the commissioner of  finance
 is authorized in his or her discretion to adjust it, or the taxpayer may
 request that the commissioner of finance adjust it, by (a) excluding one
 or  more  items  in  such determination, (b) including one or more other
 items in such determination, or (c) any other similar or different meth-
 od calculated to effect a fair and proper  allocation  of  the  business
 income  and capital reasonably attributed to the city. The party seeking
 the adjustment shall bear the burden of proof to  demonstrate  that  the
 receipts fraction determined pursuant to this section does not result in
 a  proper reflection of the taxpayer's business income or capital within
 the city and that the proposed adjustment is appropriate.
   12. Receipts from the operation of vessels shall be  included  in  the
 numerator  of  the  receipts fraction as follows. The amount of receipts
 from the operation of vessels included in the numerator of the  receipts
 fraction  shall be determined by multiplying the amount of such receipts
 by a fraction, the numerator of which shall be the aggregate  number  of
 working  days of the vessels owned or leased by the taxpayer in territo-
 rial waters of the city during the  period  covered  by  the  taxpayer's
 report  and  the  denominator  of which shall be the aggregate number of
 working days of all vessels owned or leased by the taxpayer during  such
 period.  Receipts from the operation of vessels shall be included in the
 denominator of the receipts fraction.
   § 11-654.3 Combined reports. 1. (a) The tax on a combined report shall
 be the highest of (1) the combined business income multiplied by the tax
 rate specified in clause (i) of subparagraph one  of  paragraph  (e)  of
 subdivision  one  of section 11-654 of this subchapter; (2) the combined
 capital multiplied by the tax rate specified in clause (ii) of  subpara-
 graph  one of paragraph (e) of subdivision one of section 11-654 of this
 S. 8474                            653
 
 subchapter, but not exceeding the limitation provided for in such clause
 (ii); or (3) the fixed dollar minimum that is attributable to the desig-
 nated agent of the combined group. In addition, the tax  on  a  combined
 report  shall  include  the fixed dollar minimum tax specified in clause
 (iv) of subparagraph one of paragraph (e) of subdivision one of  section
 11-654  of  this subchapter for each member of the combined group, other
 than the designated agent, that is a taxpayer.
   (b) The combined business income base is the amount  of  the  combined
 business  income  of  the  combined group that is allocated to the city,
 reduced by any prior net operating loss conversion subtraction  and  any
 net  operating loss deduction for the combined group. The combined capi-
 tal base is the amount of the combined capital  of  the  combined  group
 that is allocated to the city.
   2.  (a)  Except  as provided in paragraph (c) of this subdivision, any
 taxpayer (1) which owns or controls either directly or  indirectly  more
 than  fifty  percent  of the voting power of the capital stock of one or
 more other corporations, or (2) more than fifty percent  of  the  voting
 power  of  the  capital  stock  of  which  is owned or controlled either
 directly or indirectly by one or more other corporations,  or  (3)  more
 than fifty percent of the voting power of the capital stock of which and
 the  capital  stock  of  one  or  more  other  corporations, is owned or
 controlled, directly or indirectly, by the same interests, and (4)  that
 is  engaged  in  a unitary business with those corporations, hereinafter
 referred to as "related corporations", shall make a combined report with
 those other corporations.
   (b) A corporation required to make a combined report within the  mean-
 ing  of this section shall also include (1) a captive REIT and a captive
 RIC; (2) a combinable captive insurance company; and (3) an alien corpo-
 ration that satisfies the conditions in paragraph (a) of  this  subdivi-
 sion  if  (i)  under  any  provision  of the internal revenue code, that
 corporation is treated as a "domestic corporation" as defined in section
 seven thousand seven hundred one of the internal revenue code,  or  (ii)
 it  has  effectively  connected  income for the taxable year pursuant to
 clause (iii) of the opening paragraph of subdivision  eight  of  section
 11-652 of this subchapter.
   (c)  A  corporation  required  or  permitted to make a combined report
 under this section does not include (1) a corporation  that  is  taxable
 under  a tax imposed by subchapter two or three of this chapter or chap-
 ter eleven of this title, except for a vendor of utility  services  that
 is  taxable under both chapter eleven of this title and this subchapter,
 or would be taxable under a tax imposed by subchapter two  or  three  of
 this  chapter  or  chapter  eleven of this title, except for a vendor of
 utility services that is taxable under both chapter eleven of this title
 and this subchapter, or would have been taxable as an  insurance  corpo-
 ration  under  the  former  part  IV,  title R, chapter forty-six of the
 administrative code as in effect on  June  thirtieth,  nineteen  hundred
 seventy-four;  (2)  a REIT that is not a captive REIT, and a RIC that is
 not a captive RIC; or (3) an alien corporation that under any  provision
 of  the internal revenue code is not treated as a "domestic corporation"
 as defined in section seven thousand seven hundred one of such code  and
 has  no  effectively  connected  income for the taxable year pursuant to
 clause (iii) of the opening paragraph of subdivision  eight  of  section
 11-652 of this subchapter. If a corporation is subject to tax under this
 subchapter  solely  as  a  result  of its ownership of a limited partner
 interest in a limited partnership  that  is  doing  business,  employing
 capital,  owning  or  leasing property, or maintaining an office in this
 S. 8474                            654
 
 city, and none of the corporation's related corporations are subject  to
 tax  under  this  subchapter,  such corporation shall not be required or
 permitted to file a combined report under this section with such related
 corporations.
   (d)  A  combined  report shall be filed by the designated agent of the
 combined group as determined under subdivision seven of this section.
   3. (a) Subject to the provisions of paragraph (c) of  subdivision  two
 of this section, a taxpayer may elect to treat as its combined group all
 corporations that meet the ownership requirements described in paragraph
 (a)  of  subdivision two of this section, such corporations collectively
 referred to in this subdivision as the "commonly owned group".  If  that
 election  is made, the commonly owned group shall calculate the combined
 business income, combined business capital,  and  fixed  dollar  minimum
 amount  of all members of the group in accordance with paragraph four of
 this subdivision, whether or not that business income or business  capi-
 tal is from a single unitary business.
   (b)  The election under this subdivision shall be made on an original,
 timely filed return,  determined  with  regard  to  extensions,  of  the
 combined  group.  Any corporation entering a commonly owned group subse-
 quent to the year of election shall be included in  the  combined  group
 and  is  considered to have waived any objection to its inclusion in the
 combined group.
   (c) The election shall be irrevocable, and binding for and  applicable
 to  the  taxable  year for which it is made and for the next six taxable
 years. The election will automatically  be  renewed  for  another  seven
 taxable years after it has been in effect for seven taxable years unless
 it  is  affirmatively  revoked.  The  revocation  shall  be  made  on an
 original, timely filed return, determined with regard to extensions, for
 the first taxable year after the completion of a seven year  period  for
 which  an election under this subdivision was in place. In the case of a
 revocation, a new election under this subdivision shall not be permitted
 in any of the immediately following three taxable years. In  determining
 the  seven  and  three  year  periods described in this paragraph, short
 taxable years shall not be considered or counted.
   4. (a) In computing the tax bases for a combined report, the  combined
 group  shall  generally  be  treated  as a single corporation, except as
 otherwise provided, and subject to any regulations or guidance issued by
 the commissioner of finance or the department of finance.
   (b)(1) In computing combined business income, all intercorporate divi-
 dends shall be eliminated, and  all  other  intercorporate  transactions
 shall  be  deferred  in  a  manner similar to the United States treasury
 department  regulations  relating  to  intercompany  transactions  under
 section fifteen hundred two of the internal revenue code.
   (2)  In  computing combined capital, all intercorporate stockholdings,
 intercorporate  bills,  intercorporate  notes  receivable  and  payable,
 intercorporate accounts receivable and payable, and other intercorporate
 indebtedness, shall be eliminated.
   (c)  Qualification  for  credits,  including  any limitations thereon,
 shall be determined separately for each of the members of  the  combined
 group,  and shall not be determined on a combined group basis, except as
 otherwise provided. However, the credits shall be  applied  against  the
 combined  tax  of  the  group. To the extent that a provision of section
 11-654 of this subchapter, or  any  other  applicable  section  of  this
 subchapter,   limits  a  credit  to  the  fixed  dollar  minimum  amount
 prescribed in clause (iv) of subparagraph one of paragraph (e) of subdi-
 vision one of section 11-654 of this subchapter, such fixed dollar mini-
 S. 8474                            655
 
 mum amount shall be the fixed dollar minimum amount that is attributable
 to the designated agent of the combined group.
   (d)(1)  A  net  operating  loss  deduction is allowed in computing the
 combined business income base. Such deduction may reduce the tax on  the
 combined  business  income base to the higher of the tax on the combined
 capital or the fixed dollar minimum amount that is attributable  to  the
 designated  agent  of  the combined group. A combined net operating loss
 deduction is equal to the amount of combined net operating loss or loss-
 es from one or more taxable years that are carried  forward  or  carried
 back  to a particular taxable year. A combined net operating loss is the
 combined business loss incurred in a particular taxable year  multiplied
 by  the combined business allocation percentage for that year determined
 as provided in subdivision five of this section.
   (2) The combined net operating loss deduction and combined net operat-
 ing loss are also subject to the provisions contained in paragraphs  (a)
 through (g) of subdivision three of section 11-654.1 of this subchapter.
   (3)  In the case of a corporation that files a combined report, either
 in the year the net operating loss is incurred or in the year in which a
 deduction is claimed on account of the loss, the combined net  operating
 loss deduction is determined as if the combined group is a single corpo-
 ration  and,  to the extent possible and not otherwise inconsistent with
 this subdivision, is subject to the same limitations  that  would  apply
 for  federal income tax purposes under the internal revenue code and the
 code of federal regulations as if such corporation had  filed  for  such
 taxable  year  a  consolidated  federal  income tax return with the same
 corporations included in the combined report. If a corporation  files  a
 combined  report,  regardless  of  whether it filed a separate return or
 consolidated return for federal income tax purposes, the  net  operating
 loss  and  net  operating  loss deduction for the combined group must be
 computed as if the corporation had filed a consolidated return  for  the
 same corporations for federal income tax purposes.
   (4)  In general, any net operating loss carryover from a year in which
 a combined report was filed shall be based on the combined net operating
 loss of the group of corporations filing such report. The portion of the
 combined loss attributable to any member of the group that files a sepa-
 rate report for a succeeding taxable year will be an amount bearing  the
 same  relation  to  the  combined loss as the net operating loss of such
 corporation bears to the total net operating loss of all members of  the
 group  having such losses to the extent that they are taken into account
 in computing the combined net operating loss.
   (d-1) A prior net operating loss conversion subtraction is allowed  in
 computing the combined business income base, as provided in subdivisions
 one and two of section 11-654.1 of this subchapter. Such subtraction may
 reduce  the  tax on combined business income to the higher of the tax on
 combined capital or the fixed dollar minimum amount that is attributable
 to the designated agent of the combined group.
   (e)(i) Any election made pursuant  to  paragraph  (b)  of  subdivision
 five,  paragraphs (b) and (c) of subdivision five-a of section 11-652 of
 this subchapter, and paragraph  (g)  of  subdivision  three  of  section
 11-654.1  of  this subchapter shall apply to all members of the combined
 group.
   (ii) The determination of whether or not the limitation on  investment
 income  provided  in  subparagraph (iii) of paragraph (a) of subdivision
 five of section 11-652 of this subchapter to the combined group shall be
 based on the investment income of the combined group, determined without
 S. 8474                            656
 
 regard to  interest  expenses  attributable  to  investment  capital  or
 investment income, and the entire net income of the combined group.
   (f)(1)  In  the  case  of a captive REIT or captive RIC required under
 this section to be included in a  combined  report,  entire  net  income
 shall  be computed as required under subdivision seven, in the case of a
 captive REIT, or subdivision eight, in the case of  a  captive  RIC,  of
 section  11-653  of  this  subchapter.  However, the deduction under the
 internal revenue code for dividends paid by the captive REIT or  captive
 RIC  to any member of the affiliated group that includes the corporation
 that directly or indirectly owns over fifty percent of the voting  stock
 of the captive REIT or captive RIC shall not be allowed. For purposes of
 this  subparagraph, the term "affiliated group" means "affiliated group"
 as defined in section fifteen hundred four of the internal revenue code,
 but without regard to the exceptions provided for in subsection  (b)  of
 that section.
   (2)  In  the  case  of a combinable captive insurance company required
 under this section to be included  in  a  combined  report,  entire  net
 income  shall  be  computed  as required by subdivision eight of section
 11-652 of this subchapter.
   (g) If more than one member of a combined group is eligible for any of
 the modifications described in paragraphs (q), (r) or (s) of subdivision
 eight of section 11-652  of  this  subchapter,  all  such  members  must
 utilize the same modification.
   5.  (a)  In  determining  the  business  allocation  percentage  for a
 combined report, the receipts, net income, net gains and other items  of
 each  member  of the combined group, whether or not they are a taxpayer,
 are included and intercorporate receipts, income and  gains  are  elimi-
 nated.  Receipts, net income, net gains and other items are sourced, and
 the amounts allowed in the receipts fraction are determined, as provided
 in section 11-654.2 of this subchapter.
   (b) An election made to allocate  income  and  gains  from  qualifying
 financial  instruments  pursuant to subparagraph one of paragraph (a) of
 subdivision five of section 11-654.2 of this subchapter shall  apply  to
 all members of the combined group.
   6.  Every  member  of  the combined group that is subject to tax under
 this article shall be jointly and  severally  liable  for  the  tax  due
 pursuant to a combined report.
   7.  Each  combined  group  shall  appoint  a  designated agent for the
 combined group, which shall be a taxpayer. Only the designated agent may
 act on behalf of the members of the combined group for matters  relating
 to the combined report.
   §  11-655  Reports.  1.  Every corporation having an officer, agent or
 representative within the  city,  shall  annually  on  or  before  March
 fifteenth for taxable years beginning before January first, two thousand
 sixteen,  and  annually  on  or before April fifteenth for taxable years
 beginning on or after January first, two thousand sixteen,  transmit  to
 the commissioner of finance a report in a form prescribed by the commis-
 sioner of finance, setting forth such information as the commissioner of
 finance  may  prescribe,  except  that a corporation that reports on the
 basis of a fiscal year shall transmit such  report,  for  taxable  years
 beginning  before  January  first,  two thousand sixteen, within two and
 one-half months after the close of its fiscal  year,  and,  for  taxable
 years  beginning after January first, two thousand sixteen, within three
 and one-half months after the close of its fiscal year.  Every  taxpayer
 that  ceases  to  do  business  in  the city or to be subject to the tax
 imposed by this subchapter shall transmit to the commissioner of finance
 S. 8474                            657
 
 a report on the date of such cessation or at  such  other  time  as  the
 commissioner  of  finance  may  require covering each year or period for
 which no report was theretofore filed. Every taxpayer shall also  trans-
 mit such other reports and such facts and information as the commission-
 er  of finance may require in the administration of this subchapter. The
 commissioner of finance may grant a reasonable  extension  of  time  for
 filing reports whenever good cause exists.
   An  automatic  extension  of  six  months for the filing of its annual
 report shall be allowed any taxpayer if, within the time  prescribed  by
 the opening paragraph of this subdivision, whichever is applicable, such
 taxpayer  files  with  the  commissioner  of  finance an application for
 extension in such form as the commissioner of finance may  prescribe  by
 regulation  and  pays  on  or  before the date of such filing the amount
 properly estimated as its tax.
   2. Every report shall have annexed  thereto  a  certification  by  the
 president,   vice-president,   treasurer,   assistant  treasurer,  chief
 accounting officer or another officer of the taxpayer duly authorized so
 to act to the effect that the statements contained therein are true.  In
 the  case  of  an  association, within the meaning of paragraph three of
 section (a) of section seventy-seven hundred one of the internal revenue
 code,  a  publicly-traded  partnership  treated  as  a  corporation  for
 purposes  of the internal revenue code pursuant to section seventy-seven
 hundred four thereof and any business conducted by a trustee or trustees
 wherein interest or ownership is  evidenced  by  certificates  or  other
 written instruments, such certification shall be made by any person duly
 authorized  so  to  act  on  behalf of such association, publicly-traded
 partnership or business. The fact that an individual's name is signed on
 a certification of the report shall be prima facie  evidence  that  such
 individual is authorized to sign and certify the report on behalf of the
 corporation.  Blank  forms  of reports shall be furnished by the commis-
 sioner of finance, on application, but failure to secure  such  a  blank
 shall  not  release  any  corporation  from the obligation of making any
 report required by this subchapter.
   2-a.  The  commissioner  of  finance  may  prescribe  regulations  and
 instructions  requiring  returns  of information to be made and filed in
 conjunction with the reports required  to  be  filed  pursuant  to  this
 section,  relating  to payments made to shareholders owning, directly or
 indirectly, individually or in the aggregate, more than fifty percent of
 the issued capital stock of the taxpayer, where such payments are treat-
 ed as payments of interest in  the  computation  of  entire  net  income
 reported on such reports.
   3.  If the amount of taxable income or other basis of tax for any year
 of any taxpayer as returned to the United States treasury department  or
 the  New  York  state commissioner of taxation and finance is changed or
 corrected by the commissioner of internal revenue or  other  officer  of
 the  United  States  or  the New York state commissioner of taxation and
 finance or other competent authority, or  where  a  renegotiation  of  a
 contract  or subcontract with the United States or the state of New York
 results in a change in taxable income or other basis of tax, or where  a
 recovery  of a war loss results in a computation or recomputation of any
 tax imposed by the United States or the state  of  New  York,  or  if  a
 taxpayer,  pursuant to subsection (d) of section sixty-two hundred thir-
 teen of the internal revenue code, executes a notice of  waiver  of  the
 restrictions provided in subsection (a) of said section, or if a taxpay-
 er, pursuant to subsection (f) of section one thousand eighty-one of the
 tax  law,  executes  a  notice of waiver of the restrictions provided in
 S. 8474                            658
 
 subsection (c) of said section, such taxpayer shall report such  changed
 or  corrected  taxable  income  or other basis of tax, or the results of
 such renegotiation, or  such  computation,  or  recomputation,  or  such
 execution of such notice of waiver and the changes or corrections of the
 taxpayer's  federal  or  New York state taxable income or other basis of
 tax on which it is based, within ninety  days,  or  one  hundred  twenty
 days,  in  the  case  of  a taxpayer making a combined report under this
 subchapter for such year, after such execution  or  the  final  determi-
 nation  of  such change or correction or renegotiation, or such computa-
 tion, or recomputation, or as required by the commissioner  of  finance,
 and shall concede the accuracy of such determination or state wherein it
 is  erroneous.  The  allowance of a tentative carryback adjustment based
 upon a net operating loss carryback or net capital loss carryback pursu-
 ant to section sixty-four hundred eleven of the  internal  revenue  code
 shall  be treated as a final determination for purposes of this subdivi-
 sion. Any taxpayer filing an amended return with such  department  shall
 also file within ninety days, or one hundred twenty days, in the case of
 a taxpayer making a combined report under this subchapter for such year,
 thereafter an amended report with the commissioner of finance.
   4.  The  provisions of section 11-654.3 of this subchapter shall apply
 to combined reports.
   5. In case it shall appear to the commissioner  of  finance  that  any
 agreement,  understanding or arrangement exists between the taxpayer and
 any other corporation or any person or firm, whereby the activity, busi-
 ness, income or capital of the taxpayer within the city is improperly or
 inaccurately reflected, the commissioner of finance  is  authorized  and
 empowered,  in its discretion and in such manner as it may determine, to
 adjust items of income, deductions and capital, and to eliminate  assets
 in  computing  any  allocation  percentage provided only that any income
 directly traceable thereto be also excluded from entire net  income,  so
 as  equitably  to determine the tax. Where (a) any taxpayer conducts its
 activity or business under any agreement, arrangement  or  understanding
 in  such  manner as either directly or indirectly to benefit its members
 or stockholders, or any of them, or any person or  persons  directly  or
 indirectly interested in such activity or business, by entering into any
 transaction at more or less than a fair price which, but for such agree-
 ment,  arrangement  or  understanding,  might have been paid or received
 therefor, or (b) any taxpayer, a substantial portion  of  whose  capital
 stock  is  owned  either  directly or indirectly by another corporation,
 enters into any transaction with such other corporation on such terms as
 to create an improper loss or net income, the  commissioner  of  finance
 may  include  in the entire net income of the taxpayer the fair profits,
 which, but for such agreement, arrangement or understanding, the taxpay-
 er might have derived from such transaction. Where  any  taxpayer  owns,
 directly  or indirectly, more than fifty percent of the capital stock of
 another corporation subject to tax under section fifteen  hundred  two-a
 of the tax law and fifty percent or less of whose gross receipts for the
 taxable  year  consist  of  premiums,  the  commissioner  of finance may
 include in the entire net income of the taxpayer, as a  deemed  distrib-
 ution,  the amount of the net income of the other corporation that is in
 excess of its net premium income.
   6. An action may be brought at any time by the corporation counsel  at
 the  instance  of  the  commissioner  of finance to compel the filing of
 reports due under this subchapter.
   7. Reports shall be preserved for five years, and thereafter until the
 commissioner of finance orders them to be destroyed.
 S. 8474                            659
 
   8. Where the New York  state  commissioner  of  taxation  and  finance
 changes  or corrects a taxpayer's sales and compensating use tax liabil-
 ity with respect to the purchase or use of items for which  a  sales  or
 compensating  use  tax credit against the tax imposed by this subchapter
 was  claimed, the taxpayer shall report such change or correction to the
 commissioner of finance within ninety days of the final determination of
 such change or  correction,  or  as  required  by  the  commissioner  of
 finance,  and  shall concede the accuracy of such determination or state
 wherein it is erroneous. Any taxpayer filing an amended return or report
 relating to the purchase or use of such items  shall  also  file  within
 ninety  days thereafter a copy of such amended return or report with the
 commissioner of finance.
   § 11-656 Payment and lien of tax. 1. To the extent the tax imposed  by
 section  11-653  of  this subchapter shall not have been previously paid
 pursuant to section 11-658 of this subchapter:
   (a) such tax, or the balance thereof, shall be payable to the  commis-
 sioner  of  finance  in  full  at  the time the report is required to be
 filed; and
   (b) such tax, or the balance thereof, imposed on  any  taxpayer  which
 ceases to do business in the city or to be subject to the tax imposed by
 this  subchapter  shall be payable to the commissioner of finance at the
 time the report is required to be filed; all other  taxes  of  any  such
 taxpayer,  which  pursuant  to  the  this subdivision would otherwise be
 payable subsequent to the time such report  is  required  to  be  filed,
 shall nevertheless be payable at such time.  If the taxpayer, within the
 time prescribed by section 11-655 of this subchapter, shall have applied
 for  an  automatic extension of time to file its annual report and shall
 have paid to the commissioner of finance on  or  before  the  date  such
 application  is  filed  an amount properly estimated as provided by said
 section, the only amount payable in addition to the tax shall be  inter-
 est at the underpayment rate set by the commissioner of finance pursuant
 to section 11-687 of this chapter, or, if no rate is set, at the rate of
 seven  and  one-half percent per annum upon the amount by which the tax,
 or the portion thereof payable on or before  the  date  the  report  was
 required to be filed, exceeds the amount so paid, provided that:
   (1)  an  amount  so  paid  shall be deemed properly estimated if it is
 either: (i) not less than ninety percent of the tax  as  finally  deter-
 mined,  or (ii) not less than the tax shown on the taxpayer's report for
 the preceding taxable year, if such preceding year was a taxable year of
 twelve months; and
   (2) the time when a report is required to be filed shall be determined
 without regard to any extension of time for filing such report.
   2. The commissioner of finance may grant  a  reasonable  extension  of
 time for payment of any tax imposed by this subchapter under such condi-
 tions as the commissioner of finance deems just and proper.
   3. Intentionally omitted.
   §  11-657  Declaration  of estimated tax. 1. Every taxpayer subject to
 the tax imposed by section 11-653 of this subchapter shall make a decla-
 ration of its estimated tax for the current privilege period, containing
 such information as the commissioner of finance may prescribe  by  regu-
 lations  or  instructions,  if  such  estimated  tax  can  reasonably be
 expected to exceed one thousand dollars.
   2. The term "estimated tax" means the amount which  a  taxpayer  esti-
 mates to be the tax imposed by section 11-653 of this subchapter for the
 current  privilege  period, less the amount which it estimates to be the
 sum of any credits allowable against the tax.
 S. 8474                            660

   3. In the case of a taxpayer which reports on the basis of a  calendar
 year,  a  declaration  of estimated tax shall be filed on or before June
 fifteenth of the current privilege period, except that if  the  require-
 ments of subdivision one of this section are first met:
   (a)  after May thirty-first and before September first of such current
 privilege period, the declaration shall be filed on or before  September
 fifteenth; or
   (b)  after  August  thirty-first  and  before  December  first of such
 current privilege period, the declaration shall be filed  on  or  before
 December fifteenth.
   4. A taxpayer may amend a declaration under regulations of the commis-
 sioner of finance.
   5.  If,  on or before February fifteenth of the succeeding year in the
 case of a taxpayer which reports on the basis  of  a  calendar  year,  a
 taxpayer  files  its  report  for  the year for which the declaration is
 required, and pays therewith the balance, if any, of the full amount  of
 the tax shown to be due on the report:
   (a)  such report shall be considered as its declaration if no declara-
 tion is required to be filed during the  calendar  or  fiscal  year  for
 which  the  tax was imposed, but is otherwise required to be filed on or
 before December fifteenth pursuant to subdivision three of this section;
 and
   (b) such report shall be considered  as  the  amendment  permitted  by
 subdivision  four  of  this  section  to  be filed on or before December
 fifteenth if the tax shown on the report is greater than  the  estimated
 tax shown on a declaration previously made.
   6.  This  section  shall  apply  to privilege periods of twelve months
 other than a calendar year by the substitution of  the  months  of  such
 fiscal year for the corresponding months specified in this section.
   7.  If  the  privilege  period  for  which a tax is imposed by section
 11-653 of this subchapter is less than  twelve  months,  every  taxpayer
 required to make a declaration of estimated tax for such privilege peri-
 od  shall  make such a declaration in accordance with regulations of the
 commissioner of finance.
   8. The commissioner of finance may grant  a  reasonable  extension  of
 time,  not  to  exceed  three  months, for the filing of any declaration
 required pursuant to this section, on such terms and  conditions  as  it
 may require.
   §  11-658  Payments  on account of estimated tax. 1. For taxable years
 beginning before January first, two  thousand  sixteen,  every  taxpayer
 subject  to  the  tax imposed by section 11-653 of this subchapter shall
 pay with the report required to be filed  for  the  preceding  privilege
 period,  if  any,  or  with an application for extension of the time and
 filing such report, an amount equal to twenty-five  per  centum  of  the
 preceding  year's tax if such preceding year's tax exceeded one thousand
 dollars. For taxable years beginning on  or  after  January  first,  two
 thousand  sixteen,  every taxpayer subject to the tax imposed by section
 11-653 of this subchapter shall pay on or before the  fifteenth  day  of
 March  next  succeeding the close of each such calendar year, or, in the
 case of a taxpayer that reports on the basis of a  fiscal  year,  within
 two  and  one-half  months  after  the close of each such fiscal year an
 amount equal to twenty-five per centum of the  second  preceding  year's
 tax if the second preceding year's tax exceeded one thousand dollars.
   2.  The  estimated  tax  with  respect to which a declaration for such
 privilege period is required shall be paid, in the case  of  a  taxpayer
 which reports on the basis of a calendar year, as follows:
 S. 8474                            661
 
   (a) If the declaration is filed on or before June fifteenth, the esti-
 mated tax shown thereon, after applying thereto the amount, if any, paid
 during  the  same  privilege  period pursuant to subdivision one of this
 section, shall be paid in three equal installments. One of such install-
 ments  shall  be  paid at the time of the filing of the declaration, one
 shall be paid on the following  September  fifteenth,  and  one  on  the
 following December fifteenth.
   (b)  If  the  declaration  is filed after June fifteenth and not after
 September fifteenth of such privilege period, and is not required to  be
 filed  on  or  before  June  fifteenth of such period, the estimated tax
 shown on such declaration, after applying thereto the  amount,  if  any,
 paid  during  the  same  privilege period pursuant to subdivision one of
 this section, shall be paid in  two  equal  installments.  One  of  such
 installments  shall be paid at the time of the filing of the declaration
 and one shall be paid on the following December fifteenth.
   (c) If the declaration is filed  after  September  fifteenth  of  such
 privilege period, and is not required to be filed on or before September
 fifteenth  of  such  privilege  period,  the estimated tax shown on such
 declaration, after applying thereto the amount, if any, paid in  respect
 to  such  privilege  period pursuant to subdivision one of this section,
 shall be paid in full at the time of the filing of the declaration.
   (d) If the declaration is filed after the time prescribed therefor, or
 after the expiration of any extension of time therefor,  paragraphs  (b)
 and  (c) of this subdivision shall not apply, and there shall be paid at
 the time of such filing all installments of estimated tax payable at  or
 before  such  time,  and the remaining installments shall be paid at the
 times at which, and in the amounts in which, they would have been  paya-
 ble if the declaration had been filed when due.
   3.  If any amendment of a declaration is filed, the remaining install-
 ments, if any, shall be ratably increased or decreased, as the case  may
 be,  to  reflect any increase or decrease in the estimated tax by reason
 of such  amendment,  and  if  any  amendment  is  made  after  September
 fifteenth  of the privilege period, any increase in the estimated tax by
 reason thereof shall be paid at the time of making such amendment.
   4. Any amount paid shall be applied after payment as a first  install-
 ment against the estimated tax of the taxpayer for the current privilege
 period shown on the declaration required to be filed pursuant to section
 11-657  of  this  subchapter  or,  if no declaration of estimated tax is
 required to be filed by the taxpayer pursuant to such section, any  such
 amount  shall be considered a payment on account of the tax shown on the
 report required to be filed by the taxpayer for such privilege period.
   5. Notwithstanding the provisions of section 11-679 of this chapter or
 of section three-a of the general  municipal  law,  if  an  amount  paid
 pursuant to subdivision one of this section exceeds the tax shown on the
 report  required  to  be  filed by the taxpayer for the privilege period
 during which the amount was paid, interest shall be allowed and paid  on
 the  amount  by  which  the  amount so paid pursuant to such subdivision
 exceeds such tax, at the overpayment rate set  by  the  commissioner  of
 finance  pursuant  to  section 11-687 of this chapter, or, if no rate is
 set, at the rate of four percent per annum from the date of  payment  of
 the  amount so paid pursuant to such subdivision to the fifteenth day of
 the third month following the close of the privilege  period,  provided,
 however,  that  no interest shall be allowed or paid under this subdivi-
 sion if the amount thereof is less than one dollar or if  such  interest
 becomes payable solely because of a carryback of a net operating loss in
 a subsequent privilege period.
 S. 8474                            662
 
   6.  As  used in this section, "the preceding year's tax" means the tax
 imposed upon the taxpayer by section 11-653 of this subchapter  for  the
 preceding  calendar  or  fiscal  year, or, for purposes of computing the
 first installment of estimated  tax  when  either  the  mandatory  first
 installment  is  paid  pursuant to subdivision one of this section or an
 application has been filed for extension of  the  time  for  filing  the
 report  required to be filed for such preceding calendar or fiscal year,
 the amount  properly  estimated  pursuant  to  section  11-657  of  this
 subchapter  as  the  tax  imposed upon the taxpayer for such calendar or
 fiscal year. As used in this section, "the second preceding year's  tax"
 means  the  tax  imposed  upon  the  taxpayer  by section 11-653 of this
 subchapter for the second preceding calendar of fiscal year.
   7. This section shall apply to a privilege period of less than  twelve
 months in accordance with regulations of the commissioner of finance.
   8.  The provisions of this section shall apply to privilege periods of
 twelve months other than a calendar year  by  the  substitution  of  the
 months  of  such  fiscal  year for the corresponding months specified in
 such provisions.
   9. The commissioner of finance may grant  a  reasonable  extension  of
 time,  not to exceed six months, for payment of any installment of esti-
 mated tax required pursuant to this section, on such  terms  and  condi-
 tions  as the commissioner of finance may require including the furnish-
 ing of a bond or other  security  by  the  taxpayer  in  an  amount  not
 exceeding  twice  the amount for which any extension of time for payment
 is granted, provided, however, that interest at  the  underpayment  rate
 set  by  the  commissioner of finance pursuant to section 11-687 of this
 subchapter, or, if no rate is set, at the rate  of  seven  and  one-half
 percent  per  annum for the period of the extension shall be charged and
 collected on the amount for which any extension of time for  payment  is
 granted under this subdivision.
   10. A taxpayer may elect to pay any installment of estimated tax prior
 to the date prescribed in this section for payment thereof.
   11. Intentionally omitted.
   §  11-659 Collection of taxes. Every foreign corporation, other than a
 moneyed corporation, subject  to  the  provisions  of  this  subchapter,
 except  a  corporation  having  authority  to  do  business by virtue of
 section thirteen hundred five of the  business  corporation  law,  shall
 file  in  the  department  of  state a certificate of designation in its
 corporate name, signed and acknowledged by its president or a  vice-pre-
 sident  or  its secretary or treasurer, under its corporate seal, desig-
 nating the secretary of state as its agent  upon  whom  process  in  any
 action  provided for by this subchapter may be served within this state,
 and setting forth an address to which the secretary of state shall  mail
 a  copy  of any such process against the corporation which may be served
 upon the secretary of state. In case any  such  corporation  shall  have
 failed  to  file  such certificate of designation, it shall be deemed to
 have designated the secretary of state as its agent upon whom such proc-
 ess against it may be served; and until  a  certificate  of  designation
 shall  have  been filed the corporation shall be deemed to have directed
 the secretary of state to mail copies of process served upon him or  her
 to  the  corporation  at its last known office address within or without
 the state. When a certificate of designation  has  been  filed  by  such
 corporation  the  secretary of state shall mail copies of process there-
 after served upon the secretary of state to the  address  set  forth  in
 such  certificate.  Any  such corporation, from time to time, may change
 the address to which the secretary of state is directed to  mail  copies
 S. 8474                            663
 
 of  process, by filing a certificate to that effect executed, signed and
 acknowledged in like manner as a certificate of  designation  as  herein
 provided.  Service  of  process  upon  any  such corporation or upon any
 corporation  having  a  certificate  of  authority  under  section eight
 hundred five of the limited liability company law or having authority to
 do business by virtue of section thirteen hundred five of  the  business
 corporation  law,  in  any  action commenced at any time pursuant to the
 provisions of this subchapter, may be made by either:    (a)  personally
 delivering  to  and leaving with the secretary of state, a deputy secre-
 tary of state or with any person authorized by the secretary of state to
 receive such service duplicate copies  thereof  at  the  office  of  the
 department  of state in the city of Albany, in which event the secretary
 of state  shall  forthwith  send  by  registered  mail,  return  receipt
 requested,  one  of such copies to the corporation at the address desig-
 nated by it or at its last known office address within  or  without  the
 state, or (b) personally delivering to and leaving with the secretary of
 state,  a deputy secretary of state or with any person authorized by the
 secretary of state to receive such service, a copy thereof at the office
 of the department of state in the city of Albany  and  by  delivering  a
 copy  thereof to, and leaving such copy with, the president, vice-presi-
 dent, secretary, assistant secretary, treasurer, assistant treasurer, or
 cashier of such corporation, or  the  officer  performing  corresponding
 functions  under  another  name, or a director or managing agent of such
 corporation, personally  without  the  state.  Proof  of  such  personal
 service  without the state shall be filed with the clerk of the court in
 which the action is pending within thirty days after such  service,  and
 such service shall be complete ten days after proof thereof is filed.
   § 11-660 Limitations of time. The provisions of the civil practice law
 and  rules  relative  to the limitation of time enforcing a civil remedy
 shall not apply to any proceeding or action  taken  to  levy,  appraise,
 assess,  determine  or  enforce  the  collection  of  any tax or penalty
 prescribed by this subchapter, provided, however, that as to real estate
 in the hands of persons who are owners thereof who would  be  purchasers
 in  good  faith  but  for such tax or penalty and as to the lien on real
 estate of mortgages held by persons who would be holders thereof in good
 faith but for such tax or penalty, all such taxes  and  penalties  shall
 cease  to  be  a  lien on such real estate as against such purchasers or
 holders after the expiration of ten  years  from  the  date  such  taxes
 became  due  and  payable. The limitations herein provided for shall not
 apply to any transfer from a corporation to a person or corporation with
 intent to avoid payment of any taxes, or  where  with  like  intent  the
 transfer  is  made  to  a grantee corporation, or any subsequent grantee
 corporation, controlled by such grantor or which has  any  community  of
 interest with it, either through stock ownership or otherwise.
 
                               SUBCHAPTER 4
                      TRANSPORTATION CORPORATION TAX
 
   §  11-662    Tax  on transportation corporations and associations.  1.
 The term "corporation" as used in  this  subchapter  shall  include  any
 business  conducted  by a trustee or trustees wherein interest or owner-
 ship is evidenced by certificates or other written instruments.
   2.  For the privilege of doing business or  holding  property  in  the
 city every corporation, joint-stock company or association formed for or
 principally engaged in the conduct of aviation, steamboat, ferry, except
 a  ferry  company operating between the city of Staten Island and any of
 S. 8474                            664
 
 the boroughs of the city of New York under a lease granted by  the  city
 of  New  York,  or  navigation  business,  or  formed for or principally
 engaged in the conduct of two or  more  of  such  businesses,  except  a
 corporation,  joint-stock  company  or  association  subject to taxation
 under chapter eleven of this title, shall pay, in advance, an annual tax
 to be computed upon the basis of the amount of its capital stock  within
 the city during the preceding year, and upon each dollar of such amount.
   3.  The  measure of the amount of capital stock in the city, except as
 hereinafter provided, shall be such a  portion  of  the  issued  capital
 stock as the gross assets, exclusive of obligations issued by the United
 States  and cash on hand and on deposit, employed in any business within
 the city, bear to the gross assets, exclusive of obligations  issued  by
 the  United States and cash on hand and on deposit, wherever employed in
 business.  Provided, however, that in the case of a corporation  taxable
 hereunder  only for the privilege of holding property, the measure shall
 be such a portion of the issued  capital  stock  as  the  gross  assets,
 exclusive  of  obligations  issued by the United States and cash on hand
 and on deposit, located within the  city,  bear  to  the  gross  assets,
 exclusive  of  obligations  issued by the United States and cash on hand
 and on deposit, wherever located.  The capital of a corporation invested
 in the stock of another corporation shall be deemed to be assets located
 where the assets of the issuing corporation, other than  patents,  copy-
 rights, trademarks, contracts and good will, are located.
   4.  Every  corporation,  joint-stock company or association subject to
 taxation under this section shall, in any event, pay annually, for taxa-
 ble years ending on or before December  thirty-first,  nineteen  hundred
 seventy-four,   a minimum tax of not less than ten dollars nor less than
 one mill, and for taxable years beginning on  or  after  January  first,
 nineteen  hundred seventy-five,   a minimum tax of not less than fifteen
 dollars nor less than one and one-half mills,  on each dollar of such  a
 portion  of  the  net value of its issued capital stock, which net value
 for the purposes of this section shall be deemed to  be  not  less  than
 five  dollars  per  share,  as  may be determined upon such of the bases
 herein provided for the measurement thereof as is applicable.  The  term
 "net  value" as used in this section shall be construed to mean not less
 than the difference between a corporation's assets and liabilities,  and
 not less than the average price at which such stock sold during the year
 covered  by  the  report  which forms the basis for the tax.  But if the
 dividends paid on the par value of any kind of capital stock during  any
 year ending with the thirty-first day of December amounts to six or more
 than six per centum, the tax upon such kind of capital stock shall be at
 the  rate of one-quarter of a mill for taxable years ending on or before
 December thirty-first, nineteen hundred seventy-four, and at the rate of
 four-tenths of a mill for taxable years beginning on  or  after  January
 first,  nineteen  hundred seventy-five for  each one per centum of divi-
 dends paid and shall be computed upon the  par  value  of  such  capital
 stock,  unless  such  a  tax  be  less than the minimum tax hereinbefore
 provided in this section and the commissioner of finance shall, for such
 purpose, make a fair and equitable apportionment of the  assets  of  the
 corporation,  joint-stock  company  or association, between or among the
 different kinds of stock.
   5. If such corporation, joint-stock company or association shall  have
 more than one kind of capital stock, and upon one of such kinds of stock
 a  dividend  or  dividends  amounting to six or more than six per centum
 upon the par value thereof, has been paid, and upon the other  no  divi-
 dend  has been paid, or the dividend or dividends paid thereon amount to
 S. 8474                            665
 
 less than six per centum upon the par value thereof, then the tax  shall
 be fixed upon each kind as hereinbefore provided.
   6. The dividend rate for a corporation having stock without nominal or
 par  value shall be determined by dividing the amount paid as a dividend
 or dividends during the year by the amount paid in on such stock and, if
 the rate is six per centum or more, then for taxable years ending on  or
 before December thirty-first, nineteen hundred seventy-four, the rate of
 one-quarter  of  a  mill  for  each one per centum of dividends shall be
 applied to the amount paid in on  such  stock,  and  for  taxable  years
 beginning  on or after January first, nineteen hundred seventy-five, the
 rate of four-tenths of a mill for each one per centum of dividends shall
 be applied to the amount paid in on such stock, unless such tax be  less
 than  the  minimum  tax  hereinbefore in this section provided for.  Any
 consideration given by a corporation for the purchase of its  own  stock
 in  excess  of the consideration received by it for the issuance of such
 stock shall for the purposes of this section, be considered as  a  divi-
 dend.
   7.  The  owning or holding in the city by any corporation of property,
 other than property exclusively in interstate or foreign commerce, shall
 constitute carrying on business within the city  within  the  intent  of
 this  section,  except that a corporation having no property in the city
 other than a bank balance or stocks or bonds, or one  or  more  of  such
 kinds of property, either held for safe keeping or pledged as collateral
 security  shall  not be taxable under this section, and further provided
 that any corporation having only office furniture or  fixtures,  a  bank
 balance,  and  stocks  or bonds pledged as collateral security or merely
 deposited for safe keeping, shall not be taxable under this section.
   8. The measure of the amount of  capital  stock  in  the  city  of  an
 aviation  corporation  shall  be  a  portion of the issued capital stock
 determined by applying thereto the arithmetical average of the following
 three ratios: (a) the ratio which the aircraft arrivals  and  departures
 within  the  city scheduled by any such corporation during the preceding
 calendar year bear to the total aircraft arrivals and departures  within
 and  without  the  city scheduled by it during the same period, provided
 that in the case of non-scheduled operations all arrivals and departures
 shall be substituted for scheduled  arrivals  and  departures;  (b)  the
 ratio  which  the  revenue  tons handled by such corporation at airports
 within the city during the preceding calendar year  bear  to  the  total
 revenue  tons  handled  by  it  at  airports within and without the city
 during the same period; and (c) the ratio which such corporation's orig-
 inating revenue within the city for the preceding calendar  years  bears
 to  its  total  originating  revenue within and without the city for the
 same period.  As used in this section, the term "aircraft  arrivals  and
 departures"  means  the number of scheduled landings and takeoffs of the
 aircraft of an aviation corporation, and the  number  of  scheduled  air
 pickups  and  deliveries by the aircraft of such corporation, and in the
 case  of  non-scheduled  operations  shall  include  all  landings   and
 takeoffs,  pickups  and deliveries; the term "originating revenue" means
 revenue to any such  corporation  from  the  transportation  of  revenue
 passengers  and  revenue  property  first  received  by such corporation
 either as originating or connecting traffic at airports;  and  the  term
 "revenue  tons  handled" by any such corporation at an airport means the
 weight in tons of revenue passengers, at two hundred pounds per  passen-
 ger,  and revenue cargo first received either as originating or connect-
 ing traffic or finally discharged by such corporation at such airport.
 S. 8474                            666
 
   9. The measure of the capital stock  in  the  city  of  a  corporation
 engaged  in  the  operation of vessels in foreign commerce shall be such
 portion of the issued capital stock as the aggregate number  of  working
 days  in territorial waters of the city of all such vessels bears to the
 aggregate number of working days of all such vessels.  The dividend rate
 for  such  a corporation shall be determined by dividing the amount paid
 as a dividend or dividends on all classes of stock during  the  year  by
 the  amount  of  paid-in  capital  and, if the rate is six per centum or
 more, then for taxable years ending on or before December  thirty-first,
 nineteen  hundred seventy-four,    the rate of one-quarter of a mill for
 each one per centum of dividends shall be applied to the amount of  such
 paid-in  capital,  and  for  taxable years beginning on or after January
 first, nineteen hundred seventy-five, the rate of four-tenths of a  mill
 for  each one per centum of dividends shall be applied to the amount  of
 such paid-in capital.
   § 11-663  Additional tax on transportation  corporations  and  associ-
 ations.    Every  corporation, joint-stock company or association formed
 for or principally engaged in the conduct of aviation, steamboat, ferry,
 except a ferry company operating between the city of Staten  Island  and
 any of the boroughs of the city of New York under a lease granted by the
 city  of  New  York, or navigation business or formed for or principally
 engaged in the conduct of two or  more  of  such  businesses,  except  a
 corporation,  joint-stock  company  or  association  subject to taxation
 under chapter eleven of this title,  shall  pay  for  the  privilege  of
 carrying  on  its  business  in  the city, a tax which shall be equal to
 five-tenths of one per centum for taxable  years  ending  on  or  before
 December  thirty-first, nineteen hundred seventy-four,  and seventy-five
 hundredths of one per centum for taxable years  beginning  on  or  after
 January  first,  nineteen  hundred  seventy-five upon its gross earnings
 from all sources within the city, excluding earnings derived from  busi-
 ness  of  a  character other than wholly intra-city.  Provided, however,
 gross earnings from transportation business both originating and  termi-
 nating  within the city and traversing both the city and any other city,
 any state or states or any country shall be subject to the  tax  imposed
 by  this section and such earnings shall be allocated to the city in the
 same ratio that the mileage within the city bears to the  total  mileage
 of such business.
   § 11-664  Receivers, etc., conducting corporate business.  Any receiv-
 er,  liquidator, referee, trustee, assignee, or other fiduciary or offi-
 cer or agent appointed by any court, who conducts the  business  of  any
 corporation,  joint-stock company or association shall be subject to the
 tax or taxes imposed by this subchapter in the same manner  and  to  the
 same  extent as if the business were conducted by the agents or officers
 of such corporation, joint-stock company or association.    A  dissolved
 corporation,  joint-stock  company  or  association  which  continues to
 conduct business shall also be subjected to  the  tax  imposed  by  this
 subchapter.
   §  11-665    Service of process; limitation of time.  1. Every foreign
 corporation, other than a moneyed corporation, subject to the provisions
 of this subchapter, except a corporation having authority to do business
 by virtue of section thirteen hundred five of the  business  corporation
 law,  shall file in the department of state a certificate of designation
 in its corporate name, signed and acknowledged by its president or vice-
 president or its secretary  or  treasurer,  under  its  corporate  seal,
 designating the secretary of state as its agent upon whom process in any
 action  provided for by this subchapter or subchapter five of this chap-
 S. 8474                            667
 
 ter may be served within this state, and setting  forth  an  address  to
 which  the  secretary  of  state  shall  mail a copy of any such process
 against the corporation which may be served upon the secretary of state.
 In  case any such corporation shall have failed to file such certificate
 of designation, it shall be deemed to have designated the  secretary  of
 state  as its agent upon whom such process against it may be served; and
 until a certificate of designation shall have been filed the corporation
 shall be deemed to have directed the secretary of state to  mail  copies
 of  process served upon the secretary of state to the corporation at its
 last known office address within or without the state.   When a  certif-
 icate of designation has been filed by such corporation the secretary of
 state  shall mail copies of process thereafter served upon the secretary
 of state to the address set forth in such certificate. Any  such  corpo-
 ration, from time to time, may change the address to which the secretary
 of  state is directed to mail copies of process, by filing a certificate
 to that effect executed, signed and acknowledged in  like  manner  as  a
 certificate  of designation as herein provided.  Service of process upon
 any such corporation or upon any  corporation  having  authority  to  do
 business  by  virtue  of  section  thirteen hundred five of the business
 corporation law, in any action commenced at any  time  pursuant  to  the
 provisions  of this subchapter or subchapter five of this chapter may be
 made by either: (1) personally delivering to and leaving with the secre-
 tary of state, a deputy secretary of state or with any person authorized
 by the secretary of state to receive such service duplicate copies ther-
 eof at the office of the department of state in the city of  Albany,  in
 which  event  the  secretary of state shall forthwith send by registered
 mail, return receipt requested, one of such copies to the corporation at
 the address designated by it or at its last known office address  within
 or  without  the state, or (2) personally delivering to and leaving with
 the secretary of state, a deputy secretary of state or with  any  person
 authorized  by  the  secretary  of state to receive such service, a copy
 thereof at the office of the department of state in the city  of  Albany
 and  by  delivering  a  copy  hereof to, and leaving such copy with, the
 president, vice-president, secretary,  assistant  secretary,  treasurer,
 assistant  treasurer,  or  cashier  of  such corporation, or the officer
 performing corresponding functions under another name, or a director  or
 managing agent of such corporation, personally without the state.  Proof
 of such personal service without the state shall be filed with the clerk
 of  the  court  in  which the action is pending within thirty days after
 such service, and such service shall be complete ten  days  after  proof
 thereof is filed.
   2.  The provisions of the civil practice law and rules relative to the
 limitation of time of enforcing a civil remedy shall not  apply  to  any
 proceeding  or  action  taken  to  levy,  appraise, assess, determine or
 enforce the collection of any tax or penalty prescribed by this subchap-
 ter or subchapter five of this chapter, provided, however,  that  as  to
 real  estate in the hands of persons who are owners thereof who would be
 purchasers in good faith but for such tax or penalty and as to the  lien
 on real estate of mortgages held by persons who would be holders thereof
 in  good faith but for such tax or penalty, all such taxes and penalties
 shall cease to be a lien on such real estate as against such  purchasers
 or  holders  after  the expiration of ten years from the date such taxes
 become due and payable.  The limitations provided for in  this  subdivi-
 sion  shall  not apply to any transfer from a corporation to a person or
 corporation with intent to avoid payment of any  taxes,  or  where  with
 like intent the transfer is made to a grantee corporation, or any subse-
 S. 8474                            668
 
 quent  grantee  corporation  controlled by such grantor or which has any
 community of interest with it, either through stock ownership or  other-
 wise.
   §  11-666    Exemption  of  corporations  owned by a municipality. The
 provisions of this subchapter shall not apply to any corporation all  of
 the  capital  stock of which is owned by a municipal corporation of this
 state.
   § 11-667  Reports of corporations. Corporations liable to  pay  a  tax
 under this subchapter shall report as follows:
   1. Every corporation, association or joint-stock company liable to pay
 a  tax under section 11-662 of this subchapter shall, on or before March
 first in each year, make a written report to the commissioner of finance
 of its condition at the close of its business on the preceding  December
 thirty-first,  stating  the  amount of its authorized capital stock, the
 amount of stock paid-in, the date and rate per centum of  each  dividend
 paid  by  it  during the year ending with such day, the entire amount of
 the capital of such corporation, and the capital employed by it  in  the
 city during such year.
   2. Every corporation, joint-stock company or association liable to pay
 an additional tax under section 11-663 of this subchapter shall also, on
 or before February fifteenth, May fifteenth, August fifteenth and Novem-
 ber fifteenth in each year, make a written report to the commissioner of
 finance  of  the amount of its gross earnings subject to the tax imposed
 by said section for the quarter year ended on the last day of the second
 month preceding that in which the report is required to be filed.    Any
 such  corporation, joint-stock company or association which ceases to be
 subject to the tax imposed by  section  11-663  of  this  subchapter  by
 reason  of  a liquidation, dissolution, merger or consolidation with any
 other corporation, or any other cause, shall, on the date of such cessa-
 tion or at such other time as the commissioner of finance  may  require,
 make  a  written  report to the commissioner of finance of the amount of
 its gross earnings subject to the tax imposed by section 11-663 of  this
 subchapter for any period for which no report was therefor filed.
   3.  The  commissioner  of  finance may for good cause shown extend the
 time within which any corporation is required to report by this subchap-
 ter.
   4. Every report required by this subchapter shall have annexed thereto
 a certification by the president, vice-president,  treasurer,  assistant
 treasurer,  or  chief  accounting  officer  or  any other officer of the
 corporation, association or joint-stock company duly  authorized  so  to
 act, or of the person or one of the persons, or the members of the part-
 nership  making  the  same,  to the effect that the statements contained
 therein are true.  The fact that an individual's name  is  signed  on  a
 certification  attached  to  a  corporate  report  shall  be prima facie
 evidence that such individual is authorized to  certify  the  report  on
 behalf  of  the corporation.  Such reports shall contain any other data,
 information or matter which the commissioner of finance may  require  to
 be included therein, and it may prescribe the form in which such reports
 shall  be  made.   When so prescribed such forms shall be used in making
 the report.   The commissioner of finance may  require  at  any  time  a
 further or supplemental report under this subchapter which shall contain
 information  and  data  upon such matters as the commissioner of finance
 may specify.  Reports shall be preserved for five years, and  thereafter
 until the commissioner of finance orders them to be destroyed.
   §  11-668    Payment  of  tax and penalties.   1. The taxes imposed by
 sections 11-662 and 11-663 of this subchapter shall be due  and  payable
 S. 8474                            669
 
 at  the  time  of the filing of the report required by section 11-667 of
 this subchapter or, in case such a report is not filed when due, on  the
 last  day  specified  for  the  filing thereof, except that the tax upon
 dividends  imposed by section 11-663 of this subchapter shall be due and
 payable at the time of filing the report  for  the  period  ending  June
 thirtieth,  or,  in  case such report is not filed when due, on the last
 day specified for the filing thereof.
   2. Where an application for consent to  dissolution,  as  provided  by
 section one thousand four of the business corporation law, is filed with
 the commissioner of finance prior to the commencement of any tax year or
 period  by  a  corporation  subject  to  tax under this subchapter, such
 corporation shall not be liable for any tax imposed by  this  subchapter
 for  such  following year or period, except as may be otherwise provided
 in section 11-664 of this subchapter, provided that the  certificate  of
 dissolution  for  such  corporation  is  duly filed in the office of the
 secretary of state within twenty days after the filing of such  applica-
 tion.
   3. Notwithstanding any other provision of this subchapter, the commis-
 sioner  of  finance may grant a reasonable extension of time for payment
 of any tax imposed by this  subchapter  under  such  conditions  as  the
 commissioner deems just and proper.
   §  11-669    Taxable years to which taxes apply.  The taxes imposed by
 this subchapter are imposed for each taxable year  or  period  beginning
 with  taxable years or periods ending in or with the calendar year nine-
 teen hundred sixty-six, provided,  however,  no  tax  shall  be  imposed
 pursuant  to this subchapter for any taxable year or period ending after
 December thirty-first, nineteen hundred eighty-eight.
   § 11-670  First reports for payments for nineteen hundred  sixty-six.
 If  any report under this subchapter is due prior to September eleventh,
 nineteen hundred sixty-six, such report and the payments therewith shall
 be filed and paid by such date.
 
                               SUBCHAPTER 5
                CORPORATE TAX PROCEDURE AND ADMINISTRATION
 
   § 11-671  Application of subchapter.  1. General.   The provisions  of
 this  subchapter shall apply to the administration of and the procedures
 with respect to the taxes imposed by subchapters two, three, three-A and
 four of this chapter.
   2. Definitions.   As used in this  subchapter:  (a)  the  term  "named
 subchapters"  means  subchapters  two,  three,  three-A and four of this
 chapter;
   (b) The term "return" means a report or return of tax,  but  does  not
 include a declaration of estimated tax;
   (c) The term "corporation" includes a corporation, association, joint-
 stock  company  or  other  entity  subject to tax under any of the named
 subchapters; and
   (d) The term "person" includes a  corporation,  association,  company,
 partnership,  estate,  trust,  liquidator,  fiduciary or other entity or
 individual liable for the tax imposed by any of the named subchapters or
 under a duty to perform an act under any of the named subchapters.  Upon
 notice to the commissioner of finance that any person is acting for  any
 corporation  in  a  fiduciary  capacity, such fiduciary shall assume the
 powers, rights, duties and privileges of such corporation in respect  of
 a  tax  imposed  by  any  of  the named subchapters, except as otherwise
 specifically provided and except that the tax shall  be  collected  from
 S. 8474                            670
 
 the  estate  or  other  assets  of such corporation in the hands of such
 fiduciary, until notice is given that the fiduciary capacity has  termi-
 nated.
   §  11-672  Notice  of deficiency. 1. General. If upon examination of a
 taxpayer's return, the commissioner of finance determines that there  is
 a deficiency of tax, the commissioner may mail a notice of deficiency to
 the taxpayer. If a taxpayer fails to file a tax return, the commissioner
 of  finance  is authorized to estimate the taxpayer's city tax liability
 from any information in the commissioner's possession,  and  to  mail  a
 notice  of  deficiency  to the taxpayer. A notice of deficiency shall be
 mailed by certified or registered mail to  the  taxpayer,  at  its  last
 known  address in or out of the city. If the taxpayer has terminated its
 existence, a notice of deficiency  may  be  mailed  to  its  last  known
 address  in  or out of the city, and such notice shall be sufficient for
 purposes of this subchapter. If the commissioner of finance has received
 notice that a person is acting for the taxpayer in a fiduciary capacity,
 a copy of such notice shall also be mailed to  the  fiduciary  named  in
 such notice.
   2.  Notice  of  deficiency  as  assessment. After ninety days from the
 mailing of a notice of deficiency or, if the commissioner of finance has
 established a conciliation procedure pursuant to section 11-124 of  this
 title  and  the  taxpayer  has  requested  a  conciliation conference in
 accordance therewith, after ninety days from the mailing of the  concil-
 iation  decision  or  the date of the commissioner's confirmation of the
 discontinuance of the conciliation proceeding, such notice shall  be  an
 assessment  of  the  amount  of tax specified therein, together with the
 interest, additions to tax and penalties stated in such  notice,  except
 only  for  any  such  tax  or other amounts as to which the taxpayer has
 within such ninety day period filed with  the  tax  appeals  tribunal  a
 petition under section 11-680 of this subchapter. If the notice of defi-
 ciency  or  conciliation  decision is addressed to a taxpayer whose last
 known address is outside of the United States, such period shall be  one
 hundred fifty days instead of ninety days.
   3.  Restrictions on assessment and levy. No assessment of a deficiency
 in tax and no levy or proceeding in court for its  collection  shall  be
 made,  begun  or  prosecuted,  except  as  otherwise provided in section
 11-685 of this subchapter, until a notice of deficiency has been  mailed
 to the taxpayer, nor until the expiration of the time for filing a peti-
 tion  with  the  tax  appeals tribunal contesting such notice, nor, if a
 petition with respect to the taxable year has been both  served  on  the
 commissioner  of  finance and filed with the tax appeals tribunal, until
 the decision of the tax appeals tribunal has become final.   For  excep-
 tion  in  the case of judicial review of the decision of the tax appeals
 tribunal, see subdivision three of section 11-681 of this subchapter.
   4. Exceptions for mathematical errors. If a mathematical error appears
 on a return, including an overstatement of the amount paid as  estimated
 tax,  the  commissioner  of  finance  shall  notify the taxpayer that an
 amount of tax in excess of that shown upon the return is due,  and  that
 such excess has been assessed.  Such notice shall not be considered as a
 notice  of  deficiency for the purposes of this section, subdivision six
 of section 11-678, limiting credits or refunds after petition to the tax
 appeals tribunal, or subdivision two of section 11-680 of this  subchap-
 ter,  authorizing the filing of a petition with the tax appeals tribunal
 based on a notice of deficiency, nor shall such assessment or collection
 be prohibited by the provisions of subdivision three of this section.
 S. 8474                            671
 
   5. Exception where federal or New York state change or  correction  is
 not reported.
   (a)  If  the  taxpayer  fails  to comply with subchapter two, three or
 three-A of this chapter in not reporting a change or correction or rene-
 gotiation,  or  computation  or  recomputation  of  tax,  increasing  or
 decreasing  its  federal  or  New York state taxable income, alternative
 minimum taxable income or other basis of tax as reported on its  federal
 or  New  York  state  income  tax return or in not reporting a change or
 correction or renegotiation, or computation  or  recomputation  of  tax,
 which  is  treated  in  the  same  manner as if it were a deficiency for
 federal or New York state income  tax  purposes  or  in  not  filing  an
 amended  return  or in not reporting the execution of a notice of waiver
 executed pursuant to subsection (d) of section six thousand two  hundred
 thirteen  of the internal revenue code or pursuant to subdivision (f) of
 section one thousand eighty-one of the tax law, instead of the mode  and
 time  of assessment provided for in subdivision two of this section, the
 commissioner  of  finance  may  assess  a  deficiency  based  upon  such
 increased  or decreased federal or New York state taxable income, alter-
 native minimum taxable income or other basis of tax by  mailing  to  the
 taxpayer  a  notice  of  additional tax due specifying the amount of the
 deficiency, and such deficiency, together with the  interest,  additions
 to  tax and penalties stated in such notice, shall be deemed assessed on
 the date such notice is mailed unless within thirty days after the mail-
 ing of such notice a report of the federal or New York state  change  or
 correction  or renegotiation, or computation or recomputation of tax, or
 an amended return, where such return was required by subchapter  two  or
 three of this chapter, is filed accompanied by a statement showing wher-
 ein  such  federal  or  New  York state determination and such notice of
 additional tax due are erroneous.
   (b) Such notice shall not be considered as a notice of deficiency  for
 the  purposes of this section, subdivision six of section 11-678, limit-
 ing credits or refunds after petition to the tax  appeals  tribunal,  or
 subdivision  two  of  section 11-680 of this subchapter, authorizing the
 filing of a petition with the tax appeals tribunal based on a notice  of
 deficiency,  nor  shall  such  assessment  or  the collection thereof be
 prohibited by the provisions of subdivision three of this section.
   (c) If the taxpayer has terminated its existence, a  notice  of  addi-
 tional  tax due may be mailed to the taxpayer's last known address in or
 out of the city, and such notice shall be  sufficient  for  purposes  of
 this subchapter. If the commissioner of finance has received notice that
 a  person  is acting for the taxpayer in a fiduciary capacity, a copy of
 such notice shall also be mailed to the fiduciary named in such notice.
   6. Waiver of restrictions. The taxpayer shall at any time, whether  or
 not  a notice of deficiency has been issued, have the right to waive the
 restrictions on assessment and collection of the whole or  any  part  of
 the deficiency by a signed notice in writing filed with the commissioner
 of finance.
   7.  Two  or  more  corporations.  In  case  of a combined return under
 subchapter two or three-A or  a  consolidated  return  under  subchapter
 three  of  two  or  more  corporations,  the commissioner of finance may
 determine a deficiency of tax under subchapter two, three or three-A  of
 this chapter with respect to the entire tax due upon such return against
 any  taxpayer  included  therein.  In the case of a taxpayer which might
 have been included in such a  return  under  subchapter  two,  three  or
 three-A  of  this  chapter  when  the  tax  was originally reported, the
 commissioner of finance may determine a deficiency of tax under subchap-
 S. 8474                            672
 
 ter two, three or three-A of this  chapter  against  such  taxpayer  and
 against  any  other  taxpayers  which might have been included in such a
 return.
   8.  Deficiency  defined.  For the purposes of this subchapter, a defi-
 ciency means the amount of the tax imposed by the named subchapters,  or
 any  of  them, less: (a) the amount shown as the tax upon the taxpayer's
 return, whether the return was made or the tax computed by it or by  the
 commissioner  of  finance, and less (b) the amounts previously assessed,
 or collected without assessment, as a deficiency and plus (c) the amount
 of any rebates. For the purpose or this definition, the tax  imposed  by
 subchapter  two,  three  or three-A of this chapter and the tax shown on
 the return shall both be determined without regard  to  any  payment  of
 estimated  tax;  and  a  rebate  means  so much of an abatement, credit,
 refund or other repayment, whether or not erroneous, as was made on  the
 ground  that  the  amounts  entering into the definition of a deficiency
 showed a balance in favor of the taxpayer.
   9. Exception where change or correction of sales and compensating  use
 tax liability is not reported.
   (a)  If  a  taxpayer fails to comply with subchapter two or three-A of
 this chapter in not reporting a change or correction of  its  sales  and
 compensating  use  tax  liability  or in not filing a copy of an amended
 return or report relating to its sales and compensating use tax  liabil-
 ity, instead of the mode and time of assessment provided for in subdivi-
 sion two of this section, the commissioner of finance may assess a defi-
 ciency  based  upon such changed or corrected sales and compensating use
 tax liability, as same relates to credits claimed under  subchapter  two
 or three-A of this chapter, by mailing to the taxpayer a notice of addi-
 tional  tax  due specifying the amount of the deficiency, and such defi-
 ciency, together with the interest, additions to tax and penalties stat-
 ed in such notice, shall be deemed assessed on the date such  notice  is
 mailed  unless  within  thirty  days  after the mailing of such notice a
 report of the state change or correction or a copy of an amended  return
 or report, where such copy was required by subchapter two or three-A, is
 filed  accompanied  by  a  statement showing wherein such state determi-
 nation and such notice of additional tax due are erroneous.
   (b) Such notice shall not be considered as a notice of deficiency  for
 the  purposes of this section, subdivision six of section 11-678, limit-
 ing credits or refunds after petition to the tax  appeals  tribunal,  or
 subdivision  two of section 11-680, authorizing the filing of a petition
 with the tax appeals tribunal based on a notice of deficiency, nor shall
 such  assessment  or  the  collection  thereof  be  prohibited  by   the
 provisions of subdivision three of this section.
   (c)  If  the  taxpayer has terminated its existence, a notice of addi-
 tional tax due may be mailed to its last known address in or out of  the
 city,  and such notice shall be sufficient for purposes of this subchap-
 ter. If the commissioner of finance has received notice that a person is
 acting for the taxpayer in a fiduciary capacity, a copy of  such  notice
 shall also be mailed to the fiduciary named in such notice.
   §  11-673  Assessment.  1.  Assessment date. The amount of tax which a
 return shows to be due, or the amount of tax which a return  would  have
 shown  to  be  due  but  for a mathematical error, shall be deemed to be
 assessed on the date of filing of  the  return,  including  any  amended
 return  showing  an  increase of tax. If a notice of deficiency has been
 mailed, the amount of the deficiency shall be deemed to be  assessed  on
 the date specified in subdivision two of section 11-672 of this subchap-
 ter  if  no  petition  is both served on the commissioner of finance and
 S. 8474                            673

 filed with the tax appeals tribunal, or if a petition is so  served  and
 filed,  then  upon  the date when a decision of the tax appeals tribunal
 establishing the amount of the deficiency becomes final. If a report  or
 an  amended return filed pursuant to subchapter two, three or three-A of
 this chapter concedes the accuracy  of  a  federal  or  New  York  state
 adjustment  or  change  or correction or renegotiation or computation or
 recomputation of tax, any deficiency in tax under subchapter two,  three
 or  three-A  of  this  chapter resulting therefrom shall be deemed to be
 assessed on the date of filing such report or amended return,  and  such
 assessment  shall  be  timely  notwithstanding  section  11-674  of this
 subchapter.
   If a report filed pursuant to subchapter two of this chapter  concedes
 the  accuracy  of a state change or correction of sales and compensating
 use tax liability, any deficiency in tax under subchapter two or three-A
 of this chapter resulting therefrom shall be deemed assessed on the date
 of filing such report, and such assessment shall be timely notwithstand-
 ing section 11-674 of this subchapter.
   If a notice of additional tax due, as prescribed in  subdivision  five
 of section 11-672 of this subchapter, has been mailed, the amount of the
 deficiency  shall be deemed to be assessed on the date specified in such
 subdivision unless within thirty days after the mailing of such notice a
 report of the  federal  or  New  York  state  adjustment  or  change  or
 correction  or  renegotiation or computation or recomputation of tax, or
 an amended return, where such return was  required  by  subchapter  two,
 three  or  three-A  of this chapter, is filed accompanied by a statement
 showing wherein such federal or New York state  determination  and  such
 notice of additional tax due are erroneous.
   If  a  notice of additional tax due, as prescribed in subdivision nine
 of section 11-672 of this subchapter, has been mailed, the amount of the
 deficiency shall be deemed to be assessed on the date specified in  such
 subdivision unless within thirty days after the mailing of such notice a
 report of the state change or correction, or a copy of an amended return
 or  report, where such copy was required by subchapter two or three-A of
 this chapter, is filed accompanied by a statement showing  wherein  such
 state determination and such notice of additional tax due are erroneous.
   Any  amount  paid  as a tax or in respect of a tax, other than amounts
 paid as estimated tax, shall be deemed to be assessed upon the  date  of
 receipt of payment notwithstanding any other provisions.
   2.  Other assessment powers. If the mode or time for the assessment of
 any tax under the named subchapters, including  interest,  additions  to
 tax and assessable penalties, is not otherwise provided for, the commis-
 sioner of finance may establish the same by regulations.
   3.  Estimated  tax. No unpaid amount of estimated tax under subchapter
 two, three or three-A of this chapter shall be assessed.
   4. Supplemental assessment. The commissioner of finance  may,  at  any
 time  within  the  period  described for assessment, make a supplemental
 assessment, subject to the provisions of section 11-672 of this subchap-
 ter where applicable, whenever it is ascertained that any assessment  is
 imperfect or incomplete in any material respect.
   5.  Cross  reference.  For assessment in case of jeopardy, see section
 11-685 of this subchapter.
   § 11-674  Limitations on assessment. 1. General.  Except as  otherwise
 provided  in  this section, any tax under the named subchapters shall be
 assessed within three years after the return was filed, whether  or  not
 such return was filed on or after the date prescribed.
 S. 8474                            674
 
   2.  Time  return  deemed  filed.   For the purposes of this section, a
 return of tax filed before the last day prescribed by law  or  by  regu-
 lations  promulgated  pursuant  to  law  for the filing thereof shall be
 deemed to be filed on such last day.
   3. Exceptions.
   (a) Assessment at any time.  The tax may be assessed at any time if:
   (1) no return is filed,
   (2) a false or fraudulent return is filed with intent to evade tax,
   (3)  in  the  case  of  the tax imposed under subchapter two, three or
 three-A of this chapter, the taxpayer fails to file a report or  amended
 return  required  thereunder,  in  respect of an increase or decrease in
 federal or New York state taxable income,  alternative  minimum  taxable
 income  or  other  basis  of tax or federal or New York state tax, or in
 respect of a change or correction or renegotiation or in respect of  the
 execution  of a notice of waiver report of which is required thereunder,
 or computation or recomputation of tax, which is  treated  in  the  same
 manner  as  if it were a deficiency for federal or New York state income
 tax purposes, or
   (4) in the case of the tax imposed under subchapter two or three-A  of
 this  chapter,  the taxpayer fails to file a report or amended return or
 report required thereunder, in respect of  a  change  or  correction  of
 sales  and  compensating  use tax liability, relating to the purchase or
 use of items for which a sales or compensating use  tax  credit  against
 the tax imposed by subchapter two or three-A was claimed.
   (b)  Extension by agreement.  Where, before the expiration of the time
 prescribed in this section for the assessment of tax, both  the  commis-
 sioner  of  finance  and  the  taxpayer have consented in writing to its
 assessment after such time, the tax may be assessed at any time prior to
 the expiration of the period agreed upon.  The period so agreed upon may
 be extended by subsequent agreements in writing made before the  expira-
 tion of the period previously agreed upon.
   (c)  Report of federal or New York state change or correction.  In the
 case  of  the tax imposed under subchapter two, three or three-A of this
 chapter, if the taxpayer files a report or amended return required ther-
 eunder, in respect of an increase or decrease in  federal  or  New  York
 state  taxable income, alternative minimum taxable income or other basis
 of tax or federal or New York state tax, or in respect of  a  change  or
 correction  or renegotiation, or in respect of the execution of a notice
 of waiver report of which is  required  thereunder,  or  computation  or
 recomputation  of tax, which is treated in the same manner as if it were
 a deficiency for federal or New York  state  income  tax  purposes,  the
 assessment,  if  not  deemed  to  have  been made upon the filing of the
 report or amended return may be made at any time within two years  after
 such  report or amended return was filed.  The amount of such assessment
 of tax shall not exceed the amount of the increase in city tax attribut-
 able to such federal or New York state change or correction or renegoti-
 ation, or computation or recomputation of tax.  The provisions  of  this
 paragraph shall not affect the time within which or the amount for which
 an assessment may otherwise be made.
   (d)  Deficiency  attributable  to  net operating loss carryback.  If a
 deficiency of tax under subchapter two or three-A  of  this  chapter  is
 attributable  to  the  application  to  taxpayer of a net operating loss
 carryback or a capital loss carryback, it may be assessed  at  any  time
 that a deficiency for the taxable year of the loss may be assessed.
   (e)  Recovery  of  erroneous  refund.    An  erroneous refund shall be
 considered an underpayment of tax on the date made, and an assessment of
 S. 8474                            675

 a deficiency arising out of an erroneous refund may be made at any  time
 within  two years from the making of the refund, except that the assess-
 ment may be made within five years from the making of the refund  if  it
 appears that any part of the refund was induced by fraud or misrepresen-
 tation of a material fact.
   (f)  Request  for prompt assessment.  The tax shall be assessed within
 eighteen months after written request therefor, made after the return is
 filed, by the taxpayer or by a fiduciary representing the taxpayer,  but
 not  more  than three years after the return was filed, except as other-
 wise provided in this subdivision and subdivision four of this  section.
 This subdivision shall not apply unless:
   (1) (A) such written request notifies the commissioner of finance that
 the  taxpayer  contemplates  dissolution  at or before the expiration of
 such eighteen-month period, (B) the dissolution is in good  faith  begun
 before the expiration of such eighteen-month period, (C) the dissolution
 is completed;
   (2) (A) such written request notifies the commissioner of finance that
 a  dissolution  has in good faith been begun, and (B) the dissolution is
 completed; or
   (3) a dissolution has been completed at the time such written  request
 is made.
   (g)  Change  of  the  allocation of taxpayer's income or capital.  (1)
 With regard to taxable years beginning before January first,  two  thou-
 sand  fifteen,  no  change  of  the allocation of income or capital upon
 which the taxpayer's return, or any  additional  assessment,  was  based
 shall  be  made where an assessment of tax is made during the additional
 period of limitation under subparagraph three or four of  paragraph  (a)
 of this subdivision, or under paragraph (c), (d) or (i) of this subdivi-
 sion;  and where any such assessment has been made, or where a notice of
 deficiency has been mailed to the taxpayer on  the  basis  of  any  such
 proposed  assessment,  no  change of the allocation of income or capital
 shall be made in a proceeding on the taxpayer's claim for refund of such
 assessment or on the taxpayer's petition  for  redetermination  of  such
 deficiency.
   (2)  With regard to taxable years beginning on or after January first,
 two thousand fifteen, no change of the allocation of income  or  capital
 upon  which  the  taxpayer's return, or  any  additional assessment, was
 based shall be made where an assessment of tax is made during the  addi-
 tional  period of limitation under subparagraph three or  four  of para-
 graph (a) or under paragraph (c), (d) or (i) of this subdivision, except
 to the extent such assessment is based on an increase or decrease in New
 York state taxable income or other basis of tax or New York  state  tax,
 or  based  on  a change, correction or renegotiation of tax, or based on
 the execution of a  notice  of waiver report which  is  required  there-
 under,  or  computation or recomputation of tax, which is treated in the
 same manner  as  if  it were  a deficiency for New York state income tax
 purposes; and where any such assessment has been made, or where a notice
 of deficiency has  been mailed  to the taxpayer on the basis of any such
 proposed assessment, no change of the allocation of  income  or  capital
 shall  be  made  in a proceeding  on  the taxpayer's claim for refund of
 such assessment or on the taxpayer's  petition  for  redetermination  of
 such    deficiency,  except to the extent such assessment is based on an
 increase or decrease in New York state taxable income or other basis  of
 tax or New York state tax, or based on a change or correction or renego-
 tiation  of  tax, or based on the execution of a notice of waiver report
 which is required thereunder, or computation or  recomputation  of  tax,
 S. 8474                            676
 
 which is treated in the same manner as if it were an overpayment for New
 York state income tax purposes.
   (h)  Report  concerning  waste treatment facility.   Under the circum-
 stances described in subparagraph three of paragraph (g) of  subdivision
 eight  of  section  11-602  of  this chapter or in subparagraph three of
 paragraph (g) of subdivision eight of section 11-652  of  this  chapter,
 the  tax  may  be  assessed  within  three years after the filing of the
 report containing the information required by such paragraph.
   (i) Report of changed or corrected  sales  and  compensating  use  tax
 liability.  In the case of a tax imposed under subchapter two or three-A
 of this chapter, if the taxpayer files a report  or  amended  return  or
 report  required  thereunder,  in  respect  of a change or correction of
 sales and compensating use tax liability, the assessment, if not  deemed
 to have been made upon the filing of the report, may be made at any time
 within  two  years  after  such  report  or amended return or report was
 filed. The amount of such assessment of tax shall not exceed the  amount
 of  the  increase  in  city  tax  attributable  to  such state change or
 correction. The provisions of this paragraph shall not affect  the  time
 within  which  or  the  amount  for which an assessment may otherwise be
 made.
   4. Omission of income on return.  The tax may be assessed at any  time
 within  six  years  after  the return was filed if a taxpayer omits from
 gross income required to be reported on a return under any of the  named
 subchapters  an amount properly includable therein which is in excess of
 twenty-five per centum of the amount  of  gross  income  stated  in  the
 return.
   For the purposes of this subdivision:
   (a)  the term "gross income" means gross income for federal income tax
 purposes as reportable on a return under subchapter two  or  three-A  of
 this  chapter  and  "gross  earnings",  "gross income," "gross operating
 income" and "gross direct premiums less return premiums," as those terms
 are used in whichever of the named subchapters is applicable;
   (b) there shall not be taken into account any amount which is  omitted
 in  the return if such amount is disclosed in the return, or in a state-
 ment attached to the return, in a manner adequate to apprise the commis-
 sioner of finance of the nature and amount of such item.
   5. Suspension of running of period of limitations.  The running of the
 period of limitations on  assessment  or  collection  of  tax  or  other
 amount,  or  of  a  tranferee's liability, shall, after the mailing of a
 notice of deficiency, be suspended  for  the  period  during  which  the
 commissioner of finance is prohibited under subdivision three of section
 11-672  of this subchapter from making the assessment or from collecting
 by levy.
   § 11-675  Interest on underpayment.  1. General.  If any amount of tax
 is not paid on or before the last date prescribed in  whichever  of  the
 named  subchapters is applicable for payment, interest on such amount at
 the underpayment rate set by the commissioner  of  finance  pursuant  to
 section 11-687 of this subchapter, or, if no rate is set, at the rate of
 seven  and  one-half percent per annum shall be paid for the period from
 such last date to the date paid, whether or not any  extension  of  time
 for  payment  was granted.  Interest under this subdivision shall not be
 paid if the amount thereof is less than one dollar.
   2. Exception as to estimated tax.  This section shall not apply to any
 failure to pay estimated tax under subchapter two, three or  three-A  of
 this chapter.
 S. 8474                            677
 
   3.  Exception for mathematical error.  No interest shall be imposed on
 any underpayment of tax due solely to mathematical error if the taxpayer
 files a return within the time prescribed  in  whichever  of  the  named
 subchapters is applicable, including any extension of time, and pays the
 amount  of  underpayment  within three months after the due date of such
 return, as it may be extended.
   4.  Suspension  of  interest  on  deficiencies.    If  a   waiver   of
 restrictions on assessment of a deficiency has been filed by the taxpay-
 er,  and if notice and demand by the commissioner of finance for payment
 of such deficiency is not made within thirty days after  the  filing  of
 such  waiver,  interest  shall not be imposed on such deficiency for the
 period beginning immediately after such thirtieth day  and  ending  with
 the date of notice and demand.
   5.  Tax  reduced by carryback.   If the amount of tax under subchapter
 two or three-A for any taxable year is reduced by reason of a  carryback
 of  a  net operating loss or a capital loss, such reduction in tax shall
 not affect the computation of interest under this section for the period
 ending with the filing date for the taxable year in which the net  oper-
 ating  loss or capital loss arises. Such filing date shall be determined
 without regard to extensions of time to file.
   6. Interest treated as tax.  Interest under this section shall be paid
 upon notice and demand and shall be assessed, collected and paid in  the
 same  manner as the taxes under the named subchapters.  Any reference in
 this subchapter to the tax imposed by the named subchapters, or  any  of
 them,  shall be deemed also to refer to interest imposed by this section
 on such tax.
   7. Interest on penalties or  addition  to  tax.    Interest  shall  be
 imposed  under  subdivision  one in respect to any assessable penalty or
 addition to tax only if such assessable penalty or addition  to  tax  is
 not paid within ten days from the date of the notice and demand therefor
 under  subdivision two of section 11-683 of this subchapter in such case
 interest shall be imposed only for the period  from  such  date  of  the
 notice and demand to the date of payment.
   8.  Payment  within  ten  days after notice and demand.  If notice and
 demand is made for payment  of  any  amount  under  subdivision  two  of
 section 11-683 of this subchapter, and if such amount is paid within ten
 days  after  the  date  of  such  notice and demand, interest under this
 section on the amount so paid shall not be imposed for the period  after
 the date of such notice and demand.
   9. Limitation on assessment and collection.  Interest prescribed under
 this section may be assessed and collected at any time during the period
 within  which the tax or other amount to which such interest relates may
 be assessed and collected respectively.
   10. Interest on erroneous refund.  Any portion of tax or other  amount
 which  has  been  erroneously  refunded, and which is recoverable by the
 commissioner of finance, shall bear interest at  the  underpayment  rate
 set  by  the  commissioner of finance pursuant to section 11-687 of this
 subchapter, or, if no rate is set, at the rate  of  seven  and  one-half
 percent  per  annum from the date of the payment of the refund, but only
 if it appears that any part of the refund was  induced  by  fraud  or  a
 misrepresentation of a material fact.
   11.  Satisfaction by credits.  If any portion of a tax is satisfied by
 credit of an overpayment, then no interest shall be imposed  under  this
 section  on  the  portion  of the tax so satisfied for any period during
 which, if the credit had not been made, interest would have been  allow-
 able with respect to such overpayment.
 S. 8474                            678
 
   § 11-676  Additions to tax and civil penalties. 1. (a) Failure to file
 return.  (A)    In  case  of  failure  to  file a return under the named
 subchapters on or before the prescribed date, determined with regard  to
 any  extension  of time for filing, unless it is shown that such failure
 is  due  to reasonable cause and not due to willful neglect, there shall
 be added to the amount required to be shown as tax on such  return  five
 percent  of  the  amount of such tax if the failure is for not more than
 one month, with an additional five percent for each additional month  or
 fraction  thereof  during  which  such  failure continues, not exceeding
 twenty-five percent in the aggregate.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to any extension of time for filing, unless it is shown that such  fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion  to  tax under subparagraph (A) of this paragraph shall not be less
 than the lesser of one hundred dollars or one  hundred  percent  of  the
 amount required to be shown as tax on such return.
   (C)  For  purposes of this paragraph, the amount of tax required to be
 shown on the return shall be reduced by the amount of any  part  of  the
 tax  which  is  paid on or before the date prescribed for payment of the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (b) Failure to pay tax shown on return.  In case of failure to pay the
 amounts shown as tax on any return required to be filed under the  named
 subchapters  on or before the prescribed date, determined with regard to
 any extension of time for payment, unless it is shown that such  failure
 is  due  to reasonable cause and not due to willful neglect, there shall
 be added to the amount shown as tax  on  such  return  one-half  of  one
 percent  of  the  amount of such tax if the failure is not for more than
 one month, with an additional one-half of one  percent  for  each  addi-
 tional  month  or  fraction thereof during which such failure continues,
 not exceeding twenty-five percent in the aggregate. For the  purpose  of
 computing  the  addition  for  any  month the amount of tax shown on the
 return shall be reduced by the amount of any part of the  tax  which  is
 paid  on  or before the beginning of such month and by the amount of any
 credit against the tax which may be claimed  upon  the  return.  If  the
 amount  of  tax required to be shown on a return is less than the amount
 shown as tax on such return, this paragraph shall be applied by  substi-
 tuting such lower amount.
   (c)  Failure  to  pay  tax required to be shown on return.  In case of
 failure to pay any amount in respect of any tax required to be shown  on
 a  return  required to be filed under the named subchapters which is not
 so shown, including an assessment made pursuant to  subdivision  one  of
 section  11-673  of  this  subchapter,  within ten days of the date of a
 notice and demand therefor, unless it is shown that such failure is  due
 to reasonable cause and not due to willful neglect, there shall be added
 to  the  amount  of tax stated in such notice and demand one-half of one
 percent of such tax if the failure is not for more than one month,  with
 an additional one-half of one percent for each additional month or frac-
 tion  thereof during which such failure continues, not exceeding twenty-
 five percent in the aggregate. For the purpose of computing the addition
 for any month, the amount of tax stated in the notice and  demand  shall
 be reduced by the amount of any part of the tax which is paid before the
 beginning of such month.
   (d) Limitations on additions.
 S. 8474                            679
 
   (A) With respect to any return, the amount of the addition under para-
 graph  (a)  of  this  subdivision  shall be reduced by the amount of the
 addition under paragraph (b) of this subdivision for any month to  which
 an  addition  applies  under  both paragraphs (a) and (b).   In any case
 described  in subparagraph (B) of paragraph (a) of this subdivision, the
 amount of the addition under such paragraph (a)  shall  not  be  reduced
 below the amount provided in such subparagraph.
   (B)  With  respect  to  any return, the maximum amount of the addition
 permitted under paragraph (c) of this subdivision shall  be  reduced  by
 the  amount  of  the  addition  under paragraph (a) of this subdivision,
 determined without regard to subparagraph (B)  of  such  paragraph  (a),
 which is attributable to the tax for which the notice and demand is made
 and which is not paid within ten days of such notice and demand.
   2.  Deficiency  due to negligence. (a)  If any part of a deficiency is
 due to negligence or intentional disregard of this subchapter or any  of
 the  named  subchapters  or rules or regulations thereunder, but without
 intent to defraud, there shall be added to the tax an  amount  equal  to
 five percent of the deficiency.
   (b)  There shall be added to the tax, in addition to the amount deter-
 mined under paragraph (a) of this subdivision, an amount equal to  fifty
 percent  of the interest payable under subdivision one of section 11-675
 with respect to the portion of the deficiency described  in  such  para-
 graph  (a) which is attributable to the negligence or intentional disre-
 gard referred to in such paragraph (a), for the period beginning on  the
 last  date  prescribed by law for payment of such deficiency, determined
 without regard to any extension, and ending on the date of  the  assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
   (c)  If  any payment is shown on a return made by a payor with respect
 to dividends, patronage dividends and interest under subsection  (a)  of
 section  six  thousand forty-two, subsection (a) of section six thousand
 forty-four or subsection (a) of section six thousand forty-nine  of  the
 internal  revenue code of nineteen hundred fifty-four, respectively, and
 the payee fails to include any portion of such payment in gross  income,
 as  that term is defined in paragraph (a) of subdivision four of section
 11-674, any portion of an  underpayment  attributable  to  such  failure
 shall be treated, for purposes of this subdivision, as due to negligence
 in  the absence of clear and convincing evidence to the contrary. If any
 addition to tax is imposed under  this  subdivision  by  reason  of  the
 preceding  sentence,  the amount of the addition to tax imposed by para-
 graph (a) of this subdivision shall be five percent of  the  portion  of
 the  underpayment which is attributable to the failure described in this
 paragraph.
   3. Failure to file declaration or underpayment of  estimated  tax.  If
 any taxpayer fails to file a declaration of estimated tax under subchap-
 ter  two,  three  or three-A of this chapter, or fails to pay all or any
 part of an amount which is applied as an installment against such  esti-
 mated  tax, it shall be deemed to have made an underpayment of estimated
 tax.  There shall be added to the tax for the taxable year an amount  at
 the  underpayment  rate  set  by the commissioner of finance pursuant to
 section 11-687 of this subchapter, or, if no rate is set, at the rate of
 seven and one-half percent per annum upon the amount of the underpayment
 for the period of the underpayment but not beyond the fifteenth  day  of
 the  fourth  month  following  the close of the taxable year.  Provided,
 however, that, for taxable years beginning on or  after  January  first,
 two  thousand seventeen and before January first, two thousand eighteen,
 no amount shall be added to the tax with respect to the portion of  such
 S. 8474                            680
 
 tax  related  to the amount of any interest deductions directly or indi-
 rectly attributable to the amount included in exempt CFC income pursuant
 to subparagraph (ii) of paragraph (b) of subdivision five-a  of  section
 11-652 of this chapter or the forty percent reduction of such exempt CFC
 income  in  lieu  of  interest  attribution if the election described in
 paragraph (b) of subdivision five-a of such section is made.  The amount
 of the underpayment shall be, with respect to any installment  of  esti-
 mated  tax  computed  on the basis of either the preceding year's tax or
 the second preceding year's tax, the excess of the amount required to be
 paid over the amount, if any, paid on or before the last day  prescribed
 for  such payment or, with respect to any other installment of estimated
 tax, the excess of the amount of the installment which would be required
 to be paid if the estimated tax were equal to ninety percent of the  tax
 shown  on  the  return  for the taxable year, or if no return was filed,
 ninety percent of the tax for such year, over the amount, if any, of the
 installment paid on or before the last day prescribed for such  payment.
 In  any case in which there would be no underpayment if "eighty percent"
 were substituted for "ninety percent" each  place  it  appears  in  this
 subdivision,  the  addition  to  the  tax shall be equal to seventy-five
 percent of the amount otherwise determined.   No underpayment  shall  be
 deemed  to  exist with respect to a declaration or installment otherwise
 due on or after the termination of existence of the taxpayer.
   4. Exception to addition for underpayment of estimated tax.  The addi-
 tion to tax under subdivision three of this section with respect to  any
 underpayment  of  any  amount which is applied as an installment against
 estimated tax under subchapter two, three or  three-A  of  this  chapter
 shall  not  be  imposed if the total amount of all payments of estimated
 tax made on or before the last date prescribed for the  payment  of  any
 such  amount equals or exceeds the amount which would have been required
 to be paid on or before such date if the estimated tax were whichever of
 the following is the least:
   (a) The tax shown on the return of  the  taxpayer  for  the  preceding
 taxable  year,  if a return showing a liability for tax was filed by the
 taxpayer for the preceding taxable year and such preceding  year  was  a
 taxable year of twelve months, or
   (b) An amount equal to the tax computed at the rates applicable to the
 taxable  year,  but  otherwise  on  the  basis of the facts shown on the
 return of the taxpayer for, and the law  applicable  to,  the  preceding
 taxable year, or
   (c)  (i) An amount equal to ninety per centum of the tax for the taxa-
 ble year computed by placing on an annualized basis the taxable income:
   (1) for the first three months or the first five months of the taxable
 year, in the case of the installment required to be paid  in  the  sixth
 month,
   (2)  for the first six months or the first eight months of the taxable
 year, in the case of the installment required to be paid  in  the  ninth
 month, and
   (3)  for the first nine months or the first eleven months of the taxa-
 ble year, in the case of the installment required  to  be  paid  in  the
 twelfth month.
   (ii)  For  purposes  of subparagraph (i) of this paragraph the taxable
 income shall be placed on an annualized basis by:
   (1) multiplying it by twelve, or, in the case of  a  taxable  year  of
 less than twelve months, the number of months in the taxable year, and
 S. 8474                            681
 
   (2) dividing the resulting amount by the number of months in the taxa-
 ble  year,  three, five, six, eight, nine or eleven, as the case may be,
 referred to in subparagraph (i) of this paragraph, or
   (d)  (i)  If the base period percentage for any six consecutive months
 of the taxable year equals or exceeds seventy percent, an  amount  equal
 to ninety percent of the tax determined in the following manner:
   (A)  take  the  taxable  income for all months during the taxable year
 preceding the filing month,
   (B) divide such amount by the base period percentage  for  all  months
 during the taxable year preceding the filing month,
   (C)  determine  the  tax  on the amount determined under clause (B) of
 this subparagraph, and
   (D) multiply the tax determined under clause (C) of this  subparagraph
 by the base period percentage for the filing month and all months during
 the taxable year preceding the filing month.
   (ii) For purposes of subparagraph (i) of this paragraph:
   (A)  the  base period percentage for any period of months shall be the
 average percent which the taxable income for the corresponding months in
 each of the three preceding taxable years bears to  the  taxable  income
 for  the  three preceding taxable years. The commissioner of finance may
 by regulations provide for the determination of the base period percent-
 age in the case of reorganizations, new corporations, and other  similar
 circumstances, and
   (B)  the  term "filing month" means the month in which the installment
 is required to be paid.
   5. (a) Except as provided in paragraph (b) of this subdivision,  para-
 graphs  (a)  and (b) of subdivision four of this section shall not apply
 in the case of any corporation, or any  predecessor  corporation,  which
 had entire net income, or the portion thereof allocated within the city,
 of  one  million  dollars  or more for any taxable year during the three
 taxable years immediately preceding the taxable year involved.
     (b) The amount treated as the estimated tax under paragraphs (a) and
 (b) of subdivision four of this section shall in no event be  less  than
 seventy-five percent of the tax shown on the return for the taxable year
 beginning  in  nineteen hundred eighty-three or, if no return was filed,
 seventy-five percent of the tax for such year.
   6. Deficiency due to fraud. (a)  If any part of a deficiency is due to
 fraud, there shall be added to the tax an amount equal to two times  the
 deficiency.
   (b) The addition to tax under this subdivision shall be in lieu of any
 other addition to tax imposed by subdivision one or two of this section.
   7.  Additional  penalty.   Any person who with fraudulent intent shall
 fail to pay under the named subchapters any tax,  or  to  make,  render,
 sign or certify any return or declaration of estimated tax, or to supply
 any  information  within  the time required by or under any of the named
 subchapters, shall be liable to penalty of not more  than  one  thousand
 dollars, in addition to any other amounts required under this subchapter
 to  be  imposed,  assessed and collected by the commissioner of finance.
 The commissioner of  finance  shall  have  the  power,  in  his  or  her
 discretion, to waive, reduce or compromise any penalty under this subdi-
 vision.
   8.  Additions  treated  as  tax.    The additions to tax and penalties
 provided by this section shall be paid upon notice and demand and  shall
 be  assessed,  collected  and  paid in the same manner as taxes, and any
 reference in this subchapter to tax imposed by any of the named subchap-
 ters shall be deemed also to refer to the additions to tax and penalties
 S. 8474                            682
 
 provided by this section.   For  purposes  of  section  11-672  of  this
 subchapter, this subdivision shall not apply to:
   (a)  any  addition to tax under subdivision one of this section except
 as to that portion attributable to a deficiency;
   (b) any addition to tax under subdivision three or  fourteen  of  this
 section; and
   (c)  any  additional  penalties under subdivisions seven and twelve of
 this section.
   9. Determination of deficiency.  For purposes of subdivisions two  and
 six of this section the amount shown as the tax by the taxpayer upon its
 return  shall  be  taken  into  account in determining the amount of the
 deficiency only if such return was filed  on  or  before  the  last  day
 prescribed  for the filing of such return, determined with regard to any
 extension of time for such filing.
   10. Person defined.  For purposes of subdivisions seven and twelve  of
 this  section,  the term "person" includes an individual, corporation or
 partnership or an officer or employee of any  corporation,  including  a
 dissolved  corporation,  or a member or employee of any partnership, who
 as such officer, employee, or member is under a duty to perform the  act
 in respect of which the violation occurs.
   11. Substantial understatement of liability. If there is a substantial
 understatement  of tax for any taxable year, there shall be added to the
 tax an amount equal to ten percent of the  amount  of  any  underpayment
 attributable  to  such understatement. For purposes of this subdivision,
 there is a substantial understatement of tax for any taxable year if the
 amount of the understatement for the taxable year exceeds the greater of
 ten percent of the tax required to be shown on the return for the  taxa-
 ble year or five thousand dollars. For purposes of this subdivision, the
 term "understatement" means the excess of the amount of the tax required
 to  be  shown on the return for the taxable year, over the amount of the
 tax imposed which is shown on the return, reduced by any rebate,  within
 the  meaning  of subdivision eight of section 11-672 of this subchapter.
 The amount of such understatement shall be reduced by  that  portion  of
 the  understatement  which  is  attributable to the tax treatment of any
 item by the taxpayer if there is or was substantial authority  for  such
 treatment,  or any item with respect to which the relevant facts affect-
 ing the item's tax treatment are adequately disclosed in the  return  or
 in  a  statement attached to the return. The commissioner of finance may
 waive all or any part of the addition to tax provided by  this  subdivi-
 sion  on  a  showing by the taxpayer that there was reasonable cause for
 the understatement, or part thereof, and that the taxpayer acted in good
 faith.
   12. Aiding or assisting in the giving of fraudulent returns,  reports,
 statements  or other documents. (a) Any person who, with the intent that
 tax be evaded, shall, for a fee or other compensation or as an  incident
 to  the  performance  of  other  services for which such person receives
 compensation, aid or assist in, or procure, counsel, or advise the prep-
 aration or presentation under, or in connection with any matter  arising
 under  this  chapter  of  any  return, report, declaration, statement or
 other document which is fraudulent or false as to any  material  matter,
 or  supply  any  false  or  fraudulent  information, whether or not such
 falsity or fraud is with the knowledge or consent of the person  author-
 ized  or required to present such return, report, declaration, statement
 or other document  shall  pay  a  penalty  not  exceeding  ten  thousand
 dollars.
 S. 8474                            683
 
   (b)  For  purposes  of  paragraph  (a)  of  this subdivision, the term
 "procures" includes ordering, or otherwise causing, a subordinate to  do
 an  act, and knowing of, and not attempting to prevent, participation by
 a subordinate in an act. The term "subordinate" means any other  person,
 whether  or  not a director, officer, employee, or agent of the taxpayer
 involved, over whose activities the person has  direction,  supervision,
 or control.
   (c)  For  purposes  of  paragraph  (a)  of  this subdivision, a person
 furnishing typing, reproducing,  or  other  mechanical  assistance  with
 respect  to  a document shall not be treated as having aided or assisted
 in the preparation of such document by reason of such assistance.
   (d) The penalty imposed by this subdivision shall be  in  addition  to
 any other penalty provided by law.
   13. Failure to file report of information relating to certain interest
 payments.  In case of failure to file the report of information required
 under either subdivision two-a of section  11-605  of  this  chapter  or
 subdivision  two-a of section 11-655 of this chapter, unless it is shown
 that such failure is due to reasonable cause  and  not  due  to  willful
 neglect,  there  shall  be  added  to  the tax a penalty of five hundred
 dollars.
   14. Failure to include on  return  information  relating  to  issuer's
 allocation  percentage. Where a return is filed but does not contain (1)
 the information necessary to compute the taxpayer's issuer's  allocation
 percentage,  as defined in subparagraph one of paragraph (b) of subdivi-
 sion three of section 11-604 of this chapter, where the same  is  called
 for  on  the return, or, (2) the taxpayer's issuer's allocation percent-
 age, where the same is called for on the return but  where  all  of  the
 information  necessary  for  the  computation  of such percentage is not
 called for on the return, then unless it is shown that such  failure  is
 due  to  reasonable  cause and not due to willful neglect there shall be
 added to the tax a penalty of five hundred dollars.
   15. False or fraudulent document penalty. Any taxpayer that submits  a
 false  or  fraudulent  document  to the department shall be subject to a
 penalty of one hundred dollars per document submitted, or  five  hundred
 dollars  per  tax return submitted. Such penalty shall be in addition to
 any other penalty or addition provided by law.
   § 11-677   Overpayment.   1. General.   The commissioner  of  finance,
 within  the  applicable period of limitations, may credit an overpayment
 of tax and interest on such overpayment against any liability in respect
 of any tax imposed by this title on the taxpayer who made  the  overpay-
 ment,  and the balance shall be refunded out of the proceeds of the tax.
 Such credit of an overpayment shall  be  applied before   such  overpay-
 ment, or any portion thereof, is paid to the state commissioner of taxa-
 tion  and  finance  pursuant to section one hundred seventy-one-m of the
 tax law.
   2. Credits against estimated tax.   The commissioner  of  finance  may
 prescribe  regulations providing for the crediting against the estimated
 tax under subchapter two, three or three-A of this chapter for any taxa-
 ble year of the amount determined to be an overpayment of tax under  any
 such subchapter for a preceding taxable year.  If any overpayment of tax
 is so claimed as a credit against estimated tax for the succeeding taxa-
 ble  year, such amount shall be considered as a payment of the tax under
 subchapter two, three or three-A of  this  chapter  for  the  succeeding
 taxable  year,  whether or not claimed as a credit in the declaration of
 estimated tax for such succeeding taxable year, and no claim for  credit
 S. 8474                            684
 
 or  refund of such overpayment shall be allowed for the taxable year for
 which the overpayment arises.
   3.  Rule  where  no tax liability.  If there is no tax liability for a
 period in respect of which an amount is paid as tax, such  amount  shall
 be considered an overpayment.
   4.  Assessment  and collection after limitation period.  If any amount
 of tax is assessed or collected after the expiration of  the  period  of
 limitations properly applicable thereto, such amount shall be considered
 an overpayment.
   5.  Assignment  of  overpayment.    A credit for an overpayment of tax
 under any of the named subchapters may be assigned by the taxpayer to  a
 corporation  liable to pay taxes under any of the named subchapters, and
 the assignee of the whole or any part of such  credit,  on  filing  such
 assignment with the commissioner of finance, shall thereupon be entitled
 to  credit  upon the books of the commissioner of finance for the amount
 thereof on its current account for taxes, in the same manner and to  the
 same  effect  as  though  the  credit had originally been allowed in its
 favor.
   6. Notwithstanding article fifty-two of the  civil  practice  law  and
 rules  or any other provision of law to the contrary, the procedures for
 the enforcement of money judgments shall not apply to the department  of
 finance, or to any officer or employee of such department, as a garnish-
 ee,  with respect to any amount of money to be refunded or credited to a
 taxpayer under this chapter.
   § 11-678  Limitations on credit or refund.  1.   General.   Claim  for
 credit  or  refund  of  an  overpayment  of  tax  under any of the named
 subchapters shall be filed by the taxpayer within three years  from  the
 time  the  return was filed or two years from the time the tax was paid,
 whichever of such periods expires the later, or if no return  was  filed
 within  two years from the time the tax was paid.  If the claim is filed
 within the three year period, the amount of the credit or  refund  shall
 not exceed the portion of the tax paid within the three years immediate-
 ly preceding the filing of the claim plus the period of any extension of
 time  for filing the return.  If the claim is not filed within the three
 year period, but is filed within the two year period, the amount of  the
 credit or refund shall not exceed the portion of the tax paid during the
 two  years  immediately  preceding  the filing of the claim.   Except as
 otherwise provided in this section, if no claim is filed, the amount  of
 a  credit or refund shall not exceed the amount which would be allowable
 if a claim had been filed on the date the credit or refund  is  allowed.
 For  special  restriction  in  a proceeding on a claim for refund of tax
 paid pursuant to an assessment made as a result of: (a) a net  operating
 loss  carryback,  or  (b) an increase or decrease in federal or New York
 state taxable income or other basis of tax or federal or New York  state
 tax,  or (c) a federal or New York state change or correction or renego-
 tiation, or computation or recomputation of tax, which is treated in the
 same manner as if it were a deficiency for federal  or  New  York  state
 income  tax  purposes, see paragraph (g) of subdivision three of section
 11-674 of this subchapter.
   2. Extension of time  by  agreement.    If  any  agreement  under  the
 provisions  of  paragraph  (b) of subdivision three of section 11-674 of
 this subchapter, extending the period of  assessment  of  tax,  is  made
 within  the period prescribed in subdivision one of this section for the
 filing of a claim for credit or refund, the period for  filing  a  claim
 for  credit  or  refund,  or  for making credit or refund if no claim is
 filed, shall not expire prior to six months after the expiration of  the
 S. 8474                            685
 
 period  within which an assessment may be made pursuant to the agreement
 or any extension thereof.  The amount of such credit or refund shall not
 exceed the portion of the tax paid after the execution of the  agreement
 and  before  the  filing  of  the  claim  or the making of the credit or
 refund, as the case may be, plus the portion of the tax paid within  the
 period  which  would  be applicable under subdivision one if a claim had
 been filed on the date the agreement was executed.
   3. Notice of change or correction of federal or New York state  income
 or  other  basis  of tax.   If a taxpayer is required by subchapter two,
 three or three-A of this chapter to file a report or amended  return  in
 respect of (a) a decrease or increase in federal or New York state taxa-
 ble  income, alternative minimum taxable income or other basis of tax or
 federal or New York state tax, (b) a federal or New York state change or
 correction or renegotiation, or computation  or  recomputation  of  tax,
 which  is  treated  in  the same manner as if it were an overpayment for
 federal or New York state income  tax  purposes,  claim  for  credit  or
 refund of any resulting overpayment of tax shall be filed by the taxpay-
 er  within  two  years  from  the time such report or amended return was
 required to be filed with the commissioner of finance.  If the report or
 amended return required by subchapter two,  three  or  three-A  of  this
 chapter  is not filed within the ninety day period therein specified, no
 interest shall be payable on any claim for credit or refund of the over-
 payment attributable  to  the  federal  or  New  York  state  change  or
 correction.  The  amount  of  such credit or refund:  (c) shall, (i) for
 taxable years beginning before January first, two thousand  fifteen,  be
 computed  without  change  of  the  allocation of income or capital upon
 which the taxpayer's return, or any additional  assessment,  was  based,
 and,  (ii)  for  taxable  years beginning on or after January first, two
 thousand fifteen, be computed without  change  of  the  allocation    of
 income   or  capital upon which the taxpayer's return, or any additional
 assessment, was based to the extent that the  claim  for  refund  arises
 from  a decrease or increase in federal taxable  income  or  other basis
 of tax or federal tax, or from a federal change,  correction,  renegoti-
 ation,    computation  or  recomputation of tax, which is treated in the
 same manner as  if  it  were  an  overpayment  for  federal  income  tax
 purposes,  and  (d)  shall not exceed the amount of the reduction in tax
 attributable to such decrease or increase in federal or New  York  state
 taxable income, alternative minimum taxable income or other basis of tax
 or  federal  or  New York state tax or to such federal or New York state
 change or correction or renegotiation, or computation  or  recomputation
 of tax.
   This  subdivision shall not affect the time within which or the amount
 for which a claim for credit or refund may  be  filed  apart  from  this
 subdivision.
   4. Overpayment attributable to net operating loss carryback or capital
 loss  carryback.  A claim for credit or refund of so much of an overpay-
 ment under subchapter two or three-A of this chapter as is  attributable
 to  the application to the taxpayer of a net operating loss carryback or
 a capital loss carryback shall be filed within three years from the time
 the return was due, including extensions thereof, for the  taxable  year
 of  the loss, or within the period prescribed in subdivision two of this
 section in respect of such taxable year, or within the period prescribed
 in subdivision three of this section, where applicable,  in  respect  to
 the  taxable  year  to  which  the net operating loss or capital loss is
 carried back, whichever expires the latest.  Where such claim for credit
 or refund is filed after the expiration  of  the  period  prescribed  in
 S. 8474                            686
 
 subdivision  one or in subdivision two of this section where applicable,
 in respect to the taxable year  to  which  the  net  operating  loss  is
 carried  back,  the  amount  of  such credit or refund shall be computed
 without  change  of  the  allocation of income or capital upon which the
 taxpayer's return, or any additional assessment, was based.
   5. Failure to file claim within  prescribed  period.    No  credit  or
 refund  shall  be allowed or made, except as provided in subdivision six
 of this section or subdivision four of section 11-681 of  this  subchap-
 ter,  after the expiration of the applicable period of limitation speci-
 fied in this subchapter, unless a claim for credit or refund is filed by
 the taxpayer within such period.  Any later credit   shall be  void  and
 any  later  refund erroneous.  No period of limitations specified in any
 other law shall apply to the recovery by a taxpayer of  moneys  paid  in
 respect of taxes under the named subchapters.
   6.  Effect of a petition to tax appeals tribunal. If a notice of defi-
 ciency for a taxable year has been mailed to the taxpayer under  section
 11-672  of  this  subchapter and if the taxpayer files a timely petition
 with the tax appeals tribunal under section 11-680 of  this  subchapter,
 the  tax  appeals  tribunal  may determine that the taxpayer has made an
 overpayment for such year, whether or not it also determines a deficien-
 cy for such year. No separate claim for credit or refund for  such  year
 shall  be  filed, and no credit or refund for such year shall be allowed
 or made, except:
   (a) as to overpayment determined by a  decision  of  the  tax  appeals
 tribunal which has become final; and
   (b)  as  to  any  amount  collected in excess of an amount computed in
 accordance with the decision of  the  tax  appeals  tribunal  which  has
 become final; and
   (c) as to any amount collected after the period of limitation upon the
 making of levy for collection has expired; and
   (d)  as  to  any  amount claimed as a result of a change or correction
 described in subdivision three of this section.
   7. Limit on amount of credit or  refund.  The  amount  of  overpayment
 determined  under  subdivision six of this section shall, when the deci-
 sion of the tax appeals  tribunal  has  become  final,  be  credited  or
 refunded  in  accordance  with subdivision one of section 11-677 of this
 subchapter and shall not exceed the amount of tax which the tax  appeals
 tribunal determines as part of its decision was paid:
   (a) after the mailing of the notice of deficiency, or
   (b) within the period which would be applicable under subdivision one,
 two  or  three  of  this  section,  if on the date of the mailing of the
 notice of deficiency a claim had been filed, whether or not filed, stat-
 ing the ground upon which the tax appeals tribunal finds that  there  is
 an overpayment.
   For special restriction on credit or refund in a proceeding on a peti-
 tion  for redetermination of a deficiency where the notice of deficiency
 is issued as a result of (i) a net operating loss carryback, or (ii)  an
 increase  or  decrease  in  federal  or New York state taxable income or
 other basis of tax or federal or New York state tax, or (iii) a  federal
 or  New York state change or correction or renegotiation, or computation
 or recomputation of tax, which is treated in the same manner  as  if  it
 were a deficiency for federal or New York state income tax purposes, see
 paragraph (g) of subdivision three of section 11-674 of this subchapter.
   8.  Early  return.    For  purposes  of this section, any return filed
 before the last day prescribed for the filing thereof shall  be  consid-
 S. 8474                            687
 
 ered  as filed on such last day, determined without regard to any exten-
 sion of time granted the taxpayer.
   9.  Prepaid  tax.    For purposes of this section, any tax paid by the
 taxpayer before the last day prescribed for its payment,  including  any
 amount  paid  by the taxpayer as estimated tax for a taxable year, shall
 be deemed to have been paid by it on the  fifteenth  day  of  the  third
 month following the close of the taxable year the income of which is the
 basis for tax under subchapter two, three or three-A of this chapter, or
 on the last day prescribed in part one of subchapter three or subchapter
 four  of  this chapter for the filing of a final return for such taxable
 year, or portion thereof, determined in all cases without regard to  any
 extension of time granted the taxpayer.
   10.  Cross  reference.    For  provision barring refund of overpayment
 credited against tax of  a  succeeding  year,  see  subdivision  two  of
 section 11-677 of this subchapter.
   11.  Notice  of change or correction of sales and compensating use tax
 liability. (a) If a taxpayer is required by subchapter two or three-A of
 this chapter to file a report or amended return in respect of  a  change
 or correction of its sales and compensating use tax liability, claim for
 credit  or  refund of any resulting overpayment of tax shall be filed by
 the taxpayer within two years from  the  time  such  report  or  amended
 return  was  required  to be filed with the commissioner of finance. The
 amount of such credit or refund shall be computed without change of  the
 allocation of income or capital upon which the taxpayer's return, or any
 additional assessment, was based, and shall not exceed the amount of the
 reduction  in tax attributable to such change or correction of sales and
 compensating use tax liability.
   (b) This subdivision shall not affect the time  within  which  or  the
 amount  for  which  a claim for credit or refund may be filed apart from
 this subdivision.
   § 11-679  Interest on overpayment.  1.  General.  Notwithstanding  the
 provisions  of  section  three-a  of the general municipal law, interest
 shall be allowed and paid as follows at the overpayment rate set by  the
 commissioner  of  finance pursuant to section 11-687 of this subchapter,
 or, if no rate is set, at the rate of six percent  per  annum  upon  any
 overpayment  in  respect to the tax imposed by any of the named subchap-
 ters:
   (a) from the date of the overpayment to the  due  date  of  an  amount
 against which a credit is taken;
   (b)  from  the  date of the overpayment to a date, to be determined by
 the commissioner of finance, preceding the date of a refund check by not
 more than thirty days, whether or not such refund check is  accepted  by
 the taxpayer after tender of such check to the taxpayer.  The acceptance
 of such check shall be without prejudice to any right of the taxpayer to
 claim any additional overpayment and interest thereon.
   (c)  Late  and  amended  returns  and  claims  for  credit  or refund.
 Notwithstanding paragraph (a) or (b) of this subdivision, in the case of
 an overpayment claimed on a return of tax which is filed after the  last
 date prescribed for filing such return, determined with regard to exten-
 sions,  or claimed on an amended return of tax or claimed on a claim for
 credit or refund, no interest shall be  allowed  or  paid  for  any  day
 before the date on which such return or claim is filed.
   (d)  Interest  on certain refunds. To the extent provided for in regu-
 lations promulgated by the  commissioner  of  finance,  if  an  item  of
 income, gain, loss, deduction or credit is changed from the taxable year
 or period in which it is reported to the taxable year or period in which
 S. 8474                            688
 
 it  belongs  and the change results in an underpayment in a taxable year
 or period and an overpayment in some other taxable year or  period,  the
 provisions of paragraph (c) of this subdivision with respect to an over-
 payment  shall  not  be  applicable to the extent that the limitation in
 such paragraph on the right to interest would result in a  taxpayer  not
 being  allowed interest for a length of time with respect to an overpay-
 ment while being required to pay interest on an equivalent amount of the
 related underpayment.  However, this paragraph shall be not construed as
 limiting or mitigating the effect of any statute of limitations  or  any
 other provision of law relating to the authority of such commissioner to
 issue  a notice of deficiency or to allow a credit or refund of an over-
 payment.
   (e) Amounts of less than one dollar. No interest shall be  allowed  or
 paid if the amount thereof is less than one dollar.
   2. Advance payment of tax and estimated tax.  The provisions of subdi-
 visions  eight  and nine of section 11-678 of this subchapter applicable
 in determining the date of payment of tax for  purposes  of  determining
 the  period  of  limitations on credit or refund, shall be applicable in
 determining the date of payment for purposes of this section.
   3. Tax refund within three months of claim for overpayment.    If  any
 overpayment  of  tax imposed by any of the named subchapters is credited
 or refunded within three months  after  the  last  date  prescribed,  or
 permitted  by  extension  of  time, for filing the return of such tax on
 which such overpayment was claimed or within  three  months  after  such
 return  was  filed,  whichever is later, or within three months after an
 amended return was filed  claiming  such  overpayment  or  within  three
 months  after a claim for credit or refund was filed on which such over-
 payment was claimed, no interest shall be allowed under this section  on
 any  such  overpayment.  For  purposes  of this subdivision, any amended
 return or  claim  for  credit  or  refund  filed  before  the  last  day
 prescribed,  or  permitted  by  extension of time, for the filing of the
 return of tax for such year or period shall be considered  as  filed  on
 such last day.
   4.  Refund  of tax caused by carryback.  For purposes of this section,
 if any overpayment of tax imposed by subchapter two or three-A  of  this
 chapter  results from a carryback of a net operating loss or a net capi-
 tal loss, such overpayment shall be deemed not to have been  made  prior
 to the filing date for the taxable year in which such net operating loss
 or net capital loss arises. Such filing date shall be determined without
 regard  to extensions of time to file. For purposes of subdivision three
 of this section any overpayment described herein shall be treated as  an
 overpayment for the loss year and such subdivision shall be applied with
 respect  to such overpayment by treating the return for the loss year as
 not filed before claim for such overpayment is  filed.  The  term  "loss
 year" means the taxable year in which such loss arises.
   5. No interest until return in processible form.
   (a)  For  purposes  of  subdivisions  one and three of this section, a
 return shall not be treated as filed until it is  filed  in  processible
 form.
   (b)  For purposes of paragraph (a) of this subdivision, a return is in
 a processible form if:
   (A) such return is filed on a permitted form, and
   (B) such return contains:
   (i) the taxpayer's name;  address,  and  identifying  number  and  the
 required signatures, and
 S. 8474                            689
 
   (ii)  sufficient  required  information,  whether  on the return or on
 required attachments, to permit the  mathematical  verification  of  tax
 liability shown on the return.
   6.  Cross  reference.    For  provision with respect to interest after
 failure to file a  report  of  federal  or  New  York  state  change  or
 correction or amended return under subchapter two, three or three-A, see
 subdivision three of section 11-678 of this subchapter.
   §  11-680  Petition to tax appeals tribunal. 1. General. The form of a
 petition to the tax appeals tribunal, and further proceedings before the
 tax appeals tribunal in any case initiated by the filing of a  petition,
 shall  be  governed  by  such  rules  as  the tax appeals tribunal shall
 prescribe. No petition shall be denied  in  whole  or  in  part  without
 opportunity  for  a hearing on reasonable prior notice. Such hearing and
 any appeal to the tribunal sitting en banc from the decision rendered in
 such hearing shall be  conducted  in  the  manner  and  subject  to  the
 requirements prescribed by the tax appeals tribunal pursuant to sections
 one  hundred  sixty-eight through one hundred seventy-two of the charter
 of the preceding municipality as  it  existed  January  first,  nineteen
 hundred  ninety-four.  A  decision  of the tax appeals tribunal shall be
 rendered, and notice thereof shall be given, in the manner  provided  by
 section  one hundred seventy-one of the charter of the preceding munici-
 pality as it existed January first, nineteen hundred ninety-four.
   2. Petition for redetermination of a deficiency. Within  ninety  days,
 or one hundred fifty days if the notice is addressed to a taxpayer whose
 last known address is outside of the United States, after the mailing of
 the  notice  of deficiency authorized by section 11-672 of this subchap-
 ter, or if the commissioner of finance has  established  a  conciliation
 procedure  pursuant to section 11-124 of this title and the taxpayer has
 requested a conciliation conference in accordance therewith, after nine-
 ty days from the mailing of the conciliation decision or the date of the
 commissioner's confirmation of the discontinuance  of  the  conciliation
 proceeding, the taxpayer may file a petition with the tax appeals tribu-
 nal for redetermination of the deficiency. Such petition may also assert
 a  claim  for  refund for the same taxable year or years, subject to the
 limitations of subdivision seven of section 11-678 of  this  subchapter.
 For  special  restriction  where  the  notice of deficiency relates to a
 proposed assessment made as a result of: (a) a net operating loss carry-
 back or a capital loss carryback, (b) an increase or decrease in federal
 or New York state taxable income or other basis of tax or federal or New
 York state tax, or (c) a federal or New York state change or  correction
 or  renegotiation,  or  computation  or  recomputation  of tax, which is
 treated in the same manner as if it were a deficiency for federal or New
 York state income tax purposes, see paragraph (g) of  subdivision  three
 of section 11-674 of this subchapter.
   3.  Petition  for  refund. A taxpayer may file a petition with the tax
 appeals tribunal for the amounts asserted in a claim for refund if:
   (a) the taxpayer has filed a timely claim for refund with the  commis-
 sioner of finance,
   (b)  the taxpayer has not previously filed with the tax appeals tribu-
 nal a timely petition under subdivision two of this section for the same
 taxable year unless the petition under this  subdivision  relates  to  a
 separate claim for credit or refund properly filed under subdivision six
 of section 11-678 of this subchapter, and
   (c)  either: (1) six months have expired since the claim was filed, or
 (2) the commissioner of finance has mailed to the  taxpayer,  by  regis-
 S. 8474                            690
 
 tered or certified mail, a notice of disallowance of such claim in whole
 or in part.
   No  petition under this subdivision shall be filed more than two years
 after the date of mailing of a notice of disallowance, unless  prior  to
 the  expiration  of such two year period it has been extended by written
 agreement between the taxpayer and the commissioner  of  finance.  If  a
 taxpayer  files a written waiver of the requirement that the taxpayer be
 mailed a notice of disallowance, the two year period prescribed by  this
 subdivision  for  filing  a  petition for refund shall begin on the date
 such waiver is filed.
   (d) If the commissioner of  finance  has  established  a  conciliation
 procedure  pursuant to section 11-124 of this title, a taxpayer which is
 eligible to file a petition for refund with  the  tax  appeals  tribunal
 pursuant to this subdivision may request a conciliation conference prior
 to  filing  such  petition, provided the request is made within the time
 prescribed for filing the petition.  Notwithstanding  anything  in  this
 subdivision  to  the  contrary,  if the taxpayer has requested a concil-
 iation conference in accordance with the procedure established  pursuant
 to  section  11-124 of this title, a petition for refund may be filed no
 later than ninety days from the mailing of the conciliation decision  or
 the date of the commissioner's confirmation of the discontinuance of the
 conciliation proceeding.
   4. Assertion of deficiency after filing petition.
   (a)  Petition  for  redetermination of deficiency. If a taxpayer files
 with the tax appeals tribunal a petition for redetermination of a  defi-
 ciency, the tax appeals tribunal shall have power to determine a greater
 deficiency than asserted in the notice of deficiency and to determine if
 there  should  be  assessed  any  addition to tax or penalty provided in
 section 11-676 of this subchapter, if claim therefor is asserted  at  or
 before the hearing under rules of the tax appeals tribunal.
   (b)  Petition  for  refund. If the taxpayer files with the tax appeals
 tribunal a petition for credit or refund for a  taxable  year,  the  tax
 appeals tribunal may:
   (1) determine a deficiency for such year as to any amount of deficien-
 cy  asserted  at  or  before  the hearing under rules of the tax appeals
 tribunal and within the period in which an assessment  would  be  timely
 under section 11-674 of this subchapter, or
   (2) deny so much of the amount for which credit or refund is sought in
 the  petition, as is offset by other issues pertaining to the same taxa-
 ble year which are asserted at or before the hearing under rules of  the
 tax appeals tribunal.
   (c)  Opportunity  to  respond.  A taxpayer shall be given a reasonable
 opportunity to respond to any matters asserted by  the  commissioner  of
 finance under this subdivision.
   (d)  Restriction  on  further  notices  of deficiency. If the taxpayer
 files a petition with the tax appeals tribunal under  this  section,  no
 notice  of deficiency under section 11-672 of this subchapter may there-
 after be issued by the commissioner of  finance  for  the  same  taxable
 year, except in case of fraud or with respect to an increase or decrease
 in federal or New York state taxable income, alternative minimum taxable
 income  or  other  basis  of  tax  or federal or New York state tax or a
 federal or New York state change  or  correction  or  renegotiation,  or
 computation or recomputation of tax, which is treated in the same manner
 as  if  it  were  a  deficiency for federal or New York state income tax
 purposes, required to be reported under subchapter two, three or three-A
 of this chapter or with respect to a state change or correction of sales
 S. 8474                            691
 
 and compensating  use  tax  liability  required  to  be  reported  under
 subchapter two or three-A of this chapter.
   5.  Burden of proof. In any case before the tax appeals tribunal under
 this subchapter, the burden of proof shall be upon the petitioner except
 for the following issues, as to which the burden of proof shall be  upon
 the commissioner of finance:
   (a)  whether  the  petitioner  has been guilty of fraud with intent to
 evade tax;
   (b) whether the petitioner is liable as the transferee of property  of
 a taxpayer, but not to show that the taxpayer was liable for the tax;
   (c)  whether the petitioner is liable for any increase in a deficiency
 where such increase is asserted initially after a notice  of  deficiency
 was mailed and a petition under this section filed, unless such increase
 in deficiency is the result of an increase or decrease in federal or New
 York  state  taxable income, alternative minimum taxable income or other
 basis of tax or federal or New York state tax or a federal or  New  York
 state  change or correction or renegotiation, or computation or recompu-
 tation of tax, which is treated in the same manner as if it were a defi-
 ciency for federal or New York state income tax purposes, required to be
 reported under subchapter two, three or three-A of this chapter, and  of
 which  increase,  decrease,  change  or  correction or renegotiation, or
 computation or recomputation, the commissioner of finance had no  notice
 at  the  time  he  or she mailed the notice of deficiency or unless such
 increase in deficiency is the result of a change or correction of  sales
 and  compensating  use  tax  liability  required  to  be  reported under
 subchapter two or three-A of  this  chapter,  and  of  which  change  or
 correction  the  commissioner of finance had no notice at the time he or
 she mailed the notice of deficiency; and
   (d) whether any person is  liable  for  a  penalty  under  subdivision
 twelve of section 11-676 of this subchapter.
   6.  Evidence  of related federal or state determination. Evidence of a
 federal or state determination relating  to  issues  raised  in  a  case
 before  the tax appeals tribunal under this section shall be admissible,
 under rules established by the tax appeals tribunal.
   7. Jurisdiction over other  years.  The  tax  appeals  tribunal  shall
 consider such facts with relation to the taxes for other years as may be
 necessary correctly to determine the tax for the taxable year, but in so
 doing shall have no jurisdiction to determine whether or not the tax for
 any other year has been overpaid or underpaid.
   §  11-681  Review  of  tax  appeals tribunal's decision. 1. General. A
 decision of the tax appeals tribunal sitting en banc shall be subject to
 judicial review at the instance of any taxpayer affected thereby in  the
 manner  provided  by law for the review of a final decision or action of
 administrative agencies of the city. An application by  a  taxpayer  for
 such review must be made within four months after notice of the decision
 is sent by certified mail, return receipt requested, to the taxpayer and
 the commissioner of finance.
   2.  Judicial  review exclusive remedy. The review of a decision of the
 tax appeals tribunal provided by this section  shall  be  the  exclusive
 remedy  available  to any taxpayer for the judicial determination of the
 liability of the taxpayer for the taxes imposed by  the  named  subchap-
 ters.
   3.  Assessment  pending  review;  review  bond.  Irrespective  of  any
 restrictions on the  assessment  and  collection  of  deficiencies,  the
 commissioner  of  finance  may assess a deficiency determined by the tax
 appeals tribunal in a decision rendered pursuant to section one  hundred
 S. 8474                            692
 
 seventy-one  of  the charter of the preceding municipality as it existed
 January first, nineteen hundred ninety-four after the expiration of  the
 period specified in subdivision one, notwithstanding that an application
 for  judicial review in respect of such deficiency has been duly made by
 the taxpayer unless the taxpayer, at or before the time  the  taxpayer's
 application  for  review is made, has paid the deficiency, has deposited
 with the commissioner of finance the amount of the  deficiency,  or  has
 filed  with  the commissioner of finance a bond, which may be a jeopardy
 bond under subdivision eight of section 11-685 of  this  subchapter,  in
 the  amount  of  the  portion  of the deficiency, including interest and
 other amounts, in respect of which the application for  review  is  made
 and  all  costs and charges which may accrue against the taxpayer in the
 prosecution of the proceeding, including costs of all appeals, and  with
 surety  approved  by a justice of the supreme court of the state, condi-
 tioned upon the payment of the deficiency, including interest and  other
 amounts,  as  finally  determined  and such costs and charges.  If, as a
 result of a waiver of the restrictions on the assessment and  collection
 of  a  deficiency,  any part of the amount determined by the tax appeals
 tribunal is paid after the filing of the review bond, such  bond  shall,
 at the request of the taxpayer, be proportionately reduced.
   4.  Credit, refund or abatement after review. If the amount of a defi-
 ciency determined by the tax appeals tribunal is disallowed in whole  or
 in  part by the court of review, the amount so disallowed shall be cred-
 ited or refunded to the taxpayer, without the making of claim  therefor,
 or, if payment has not been made, shall be abated.
   5.  Date  of  finality of tax appeals tribunal decision. A decision of
 the tax appeals tribunal shall become final upon the expiration  of  the
 period specified in subdivision one of this section for making an appli-
 cation for review, if no such application has been duly made within such
 time,  or if such application has been duly made, upon expiration of the
 time for all further judicial review, or upon the rendering by  the  tax
 appeals  tribunal  of  a  decision in accordance with the mandate of the
 court on review provided, however, for the purpose of making an applica-
 tion for review, the decision of  the  tax  appeals  tribunal  shall  be
 deemed  final  on  the  date the notice of decision is sent by certified
 mail to the taxpayer and the commissioner of finance.
   § 11-682 Mailing rules; holidays; miscellaneous.   1. Timely  mailing.
 (a)  If  any  return,  declaration  of  estimated tax, claim, statement,
 notice, petition, or other document required to be filed, or any payment
 required to be made, within a  prescribed  period  or  on  or  before  a
 prescribed  date  under authority of any provision of this subchapter or
 of the named subchapters is, after such period or such  date,  delivered
 by United States mail to the commissioner of finance, tax appeals tribu-
 nal,  bureau,  office,  officer  or  person with which or with whom such
 document is required to be filed, or to which or to whom such payment is
 required to be made, the date of the United States postmark  stamped  on
 the  envelope  shall be deemed to be the date of delivery. This subdivi-
 sion shall apply only if the postmark date falls within  the  prescribed
 period  or on or before the prescribed date for the filing of such docu-
 ment, or for making the payment, including  any  extension  granted  for
 such  filing or payment, and only if such document or payment was depos-
 ited in the mail, postage prepaid, properly addressed to the commission-
 er of finance, tax appeals tribunal, bureau, office, officer  or  person
 with which or with whom the document is required to be filed or to which
 or  to whom such payment is required to be made. If any document is sent
 by United States registered mail, such registration shall be prima facie
 S. 8474                            693
 
 evidence that  such  document  was  delivered  to  the  commissioner  of
 finance,  tax  appeals  tribunal,  bureau,  office, officer or person to
 which or to whom addressed. To  the  extent  that  the  commissioner  of
 finance  or, where relevant, the tax appeals tribunal shall prescribe by
 regulation, certified mail may be used in lieu of registered mail  under
 this  subdivision.  Except as provided in paragraph (b) of this subdivi-
 sion, this subdivision shall apply in the case of postmarks not made  by
 the  United  States postal service only if and to the extent provided by
 regulations of the commissioner of finance or, where relevant,  the  tax
 appeals tribunal.
   (b)  (i)  Any  reference  in  paragraph (a) of this subdivision to the
 United States mail shall be treated as  including  a  reference  to  any
 delivery  service  designated  by  the  secretary of the treasury of the
 United States pursuant to section seventy-five hundred two of the inter-
 nal revenue code and any reference in paragraph (a) of this  subdivision
 to a United States postmark shall be treated as including a reference to
 any  date recorded or marked in the manner described in section seventy-
 five hundred two of the internal revenue code by a  designated  delivery
 service.  If the commissioner of finance finds that any delivery service
 designated by such secretary is inadequate for the needs  of  the  city,
 the  commissioner  may  withdraw  such  designation for purposes of this
 title. The commissioner may also designate additional delivery  services
 meeting the criteria of section seventy-five hundred two of the internal
 revenue code for purposes of this title, or may withdraw any such desig-
 nation  if  the commissioner of finance finds that a delivery service so
 designated is inadequate for the needs of the  city.  Any  reference  in
 paragraph  (a)  of  this  subdivision to the United States mail shall be
 treated as including a reference to any delivery service  designated  by
 the  commissioner  of finance and any reference in paragraph (a) of this
 subdivision to a United States postmark shall be treated as including  a
 reference  to  any  date  recorded  or marked in the manner described in
 section seventy-five hundred two of  the  internal  revenue  code  by  a
 delivery  service  designated  by the commissioner of finance, provided,
 however, any withdrawal of designation or additional designation by  the
 commissioner  of  finance shall not be effective for purposes of service
 upon the tax appeals tribunal,  unless  and  until  such  withdrawal  of
 designation  or  additional  designation is ratified by the president of
 the tax appeals tribunal.
   (ii) Any equivalent of registered or certified mail designated by  the
 United  States secretary of the treasury, or as may be designated by the
 commissioner of finance pursuant to  the  same  criteria  used  by  such
 secretary for such designations pursuant to section seventy-five hundred
 two  of  the internal revenue code, shall be included within the meaning
 of registered or certified mail as used in paragraph (a) of this  subdi-
 vision.  If  the  commissioner  of  finance finds that any equivalent of
 registered or certified mail designated by such secretary or the commis-
 sioner of finance is inadequate for the needs of the city,  the  commis-
 sioner  of  finance  may  withdraw such designation for purposes of this
 title, provided, however, any withdrawal of  designation  or  additional
 designation  by  the  commissioner of finance shall not be effective for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal of designation or additional designation is ratified  by  the
 president of the tax appeals tribunal.
   2.  Last known address.  For purposes of this subchapter, a taxpayer's
 last known address shall be the address given in the last  return  filed
 S. 8474                            694
 
 by  it,  unless  subsequently  to the filing of such return the taxpayer
 shall have notified the commissioner of finance of a change of address.
   3.  Last  day  a  Saturday, Sunday or legal holiday. When the last day
 prescribed under authority of this subchapter or the named  subchapters,
 including  any  extension  of  time,  for  performing any act falls on a
 Saturday, Sunday, or legal holiday in the state, the performance of such
 act shall be considered timely if it is performed on the next succeeding
 day which is not a Saturday, Sunday or legal holiday.
   4. Certificate; unfiled return. For purposes of  this  subchapter  and
 sections  one hundred sixty-eight through one hundred seventy-two of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four, the certificate of the commissioner of finance
 to the effect that a tax has not been paid, that a return or declaration
 of estimated tax has not been filed, or that information  has  not  been
 supplied,  as required by or under the provisions of this chapter, shall
 be prima facie evidence that such tax  has  not  been  paid,  that  such
 return  or  declaration has not been filed, or that such information has
 not been supplied.
   § 11-683  Collection, levy and liens.  1. Collection procedures.   The
 taxes imposed by the named subchapters shall be collected by the commis-
 sioner of finance, and he or she may establish the mode or time for  the
 collection  of  any  amount  due  him or her thereunder if not otherwise
 specified.   The commissioner of finance shall,  upon  request,  give  a
 receipt  for  any sum collected thereunder.  The commissioner of finance
 may authorize banks or trust companies which are depositaries or  finan-
 cial  agents  of  the  city  to  receive  and give a receipt for any tax
 imposed under the named subchapters in such manner, at such  times,  and
 under  such conditions as the commissioner of finance may prescribe; and
 the commissioner of finance shall prescribe the manner, times and condi-
 tions under which the receipt of such tax by such banks and trust compa-
 nies is to be treated as payment of such  tax  to  the  commissioner  of
 finance.
   2.  Notice  and  demand for tax.  The commissioner of finance shall as
 soon as practicable give notice to each taxpayer liable for  any  amount
 of  tax,  addition  to tax, penalty or interest, which has been assessed
 but remains unpaid, stating the amount and  demanding  payment  thereof.
 Such notice shall be left at the principal office of the taxpayer in the
 city  or  shall  be  sent by mail to such taxpayer's last known address.
 Except where the commissioner  of  finance  determines  that  collection
 would  be jeopardized by delay, if any tax is assessed prior to the last
 date, including any date fixed by extension, prescribed for  payment  of
 such  tax,  payment  of  such tax shall not be demanded until after such
 date.
   3. Issuance of warrant after notice and demand.  If any corporation or
 other person liable under the named subchapters for the payment  of  any
 tax, addition to tax, penalty or interest neglects or refuses to pay the
 same  within  ten days after notice and demand therefor is given to such
 corporation or other person under subdivision two of this  section,  the
 commissioner  of  finance  may  within  six years after the date of such
 assessment issue a warrant directed to the sheriff of any county of  the
 state,  or  to  any  officer  or  employee of the department of finance,
 commanding  him or her to levy upon and sell the real and personal prop-
 erty of such corporation or other person for the payment of  the  amount
 assessed,  with  the  cost  of executing the warrant, and to return such
 warrant to the commissioner of finance, and pay to the commissioner  the
 money collected by virtue thereof within sixty days after the receipt of
 S. 8474                            695

 the warrant.  If the commissioner of finance finds that  the  collection
 of the tax or other amount is in jeopardy, notice and demand for immedi-
 ate  payment  of such tax may be made by the commissioner of finance and
 upon failure or refusal to pay such tax or other amount the commissioner
 of  finance  may  issue  a  warrant without regard to the ten-day period
 provided in this subdivision.
   4. Copy of warrant to be filed and lien to be created.  Any sheriff or
 officer or employee who receives a warrant under  subdivision  three  of
 this  section  shall  within  five  days thereafter file a copy with the
 clerk of the appropriate county.  The clerk shall thereupon enter in the
 judgment docket, in the column for judgment debtors,  the  name  of  the
 taxpayer mentioned in the warrant, and in appropriate columns the tax or
 other  amounts  for  which  the warrant is issued and the date when such
 copy is filed; and such amount shall thereupon be a  binding  lien  upon
 the real, personal and other property of the taxpayer.
   5.  Judgment.  When a warrant has been filed with the county clerk the
 commissioner of finance shall, on behalf of the city, be deemed to  have
 obtained judgment against the taxpayer for the tax or other amounts.
   6.  Execution.    The  sheriff  or officer or employee shall thereupon
 proceed upon the judgment in all respects, with like effect, and in  the
 same  manner  prescribed  by law in respect to executions issued against
 property upon judgments of a court of record, and  a  sheriff  shall  be
 entitled  to  the  same  fees  for  his or her services in executing the
 warrant, to be collected in the same manner.  An officer or employee  of
 the  department of finance may proceed in any county or counties of this
 state and shall have all the powers of execution conferred by  law  upon
 sheriffs,  but  shall be entitled to no fee or compensation in excess of
 actual expenses paid in connection with the execution of the warrant.
   7. Foreign corporations.  Where a notice and demand under  subdivision
 two  of  this  section shall have been given to a foreign corporation or
 other person who is not then a resident, and it appears to  the  commis-
 sioner  of finance that it is not practicable to find in the state prop-
 erty of such foreign corporation or nonresident person sufficient to pay
 the entire balance of tax or other amount owing by such  foreign  corpo-
 ration  or  nonresidential  person,  the commissioner of finance may, in
 accordance with subdivision three  of  this  section,  issue  a  warrant
 directed  to an officer or employee of the department of finance, a copy
 of which warrant shall be mailed by certified or registered mail to such
 foreign corporation or nonresident person at  its  last  known  address,
 subject  to  the rules of mailing provided in subdivision one of section
 11-672 of this subchapter.  Such warrant shall command  the  officer  or
 employee to proceed in Richmond county, and he or she shall, within five
 days  after  receipt of the warrant, file the warrant and obtain a judg-
 ment in accordance with this section.   Thereupon  the  commissioner  of
 finance  may  authorize  the  institution of any action or proceeding to
 collect or enforce the judgment in any place and by any procedure that a
 civil judgment of the supreme court of the state of New  York  could  be
 collected  or  enforced. The commissioner of finance may also, in his or
 her discretion, designate agents or retain counsel for  the  purpose  of
 collecting,  outside  the  state,  any  unpaid  taxes, additions to tax,
 penalties or interest which have been assessed under this subchapter  or
 under  any  of  the  named  subchapters, against foreign corporations or
 other non-resident persons, may fix the compensation of such agents  and
 counsel  to  be  paid  out  of  money appropriated or otherwise lawfully
 available for payment thereof, and may require of them  bonds  or  other
 security  for the faithful performance of their duties, in such form and
 S. 8474                            696
 
 in such amount as the commissioner of  finance  shall  deem  proper  and
 sufficient.
   8. Action by city for recovery of taxes.  Action may be brought by the
 corporation  counsel  of the city at the instance of the commissioner of
 finance to recover the amount of any unpaid  taxes,  additions  to  tax,
 penalties  or interest which have been assessed under this subchapter or
 under the named subchapters within six  years  prior  to  the  date  the
 action is commenced.
   9.  Release  of lien.  The commissioner of finance, if he or she finds
 that the interests of the city will not thereby be jeopardized, and upon
 such conditions as it may require, may release  any  property  from  the
 lien  of  any  warrant  filed  under  subdivision  four or seven of this
 section for unpaid taxes, additions to tax, penalties and interest filed
 pursuant to this section, and such release or vacating  of  the  warrant
 may  be  recorded  in  the office of any recording officer in which such
 warrant has been filed.  The clerk shall thereupon cancel and  discharge
 as of the original date of docketing the vacated warrant.
   10.  Lien  from due date of return.  (a) In addition to any other lien
 provided for in this section, each tax imposed by the named  subchapters
 shall  become  a  lien on the date on which the return is required to be
 filed, without regard to any extension of time for filing  such  return,
 except  that  such  tax  shall become a lien not later than the date the
 taxpayer ceases to be subject to the tax imposed by  any  of  the  named
 subchapters, or to do business in this state in a corporate or organized
 capacity.    Each such tax shall be a lien and binding upon the real and
 personal property of the taxpayer, or of a transferee liable to pay  the
 same,  until the same is paid in full, except that no lien for any addi-
 tional tax assessed pursuant to this  subchapter  shall  be  enforceable
 against property which prior to the issuance to the taxpayer of a notice
 of  deficiency  under  section 11-672 of this subchapter had been trans-
 ferred in good faith to a bona fide transferee for value.  But the  lien
 of  each  such  tax shall be subject to the lien of any mortgage indebt-
 edness existing against real property previous to the time when the  tax
 became  a lien and where such mortgage indebtedness has been incurred in
 good faith and was not given, directly or indirectly, to any officer  or
 stockholder  of  the corporation owning such real property, whether as a
 purchase money mortgage or otherwise, and shall also be subject  to  the
 lien of local taxes and assessments, without regard to when the lien for
 such taxes and assessments may have accrued.  If the return is filed and
 the  tax  shown on the report to be due is paid on or before the date on
 which the report is required to be filed, without regard to  any  exten-
 sions  of time for filing such report, the lien shall not be enforceable
 against the interest of any purchaser or mortgagee in property which  is
 thereafter,  but  prior  to  the issuance to the taxpayer of a notice of
 deficiency under section 11-672 of this subchapter transferred to a bona
 fide purchaser for value, or mortgaged where the  mortgage  indebtedness
 is  incurred  in  good  faith and the mortgage is not given, directly or
 indirectly, to any officer or stockholder of the corporation.    In  any
 action to foreclose any such mortgage, or to foreclose the lien of local
 taxes  or  assessments,  to  which  the people of the state, or the city
 shall have been made a party defendant by reason of the existence  of  a
 lien  for  any  such tax, or if no such tax was due or was a lien at the
 time of the commencement of such action and the filing of the notice  of
 pendency thereof but such a tax becomes due or becomes a lien subsequent
 to  the  time  of  the commencement of such action and the filing of the
 notice of pendency  thereof,  such  real  property  shall  be  sold  and
 S. 8474                            697
 
 conveyed  in  such  action free from any such tax lien, and any such tax
 lien may become a lien on any surplus moneys which may result from  such
 sale,  to  be determined in the proceedings for the distribution of such
 surplus moneys.  Where title to real property passes from an individual,
 or  from  a corporation owing no tax, to another corporation which is in
 default for such tax, the lien herein provided shall not be  enforceable
 except as to any equity after the prior mortgage or purchase money mort-
 gage encumbrance.
   (b)  The  commissioner  of  finance  may, upon application made to the
 commissioner and the payment of a fee of  twenty-five  dollars,  release
 any real property from the lien under this subdivision, provided payment
 be made to the commissioner of finance of such a sum as the commissioner
 of finance shall deem adequate consideration for such release, or depos-
 it be made of such security or such bond be filed as the commissioner of
 finance shall deem proper to secure payment of any such tax.  The appli-
 cation  for  such  release  shall contain an accurate description of the
 property to be released together with such information  as  the  commis-
 sioner  of  finance  may  require.   Such release may be recorded in any
 office in which conveyances of real estate are entitled to be  recorded.
 (c)  All  taxes,  additions  to  tax,  penalties and interest which have
 become a lien under this subdivision shall cease to be a lien after  the
 expiration  of  twenty  years from the date they become due and payable,
 except that taxes, additions to tax, penalties and interest  which  have
 become  a lien under this subdivision (1) as to real estate in the hands
 of persons who are owners thereof who would be purchasers in good  faith
 but  for  such taxes, additions to tax, penalties or interest and (2) as
 to the lien on real estate of mortgages held by  persons  who  would  be
 holders  thereof  in  good  faith  but for such taxes, additions to tax,
 penalties or interest, as against  such  purchasers  or  holders,  shall
 cease  to be a lien after the expiration of ten years from the date they
 become due and payable. The limitations herein provided  for  shall  not
 apply to any transfer from a corporation to a person or corporation with
 intent  to  avoid  payment  of  any taxes, or where with like intent the
 transfer is made to a grantee corporation,  or  any  subsequent  grantee
 corporation,  controlled  by  such grantor or which has any community of
 interest with it, either through stock ownership or otherwise.
   § 11-684  Transferees.  1. General.  The liability, at law or in equi-
 ty, of a transferee of property of a taxpayer for any tax, additions  to
 tax,  penalty  or  interest  due  the commissioner of finance under this
 subchapter or under the named subchapters, shall be assessed, paid,  and
 collected  in  the  same  manner  and subject to the same provisions and
 limitations as in the case of the tax to which  the  liability  relates,
 except  that the period of limitations for assessment against the trans-
 feree shall be extended by one year for  each  successive  transfer,  in
 order, from the original taxpayer to the transferee involved, but not by
 more  than  three years in the aggregate.  The term transferee includes,
 in case of successive transfers, donee, heir, legatee, devisee,  distri-
 butee, and successor by merger, consolidation or other reorganization.
   2. Exceptions.
   (a)  If before the expiration of the period of limitations for assess-
 ment of liability of the transferee, a  claim  has  been  filed  by  the
 commissioner  of  finance  in any court against the original taxpayer or
 the last preceding transferee based upon the liability of  the  original
 taxpayer,  then  the period of limitation for assessment of liability of
 the transferee shall in no event expire prior to  one  year  after  such
 claim has been finally allowed, disallowed or otherwise disposed of.
 S. 8474                            698

   (b)  If,  before  the expiration of the time prescribed in subdivision
 one or paragraph (a) of this  subdivision  for  the  assessment  of  the
 liability,  the  commissioner  of  finance  and the transferee have both
 consented in writing to its assessment after such  time,  the  liability
 may be assessed at any time prior to the expiration of the period agreed
 upon.    The  period so agreed upon may be extended by subsequent agree-
 ments in writing made before the expiration  of  the  period  previously
 agreed upon.  For the purpose of determining the period of limitation on
 credit  or  refund to the transferee or overpayments of tax made by such
 transferee or overpayments of tax made by the transferor as to which the
 transferee is legally entitled to credit or refund, such  agreement  and
 any extension thereof shall be deemed an agreement and extension thereof
 referred  to in subdivision two of section 11-678 of this subchapter. If
 the agreement is executed after the expiration of the period of  limita-
 tion  for assessment against the original taxpayer, then in applying the
 limitations under subdivision two of section 11-678 of  this  subchapter
 on  the amount of the credit or refund, the period specified in subdivi-
 sion one of section 11-678 of this subchapter shall be increased by  the
 period from the date of such expiration to the date of the agreement.
   3. Period for assessment against certain transferors.  For purposes of
 this  section,  if  any person is deceased or is a corporation which has
 terminated its  existence,  the  period  of  limitation  for  assessment
 against  such person or corporation shall be the period that would be in
 effect had death or termination of existence not occurred.
   4. Evidence.  The commissioner of finance shall use his or her  powers
 to  make  available  to  the transferee evidence necessary to enable the
 transferee to determine the liability of the original  taxpayer  and  of
 any  preceding  transferees,  but without undue hardship to the original
 taxpayer or preceding transferee.    See  subdivision  five  of  section
 11-680 of this subchapter for rule as to burden of proof.
   § 11-685 Jeopardy assessments. 1. Authority for making. If the commis-
 sioner  of finance believes that the assessment or collection of a defi-
 ciency will be jeopardized by delay, the  commissioner  shall,  notwith-
 standing the provisions of section 11-672 of this subchapter immediately
 assess  such deficiency, together with all interest, penalties and addi-
 tions to tax provided for by law, and notice and demand shall be made by
 the commissioner of finance for the payment thereof.
   2. Notice of deficiency. If the jeopardy assessment is made before any
 notice in respect of the tax to which the  jeopardy  assessment  relates
 has  been  mailed  under  section  11-672  of  this subchapter, then the
 commissioner of finance shall mail a notice under  such  section  within
 sixty days after the making of the assessment.
   3.  Amount assessable before decision of the tax appeals tribunal. The
 jeopardy assessment may be made in respect of a  deficiency  greater  or
 less  than that of which notice is mailed to the taxpayer and whether or
 not the taxpayer has theretofore filed a petition with the  tax  appeals
 tribunal.  The  commissioner  of  finance  may,  at  any time before tax
 appeals tribunal renders its decision, abate  such  assessment,  or  any
 unpaid portion thereof, to the extent that the commissioner believes the
 assessment  to  be  excessive in amount. The tax appeals tribunal may in
 its decision redetermine the entire amount of the deficiency and of  all
 amounts assessed at the same time in connection therewith.
   4.  Amounts  assessable after decision of the tax appeals tribunal. If
 the jeopardy assessment is made after the decision of  the  tax  appeals
 tribunal is rendered, such assessment may be made only in respect of the
 deficiency determined by the tax appeals tribunal in its decision.
 S. 8474                            699
 
   5.  Expiration  of  right  to assess. A jeopardy assessment may not be
 made after the decision of the tax appeals tribunal has become final  or
 after the taxpayer has made an application for review of the decision of
 the tax appeals tribunal.
   6.  Collection  of unpaid amounts. When a petition has been filed with
 the tax appeals tribunal and when the  amount  which  should  have  been
 assessed  has  been determined by a decision of the tax appeals tribunal
 which has become final, then any unpaid portion, the collection of which
 has been stayed by bond, shall be collected as  part  of  the  tax  upon
 notice  and  demand  from the commissioner of finance, and any remaining
 portion of the  assessment  shall  be  abated.  If  the  amount  already
 collected  exceeds the amount determined as the amount which should have
 been assessed, such excess shall be credited or refunded to the taxpayer
 as provided in section 11-677 of this subchapter without the  filing  of
 claim  therefor.    If  the amount determined as the amount which should
 have been assessed is greater than the amount  actually  assessed,  then
 the  difference  shall be assessed and shall be collected as part of the
 tax upon notice and demand from the tax appeals tribunal.
   7. Abatement if jeopardy does not exist. The commissioner  of  finance
 may abate the jeopardy assessment if the commissioner finds that jeopar-
 dy  does  not exist.  Such abatement may not be made after a decision of
 the tax appeals tribunal in respect of the deficiency has been  rendered
 or,  if  no  petition  is filed with the tax appeals tribunal, after the
 expiration of the period for filing such petition. The period of limita-
 tion on  the  making  of  assessments  and  levy  or  a  proceeding  for
 collection,  in respect of any deficiency, shall be determined as if the
 jeopardy assessment so abated had not been made, except that the running
 of such period shall in any event be suspended for the period  from  the
 date  of  such jeopardy assessment until the expiration of the tenth day
 after the day on which such jeopardy assessment is abated.
   8. Bond to stay collection. The collection of the whole or any  amount
 of any jeopardy assessment may be stayed by filing with the commissioner
 of finance, within such time as may be fixed by regulation, a bond in an
 amount  equal to the amount as to which the stay is desired, conditioned
 upon the payment of the amount,  together  with  interest  thereon,  the
 collection  of  which is stayed at the time of which, but for the making
 of the jeopardy assessment, such amount would be due.   Upon the  filing
 of  the  bond  the  collection  of  so much of the amount assessed as is
 covered by the bond shall be stayed. The taxpayer shall have  the  right
 to  waive  such  stay at any time in respect of the whole or any part of
 the amount covered by the bond, and if as a result of  such  waiver  any
 part  of  the amount covered by the bond is paid, then the bond shall at
 the request of the taxpayer, be proportionately reduced. If any  portion
 of the jeopardy assessment is abated, or if a notice of deficiency under
 section  11-672 of this subchapter is mailed to the taxpayer in a lesser
 amount, the bond shall, at the request of the taxpayer,  be  proportion-
 ately reduced.
   9.  Petition  to tax appeals tribunal. If the bond is given before the
 taxpayer has filed its petition under section 11-680 of this subchapter,
 the bond shall contain a further condition that if  a  petition  is  not
 filed  within  the period provided in such section, then the amount, the
 collection of which is stayed by the bond, will be paid  on  notice  and
 demand  at  any  time after the expiration of such period, together with
 interest thereon from the date of the jeopardy notice and demand to  the
 date  of  notice  and  demand  under this subdivision. The bond shall be
 conditioned upon the payment of so much of such  assessment,  collection
 S. 8474                            700
 
 of  which  is  stayed by the bond, as is not abated by a decision of the
 tax appeals tribunal which has become final. If the tax appeals tribunal
 determines that the amount assessed is greater  than  the  amount  which
 should  have  been  assessed, then the bond shall, at the request of the
 taxpayer, be proportionately  reduced  when  the  decision  of  the  tax
 appeals tribunal is rendered.
   10.  Stay  of  sale  of seized property pending tax appeals tribunal's
 decision. Where a jeopardy assessment is made, the property  seized  for
 the collection of the tax shall not be sold:
   (a)  if  subdivision  two  of this section is applicable, prior to the
 issuance of the notice of deficiency and  the  expiration  of  the  time
 provided in section 11-680 of this subchapter for filing a petition with
 the tax appeals tribunal, and
   (b)  if  a  petition  is  filed with the tax appeals tribunal, whether
 before or after the making of such jeopardy  assessment,  prior  to  the
 expiration  of  the period during which the assessment of the deficiency
 would be prohibited if subdivision one of this section were not applica-
 ble.
   Such property may be sold if the taxpayer consents to the sale, or  if
 the commissioner of finance determines that the expenses of conservation
 and maintenance will greatly reduce the net proceeds, or if the property
 is perishable.
   11.  Interest. For the purpose of subdivision one of section 11-675 of
 this subchapter, the last date prescribed for payment  shall  be  deter-
 mined  without  regard to any notice and demand for payment issued under
 this section prior to  the  last  date  otherwise  prescribed  for  such
 payment.
   12.  Early termination of taxable year. If the commissioner of finance
 finds that a taxpayer designs quickly to remove its property  from  this
 state,  or to conceal its property therein, or to do any other act tend-
 ing to prejudice or to render wholly or partly  ineffectual  proceedings
 to  collect the tax for the current or the preceding taxable year unless
 such proceedings be brought without delay, the commissioner  of  finance
 shall  declare  the  taxable period for such taxpayer immediately termi-
 nated, and shall cause notice of such  finding  and  declaration  to  be
 given  the taxpayer, together with a demand for immediate payment of the
 tax for the taxable period so declared terminated and of the tax for the
 preceding taxable year so much of such tax as is unpaid, whether or  not
 the  time  otherwise allowed by law for filing return and paying the tax
 has expired; and such taxes shall thereupon become immediately  due  and
 payable.  In any proceeding brought to enforce payment of taxes made due
 and payable by virtue of the provisions of this subdivision, the finding
 of the commissioner of finance made as  herein  provided,  whether  made
 after  notice to the taxpayer or not, shall be for all purposes presump-
 tive evidence of jeopardy.
   13. Reopening of taxable period. Notwithstanding  the  termination  of
 the  taxable  period  of the taxpayer by the commissioner of finance, as
 provided in subdivision twelve of  this  section,  the  commissioner  of
 finance  may  reopen such taxable period each time the taxpayer is found
 by the commissioner of finance  to  have  received  income,  within  the
 current  taxable  year, since the termination of such period.  A taxable
 period so terminated by the commissioner of finance may be  reopened  by
 the  taxpayer  if  it  files with the commissioner of finance a true and
 accurate return under any of the  named  subchapters  for  such  taxable
 period,  together  with  such  other  information as the commissioner of
 finance may by regulations prescribe.
 S. 8474                            701
 
   14. Furnishing of bond where taxable year is closed by the commission-
 er of finance. Payment of taxes shall not be enforced by any proceedings
 under the provisions of subdivision twelve of this section prior to  the
 expiration  of  the  time otherwise allowed for paying such taxes if the
 taxpayer  furnishes, under regulations prescribed by the commissioner of
 finance, a bond to insure the timely making of returns with respect  to,
 and payment of, such taxes or any taxes for prior years.
   §  11-686 Criminal penalties; cross-reference. For criminal penalties,
 see chapter forty of this title.
   § 11-687  General powers of the commissioner of finance.  1.  General.
 The commissioner of finance shall administer and enforce the tax imposed
 by the named subchapters and the commissioner is authorized to make such
 rules  and  regulations, and to require such facts and information to be
 reported,  as  the  commissioner  may  deem  necessary  to  enforce  the
 provisions  of  this  subchapter  and  of the named subchapters; and the
 commissioner may delegate the commissioner's  powers and functions under
 all subchapters of this chapter to one of the commissioner's deputies or
 to any employee or employees of his or her department.
   2. Examination of books and witnesses. The  commissioner  of  finance,
 for  the  purpose  of ascertaining the correctness of any return, or for
 the purpose of making an estimate of tax liability of  any  corporation,
 shall  have  power to examine or to cause to have examined, by any agent
 or representative designated by the commissioner for that  purpose,  any
 books, papers, records or memoranda bearing upon the matters required to
 be  included in the return, and may require the attendance of the corpo-
 ration rendering the return through any  officer  or  employee  of  such
 corporation,  or  the attendance of any other person having knowledge in
 the premises, and may take testimony and require proof material for  the
 commissioner's  information,  with  power  to  administer  oaths to such
 person or persons.
   3. Abatement authority. The commissioner of finance,  of  the  commis-
 sioner's own motion, may abate any small unpaid balance of an assessment
 of  tax,  or  any  liability  in respect thereof, if the commissioner of
 finance determines under uniform rules prescribed  by  the  commissioner
 that  the administration and collection costs involved would not warrant
 collection of the amount due.  The commissioner may also abate,  of  his
 or  her  own  motion, the unpaid portion of the assessment of any tax or
 any liability in respect thereof, which is excessive in  amount,  or  is
 assessed  after  the  expiration  of  the  period of limitation properly
 applicable thereto, or is erroneously or illegally assessed.   No  claim
 for abatement under this subdivision shall be filed by a taxpayer.
   4.  Special  refund  authority.  Where no questions of fact or law are
 involved and it appears from the records of the commissioner of  finance
 that  any  moneys  have been erroneously or illegally collected from any
 taxpayer or other person, or paid by such taxpayer or other person under
 a mistake of facts, pursuant to the provisions of this subchapter or any
 of the named subchapters, the commissioner of finance at anytime,  with-
 out  regard  to  any  period  of limitations, shall have the power, upon
 making a record of his or her reasons therefor in writing, to cause such
 moneys so paid and being erroneously and illegally held to be refunded.
   5. (a) Authority to set interest rates. The  commissioner  of  finance
 shall  set the overpayment and underpayment rates of interest to be paid
 pursuant to sections 11-606, 11-608,  11-645,  11-647,  11-656,  11-658,
 11-675, 11-676, and 11-679 of this chapter, but if no such rate or rates
 of  interest are set, such overpayment rate shall be deemed to be set at
 six percent per annum and such underpayment rate shall be deemed  to  be
 S. 8474                            702
 
 set  at  seven  and  one-half  percent per annum.   Such overpayment and
 underpayment rates shall be the rates prescribed  in  paragraph  (b)  of
 this  subdivision but the underpayment rate shall not be less than seven
 and  one-half percent per annum.  Any such rates set by the commissioner
 of finance shall apply to taxes, or any portion thereof, which remain or
 become due or overpaid on or after the date on which such  rates  become
 effective  and  shall  apply  only  with respect to interest computed or
 computable for periods or portions of periods occurring  in  the  period
 during which such rates are in effect.
   (b) General rule. (A) Overpayment rate. The overpayment rate set under
 this  subdivision shall be the sum of (i) the federal short-term rate as
 provided under paragraph (c) of this subdivision, plus (ii) two percent-
 age points.
   (B) Underpayment rate. The underpayment rate set under  this  subdivi-
 sion  shall  be  the  sum of (i) the federal short-term rate as provided
 under paragraph (c) of this  subdivision,  plus  (ii)  seven  percentage
 points.
   (c) Federal short-term rate. For purposes of this subdivision:
   (A)  The  federal  short-term  rate for any month shall be the federal
 short-term rate determined by the United States secretary of the  treas-
 ury  during  such  month  in  accordance  with subsection (d) of section
 twelve hundred seventy-four of the internal  revenue  code  for  use  in
 connection  with  section  six  thousand  six  hundred twenty-one of the
 internal revenue code. Any such rate shall be  rounded  to  the  nearest
 full  percent,  or,  if a multiple of one-half of one percent, such rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i) In general. Except as provided in clause  (ii)  of  this  subpara-
 graph,  the federal short-term rate for the first month in each calendar
 quarter shall apply during the first calendar  quarter  beginning  after
 such month.
   (ii)  Special rule for the month of September, nineteen hundred eight-
 y-nine. The federal short-term rate for the  month  of  April,  nineteen
 hundred  eighty-nine shall apply with respect to setting the overpayment
 and underpayment rates for the  month  of  September,  nineteen  hundred
 eighty-nine.
   (d)  Publication  of interest rates. The commissioner of finance shall
 cause to be published in the city record,  and  give  other  appropriate
 general  notice  of, the interest rates to be set under this subdivision
 no later than twenty days preceding the first day of the calendar  quar-
 ter  during which such interest rates apply. The setting and publication
 of such interest rates shall not be included  within  paragraph  (a)  of
 subdivision  five  of section one thousand forty-one of the city charter
 relating to the definition of a rule.
   (e) Cross-reference. For provisions  relating  to  the  power  of  the
 commissioner of finance to abate small amounts of interest, see subdivi-
 sion three of this section.
   6.  In  computing the amount of any interest required to be paid under
 this subchapter or any of the named subchapters by the  commissioner  of
 finance  or by the taxpayer, or any other amount determined by reference
 to such amount of interest, such  interest  and  such  amount  shall  be
 compounded daily. The preceding sentence shall not apply for purposes of
 computing the amount of any addition to tax for failure to pay estimated
 tax under subdivision three of section 11-676 of this subchapter.
   §  11-688    Secrecy  required  of official; penalty for violation. 1.
 Except in accordance with proper judicial order or as otherwise provided
 S. 8474                            703
 
 by law, it shall be  unlawful  for  the  commissioner  of  finance,  the
 department  of  finance  of  the  city,  any  officer or employee of the
 department of finance of the city, the tax appeals tribunal, any commis-
 sioner  or  employee  of such tribunal, any person who, pursuant to this
 section, is permitted to inspect any report or return, or  to  whom  any
 information  contained  in any report or return is furnished, any person
 engaged or retained by such department on an independent contract basis,
 or any person who in any manner may acquire knowledge of the contents of
 a report filed pursuant to this chapter, to divulge or make known in any
 manner the amount of income or any particulars set forth or disclosed in
 any report or return, under this chapter. The officers charged with  the
 custody of such reports and returns shall not be required to produce any
 of  them  or  evidence  of  anything  contained in them in any action or
 proceeding in any court, except on behalf of the city in  an  action  or
 proceeding  involving  the collection of a tax due under this chapter to
 which the city is a party or a claimant, or on behalf of  any  party  to
 any  action  or proceeding under the provisions of this chapter when the
 reports, returns or facts shown thereby are directly  involved  in  such
 action  or  proceeding, in any of which events the court may require the
 production of, and may admit in evidence, so much  of  said  reports  or
 returns  or  of  facts  shown  thereby as are pertinent to the action or
 proceeding, and no more.  Nothing herein shall be construed to  prohibit
 the  delivery  to  a taxpayer or its duly authorized representative of a
 copy of any report filed by it,  nor  to  prohibit  the  publication  of
 statistics  so classified as to prevent the identification of particular
 reports or returns and the items  thereof,  or  the  inspection  by  the
 corporation  counsel  or  other legal representatives of the city of the
 report or return of any taxpayer which shall bring action to  set  aside
 or  review the tax based thereon, or against which an action or proceed-
 ing under this chapter or under any local law of  the  city  imposed  as
 authorized  by the act authorizing the adoption of this chapter has been
 recommended by the commissioner of finance or the corporation counsel or
 has been instituted, or the inspection of the reports or returns of  any
 taxpayer  by  the  duly designated officers or employees of the city for
 purposes of an audit under this chapter or an audit  authorized  by  the
 act  authorizing  the  adoption  of  this  chapter;  and nothing in this
 subchapter or chapter eleven of this title shall be construed to prohib-
 it the publication of the issuer's allocation percentage, as defined  in
 subparagraph one of paragraph (b) of subdivision three of section 11-604
 of  this  chapter,  of any corporation which may be required to be allo-
 cated within the city for purposes of the tax  imposed  by  any  of  the
 named subchapters or chapter eleven of this title.
   2.  (a)  Any  officer  or  employee of the state or city who willfully
 violates the provisions of subdivision one  of  this  section  shall  be
 dismissed  from  office and be incapable of holding any public office in
 the city or this state for a period of five years thereafter.
   (b) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   3. Notwithstanding any provisions of this section, the commissioner of
 finance may permit the secretary of the treasury of the United States or
 his or her delegates, or the proper officer of this or any  other  state
 charged  with  tax  administration,  or the authorized representative of
 either such officer, to inspect the returns or reports filed  under  any
 of  the  named subchapters, or may furnish to such officer or his or her
 authorized representative an abstract of any such return  or  report  or
 supply  information  concerning  an item contained in any such return or
 S. 8474                            704
 
 report, or supply  him  or  her  with  information  concerning  an  item
 contained in any such return or report, or disclosed by an investigation
 of tax liability under any of the named subchapters, but such permission
 shall be granted or such information furnished to such officer or his or
 her  representative  only  if  the  laws of the United States or of such
 state, as the case may be, grant substantially similar privileges to the
 commissioner of finance and such information  is  to  be  used  for  tax
 purposes  only;  and  provided  further  the commissioner of finance may
 furnish to the secretary of the treasury of the United States or his  or
 her  delegates  or to the tax commission of the state of New York or its
 delegates such returns or reports filed under any of the named  subchap-
 ters  and  other  tax information, as he or she may consider proper, for
 use in court actions or proceedings under the internal revenue  code  or
 the tax law of the state of New York, whether civil or criminal, where a
 written request therefor has been made to the commissioner of finance by
 the  secretary  of  the  treasury  or by such tax commission or by their
 delegates, provided the laws of the United States or  the  laws  of  the
 state of New York grant substantially similar powers to the secretary of
 the  treasury  or  his or her delegates or to such tax commission or its
 delegates.  Where the commissioner of finance has so authorized  use  of
 returns,  reports  or  other information in such actions or proceedings,
 officers and employees of the department of finance may testify in  such
 actions  or  proceedings  in  respect  to such returns, reports of other
 information.
   4. Notwithstanding  the provisions of subdivision one of this section,
 the commissioner of finance, in his or her discretion,  may  require  or
 permit  any or all persons liable for any tax imposed by this chapter to
 make payments on account of estimated tax and payment of any tax, penal-
 ty or interest imposed by this chapter to banks, banking houses or trust
 companies designated by the commissioner of finance and to file declara-
 tions of estimated tax, applications for automatic extensions of time to
 file reports, and reports with  such  banks,  banking  houses  or  trust
 companies  as  agents  of the commissioner of finance, in lieu of making
 any such payment directly to the commissioner of finance.  However,  the
 commissioner  of finance shall designate only such banks, banking houses
 or trust companies as are depositories or financial agents of the city.
   5. This section  shall be deemed a state statute for purposes of para-
 graph (a) of subdivision two of section eighty-seven of the public offi-
 cers law.
   6. Notwithstanding anything in subdivision one of this section to  the
 contrary,  if  a  taxpayer  has  petitioned the tax appeals tribunal for
 administrative review as provided in section one hundred seventy of  the
 charter of the preceding municipality as it existed January first, nine-
 teen  hundred  ninety-four, the commissioner of finance shall be author-
 ized to present to the tribunal any report or return of  such  taxpayer,
 or  any  information contained therein or relating thereto, which may be
 material or relevant to the proceeding  before  the  tribunal.  The  tax
 appeals  tribunal  shall be authorized to publish a copy or a summary of
 any decision rendered pursuant to section one hundred seventy-one of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four.
   7. Notwithstanding anything in subdivision one of  this  section,  the
 commissioner  of  finance  may  disclose  to  a taxpayer or a taxpayer's
 related member, as defined in paragraph  (n)  of  subdivision  eight  of
 section  11-602, paragraph (n) of subdivision eight of section 11-652 or
 paragraph one of subdivision (q) of  section  11-641  of  this  chapter,
 S. 8474                            705

 information  relating  to any royalty paid, incurred or received by such
 taxpayer or related member to or from the other, including the treatment
 of such payments by the taxpayer or the related member in any report  or
 return transmitted to the commissioner of finance under this title.
   §  11-689    Disposition of revenues.  All revenues resulting from the
 imposition of the taxes under this chapter shall be paid into the treas-
 ury of the city and shall be credited to and deposited  in  the  general
 fund  of  the  city, but no part of such revenues may be expended unless
 appropriated in the annual budget of the city.
   § 11-690  Inconsistencies with other laws.  If any provision  of  this
 chapter is inconsistent with, in conflict with, or contrary to any other
 provision of law, such provision of this chapter shall prevail over such
 other  provision  and  such other provision shall be deemed to have been
 amended, superseded or repealed to the  extent  of  such  inconsistency,
 conflict or contrariety.
 
                                 CHAPTER 7
                     COMMERCIAL RENT OR OCCUPANCY TAX
   §  11-701  Definitions.  When used in this chapter the following terms
 shall mean or include:
   1. "Person." An individual, partnership, society,  association,  joint
 stock  company,  corporation, estate, receiver, assignee, trustee or any
 other person acting in a fiduciary  capacity,  whether  appointed  by  a
 court or otherwise, and any combination of individuals.
   2. "Landlord." A person who grants the right to use or occupy premises
 to  any  lessee,  sublessee,  licensee or concessionaire, whether or not
 such person is the owner of the premises.
   3. "Tenant." A person paying or required to pay rent for premises as a
 lessee, sublessee, licensee or concessionaire.
   4. "Premises." Any real property or part thereof,  and  any  structure
 thereon or space therein.
   5.  "Taxable  premises."  Any  premises  in the city occupied, used or
 intended to be occupied or used for the purpose of carrying on or  exer-
 cising any trade, business, profession, vocation or commercial activity,
 including  any  premises  so  used even though it is used solely for the
 purpose of renting, or granting the right to occupy  or  use,  the  same
 premises in whole or in part to tenants.
   6.  "Rent."  The consideration paid or required to be paid by a tenant
 for the use or occupancy of premises, valued in money, whether  received
 in money or otherwise, including all credits and property or services of
 any  kind  and  including any payment required to be made by a tenant on
 behalf of his or her landlord for real  estate  taxes,  water  rents  or
 charges, sewer rents or any other expenses, including insurance, normal-
 ly payable by a landlord who owns the realty other than expenses for the
 improvement, repair or maintenance of the tenant's premises.
   7. "Base rent." The rent paid for each taxable premises by a tenant to
 his  or  her  landlord for a period, less the amounts received by or due
 such tenant for the same period from any tenant  of  any  part  of  such
 premises:
   (i)  as  rent  for  premises which constitute taxable premises of such
 tenant except where such tenant is exempt from tax thereon  pursuant  to
 subdivision  b  or  paragraph  six of subdivision c of section 11-704 of
 this chapter; provided, however, that for tax periods beginning  on  and
 after  June  first,  nineteen  hundred eighty-five, rent received or due
 from a tenant exempt from tax  thereon  pursuant  to  paragraph  two  of
 subdivision  b  of section 11-704 of this chapter, as such paragraph two
 S. 8474                            706
 
 was in effect immediately prior to its amendment  by  local  law  number
 fifty-seven  for the year nineteen hundred ninety-three, may be deducted
 if such tenant occupies or uses  the  premises  pursuant  to  a  written
 agreement  made  prior  to June first, nineteen hundred eighty-four, the
 terms and conditions of which have not  been  changed  or  amended;  and
 provided,  further,  that  for  tax  periods beginning on and after June
 first, nineteen hundred eighty-five, with respect  to  a  tenant  exempt
 from tax pursuant to paragraph two of subdivision b of section 11-704 of
 this  chapter,  as such paragraph two was in effect immediately prior to
 its amendment by local law number  fifty-seven  for  the  year  nineteen
 hundred ninety-three, because of the reduction in base rent provided for
 in subdivision h of section 11-704 of this chapter, rent received or due
 from  such  tenant  may  be deducted if such tenant occupies or uses the
 premises pursuant to a written agreement made prior to June first, nine-
 teen hundred eighty-five, the terms and conditions  of  which  have  not
 been  changed  or  amended;  and provided, further, that for tax periods
 beginning on and after June first, nineteen  hundred  ninety-four,  with
 respect  to a tenant exempt from tax pursuant to paragraph two of subdi-
 vision b of section 11-704 of this chapter as a result of the  amendment
 of such paragraph two by local law number fifty-seven for the year nine-
 teen  hundred  ninety-three, whether or not such exemption is due to the
 reduction in base rent provided for in subdivision h of  section  11-704
 of  this  chapter, rent received or due from such tenant may be deducted
 if such tenant occupies or uses  the  premises  pursuant  to  a  written
 agreement  made  prior to June first, nineteen hundred ninety-three, the
 terms and conditions of which have not  been  changed  or  amended;  and
 provided,  further,  that  for  tax  periods beginning on and after July
 twenty-ninth, nineteen hundred eighty-seven, with respect  to  a  tenant
 exempt  from  tax  pursuant to paragraph two of subdivision b of section
 11-704 of this chapter because of the reduction in  base  rent  provided
 for in subdivision f of section 11-704 of this chapter, rent received or
 due  from  such  tenant  may  be  deducted; and provided, further, that,
 notwithstanding anything in this paragraph  to  the  contrary,  for  tax
 periods beginning on and after June first, nineteen hundred ninety-five,
 with  respect  to  a tenant exempt from tax pursuant to paragraph two of
 subdivision b of section 11-704 of this chapter, rents received  or  due
 from such tenant may be deducted;
   (ii) as rent for premises which do not constitute taxable premises and
 which  are  used  by  such  tenant  as  lodging or residential premises,
 including such residential premises in hotels, apartment hotels or lodg-
 ing houses as defined in former title V of chapter forty-six of the code
 of the preceding municipality;
   (iii) who is exempt from tax under subdivision a of section 11-704  of
 this chapter;
   (iv)  as  rent  for  premises which do not constitute taxable premises
 where such rent is, or to the extent that such rent is, deductible  from
 the  base rent of such tenant by reason of paragraph five of subdivision
 c of section 11-704 of this chapter; and
   (v) as rent for premises which do  not  constitute  taxable  premises,
 pursuant  to  a common law relationship of landlord and tenant, notwith-
 standing the definition given to those terms by paragraphs two and three
 of this section, except where it is received as  rent,  whether  or  not
 such  landlord-tenant  relationship exists, for premises which are occu-
 pied as or constitute:
   (a) a locker, safe deposit box or beach cabana;
 S. 8474                            707
 
   (b) storage space in part of a warehouse  or  in  part  of  any  other
 structure or area in which goods are stored;
   (c)  garage space or parking space in any part of a garage, of a park-
 ing lot or of a parking area where the entire garage, entire parking lot
 or entire parking area accommodates more than two motor vehicles;
   (d) an occupancy of a type which customarily has not been the  subject
 of  such  a  common  law  relationship of landlord and tenant.   Nothing
 contained in this chapter shall be  construed  to  permit  a  tenant  to
 deduct the same rent from his or her base rent more than once.
   8.  "Premises  used for railroad transportation purposes." The portion
 of any premises of any person actually operating  a  railroad,  used  by
 such  person  for  normal or necessary railroad transportation purposes.
 The words normal or necessary railroad transportation purposes, as  used
 in  this definition, shall not include any activities which are normally
 carried on by persons not engaged in furnishing railroad  transportation
 service  such  as  the operation of retail stores, barber shops, restau-
 rants, theatres, hotels, and newsstands; nor shall  such  words  include
 any  activities  which  are  not  deemed  transportation  purposes under
 sections four hundred eighty-nine-b and four  hundred  eighty-nine-m  of
 the real property tax law.
   9. "Premises used for air transportation purposes." The portion of any
 premises,  located  within  an  airport  or within an air transportation
 terminal shared by more than one air line, of any person actually  oper-
 ating an air line as a common carrier, used by such person for normal or
 necessary air transportation purposes. The words normal or necessary air
 transportation  purposes,  as used in this definition, shall not include
 any activities which are normally carried on by persons not  engaged  in
 furnishing  air  transportation  service such as the operation of retail
 stores, barber shops, restaurants, theatres, hotels and newsstands.
   10. "Return." Any return filed or  required  to  be  filed  as  herein
 provided other than an information return.
   11.  "Tax  period."  The period for which any return is required to be
 filed under this chapter.
   12. "Tax year." June first of any calendar year  through  May  thirty-
 first of the following calendar year.
   13. "Day." A calendar day or any part thereof.
   14. "City." The city of Staten Island.
   15.  "Commissioner  of  finance."  The  commissioner of finance of the
 city.
   16. "Comptroller." The comptroller of the city.
   17. "Dramatic or musical arts performance."  A  performance  or  repe-
 tition  thereof  in  a  theatre,  opera  house or concert hall of a live
 dramatic performance, whether or not musical in  part.  The  performance
 encompassed  by this definition shall include so-called legitimate thea-
 tre plays, musical comedies and  operettas.    They  shall  not  include
 circuses,  ice  skating  shows  or  aqua  shows;  they shall not include
 performances of any kind in a roof  garden,  cabaret  or  other  similar
 place;  and  they  shall  not  include radio or television performances,
 whether or not such performances are prerecorded for later broadcast.
   18. "Premises used for omnibus transportation purposes."  The  portion
 of  any premises located within a passenger terminal of any person actu-
 ally operating an omnibus line or route as a  common  carrier,  used  by
 such person for normal or necessary omnibus line or route transportation
 purposes.  The words normal or necessary omnibus line or route transpor-
 tation purposes, as used in  this  definition,  shall  not  include  any
 activities,  which  are  normally  carried  on by persons not engaged in
 S. 8474                            708
 
 furnishing omnibus line or route transportation  services  such  as  the
 operation  of retail stores, barber shops, restaurants, theatres, hotels
 and newsstands.
   19.  "Tax  appeals  tribunal." The tax appeals tribunal established by
 section one hundred sixty-eight of the charter of the preceding  munici-
 pality as it existed January first, nineteen hundred ninety-four.
   20. "Premises used for retail sales purposes." Premises primarily used
 for  the  selling or otherwise disposing or furnishing of tangible goods
 directly to the ultimate user or consumer.
   §  11-702  Imposition of tax.  a.  (1) For each tax year commencing on
 or after June first, nineteen  hundred  sixty-three  and  ending  on  or
 before  May  thirty-first,  nineteen hundred seventy, every tenant shall
 pay a tax of two and one-half per centum of his or  her  base  rent  for
 such tax year where his or her base rent is not in excess of twenty-five
 hundred  dollars  per year or where his or her base rent is for a period
 of less than one year and would not exceed twenty-five  hundred  dollars
 for  a year if it were paid on an equivalent basis for an entire year or
 a tax of five per centum of his or her base rent for such tax year where
 his or her base rent is in excess of  twenty-five  hundred  dollars  per
 year or where his or her base rent is for a period of less than one year
 and  would  exceed twenty-five hundred dollars a year if it were paid on
 an equivalent basis for an entire year.
   (2) For each tax year commencing on or  after,  June  first,  nineteen
 hundred  seventy, every tenant shall pay a tax at the rates shown in the
 following table:
 When the annual rent is:   But not more than:    The rate shall be:
 0.....................         $2,499            2 1/2% of the rent
 $ 2,500 or over.......         $4,999                5% of the rent
 $ 5,000 or over.......         $7,999            6 1/4% of the rent
 $ 8,000 or over.......        $10,999                7% of the rent
 $11,000 and over......                           7 1/2% of the rent
   For tax years embraced within the period beginning after  May  thirty-
 first, nineteen hundred seventy-seven and ending May thirty-first, nine-
 teen  hundred  eighty, the tax shall be imposed at rates equal to ninety
 percent of the rates shown in such table.
   For tax years  beginning  after  May  thirty-first,  nineteen  hundred
 eighty and ending May thirty-first, nineteen hundred eighty-one, the tax
 shall  be  imposed  at  rates  equal to eighty-five percent of the rates
 shown in such table.
   For tax years  beginning  after  May  thirty-first,  nineteen  hundred
 eighty-one, the tax shall be imposed at rates equal to eighty percent of
 the rates shown in such table.
   Where  the  rent is for a period of less than one year, the rate shall
 be determined by assuming that the rent is on an  equivalent  basis  for
 the entire year.
   b.    Nothing  contained  in  this  chapter shall be deemed to require
 payment of a double or multiple tax pursuant to this chapter on any part
 of any taxable premises.
   c.  Where a tenant pays an undivided rent for premises used  both  for
 residential  purposes and as taxable premises, the tax shall be applica-
 ble to so much of the rent as is ascribable to the portion of such prem-
 ises used as taxable premises.  Where, however, the rent  ascribable  to
 so  much of such premises as is used as taxable premises does not exceed
 fifty dollars a month, such rent shall be excluded  from  such  tenant's
 base  rent.  Nothing contained in this subdivision shall be construed as
 indicating an intent to exclude any base rent from the  tax  imposed  by
 S. 8474                            709
 
 this  chapter merely because it is paid as part of an undivided rent for
 premises which are only partially used as taxable premises.
   d.    The  tax imposed by this chapter shall be in addition to any and
 all other taxes including the public housing tax imposed by chapter  ten
 of this title.
   e.  Nothing contained in this section shall be construed as permitting
 base  rent of a tenant for one taxable premises to be reduced by deduct-
 ing rents received by him or her for another taxable premises  of  which
 he or she is also a tenant.
   §   11-703   Presumptions and burden of proof.  a.  For the purpose of
 the proper administration of this chapter and to prevent evasion of  the
 tax  hereby  imposed  it shall be presumed that all premises are taxable
 premises and that all rent paid or required to be paid by  a  tenant  is
 base  rent  until the contrary is established, and the burden of proving
 that such presumptive base rent or any portion thereof is  not  included
 in  the  measure  of  the  tax  imposed  by this chapter shall be on the
 tenant.
   b.  Where a tenant uses premises both for residential purposes and  as
 taxable  premises and the tenant pays an undivided rent for the premises
 so used, it shall be conclusively presumed against such tenant that  the
 rent  ascribable to so much of such premises as is used as taxable prem-
 ises shall be the amount which such tenant  deducts  as  rent  for  such
 premises  in  determining the tenant's federal income tax, as reduced by
 any disallowance of such deduction which is not being  contested,  which
 is fairly attributable to the tax period or tax year.
   §  11-704  Exemptions  and deductions from base rent. a. The following
 shall be exempt from the payment of the tax imposed by this chapter:
   1. The state of New York,  or  any  public  corporation,  including  a
 public corporation created pursuant to agreement or compact with another
 state or the Dominion of Canada, improvement district or other political
 subdivision of the state;
   2.  The  United  States of America, insofar as it is immune from taxa-
 tion;
   3. The United Nations or other world-wide international  organizations
 of which the United States of America is a member;
   4. Any corporation, or association, or trust, or community chest, fund
 or  foundation, organized and operated exclusively for religious, chari-
 table, or educational purposes, or for  the  prevention  of  cruelty  to
 children  or animals, and no part of the net earnings of which inures to
 the benefit of any private shareholder or individual and no  substantial
 part  of the activities of which is carrying on propaganda, or otherwise
 attempting to influence legislation; provided, however, that nothing  in
 this  paragraph  shall  include an organization operated for the primary
 purpose of carrying on a trade or business for profit,  whether  or  not
 all of its profits are payable to one or more organizations described in
 this paragraph;
   5.  Any tenant who would be subject to taxes under this chapter aggre-
 gating not more than one dollar for a tax year with respect to all taxa-
 ble premises used by the tenant; and
   6. Any tenant located in the "World Trade Center Area," as defined  as
 follows:  the  area in the borough of Manhattan bounded by Church Street
 on the east starting at the intersection of Liberty  Street  and  Church
 Street;  running northerly along the center line of Church Street to the
 intersection of Church Street and Vesey Street; running  westerly  along
 the  center line of Vesey Street to the intersection of Vesey Street and
 West Broadway; running northerly along the center line of West  Broadway
 S. 8474                            710

 to the intersection of West Broadway and Barclay Street; running wester-
 ly  along  the  center  line  of  Barclay  Street to the intersection of
 Barclay Street and Washington Street; running southerly along the center
 line  of  Washington Street to the intersection of Washington Street and
 Vesey Street; running westerly along the center line of Vesey Street  to
 the  intersection  of  Vesey  Street  and West Street; running southerly
 along the center line of West Street to the intersection of West  Street
 and  Liberty  Street;  running easterly along the center line of Liberty
 Street to the intersection of  Liberty  Street  and  Washington  Street;
 running  southerly  along  the  center  line of Washington Street to the
 intersection of Washington Street and Albany  Street;  running  easterly
 along  the  center  line  of Albany Street to the intersection of Albany
 Street and Greenwich Street; running northerly along the center line  of
 Greenwich  Street  to  Liberty  Street;  and  running easterly along the
 center line of Liberty Street to the intersection of Liberty Street  and
 Church Street.
   b.  1.  A tenant who uses premises for no more than fourteen days in a
 tax year whether or not consecutive, where his or her agreement with his
 or her landlord does not require him or her to pay  rent  for  a  longer
 period shall be exempt from the payment of the tax imposed by this chap-
 ter in respect to the rent paid by him or her for such premises.
   2.  A  tenant whose base rent, (i) for tax years beginning on or after
 June first, nineteen hundred eighty-one and  ending  on  or  before  May
 thirty-first,  nineteen  hundred  eighty-four,  is not in excess of four
 thousand nine hundred ninety-nine dollars per year,  (ii)  for  the  tax
 year  beginning  June first, nineteen hundred eighty-four and ending May
 thirty-first, nineteen hundred eighty-five, is not in  excess  of  seven
 thousand  nine hundred ninety-nine dollars per year, (iii) for tax years
 beginning on or after  June  first,  nineteen  hundred  eighty-five  and
 ending  on  or before May thirty-first, nineteen hundred ninety-four, is
 not in excess of ten thousand nine hundred ninety-nine dollars per year,
 (iv) for the tax year beginning June first, nineteen hundred ninety-four
 and ending May thirty-first, nineteen hundred  ninety-five,  is  not  in
 excess of twenty thousand nine hundred ninety-nine dollars per year, (v)
 for  the tax year beginning June first, nineteen hundred ninety-five and
 ending May thirty-first, nineteen hundred ninety-six, is not  in  excess
 of  thirty  thousand nine hundred ninety-nine dollars per year, (vi) for
 the tax year beginning  June  first,  nineteen  hundred  ninety-six  and
 ending May thirty-first, nineteen hundred ninety-seven, is not in excess
 of thirty-nine thousand nine hundred ninety-nine dollars per year, (vii)
 for  tax  years beginning on or after June first, nineteen hundred nine-
 ty-seven and ending on or before May thirty-first, two thousand, is  not
 in  excess  of ninety-nine thousand nine hundred ninety-nine dollars per
 year, calculated without regard to any reduction in base rent allowed by
 paragraph two of subdivision h of this section, (viii)  for  the  period
 beginning  June  first,  two thousand and ending November thirtieth, two
 thousand, is not in excess of ninety-nine thousand nine hundred  ninety-
 nine  dollars  per  year,  calculated without regard to any reduction in
 base rent allowed by paragraph two of subdivision  h  of  this  section,
 (ix)  for  the  period beginning December first, two thousand and ending
 May thirty-first, two thousand one, is not  in  excess  of  one  hundred
 forty-nine  thousand  nine  hundred ninety-nine dollars per year, calcu-
 lated without regard to any reduction in base rent allowed by  paragraph
 two of subdivision h of this section, and (x) for tax years beginning on
 or  after  June first, two thousand one, is not in excess of two hundred
 forty-nine thousand nine hundred ninety-nine dollars  per  year,  calcu-
 S. 8474                            711
 
 lated  without regard to any reduction in base rent allowed by paragraph
 two of subdivision h of this section, shall be exempt from  the  payment
 of  the tax imposed by this chapter with respect to such rent, provided,
 however, that where the base rent of such tenant is for a period of less
 than  one year, such base rent shall, for purposes of this paragraph, be
 determined as if it had been on an equivalent basis for the entire year;
 and provided, further, that for purposes  of  subparagraphs  (viii)  and
 (ix)  of  this  paragraph, base rent for the period specified in each of
 such subparagraphs shall be separately annualized as if it had  been  on
 an  equivalent basis for an entire year, irrespective of the actual base
 rent for the tax year including the period specified  in  such  subpara-
 graph. Provided, however, (xi) a tenant whose base rent for the tax year
 beginning  June first, nineteen hundred eighty-four and ending May thir-
 ty-first, nineteen hundred  eighty-five,  is  at  least  eight  thousand
 dollars  per  year, but not in excess of ten thousand nine hundred nine-
 ty-nine dollars per year, shall be exempt from the payment  of  the  tax
 imposed  by this chapter with respect to such rent for the period begin-
 ning December first, nineteen hundred eighty-four and ending  May  thir-
 ty-first,  nineteen  hundred  eighty-five, and (xii) a tenant whose base
 rent for the tax year beginning June first, nineteen hundred ninety-five
 and ending May thirty-first, nineteen hundred ninety-six,  is  at  least
 thirty-one  thousand  dollars per year, but not in excess of thirty-nine
 thousand nine hundred ninety-nine dollars per year, shall be exempt from
 the payment of the tax imposed by this chapter with respect to such rent
 for the period beginning September first, nineteen  hundred  ninety-five
 and ending May thirty-first, nineteen hundred ninety-six.
   c.  Base  rent  shall  be reduced by the amount of the taxpayer's rent
 for, or reasonably ascribable to, the taxpayer's own use  of  the  prem-
 ises:
   1. As premises used for railroad transportation purposes.
   2. As premises used for air transportation purposes.
   3. As piers insofar as such premises are used in interstate or foreign
 commerce.
   4. Which are located in, upon, above or under any public street, high-
 way  or  other  public place, and which are defined as special franchise
 property in the real property tax law.
   5. Which are taxed pursuant to subchapter one  of  chapter  twenty  of
 this  title  to the extent that such premises are subject to, and during
 the period that they are subject to, such tax.
   6. Which are taxed pursuant to subdivision b or c of  section  11-1005
 of this title.
   7. Which are advertising signs, advertising space, vending machines or
 newsstands   within  or  attached  to  stations,  platforms,  stairways,
 entranceways, passageways, mezzanines  or  tracks  of  a  rapid  transit
 subway  or  elevated  railroad  operated  by  the  New York city transit
 authority when the rent of the tenant or of  the  tenant's  landlord  is
 payable to such authority.
   8. As premises used for omnibus transportation purposes.
   9.  As premises used for retail sales purposes where such premises are
 located in the area in the borough of Manhattan bounded by Murray Street
 on the north starting at the intersection  of  West  Street  and  Murray
 Street;  running  easterly  along  the  center  line  of  Murray Street,
 connecting through City Hall Park with  the  center  line  of  Frankfort
 Street  and  running  easterly  along  the center lines of Frankfort and
 Dover Streets to the intersection of  Dover  Street  and  South  Street;
 running  southerly along the center line of South Street to Peter Minuit
 S. 8474                            712
 
 Plaza; connecting through Peter Minuit Plaza to the center line of State
 Street and running northwesterly along the center line of  State  Street
 to  the intersection of State Street and Battery Place; running westerly
 along  the  center  line of Battery Place to the intersection of Battery
 Place and West Street; and running northerly along the  center  line  of
 West  Street  to  the intersection of West Street and Murray Street. Any
 tax lot which is partly located inside such area shall be deemed  to  be
 entirely located inside such area.
   d.  A tenant who uses taxable premises for renting to others for resi-
 dential purposes to the extent of seventy-five per centum or more of the
 rentable floor space shall be exempt from the tax imposed by this  chap-
 ter  in  respect  to  the rent paid for such premises from the time that
 construction thereof commences, provided, however, that  this  paragraph
 shall not be applicable to hotels, apartment hotels or lodging houses as
 defined  in  former  title  V  of  chapter  forty-six of the code of the
 preceding municipality.
   e. (1) A tenant who uses taxable premises for a  dramatic  or  musical
 arts  performance  for less than four weeks where there is no indication
 prior to or at  the  time  that  such  performance  commences  that  the
 performance  is  intended  to continue for less than four weeks shall be
 exempt from the tax imposed by this chapter with  respect  to  the  rent
 paid for such taxable premises.
   (2)  (i) Notwithstanding any other provision of law to the contrary, a
 tenant who uses taxable premises for the production and performance of a
 theatrical work shall be exempt from the tax  imposed  by  this  chapter
 with respect to the rent paid for such taxable premises for a period not
 exceeding  fifty-two  weeks beginning on the date that the production of
 such theatrical work commences, provided, however,  that  this  subpara-
 graph  shall  not  apply  to any theatrical work the production of which
 commenced prior to June first, nineteen hundred ninety-five.
   (ii) For purposes of this paragraph, the term "theatrical work"  shall
 mean a performance or repetition thereof in a theater of a live dramatic
 performance,  whether  or  not  musical in part, that contains sustained
 plots or recognizable thematic material, including so-called  legitimate
 theater  plays  or musicals, dramas, melodramas, comedies, compilations,
 farces or reviews, provided that such performance is intended to be open
 to the public for at least two weeks. The term "theatrical  work"  shall
 not  include performances of any kind in a roof garden, cabaret or simi-
 lar place, circuses, ice skating shows, aqua shows, variety shows, magic
 shows, animal acts, concerts, industrial shows or similar  performances,
 or  radio  or  television performances, whether or not such performances
 are pre-recorded for later broadcast.
   f. 1. A tenant who is  an  eligible  business  and  has  obtained  the
 certifications  required  by paragraph four of this subdivision shall be
 permitted to reduce his or her base  rent  for  particular  premises  to
 which  he  or  she  has relocated by an amount determined by multiplying
 such base rent by a fraction the numerator of which  is  the  number  of
 eligible  aggregate  employment  shares  maintained  by such tenant with
 respect to such premises in the tax year for which  such  tenant  claims
 the  reduction  and  the  denominator  of which is a number equal to the
 number of aggregate employment shares maintained by such tenant in  such
 premises  in  the  tax  year  for which such tenant claims the reduction
 allowed by this subdivision, provided, however,  that  such  denominator
 shall not exceed the highest number of aggregate employment shares main-
 tained by such tenant in such premises in any of the tax years described
 below  which  commence  prior  to  or concurrently with the tax year for
 S. 8474                            713
 
 which such tenant claims the reduction allowed by this subdivision:  (i)
 the tax year during which such tenant relocates to such particular prem-
 ises;  and  (ii)  each of the three tax years immediately succeeding the
 tax  year during which such tenant relocates to such premises. Base rent
 for a particular premises may be reduced as provided in this subdivision
 for the tax year during which the tenant relocates to such premises  and
 for  any of the twelve immediately succeeding tax years during which the
 tenant maintains eligible aggregate employment shares  with  respect  to
 such  premises, provided, however, that there shall be no such reduction
 with respect to base rent for any part of the  tax  year  preceding  the
 date  of relocation to such premises, and provided, further, however, in
 the twelfth succeeding tax year there shall be  a  reduction  only  with
 respect to base rent for the period, commencing on the first day of such
 tax  year,  equal  to the difference between the total number of days in
 the tax year of relocation and the number of days in such  tax  year  of
 relocation  commencing  with  and  following the date of relocation, and
 provided, further, that there shall be no such reduction with respect to
 premises used for retail activity or hotel services.
   2. (i) For purposes of this subdivision, the  terms  "eligible  area,"
 "eligible  aggregate  employment  shares," "relocate," "retail activity"
 and "hotel services" shall have the meanings ascribed by section  22-621
 of  the  code  of the preceding municipality, provided that whenever the
 term "taxable year " appears in such section 22-621, such term shall  be
 read  as  "tax  year,"  as the term "tax year" is defined in subdivision
 twelve of section 11-701 of this chapter except when  the  taxable  year
 referred  to  is the taxable year immediately preceding the taxable year
 during which such tenant relocates.
   (ii) For purposes of this subdivision, the  term  "eligible  business"
 shall  have  the  meaning  ascribed by section 22-621 of the code of the
 preceding municipality,  provided  that  such  term  shall  in  addition
 include  any  person  subject  to a tax imposed under subchapter four of
 chapter six of this title and any person who is an insurance corporation
 as defined in section one thousand five hundred of the tax  law,  which:
 (A)  has been conducting substantial business  operations at one or more
 business locations outside the eligible area for the twenty-four consec-
 utive months immediately preceding the taxable year  during  which  such
 eligible  business  relocates;  and  (B) on or after May twenty-seventh,
 nineteen hundred eighty-seven relocates all or  part  of  such  business
 operations;  and  (C)  on  or after May twenty-seventh, nineteen hundred
 eighty-seven first enters into a lease for  the  premises  to  which  it
 relocates or a parcel on which will be constructed such premises.
   3.  The  reduction  allowed  by  this subdivision may be claimed on an
 estimated basis on the returns filed for the tax periods ending  on  the
 last  days  of August, November and February of each year if, and to the
 extent, permitted by regulations  promulgated  by  the  commissioner  of
 finance.
   4.  No  tenant shall be authorized to receive a reduction in base rent
 subject to tax under the provisions of this subdivision, until the prem-
 ises with respect to which it is claiming a reduction in base rent  meet
 the requirements in the definition of eligible premises and until it has
 obtained  a  certification  of  eligibility  from the mayor or an agency
 designated by the mayor, and an annual certification from the  mayor  or
 an agency designated by the mayor as to the number of eligible aggregate
 employment  shares  maintained  by  such  tenant  which  may qualify for
 obtaining a base rent reduction for the tenant's tax year.  Any  written
 documentation submitted to the mayor or such agency or agencies in order
 S. 8474                            714
 
 to  obtain  any  such certification shall be deemed a written instrument
 for purposes of section 175.00 of the penal law.  Application  fees  for
 such  certifications  shall be determined by the mayor or such agency or
 agencies. No certification of eligibility shall be issued to an eligible
 business on or after July first, two thousand three unless such business
 meets  the  requirements of either subparagraph (a) or (b) of this para-
 graph:
   (a) (1) prior to such date such  business  has  purchased,  leased  or
 entered  into  a  contract to purchase or lease particular premises or a
 parcel on which will be constructed such premises or already owned  such
 premises or parcel;
   (2)  prior to such date improvements have been commenced on such prem-
 ises or parcel which improvements will meet the requirements of subdivi-
 sion (e) of section 22-621 of the code  of  the  preceding  municipality
 relating to expenditures for improvements;
   (3) prior to such date such business submits a preliminary application
 for a certification of eligibility to such mayor or such agency or agen-
 cies  with respect to a proposed relocation to such particular premises;
 and
   (4) such business relocates to such particular premises not later than
 thirty-six months or, in a case in which the expenditures made  for  the
 improvements  specified in clause two of this subparagraph are in excess
 of fifty million dollars within seventy-two  months  from  the  date  of
 submission of such preliminary application; or
   (b) (1) not later than June thirtieth, two thousand ten, such business
 has  purchased,  leased  or entered into a contract to purchase or lease
 particular premises wholly contained in a building in which at least  an
 aggregate  of  forty  per  centum  or  two hundred thousand square feet,
 whichever is less, of the nonresidential floor area of such building has
 been purchased or leased by a business or businesses which meet or  will
 meet the requirements of subparagraph (a) of this paragraph with respect
 to such floor area and which are or will become certified as eligible to
 receive a credit under section 22-622 of the code of the preceding muni-
 cipality with respect to such floor area;
   (2)  not  later  than  June thirtieth, two thousand ten, such business
 submits a preliminary application for a certification of eligibility  to
 such  mayor  or such agency or agencies with respect to a proposed relo-
 cation to such particular premises; and
   (3) not later than June thirtieth, two  thousand  ten,  such  business
 relocates to such particular premises.
   Any  tenant subject to a tax imposed under chapter five, or subchapter
 two, three or three-A of chapter six, of this title obtaining a  certif-
 ication  of eligibility pursuant to subdivision (b) of section 22-622 of
 the code of the preceding municipality shall be deemed to have  obtained
 the certification of eligibility required by this paragraph.
   g.  Whenever  the  rent  paid  by a tenant for his or her occupancy of
 taxable premises is measured in whole or in part by the  gross  receipts
 from  the  tenant's  sales  within such place, the tenant's rent, to the
 extent paid on the basis of such gross receipts, shall be deemed not  to
 exceed fifteen percent of such gross receipts.
   h.  (1)  In the case of any taxable premises located in the borough of
 Manhattan north of the center line of  ninety-sixth  street  or  in  the
 boroughs of the Bronx, Brooklyn, Queens and Staten Island, the base rent
 for  such premises shall be reduced by ten percent for the period begin-
 ning on January first, nineteen hundred eighty-six and ending May  thir-
 ty-first, nineteen hundred eighty-seven, by twenty percent for the peri-
 S. 8474                            715
 
 od  beginning  June  first, nineteen hundred eighty-seven and ending May
 thirty-first, nineteen hundred eighty-nine, and by  thirty  percent  for
 the period beginning June first, nineteen hundred eighty-nine and ending
 August  thirty-first, nineteen hundred ninety-five, such reduction to be
 made after all other exemptions and deductions authorized by this  chap-
 ter  have  been  taken.  For periods beginning September first, nineteen
 hundred ninety-five and thereafter, a tenant of taxable premises located
 in that part of the city specified in this  paragraph  shall  be  exempt
 from  the payment of the tax imposed by this chapter with respect to the
 rent for such taxable premises.
   (2) In the case of any taxable premises  located  in  the  borough  of
 Manhattan south of the center line of ninety-sixth street, the base rent
 for such premises shall be reduced by (i) fifteen percent for the period
 beginning  March first, nineteen hundred ninety-six and ending May thir-
 ty-first, nineteen hundred ninety-six, (ii) twenty-five percent for  the
 period  beginning  June  first,  nineteen  hundred ninety-six and ending
 August thirty-first, nineteen hundred ninety-eight,  and  (iii)  thirty-
 five  percent  for  periods  beginning September first, nineteen hundred
 ninety-eight and thereafter, such reduction to be made after  all  other
 exemptions and deductions authorized by this chapter have been taken.
   i.  (1)  (a)  (i) For purposes of, and to the extent relevant to, this
 subdivision, the following terms shall, except to the extent hereinafter
 modified, have the definitions assigned to such terms  in  section  four
 hundred ninety-nine-a of the real property tax law, and such definitions
 shall apply with the same force and effect as if they had been set forth
 in  full  in this subdivision: "abatement zone," "aggregate floor area,"
 "applicant," "department of finance," "eligible building,"  "eligibility
 period,"  "eligible premises," "expansion premises," "expansion tenant,"
 "governmental agency," "landlord," "lease commencement date," "mixed-use
 building," "new tenant," "person," "relocation area," "renewal  tenant,"
 "rent commencement date," "subtenant" and "tenant."
   (ii)  For  purposes  of  this subdivision, the definitions assigned by
 clause (i) of  this  subparagraph  to  the  terms  "eligible  premises,"
 "expansion  tenant," "landlord," "new tenant" and "renewal tenant" shall
 be modified as follows:   (A)  whenever  the  term  "eligible  building"
 appears  in any of such definitions, such term, notwithstanding anything
 to the contrary, shall be deemed to include an eligible government-owned
 building and, for purposes of subparagraph (b-2)  of  paragraph  two  of
 subdivision  i  of this section, a non-residential or mixed-use building
 located south of the center line of  Canal  Street  in  the  borough  of
 Manhattan,  regardless  of  when  it received its initial certificate of
 occupancy or initial temporary certificate of occupancy  and  regardless
 of  when  it  was constructed and shall be deemed to include an eligible
 government-owned building; and (B) a reference  in  any  of  such  defi-
 nitions  to  a lease which meets the eligibility requirements of section
 four hundred ninety-nine-c of the real property tax law shall be  deemed
 to  include,  in  the case of a lease of premises in an eligible govern-
 ment-owned building, a lease which meets the eligibility requirements of
 paragraph four of this subdivision.
   (b) When used in this subdivision, the following terms shall  mean  or
 include:    (i)  "Eligible  government-owned  building." A building that
 would be an eligible building, as such term is defined in  section  four
 hundred  ninety-nine-a  of  the  real property tax law, but for the fact
 that it is owned by a governmental agency.
   (ii) "Eligible taxable premises." Taxable premises that  are  eligible
 premises or expansion premises.
 S. 8474                            716
 
   (iii)  "Eligible  tenant."  A  tenant  with  respect to whose lease of
 eligible taxable premises there has been issued a certificate of  abate-
 ment or a certificate of eligibility.
   (iv)  "Base  year." The twelve-month period that commences on the rent
 commencement date.
   (v) "Base rent for the base year." The total base  rent  for  eligible
 taxable  premises  for  the  base year, determined without regard to the
 special reduction allowed by this subdivision.
   (vi) "Certificate of abatement." The certificate of  abatement  issued
 pursuant  to section four hundred ninety-nine-d of the real property tax
 law.
   (vii) "Certificate of eligibility."  The  certificate  of  eligibility
 issued pursuant to paragraph five of this subdivision.
   (2)  (a)  An  eligible  tenant  of  eligible taxable premises shall be
 allowed a special reduction in determining the  taxable  base  rent  for
 such  eligible taxable premises. Such special reduction shall be allowed
 with respect to the rent for such eligible taxable premises for a period
 not exceeding sixty months or, with respect to a lease commencing on  or
 after  April  first, nineteen hundred ninety-seven with an initial lease
 term of less than five years, but not less than three years, for a peri-
 od not exceeding thirty-six months, commencing on the rent  commencement
 date  applicable  to  such eligible taxable premises, provided, however,
 that in no event shall any special reduction be allowed for  any  period
 beginning  after  March  thirty-first,  two  thousand thirty-four.   For
 purposes of applying such special reduction, the base rent for the  base
 year  shall,  where  necessary  to  determine  the amount of the special
 reduction allowable with respect to any number of months falling  within
 a tax period, be prorated by dividing the base rent for the base year by
 twelve and multiplying the result by such number of months.
   (a-1)  Notwithstanding paragraph one of this subdivision, for purposes
 of, and to the extent relevant to, the special reduction allowed by this
 subparagraph, the definitions set forth in section four hundred  ninety-
 nine-aa of the real property tax law shall apply with the same force and
 effect as if they had been set forth in full in this subdivision, except
 as  such  definitions  are  hereinafter  modified. An eligible tenant of
 eligible taxable premises shall be allowed a special reduction in deter-
 mining the  taxable  base  rent  for  such  eligible  taxable  premises,
 provided,  however, that (i) such eligible taxable premises are eligible
 premises as defined in paragraph (c) of subdivision ten of section  four
 hundred  ninety-nine-aa of the real property tax law, (ii) such eligible
 taxable premises are located in  the  special  garment  center  district
 identified in the abatement zone defined in paragraph (c) of subdivision
 two of section four hundred ninety-nine-aa of the real property tax law,
 (iii)  the lease for such eligible taxable premises commences within the
 eligibility period applicable to the abatement zone defined in paragraph
 (c) of subdivision two of section four  hundred  ninety-nine-aa  of  the
 real property tax law, (iv) the lease for such eligible taxable premises
 has  an  initial lease term of at least three years and (v) such special
 reduction is limited to the benefit period, as  defined  in  subdivision
 five  of  section  four  hundred ninety-nine-aa of the real property tax
 law, applicable to a lease commencing on or after July first, two  thou-
 sand  five  for  eligible  premises  located  within  the abatement zone
 defined in paragraph (c) of subdivision  two  of  section  four  hundred
 ninety-nine-aa of the real property tax law.
   (a-2)  The  amount  of  the  special reduction allowed by subparagraph
 (a-1) of this paragraph shall be determined as follows:    (i)  For  the
 S. 8474                            717
 
 base  year  the  amount  of such special reduction shall be equal to the
 base rent for the base year.
   (ii)  For  the  first through ninth twelve-month periods following the
 base year the amount of such special reduction shall  be  equal  to  the
 lesser of (A) the base rent for each such twelve-month period or (B) the
 base rent for the base year.
   (a-3)  When  used  in  this  subdivision,  for purposes of the special
 reduction allowed by subparagraph (a-1) of this paragraph, the following
 terms shall mean or include:  (i) "Eligible taxable  premises."  Taxable
 premises that are eligible premises or expansion premises.
   (ii) "Eligible tenant." A tenant with respect to whose lease of eligi-
 ble taxable premises there has been issued a certificate of abatement.
   (iii)  "Base year." The twelve-month period that commences on the rent
 commencement date.
   (iv) "Base rent for the base year." The total base rent  for  eligible
 taxable  premises  for  the  base  year,  determined without the special
 reduction allowed by subparagraph (a-1) of this paragraph.
   (v) "Certificate of abatement." The certificate  of  abatement  issued
 pursuant to section four hundred ninety-nine-dd of the real property tax
 law.
   (b)  Except as provided in subparagraphs (b-1) and (b-2) of this para-
 graph, the amount of the special reduction allowed by  this  subdivision
 shall  be  determined  as follows:   (i) For the base year the amount of
 such special reduction shall be equal to the  base  rent  for  the  base
 year.
   (ii)  For the first and second twelve-month periods following the base
 year the amount of such special reduction shall be equal to  the  lesser
 of  (A)  the base rent for each such twelve-month period or (B) the base
 rent for the base year.
   (iii) For the third twelve-month period following the  base  year  the
 amount  of  such  special  reduction shall be equal to two-thirds of the
 lesser of (A) the base rent for such twelve-month period or (B) the base
 rent for the base year.
   (iv) For the fourth twelve-month period following the  base  year  the
 amount  of  such  special  reduction  shall be equal to one-third of the
 lesser of (A) the base rent for such twelve-month period or (B) the base
 rent for the base year.
   (b-1) The amount of the special reduction allowed by this  subdivision
 with  respect  to  a  lease commencing on or after April first, nineteen
 hundred ninety-seven with an initial lease term of less than five years,
 but not less than three years, shall be determined as follows:  (i)  For
 the base year the amount of such special reduction shall be equal to the
 base rent for the base year.
   (ii)  For  the  first  twelve-month period following the base year the
 amount of such special reduction shall be equal  to  two-thirds  of  the
 lesser of (A) the base rent for such twelve-month period or (B) the base
 rent for the base year.
   (iii)  For  the second twelve-month period following the base year the
 amount of such special reduction shall be  equal  to  one-third  of  the
 lesser of (A) the base rent for such twelve-month period or (B) the base
 rent for the base year.
   (b-2)  The amount of the special reduction allowed by this subdivision
 with respect to a lease other than a sublease  commencing  between  July
 first,  two  thousand five and June thirtieth, two thousand twenty-seven
 with an initial or renewal lease term of at least five  years  shall  be
 S. 8474                            718

 determined as follows:  (i) For the base year the amount of such special
 reduction shall be equal to the base rent for the base year.
   (ii)  For  the  first,  second,  third and fourth twelve-month periods
 following the base year the amount of such special  reduction  shall  be
 equal  to  the  lesser  of  (A) the base rent for each such twelve-month
 period or (B) the base rent for the base year.
   (c) For purposes of determining (i) whether a tenant is,  pursuant  to
 the provisions of paragraph two of subdivision b of this section, exempt
 from payment of the tax imposed by this chapter with respect to the base
 rent  for  eligible  taxable premises or (ii) whether, and the extent to
 which, a tenant is eligible for  the  credit  allowed  pursuant  to  the
 provisions  of section 11-704.3 of this chapter with respect to eligible
 taxable premises, the term "base rent" as used in such provisions  shall
 be  the  base  rent  as determined prior to the allowance of any special
 reduction allowed by this subdivision.
   (d) Notwithstanding anything to the contrary,  for  purposes  of  this
 subdivision,  expansion  premises  shall  be  treated  as  separate  and
 distinct from any other premises of the expansion  tenant  in  the  same
 eligible building.
   (3) The special reduction allowed by this subdivision shall be allowed
 commencing  on  the  rent commencement date; however, if the date of the
 certificate of abatement or certificate of eligibility is later than the
 rent commencement date, the tenant shall not,  in  the  first  instance,
 claim the special reduction on any return required to be filed for a tax
 period  ending  prior  to  the  date of such certificate of abatement or
 certificate of eligibility. If the date of such certificate of abatement
 or certificate of eligibility falls in a tax period  subsequent  to  the
 tax  period  in  which  the  rent commencement date falls, but both such
 dates fall within the same tax year, the special reduction that was  not
 claimed  in the first instance for any period preceding the date of such
 certificate  of  abatement  or  certificate  of  eligibility  shall   be
 reflected  in  the  final  return  for  the tax year. If the date of the
 certificate of abatement or certificate of eligibility falls in the  tax
 year  following  the tax year in which the rent commencement date falls,
 an amended final return shall be filed for  such  earlier  tax  year  in
 which  shall  be  reflected any special reduction allowable for such tax
 year; in addition, the final  return  for  such  later  tax  year  shall
 reflect any special reduction that was not claimed in the first instance
 for any period in such tax year preceding the date of the certificate of
 abatement or certificate of eligibility.
   (4)  (a)  With  respect to premises located in an eligible government-
 owned building, no special reduction shall be allowed under this  subdi-
 vision  unless:  (i) the landlord enters into a lease for eligible prem-
 ises with a new  tenant  or  a  renewal  tenant  and:    (A)  the  lease
 commencement  date  is within the eligibility period; and (B) (I) if, by
 the sixtieth day following the  rent  commencement  date,  such  new  or
 renewal  tenant  employs  fifty or fewer employees in the eligible prem-
 ises, the initial lease term is for a period of  at  least  five  years,
 provided,  however,  that with respect to a lease commencing on or after
 July first, nineteen hundred ninety-six if, by the sixtieth day  follow-
 ing  the  rent commencement date, such new or renewal tenant employs one
 hundred twenty-five or fewer employees in  the  eligible  premises,  the
 initial lease term is for a period of at least five years, and provided,
 further,  that  with  respect  to  a  lease commencing on or after April
 first, nineteen hundred ninety-seven if, by the sixtieth  day  following
 the  rent  commencement  date,  such  new  or renewal tenant employs one
 S. 8474                            719
 
 hundred twenty-five or fewer employees in  the  eligible  premises,  the
 initial  lease term is for a period of at least three years, or (II) if,
 by the sixtieth day following the rent commencement date,  such  new  or
 renewal  tenant  employs more than fifty employees in the eligible prem-
 ises, the initial lease term is for a period  of  at  least  ten  years,
 provided,  however,  that with respect to a lease commencing on or after
 July first, nineteen hundred ninety-six if, by the sixtieth day  follow-
 ing  the rent commencement date, such new or renewal tenant employs more
 than one hundred twenty-five employees in  the  eligible  premises,  the
 initial lease term is for a period of at least ten years; or
   (ii)  the  landlord  enters  into a lease with an expansion tenant for
 expansion premises and:  (A) the lease commencement date is  within  the
 eligibility  period;  (B)  if  the expansion premises are located in the
 eligible building previously occupied  by  such  expansion  tenant,  the
 lease term for the premises in the eligible building previously occupied
 by such expansion tenant will expire no earlier than the expiration date
 of  the  initial  lease  term  for the expansion premises, provided that
 where such expansion tenant occupies premises in the  eligible  building
 under  more  than  one  lease, the provisions of this subclause shall be
 applied with reference to the lease  for  the  premises  containing  the
 largest  amount  of  square feet, provided, however, that this subclause
 shall not apply to a lease commencing on or after July  first,  nineteen
 hundred  ninety-six;  and  (C) (I) if, by the sixtieth day following the
 rent commencement date, such expansion tenant  employs  fifty  or  fewer
 employees  in  the eligible building in which the expansion premises are
 located, the initial lease term for the  expansion  premises  is  for  a
 period of at least five years, provided, however, that with respect to a
 lease commencing on or after July first, nineteen hundred ninety-six if,
 by the sixtieth day following the rent commencement date, such expansion
 tenant  employs one hundred twenty-five or fewer employees in the expan-
 sion premises, the initial lease term for the expansion premises is  for
 a  period  of  at  least  five  years,  and provided, further, that with
 respect to a lease commencing on or after April first, nineteen  hundred
 ninety-seven  if,  by  the  sixtieth day following the rent commencement
 date, such expansion tenant employs one  hundred  twenty-five  or  fewer
 employees  in  the  expansion  premises,  the initial lease term for the
 expansion premises is for a period of at least three years, or (II)  if,
 by the sixtieth day following the rent commencement date, such expansion
 tenant  employs more than fifty employees in such eligible building, the
 initial lease term for the expansion premises is  for  a  period  of  at
 least  ten  years,  provided,  however,  that  with  respect  to a lease
 commencing on or after July first, nineteen hundred  ninety-six  if,  by
 the  sixtieth  day  following the rent commencement date, such expansion
 tenant employs more than one hundred twenty-five employees in the expan-
 sion premises, the initial lease term for the expansion premises is  for
 a period of at least ten years.
   (b) Notwithstanding anything in this subdivision to the contrary, with
 respect to premises located in an eligible government-owned building, no
 certificate  of  eligibility  shall  be  issued and no special reduction
 shall be allowed under this subdivision if:   (i) the tenant  has  relo-
 cated  to  such premises from any area in the borough of Manhattan north
 of the center line of 96th street or from any portion of the boroughs of
 the Bronx, Brooklyn, Queens, or Staten Island; or  (ii)  the  lease  for
 such premises provides that during the initial lease term required under
 subparagraph (a) of this paragraph either the landlord or the tenant may
 terminate  such  lease  prior to the expiration of such required initial
 S. 8474                            720
 
 lease term, provided that such lease may provide that either  the  land-
 lord or the tenant may terminate such lease if (A) the other party is in
 default  of  any  of  such  party's obligations under the lease, (B) the
 eligible  premises  are  damaged or destroyed by fire or other casualty,
 (C) the eligible premises are  rendered  unusable  for  any  reason  not
 attributable  to  any act or failure to act of either tenant or landlord
 or (D) the eligible premises are acquired by eminent domain.
   (c) For purposes of this paragraph, the expiration  date  of  a  lease
 shall  be  determined  by  the  expiration date set forth in such lease,
 without giving effect to any rights of the landlord  or  the  tenant  to
 terminate such lease prior to the expiration date set forth therein.
   (5)  (a)  (i)  With respect to premises located in an eligible govern-
 ment-owned building, an application for  a  certificate  of  eligibility
 entitling a tenant to claim the special reduction allowed by this subdi-
 vision  shall  be filed by such tenant with the department of finance on
 or after the date on which  the  lease  for  the  eligible  premises  is
 executed  by  the  landlord  and  tenant  but  in no event more than one
 hundred eighty days following the later of the rent commencement date or
 the date that chapter four of the laws of nineteen  hundred  ninety-five
 became  a  law,  and  no such certificate of eligibility shall be issued
 unless such application is filed within such time.
   (ii) Notwithstanding clause (i) of this  subparagraph  and  any  other
 provision  of law to the contrary, with respect to a lease commencing on
 or after July first, nineteen hundred ninety-six in premises located  in
 an  eligible government-owned building, an application for a certificate
 of eligibility entitling a tenant to claim the special reduction allowed
 by this subdivision shall be filed by such tenant with the department of
 finance on or after the date on which the lease for the  eligible  prem-
 ises  is  executed  by the landlord and tenant but in no event more than
 one hundred eighty days following the rent commencement  date  or  sixty
 days following the date that the chapter of the laws of nineteen hundred
 ninety-seven  that  added  this clause became a law, whichever is later,
 and no such certificate of  eligibility  shall  be  issued  unless  such
 application is filed within such time.
   (iii)  Notwithstanding any other provisions of law to the contrary, an
 application for the special reduction allowed by subparagraph  (b-2)  of
 paragraph  two  of  this subdivision shall be considered timely filed if
 filed by such tenant with the department of finance on or after the date
 on which the lease for the eligible premises is executed by the landlord
 and tenant but in no event more than one hundred eighty  days  following
 the  rent  commencement date or by May thirtieth, two thousand fourteen,
 whichever is later, and no such special  reduction  shall  be  permitted
 unless such application is filed within such time.
   (b) In addition to any other information required by the department of
 finance, such application for a certificate of eligibility shall include
 (i)  an  abstract  of the lease for the eligible taxable premises, which
 shall include the lease commencement date, the  rent  commencement  date
 and the expiration date of such lease, (ii) a statement as to the number
 of  persons employed by the tenant in the eligible taxable premises and,
 where applicable, in the eligible building containing such premises,  by
 the sixtieth day following the rent commencement date, (iii) a statement
 as to the location of all office or retail space in the city occupied by
 the  tenant prior to the execution of the lease for the eligible taxable
 premises and the commencement and expiration dates  of  all  leases  for
 such office or retail space located in the abatement zone. Such applica-
 tion  shall  also  state  that  the  tenant agrees to comply with and be
 S. 8474                            721
 
 subject to such rules as may be issued from time to time by the  depart-
 ment of finance.
   (c) The department of finance shall issue a certificate of eligibility
 upon  determining  that  an application filed pursuant to this paragraph
 meets the requirements set forth in this subdivision, provided, however,
 that no such certificate of eligibility shall be issued if any  payments
 in  lieu  of taxes, water or sewer charges or other lienable charges are
 due and owing with respect to such eligible government-owned building at
 the time such application is pending, unless such payments  in  lieu  of
 taxes  or  charges  are  at  such time being paid in timely installments
 pursuant to a written agreement with the department of finance or  other
 appropriate agency.
   (d)  The  burden  of proof shall be on the tenant to show by clear and
 convincing evidence that the requirements for granting a certificate  of
 eligibility  have  been  satisfied. The department of finance shall have
 the authority to require that statements in connection with applications
 pursuant to this paragraph be made under oath.
   (e) The department of finance may provide by rule for the  payment  by
 tenants of premises in eligible government-owned buildings of reasonable
 administrative   charges   or  fees  necessary  to  defray  expenses  in
 connection with the determination of initial and continuing  eligibility
 for the special reduction allowed by this subdivision.
   (6)  (a) If an eligible tenant (i) sublets any portion of the eligible
 taxable premises to any other person, or (ii) otherwise ceases to occupy
 or use any portion of the premises as eligible  taxable  premises,  such
 tenant  shall,  immediately upon the occurrence of any such event, cease
 to be eligible for the special reduction  allowed  by  this  subdivision
 with  respect  to  the  portion of the premises which is sublet or which
 ceases to be occupied or used by such tenant as eligible  taxable  prem-
 ises, and for any period following the occurrence of any such event, the
 special reduction otherwise allowed by this subdivision shall be reduced
 by  an  amount  determined  by  multiplying  the  amount of such special
 reduction by the percentage of the premises which is sublet or which has
 ceased to be occupied or used as eligible taxable premises.
   Such tenant shall give written notice of the occurrence  of  any  such
 event  to  the  department of finance within thirty days thereof. If the
 tenant fails to give such notice, an assessment of  any  additional  tax
 that  may become due as a result of the occurrence of any such event may
 be made at any time, notwithstanding anything in section 11-717 of  this
 chapter to the contrary.
   (b) Notwithstanding anything in this chapter to the contrary, a tenant
 claiming  the special reduction allowed by this subdivision shall file a
 return for each tax period with respect to which such special  reduction
 is  claimed.  Each  such  return  shall  contain  a certification by the
 tenant, in such form as the department of finance may prescribe, to  the
 effect  that such tenant meets all the requirements of this subdivision,
 and no special reduction shall  be  allowed  if  such  return  does  not
 contain such certification by such tenant.
   (c)  If  any  special  reduction  allowed  under  this subdivision was
 obtained by a tenant as a result of having made a  false  or  misleading
 statement  as to a material fact or having omitted to state any material
 fact necessary in order to make such statement not false or  misleading,
 no  such  special reduction shall be allowed and any additional tax that
 becomes due as a result of such disallowance  may  be  assessed  at  any
 time,  notwithstanding anything in section 11-717 of this chapter to the
 contrary. In addition, the department of finance may  declare  any  such
 S. 8474                            722
 
 tenant to be ineligible to claim any special reduction under this subdi-
 vision in the future with respect to the same or any other premises.
   7.  A  determination by the department of finance pursuant to subdivi-
 sion six of section four hundred ninety-nine-f of the real property  tax
 law  to  deny,  terminate or revoke any abatement applied for or granted
 pursuant to title four of article four of  the  real  property  tax  law
 based  on the relationship between the landlord and the tenant shall not
 be dispositive  of  whether  such  tenant  is  eligible  for  a  special
 reduction  under  this subdivision. The department of finance may deter-
 mine that such tenant is eligible for a  special  reduction  under  this
 subdivision and may issue a certificate of eligibility to such tenant in
 accordance  with the procedures and pursuant to the standards applicable
 to a tenant of premises located in an eligible  government-owned  build-
 ing, provided, however, that any application filed pursuant to paragraph
 five of this subdivision by a tenant whose application for a certificate
 of abatement pursuant to title four of article four of the real property
 tax  law was denied by the department of finance pursuant to subdivision
 six of section four hundred ninety-nine-f of the real property  tax  law
 based  on  the relationship between the landlord and the tenant, or by a
 tenant whose application for a  certificate  of  abatement  pursuant  to
 title  four  of article four of the real property tax law was granted by
 the department of finance, but whose abatement was terminated or revoked
 by the department of finance pursuant to subdivision six of section four
 hundred ninety-nine-f  of  the  real  property  tax  law  based  on  the
 relationship  between  the landlord and the tenant, may be deemed by the
 department of finance to have been filed on the date the application for
 such certificate of abatement was filed. This paragraph shall only apply
 to leases commencing on or after April first, nineteen  hundred  ninety-
 seven.
   §  11-704.2  Special credit. A tenant whose base rent for the tax year
 beginning June first, nineteen hundred ninety-three and ending May thir-
 ty-first, nineteen hundred  ninety-four  is  at  least  eleven  thousand
 dollars  per  year  but  not in excess of thirteen thousand nine hundred
 ninety-nine dollars per year shall be allowed a credit against  the  tax
 imposed by this chapter for such tax year, such credit shall be equal to
 twenty-five  percent  of  the tax imposed on such base rent for such tax
 year. Where the base rent of a tenant is for a period of less  than  one
 year,  such base rent shall, for purposes of this section, be determined
 as if it had been on an equivalent basis for the entire year. The credit
 allowed under this section shall be deducted prior to the  deduction  of
 any credit allowable under section 11-704.1 of this chapter.
   §  11-704.3  Tax  credit.  (a)  (1) For the period beginning September
 first, nineteen hundred ninety-five and ending May  thirty-first,  nine-
 teen  hundred  ninety-six,  a  credit  shall  be allowed against the tax
 imposed by this chapter, such credit to be determined in accordance with
 the following table:
 
 If the tenant's annualized           The credit shall be an amount equal
 base rent for such period is:        to the following  percentage of the
                                      tax imposed on such annualized base
                                      rent for such period:
 At least:                But not over:
 $40,000                  $44,999                  80%
 $45,000                  $49,999                  60%
 $50,000                  $54,999                  40%
 $55,000                  $59,999                  20%
 S. 8474                            723
 
   If the tenant's annualized base rent for such period  is  over  fifty-
 nine  thousand  nine  hundred  ninety-nine  dollars,  no credit shall be
 allowed under this paragraph.
   (2) For the tax year beginning June first, nineteen hundred ninety-six
 and  ending  May  thirty-first,  nineteen hundred ninety-seven, a credit
 shall be allowed against the tax imposed by this chapter, such credit to
 be determined in accordance with the following table:
 
 If the tenant's base rent is:        The credit shall be an amount equal
                                      to the  following percentage of the
                                      tax imposed  on such  base rent for
                                      the tax year:
 At least:                But not over:
 $40,000                  $44,999                  80%
 $45,000                  $49,999                  60%
 $50,000                  $54,999                  40%
 $55,000                  $59,999                  20%
 
   If the tenant's base rent is over  fifty-nine  thousand  nine  hundred
 ninety-nine dollars, no credit shall be allowed under this paragraph.
   (3)  For  each  tax  year  beginning  on or after June first, nineteen
 hundred ninety-seven and ending on or before May thirty-first, two thou-
 sand, a credit shall be allowed against the tax imposed by this chapter,
 such credit to be determined in accordance with the following table:
 
 If the tenant's base rent is:        The credit shall be an amount equal
                                      to the following  percentage of the
                                      tax imposed by this chapter for the
                                      tax year:
 At least:                But not over:
 $100,000                 $109,999                 80%
 $110,000                 $119,999                 60%
 $120,000                 $129,999                 40%
 $130,000                 $139,999                 20%
 
   If the tenant's base rent is over  one  hundred  thirty-nine  thousand
 nine  hundred ninety-nine dollars, no credit shall be allowed under this
 paragraph. For purposes of this paragraph, 'base rent' shall  be  calcu-
 lated  without regard to any reduction in base rent allowed by paragraph
 two of subdivision h of section 11-704 of this chapter.
   (4) For the period beginning  June  first,  two  thousand  and  ending
 November  thirtieth, two thousand, a credit shall be allowed against the
 tax imposed by this chapter, such credit to be determined in  accordance
 with the following table:
 
 If the tenant's annualized           The credit shall be an amount equal
 base rent for such period is:        to the following percentage of the
                                      tax imposed on such annualized base
                                      rent for such period:
 At least:                But not over:
 $100,000                 $109,999                 80%
 $110,000                 $119,999                 60%
 $120,000                 $129,999                 40%
 $130,000                 $139,999                 20%
 S. 8474                            724
 
   If  the  tenant's  annualized  base  rent  for such period is over one
 hundred thirty-nine thousand nine hundred ninety-nine dollars, no credit
 shall be allowed under this paragraph. For purposes  of  this  paragraph
 'base  rent' shall be calculated without regard to any reduction in base
 rent allowed by paragraph two of subdivision h of section 11-704 of this
 chapter.
   (5)  For  the period beginning December first, two thousand and ending
 May thirty-first, two thousand one, a credit shall  be  allowed  against
 the tax imposed by this chapter, such credit to be determined in accord-
 ance with the following table:
 
 If the tenant's annualized           The credit shall be an amount equal
 base rent for such period is:        to the following percentage of the
                                      tax imposed on such annualized base
                                      rent for such period:
 At least:                But not over:
 $150,000                 $159,999                 80%
 $160,000                 $169,999                 60%
 $170,000                 $179,999                 40%
 $180,000                 $189,999                 20%
 
   If  the  tenant's  annualized  base  rent  for such period is over one
 hundred eighty-nine thousand nine hundred ninety-nine dollars, no credit
 shall be allowed under this paragraph. For purposes of  this  paragraph,
 'base  rent' shall be calculated without regard to any reduction in base
 rent allowed by paragraph two of subdivision h of section 11-704 of this
 chapter.
   (6) For each tax year beginning on or after June first,  two  thousand
 one,  a  credit shall be allowed against the tax imposed by this chapter
 as follows: a tenant whose base rent is at least two hundred  and  fifty
 thousand  dollars but not more than three hundred thousand dollars shall
 be allowed a credit in an amount determined  by  multiplying  three  and
 nine-tenths percent of base rent by a fraction the numerator of which is
 three  hundred  thousand  dollars  minus the amount of base rent and the
 denominator of which is fifty thousand dollars.  If  the  tenant's  base
 rent  is over three hundred thousand dollars, no credit shall be allowed
 under this paragraph. For purposes of this paragraph, 'base rent'  shall
 be  calculated  without  regard to any reduction in base rent allowed by
 paragraph two of subdivision h of section 11-704 of this chapter.
   (b) (1) Where the base rent of a tenant is for a period of  less  than
 one  year, such base rent shall, for purposes of this section, be deter-
 mined as if it had been on an equivalent basis for the entire year.  The
 credits  allowed  under  this  section  shall  be  deducted prior to the
 deduction of any credit allowable under section 11-704.1 of  this  chap-
 ter.
   (2)  For  purposes  of  paragraphs four and five of subdivision (a) of
 this section, base rent for the period specified in each of  such  para-
 graphs shall be separately annualized as if it had been on an equivalent
 basis  for  an entire year, irrespective of the actual base rent for the
 tax year including the period specified in such paragraph.
   § 11-704.4. Small business tax credit. a. As used in this section, the
 following terms have the following meanings:
   1. Income factor. The term "income factor" shall mean:
   (i) for a tenant with total income  of  not  more  than  five  million
 dollars, one;
 S. 8474                            725
 
   (ii)  for a tenant with total income of more than five million dollars
 but not more than ten million dollars, a fraction the numerator of which
 is ten million dollars minus the amount of total income and the  denomi-
 nator of which is five million dollars; and
   (iii) for a tenant with total income of more than ten million dollars,
 zero.
   2. Rent factor. The term "rent factor" shall mean:
   (i)  for  a  tenant  whose small business tax credit base rent is less
 than five hundred thousand dollars, one; and
   (ii) for a tenant whose small business tax  credit  base  rent  is  at
 least five hundred thousand dollars but not more than five hundred fifty
 thousand  dollars,  a  fraction  the  numerator of which is five hundred
 fifty thousand dollars minus the amount of  small  business  tax  credit
 base rent and the denominator of which is fifty thousand dollars.
   3.  Small  business tax credit base rent. The term "small business tax
 credit base rent" shall mean the base rent calculated without regard  to
 any  reduction in base rent allowed by paragraph two of subdivision h of
 section 11-704 of this chapter.
   4. Total income.  The  term  "total  income"  shall  mean  the  amount
 reported by a person, as defined by section seven thousand seven hundred
 one  of  the  internal revenue code, to the internal revenue service for
 the purpose of the federal  income  tax  in  the  tax  year  immediately
 preceding the period for which the tenant is applying for the credit set
 forth  in  subdivision b that is equal to the gross receipts or sales of
 the person minus any returns and allowances, minus  the  cost  of  goods
 sold  plus  the  amount  of  any dividends, interest, gross rents, gross
 royalties, capital gain net income, net gain or loss from  the  sale  of
 business property, net farm profit or loss, ordinary income or loss from
 other  partnerships,  estates  or trusts or other income or loss; except
 that, if the tenant is a limited liability  company  or  other  business
 entity  that  is  not  separate  from  its  owner for federal income tax
 purposes under section 301.7701-2(c)(2) of  title  26  of  the  code  of
 federal  regulations, total income as defined in this section shall mean
 the total income of the person that reports the activities of the tenant
 as its sole owner for federal income tax purposes.
   b. Beginning on June first, two thousand eighteen  and  for  each  tax
 year  beginning  thereafter,  a  credit shall be allowed against the tax
 imposed by this chapter as follows: a tenant whose  small  business  tax
 credit  base rent is at least two hundred fifty thousand dollars but not
 more than five hundred fifty thousand dollars shall be allowed a  credit
 in  the  amount  determined by multiplying the tax imposed on the tenant
 pursuant to section 11-702 of this chapter minus any  allowable  credits
 or exemptions set forth outside this section by the income factor and by
 the  rent factor. If the tenant's small business tax credit base rent is
 over five hundred fifty thousand dollars, no  credit  shall  be  allowed
 under this section.
   c.  The  department  of  finance may promulgate any rules necessary to
 implement the provisions of this section, including, but not limited to,
 rules that prevent abuse of this section by related parties.
   § 11-705 Returns.  a. Every tenant subject to tax under  this  chapter
 shall file with the commissioner of finance a return with respect to the
 taxes  payable  for  the  three month periods ending on the last days of
 August, November and February of each  year  and  a  final  return  with
 respect  to the taxes payable for the tax year ending on the last day of
 May of each year.  Such returns shall be filed within twenty  days  from
 the  expiration  of  the  period covered thereby. A tenant who is exempt
 S. 8474                            726
 
 from the tax by reason of paragraph two  of  subdivision  b  of  section
 11-704  of  this  chapter shall nevertheless be required to file a final
 return, provided, however, that for tax years beginning on or after June
 first,  nineteen hundred ninety-five and ending on or before May thirty-
 first, nineteen hundred ninety-seven, no  such  final  return  shall  be
 required from such exempt tenant with respect to taxable premises if (1)
 the  tenant's  rent  for such premises, determined without regard to any
 deduction from or reduction in rent or base rent allowed by  this  chap-
 ter,  does  not exceed fifteen thousand dollars for the tax year and (2)
 in the case of a tenant who has more  than  one  taxable  premises,  the
 aggregate  rents for all such premises, determined without regard to any
 deduction from or reduction in rent or base rent allowed by  this  chap-
 ter,  do  not  exceed fifteen thousand dollars for the tax year. For tax
 years beginning on June first, nineteen hundred ninety-seven and  ending
 on  or  before  May thirty-first, two thousand one, no such final return
 shall be required from such exempt tenant with respect  to  any  taxable
 premises  if (1) the tenant's rent for such premises, determined without
 regard to any deduction from or reduction in rent or base  rent  allowed
 by  this  chapter, does not exceed seventy-five thousand dollars for the
 tax year and (2) the amount of rent received or due from  any  subtenant
 of  such  exempt  tenant  with  respect to such premises does not exceed
 seventy-five thousand dollars for the tax year. For tax years  beginning
 on  or after June first, two thousand one, no such final return shall be
 required from such exempt tenant with respect to any taxable premises if
 (1) the tenant's rent for such premises, determined  without  regard  to
 any  deduction  from  or  reduction in rent or base rent allowed by this
 chapter, does not exceed two hundred thousand dollars for the  tax  year
 and  (2)  the  amount of rent received or due from any subtenant of such
 exempt tenant with respect to such premises does not exceed two  hundred
 thousand  dollars  for  the  tax  year. Notwithstanding anything in this
 subdivision to the contrary, for  tax  periods  beginning  on  or  after
 September  first,  nineteen  hundred  ninety-five,  no  return  shall be
 required pursuant to this subdivision with respect to any taxable  prem-
 ises  located  in  that  part  of the city specified in paragraph one of
 subdivision h of section 11-704 of this chapter,  and  no  such  taxable
 premises  shall be taken into account for purposes of clause two of this
 subparagraph. The commissioner of finance may permit or require returns,
 including final returns, to be made for  other  periods  and  upon  such
 dates  as  the commissioner may specify and if he or she deems it neces-
 sary, in order to insure the payment of the tax imposed by this chapter,
 the commissioner may require such returns to be made for shorter periods
 than those prescribed by this subdivision of this section, and upon such
 dates as he or she may specify.
   b.  The commissioner of finance may by regulation require  the  filing
 of information returns and supplemental information returns by landlords
 and  by tenants of taxable premises, whether or not they are required to
 pay the tax imposed by this chapter, upon such dates or at such times as
 the commissioner may specify if he or  she  deems  the  filing  of  such
 information returns necessary for proper administration of this chapter.
   c.  The form of returns and information returns shall be prescribed by
 the  commissioner  of  finance and shall contain such information as the
 commissioner may deem necessary for the proper  administration  of  this
 chapter.    The  commissioner  of finance may require amended returns or
 amended information returns to be filed within twenty days after  notice
 and to contain the information specified in the notice.
 S. 8474                            727

   d.   If a return or information return is not filed, or if a return of
 any kind when filed is  incorrect  or  insufficient  on  its  face,  the
 commissioner  of  finance  shall take the necessary steps to enforce the
 filing of such a return or of a corrected return.
   §  11-706  Payment of tax. a. The tax imposed by this chapter shall be
 due and payable on or before the twentieth day  of  the  calendar  month
 following  the  end  of each tax period and shall be paid to the commis-
 sioner of finance, as follows: The tax to be paid at such time shall  be
 based  on the base rent for such tax period and the rate of tax shall be
 the one which would be applicable if the base rent for such period  were
 the  same  for  each  tax  period  during  the tax year, except that the
 payment required to be made together with the final  return  or  at  the
 time  that the final return should be filed shall be the amount by which
 the actual tax for the tax year exceeds the amounts previously paid  for
 the tax year.
   b.  Where  the  final return shows that the amount of tax paid for the
 tax year exceeds the actual tax  for  such  year,  the  commissioner  of
 finance  shall  make  the  appropriate  refund  as promptly as possible,
 provided, however, that where the commissioner of finance has reason  to
 believe  that the final return is inaccurate, the commissioner may with-
 hold the refund in whole or in part.  The making of a refund pursuant to
 this subdivision shall not prevent  the  commissioner  of  finance  from
 making  a  determination that additional tax is due or from pursuing any
 other method to recover the full amount of the actual tax  due  for  the
 tax year.
   c.  Where  a  tenant ceases to do business the tax, as measured by the
 tenant's base rent for the prior part of the  tax  year,  shall  be  due
 immediately,  and  the tenant shall file a final return, but, should the
 tenant continue to pay rent for the taxable premises, the  tenant  shall
 file  the normally required returns and a final return for the tax year,
 provided, however, that  any  such  tax  payment  shall  be  applied  in
 reduction  of  the tax payments required to be made with such returns or
 with the final return for such tax year.
   § 11-707  Records to be kept.  Every landlord of taxable premises  and
 every  tenant  of  taxable  premises shall keep records of rent paid and
 received by him or her in such form as the commissioner of  finance  may
 by  regulation  require, all leases or agreements which fix the rents or
 rights of tenants of taxable premises, and such other records,  receipts
 and other papers relevant to the ascertainment of the tax due under this
 chapter  as the commissioner of finance may by regulation require.  Such
 records shall be offered for inspection and examination at any time upon
 demand by the commissioner of finance.  Such records, unless the commis-
 sioner of finance consents to a sooner destruction or requires that they
 be kept for a longer time, shall be preserved  for  a  period  of  three
 years  except that leases or agreements which fix the rents or rights of
 a tenant shall be kept for a period of three years after the  expiration
 of the tenancy thereunder.
   § 11-708 Determination of tax. If a return required by this chapter is
 not  filed,  or if a return when filed is incorrect or insufficient, the
 commissioner of finance shall determine the amount of tax due from  such
 information as may be obtainable and, if necessary, may estimate the tax
 on  the basis of external indices. Notice of such determination shall be
 given to the person liable for the payment of  the  tax.  Such  determi-
 nation  shall  finally  and  irrevocably  fix  the tax unless the person
 against whom it is assessed, within ninety  days  after  the  giving  of
 notice  of  such  determination  or,  if the commissioner of finance has
 S. 8474                            728
 
 established a conciliation procedure pursuant to section 11-124 of  this
 title  and  the  taxpayer  has  requested  a  conciliation conference in
 accordance therewith, within ninety days from the mailing of  a  concil-
 iation  decision  or  the date of the commissioner's confirmation of the
 discontinuance of the conciliation proceeding, both (1) serves  a  peti-
 tion  upon the commissioner of finance and (2) files a petition with the
 tax appeals tribunal for  a  hearing,  or  unless  the  commissioner  of
 finance  of  the  commissioner's  own motion shall redetermine the same.
 Such hearing and any appeal to the tax appeals tribunal sitting en  banc
 from  the  decision  rendered  in such hearing shall be conducted in the
 manner and subject to the requirements prescribed  by  the  tax  appeals
 tribunal  pursuant  to  sections  one  hundred  sixty-eight  through one
 hundred seventy-two of the charter of the preceding municipality  as  it
 existed January first, nineteen hundred ninety-four.  After such hearing
 the tax appeals tribunal shall give notice of its decision to the person
 against  whom the tax is assessed and to the commissioner of finance.  A
 decision of the tax appeals tribunal sitting en banc shall be reviewable
 for error, illegality or unconstitutionality or any other reason whatso-
 ever by a proceeding under article seventy-eight of the  civil  practice
 law  and  rules  if application therefor is made to the supreme court by
 the person against whom the tax was assessed within  four  months  after
 the  giving  of  the  notice  of  such  tax  appeals  tribunal decision,
 provided, however, that any such proceeding under article  seventy-eight
 of the civil practice law and rules shall not be instituted by a taxpay-
 er unless:  (a) the amount of any tax sought to be reviewed, with inter-
 est and penalties thereon, if any, shall be first deposited and there is
 filed an undertaking with the commissioner of finance, issued by a sure-
 ty company authorized to transact business in this state and approved by
 the superintendent of insurance of this state as to solvency and respon-
 sibility, in such amount as a justice of the supreme court shall approve
 to  the effect that if such proceeding be dismissed or the tax confirmed
 the taxpayer will pay all costs and charges  which  may  accrue  in  the
 prosecution of such proceeding or (b) at the option of the taxpayer such
 undertaking  may be in a sum sufficient to cover the taxes, interest and
 penalties stated in such decision plus the costs and charges  which  may
 accrue  against  it in the prosecution of the proceeding, in which event
 the taxpayer shall not be required to pay such taxes, interest or penal-
 ties as a condition precedent to the application.
   § 11-709 Refunds. a. In  the  manner  provided  in  this  section  the
 commissioner  of  finance  shall refund or credit, without interest, any
 tax, penalty or interest erroneously,  illegally  or  unconstitutionally
 collected or paid, if written application to the commissioner of finance
 for such refund shall be made within eighteen months from the date fixed
 by this chapter for filing the return on which such payment was based or
 within  six  months  of  the  payment thereof, whichever of such periods
 expire the later. Whenever a refund or credit is  made  or  denied,  the
 commissioner  of finance shall state his or her reason therefor and give
 notice thereof to the taxpayer in writing. The commissioner  of  finance
 may, in lieu of any refund required to be made, allow credit therefor on
 payments due from the applicant.
   b.  Any  determination of the commissioner of finance denying a refund
 or credit pursuant to subdivision a of this section shall be  final  and
 irrevocable unless the applicant for such refund or credit, within nine-
 ty  days  from  the  mailing of notice of such determination, or, if the
 commissioner of finance has established a conciliation procedure  pursu-
 ant  to  section  11-124 of this title and the applicant has requested a
 S. 8474                            729
 
 conciliation conference in accordance therewith, within ninety days from
 the mailing of a conciliation decision or the date of the commissioner's
 confirmation of the discontinuance of the conciliation proceeding,  both
 (1)  serves  a petition upon the commissioner of finance and (2) files a
 petition with the tax appeals tribunal for a hearing. Such petition  for
 a refund or credit, made as herein provided, shall be deemed an applica-
 tion  for a revision of any tax, penalty or interest complained of. Such
 hearing of any appeal to the tax appeals tribunal sitting en  banc  from
 the  decision  rendered in such hearing shall be conducted in the manner
 and subject to the requirements prescribed by the tax  appeals  tribunal
 pursuant  to  section one hundred sixty-eight through one hundred seven-
 ty-two of the charter of the preceding municipality as it existed  Janu-
 ary  first,  nineteen  hundred  ninety-four. After such hearing, the tax
 appeals tribunal shall give notice of its decision to the applicant  and
 to  the  commissioner  of  finance.  The  applicant shall be entitled to
 institute a proceeding pursuant to article seventy-eight  of  the  civil
 practice  law and rules to review a decision of the tax appeals tribunal
 sitting en banc if application to the supreme  court  be  made  therefor
 within  four  months  after  the  giving of notice of such decision, and
 provided, in the case of an application by  a  taxpayer,  that  a  final
 determination  of  tax  due  was  not previously made. Such a proceeding
 shall not be instituted by a taxpayer unless an undertaking shall  first
 be  filed with the commissioner of finance, in such amount and with such
 sureties as a justice of the supreme court shall approve, to the  effect
 that  if such proceeding be dismissed or the tax confirmed, the taxpayer
 will pay all costs and charges which may accrue in  the  prosecution  of
 the proceeding.
   c.  A  person  shall  not  be entitled to a revision, refund or credit
 under this section of a tax, interest or penalty which had  been  deter-
 mined  to  be  due  pursuant to the provisions of section 11-708 of this
 chapter where such person has had a hearing  or  an  opportunity  for  a
 hearing,  as provided in said section, or has failed to avail himself or
 herself of the remedies therein provided. No refund or credit  shall  be
 made  of  a  tax,  interest or penalty paid after a determination by the
 commissioner of finance made pursuant to section 11-708 of this  chapter
 unless  it  be  found  that such determination was erroneous, illegal or
 unconstitutional, or otherwise improper, by  the  tax  appeals  tribunal
 after a hearing, or, if such tax appeals tribunal affirms in whole or in
 part  the  determination of the commissioner of finance, in a proceeding
 under article seventy-eight of the civil practice law and rules,  pursu-
 ant  to  the provisions of said section, in which event refund or credit
 without interest shall be made of the tax, interest or penalty found  to
 have been overpaid.
   §  11-710  Remedies  exclusive.  The remedies provided by this chapter
 shall be the exclusive remedies available to any person for  the  review
 of  tax  liability  imposed  by  this  chapter;  and no determination or
 proposed determination of tax or determination on  any  application  for
 refund  by  the  commissioner  of  finance,  nor any decision by the tax
 appeals tribunal or any of  its  administrative  law  judges,  shall  be
 enjoined  or  reviewed  by an action for declaratory judgment, an action
 for money had and received or by any action or proceeding other than, in
 the case of a decision by the tax appeals tribunal sitting  en  banc,  a
 proceeding  under  article  seventy-eight  of the civil practice law and
 rules; provided, however, that a taxpayer  may  proceed  by  declaratory
 judgment  if  he or she institutes suit within thirty days after a defi-
 ciency assessment is made and pays the amount of the deficiency  assess-
 S. 8474                            730
 
 ment  to  the  commissioner  of finance prior to the institution of such
 suit and posts a bond for costs as provided in section  11-708  of  this
 chapter.
   §  11-711    Reserves.   In cases where the taxpayer has applied for a
 refund and has instituted a proceeding under  article  seventy-eight  of
 the  civil  practice  law and rules to review a determination adverse to
 the taxpayer on his or her application for refund, the comptroller shall
 set up appropriate reserves to meet any decision adverse to the city.
   § 11-712  Proceedings to recover tax.  a.  Whenever any  person  shall
 fail  to  pay  any tax or penalty or interest imposed by this chapter as
 herein provided, the corporation counsel shall, upon the request of  the
 commissioner  of  finance,  bring  or  cause  to be brought an action to
 enforce payment of the same against the person liable for  the  same  on
 behalf  of  the  city  of Staten Island in any court of the state of New
 York or of any other state or of the United  States.  If,  however,  the
 commissioner  of  finance  in  his  or  her   discretion believes that a
 taxpayer subject to the provisions of this chapter  is  about  to  cease
 business, leave the state or remove or dissipate the assets out of which
 tax  or  penalties  might  be satisfied and that any such tax or penalty
 will not be paid when due, he or she may declare such tax or penalty  to
 be immediately due and payable and may issue a warrant immediately.
   b. As an additional or alternate remedy, the commissioner  of  finance
 may issue a warrant, directed to the city sheriff commanding the sheriff
 to  levy  upon  and  sell  the real and personal property of such person
 which may be found within the city, for the payment of the amount there-
 of, with any penalties and interest,  and  the  cost  of  executing  the
 warrant,  and  to return such warrant to the commissioner of finance and
 to pay to the commissioner the money collected by virtue thereof  within
 sixty  days  after the receipt of such warrant.  The city sheriff shall,
 within five days after the receipt of the warrant, file with the  county
 clerk  a copy thereof, and thereupon such clerk shall enter in the judg-
 ment docket the name of the person mentioned  in  the  warrant  and  the
 amount  of  the  tax,  penalties  and  interest for which the warrant is
 issued and the date when such copy is filed.   Thereupon the  amount  of
 such  warrant  so  docketed  shall  become  a lien upon the title to and
 interest in real and personal property of the person  against  whom  the
 warrant is issued.  The city sheriff shall then proceed upon the warrant
 in  the  same  manner  and  with  like effect as that provided by law in
 respect to executions issued against property upon judgments of a  court
 of  record, and for services in executing the warrant the sheriff  shall
 be entitled to the same fees which the sheriff may collect in  the  same
 manner.    In the discretion of the commissioner of finance a warrant of
 like terms, force and effect may be issued and directed to  any  officer
 or  employee  of the department of finance, and in the execution thereof
 such officer or employee shall have all the powers conferred by law upon
 sheriffs, but he or she shall be entitled to no fee or  compensation  in
 excess  of the actual expenses paid in the performance of such duty.  If
 a warrant is returned not satisfied in full, the commissioner of finance
 may from time to time issue new warrants and shall also  have  the  same
 remedies  to enforce the amount due thereunder as if the city had recov-
 ered judgment therefor and execution thereon had been returned  unsatis-
 fied.
   c.  Whenever  there  is made a sale, transfer or assignment in bulk of
 any part or the whole of a stock  of  merchandise  or  of  fixtures,  or
 merchandise and of fixtures pertaining to the conducting of the business
 of  the  seller,  transferor or assignor, otherwise than in the ordinary
 S. 8474                            731
 
 course of trade and in the regular prosecution  of  said  business,  the
 purchaser,  transferee or assignee shall at least ten days before taking
 possession of such merchandise, fixtures, or merchandise  and  fixtures,
 or  paying  therefor,  notify  the commissioner of finance by registered
 mail of the proposed sale and of the price, terms and conditions thereof
 whether or not the seller, transferor or assignor, has  represented  to,
 or  informed  the purchaser, transferee or assignee that it owes any tax
 pursuant to this chapter and whether or not the purchaser, transferee or
 assignee has knowledge that such taxes are owing, and whether  any  such
 taxes are in fact owing.
   Whenever  the  purchaser,  transferee  or  assignee shall fail to give
 notice to the commissioner of finance as required by the  opening  para-
 graph of this subdivision, or whenever the commissioner of finance shall
 inform  the  purchaser, transferee or assignee that a possible claim for
 such tax or taxes exists, any sums  of  money,  property  or  choses  in
 action,  or  other  consideration,  which  the  purchaser, transferee or
 assignee is required to transfer  over  to  the  seller,  transferor  or
 assignor  shall  be  subject  to a first priority right and lien for any
 such taxes theretofore or thereafter determined to be due from the sell-
 er, transferor or assignor to the city, and the purchaser, transferee or
 assignee is forbidden to transfer to the seller, transferor or  assignor
 any  such  sums  of money, property or choses in action to the extent of
 the amount of the  city's  claim.    For  failure  to  comply  with  the
 provisions  of  this subdivision, the purchaser, transferee or assignee,
 in addition to being subject to the  liabilities  and  remedies  imposed
 under  the provisions of former section forty-four of the personal prop-
 erty law, shall be personally liable for the payment to the city of  any
 such  taxes  theretofore  or thereafter determined to be due to the city
 from the seller, transferor or  assignor,  and  such  liability  may  be
 assessed  and enforced in the same manner as the liability for tax under
 this chapter.
   d. The commissioner of finance, if he or she finds that the  interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the  commissioner  of finance may require, may release any property from
 the lien of any warrant or vacate such warrant for unpaid  taxes,  addi-
 tions  to tax, penalties and interest filed pursuant to subdivision b of
 this section, and such  release  or  vacating  of  the  warrant  may  be
 recorded  in  the  office of any recording officer in which such warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   § 11-713  General powers of the commissioner of finance.  In  addition
 to  the  powers  granted to the commissioner of finance in this chapter,
 the commissioner  is hereby authorized and empowered:
   1. To make, adopt and amend rules and regulations appropriate  to  the
 carrying out of this chapter and the purposes thereof;
   2.  To  extend,  for cause shown, the time for filing any return for a
 period not exceeding ninety days; and to compromise disputed  claims  in
 connection with the taxes hereby imposed;
   3.  To request information from the tax commission of the state on New
 York or the treasury department of the United  States  relative  to  any
 person;  and to afford information to such tax commission or such treas-
 ury department relative to any person;
   4. To delegate the commissioner's functions pursuant to  this  section
 to  a  deputy  commissioner of finance or other employee or employees of
 the commissioner's department;
 S. 8474                            732
 
   5. To assess, determine, revise and adjust  the  taxes  imposed  under
 this chapter;
   6.  To  require  any  tenant  who  uses  premises for both residential
 purposes and as taxable premises and who pays an undivided rent for  the
 entire  premises  so  used to provide the commissioner with a signed and
 notarized request to the United States director of internal revenue  for
 photostatic  copies  of the tenant's income tax return for any year when
 the commissioner deems such income tax return necessary to determine the
 rent ascribable to so much of such premises as is used as taxable  prem-
 ises; and, if the tenant refuses to provide the commissioner with such a
 signed written request, to treat the rent for the entire premises as the
 rent for so much as is used as taxable premises;
   7.  To prescribe methods for determining how much of any tenant's base
 rent is ascribable to a use which results in a  reduction  of  the  base
 rent or for determining any other division of rent or of use of premises
 necessary  for  the determination of the base rent or the amount of base
 rent subject to tax under this chapter;
   8. To authorize banks or trust companies  which  are  depositories  or
 financial  agents  of the city to receive and give a receipt for any tax
 imposed under this chapter in such manner, at such times, and under such
 conditions as the commissioner of finance may prescribe; and the commis-
 sioner of finance shall prescribe the manner, times and conditions under
 which the receipt of such tax by such banks and trust companies is to be
 treated as payment of such tax to the commissioner of finance.
   § 11-714  Administration of oaths and  compelling  testimony.  a.  The
 commissioner  of  finance,  the commissioner's employees duly designated
 and authorized by the commissioner, the tax appeals tribunal and any  of
 its  duly designated and authorized employees shall have power to admin-
 ister oaths and take affidavits in relation to any matter or  proceeding
 in  the  exercise  of  their  powers  and duties under this chapter. The
 commissioner of finance and the tax appeals tribunal shall have power to
 subpoena and require the attendance of witnesses and the  production  of
 books,  papers  and  documents  to  secure  information pertinent to the
 performance of the duties of the commissioner  or  of  the  tax  appeals
 tribunal hereunder and of the enforcement of this chapter and to examine
 them  in  relation thereto, and to issue commissions for the examination
 of witnesses who are out of the state or unable  to  attend  before  the
 commissioner or the tax appeals tribunal or excused from attendance.
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 testimony  of  witnesses  and  the  production and examination of books,
 papers and documents called for by the subpoena of the  commissioner  of
 finance or the tax appeals tribunal under this chapter.
   c.  Cross-reference; criminal penalties. For failure to obey subpoenas
 or for testifying falsely,  see  section  11-4007  of  this  title;  for
 supplying  false  or fraudulent information, see section 11-4002 of this
 title.
   d. The officers who serve the summons or subpoena of the  commissioner
 of finance or the tax appeals tribunal hereunder and witnesses attending
 in response thereto shall be entitled to the same fees as are allowed to
 officers  and  witnesses  in  civil cases in courts of record, except as
 herein otherwise provided. Such officers shall be the city sheriff,  and
 the  sheriff's  duly  appointed deputies or any officers or employees of
 the department of finance or the tax  appeals  tribunal,  designated  to
 serve such process.
 S. 8474                            733
 
   §  11-715  Interest and penalties. (a) Interest on underpayment; quar-
 terly return.  If any amount of tax required to be paid together with  a
 return,  other  than  the final return for a tax year, is not paid on or
 before the last date prescribed  for  payment,  without  regard  to  any
 extension  of  time  granted for payment, interest on such amount at the
 rate set by the commissioner of finance pursuant to subdivision  (h)  of
 this  section,  or, if no rate is set, at the rate of seven and one-half
 percent per annum, shall be paid for the  period  from  such  last  date
 until  twenty  days  after  the  end  of  the tax year during which such
 payments were due or until such prior time as the tax paid for  the  tax
 year equals seventy-five percent of the full tax required to be paid for
 the  tax year. Such interest shall be paid with the final return for the
 tax year to which it relates. In computing the amount of interest to  be
 paid,  such  interest  shall  be  compounded  daily. Interest under this
 subdivision shall not be paid if the amount thereof  is  less  than  one
 dollar.
   (b)  Interest  on  underpayment;  final return.   If any amount of tax
 required to be paid together with the final return for a tax year is not
 paid on or before the last date prescribed for payment,  without  regard
 to any extension of time granted for payment, interest on such amount at
 the  rate set by the commissioner of finance pursuant to subdivision (h)
 of this section, or, if no rate is set, at the rate of  seven  and  one-
 half percent per annum, shall be paid for the period from such last date
 to  the date of payment. In computing the amount of interest to be paid,
 such interest shall be compounded daily. Interest under this subdivision
 shall not be paid if the amount thereof is less than one dollar.
   (c) (1) Failure to file final return. (A)  In case of failure to  file
 a  final  return  under  this  chapter on or before the prescribed date,
 determined with regard to any extension of time for filing, unless it is
 shown that such failure is due to reasonable cause and not due to  will-
 ful  neglect, there shall be added to the amount required to be shown as
 tax on such return five percent of the amount of such tax if the failure
 is for not more than one month, with an additional five percent for each
 additional month or fraction thereof during which such  failure  contin-
 ues,  not  exceeding twenty-five percent in the aggregate, and, in addi-
 tion thereto, where a tenant, with respect to any taxable  premises,  is
 exempt  from  tax by reason of paragraph two of subdivision b of section
 11-704 of this chapter, there shall be imposed a penalty of one  hundred
 dollars.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to  any extension of time for filing, unless it is shown that such fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion to tax under subparagraph (A) of this paragraph shall not  be  less
 than  the  lesser  of  one hundred dollars or one hundred percent of the
 amount required to be shown as tax on such return.
   (C) For purposes of this paragraph, the amount of tax required  to  be
 shown  on  the  return shall be reduced by the amount of any part of the
 tax which is paid on or before the date prescribed for  payment  of  the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2)  Failure  to pay tax shown on final return.  In case of failure to
 pay the amount shown as tax on a final return required to be filed under
 this chapter on or before the prescribed date, determined with regard to
 any extension of time for payment, unless it is shown that such  failure
 is  due to reasonable cause and not due to  willful neglect, there shall
 S. 8474                            734
 
 be added to the amount shown as tax  on  such  return  one-half  of  one
 percent  of  the  amount of such tax if the failure is not for more than
 one month, with an additional one-half of one  percent  for  each  addi-
 tional  month  or  fraction thereof during which such failure continues,
 not exceeding twenty-five percent in the aggregate. For the  purpose  of
 computing  the  addition  for  any  month the amount of tax shown on the
 return shall be reduced by the amount of any part of the  tax  which  is
 paid  on  or before the beginning of such month and by the amount of any
 credit against the tax which may be claimed  upon  the  return.  If  the
 amount  of  tax required to be shown on a return is less than the amount
 shown as tax on such return, this paragraph shall be applied by  substi-
 tuting such lower amount.
   (3)  Failure to pay tax required to be shown on final return.  In case
 of failure to pay any amount in respect of any tax required to be  shown
 on  a  final return required to be filed under this chapter which is not
 so shown, including a determination made pursuant to section  11-708  of
 this  chapter, within ten days of the date of a notice and demand there-
 for, unless it is shown that such failure is due to reasonable cause and
 not due to willful neglect, there shall be added to the  amount  of  tax
 stated  in such notice and demand one-half of one percent of such tax if
 the failure is not for more than one month, with an additional  one-half
 of  one  percent  for  each  additional month or fraction thereof during
 which such failure continues, not exceeding twenty-five percent  in  the
 aggregate.  For the purpose of computing the addition for any month, the
 amount of tax stated in the notice and demand shall be  reduced  by  the
 amount of any part of the tax which is paid before the beginning of such
 month.
   (4) Limitations on additions.
   (A) With respect to any final return, the amount of the addition under
 paragraph  one of this subdivision shall be reduced by the amount of the
 addition under paragraph two of this subdivision for any month to  which
 an addition applies under both such paragraphs one and two.  In any case
 described  in subparagraph (B) of paragraph one of this subdivision, the
 amount of the addition under such paragraph one  shall  not  be  reduced
 below the amount provided in such subparagraph.
   (B)  With respect to any final return, the maximum amount of the addi-
 tion permitted under  paragraph  three  of  this  subdivision  shall  be
 reduced by the amount of the addition under paragraph one of this subdi-
 vision,  determined without regard to subparagraph (B) of such paragraph
 one, which is attributable to the tax for which the notice and demand is
 made and which is not paid within ten days of such notice and demand.
   (d) Underpayment due to negligence. (1) If any part of an underpayment
 of tax is due to negligence or intentional disregard of this chapter  or
 any rules or regulations hereunder, but without intent to defraud, there
 shall  be added to the tax a penalty equal to five percent of the under-
 payment.
   (2) There shall be added to the tax, in addition to the amount  deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under subdivision (b)  of  this  section
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to the negligence or intentional  disre-
 gard  referred to in such paragraph one, for the period beginning on the
 last date prescribed by law for payment of such underpayment, determined
 without regard to any extension, and ending on the date of  the  assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
 S. 8474                            735
 
   (e)  Underpayment  due to fraud. (1) If any part of an underpayment of
 tax is due to fraud, there shall be added to the tax a penalty equal  to
 fifty percent of the underpayment.
   (2) There shall be added to the tax, in addition to the penalty deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under subdivision (b)  of  this  section
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to fraud, for the  period  beginning  on
 the last date prescribed by law for payment of such underpayment, deter-
 mined  without  regard  to  any extension, and ending on the date of the
 assessment of the tax, or, if earlier, the date of the  payment  of  the
 tax.
   (3)  The  penalty under this subdivision shall be in lieu of any other
 addition to tax imposed by subdivision (c) or (d) of this section.
   (f) Additional penalty.  Any person who, with fraudulent intent, shall
 fail to pay any tax imposed by this chapter, or to make, render, sign or
 certify any return,  or  to  supply  any  information  within  the  time
 required  by or under this chapter, shall be liable for a penalty of not
 more than one  thousand  dollars,  in  addition  to  any  other  amounts
 required under this chapter to be imposed, assessed and collected by the
 commissioner  of  finance.  The  commissioner  of finance shall have the
 power, in his or her discretion, to  waive,  reduce  or  compromise  any
 penalty under this subdivision.
   (g)  The  interest and penalties imposed by this section shall be paid
 and disposed of in the same manner as other revenues from this  chapter.
 Unpaid  interest and penalties may be enforced in the same manner as the
 tax imposed by this chapter.
   (h) (1) Authority to set interest rates.  The commissioner of  finance
 shall  set  the rate of interest to be paid pursuant to subdivisions (a)
 and (b) of this section, but if no such rate of interest  is  set,  such
 rate  shall be deemed to be set at seven and one-half percent per annum.
 Such rate shall be the same for each subdivision and shall be  the  rate
 prescribed  in  paragraph  two of this subdivision but shall not be less
 than seven and one-half percent per annum. Any  such  rate  set  by  the
 commissioner  of  finance  shall apply to taxes, or any portion thereof,
 which remain or become due on or after  the  date  on  which  such  rate
 becomes effective and shall apply only with respect to interest computed
 or computable for periods or portions of periods occurring in the period
 in which such rate is in effect.
   (2)  General  rule.  The  rate  of interest set under this subdivision
 shall be the sum of (i) the federal short-term rate  as  provided  under
 paragraph three of this subdivision, plus (ii) seven percentage points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A)  The  federal  short-term  rate for any month shall be the federal
 short-term rate determined by the United States secretary of the  treas-
 ury  during  such  month  in  accordance  with subsection (d) of section
 twelve hundred seventy-four of the internal  revenue  code  for  use  in
 connection  with  section  six  thousand  six  hundred twenty-one of the
 internal revenue code. Any such rate shall be  rounded  to  the  nearest
 full  percent,  or,  if a multiple of one-half of one percent, such rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i) In general. Except as provided in clause  (ii)  of  this  subpara-
 graph,  the federal short-term rate for the first month in each calendar
 quarter shall apply during the first calendar  quarter  beginning  after
 such month.
 S. 8474                            736
 
   (ii)  Special rule for the month of September, nineteen hundred eight-
 y-nine. The federal short-term rate for the  month  of  April,  nineteen
 hundred  eighty-nine  shall  apply  with  respect to setting the rate of
 interest for the month of September, nineteen hundred eighty-nine.
   (4)  Publication  of  interest rate. The commissioner of finance shall
 cause to be published in the City Record,  and  give  other  appropriate
 general notice of, the interest rate to be set under this subdivision no
 later  than  twenty days preceding the first day of the calendar quarter
 during which such interest rate applies. The setting and publication  of
 such  interest rate shall not be included within paragraph (a) of subdi-
 vision five of section one thousand forty-one of the city charter of the
 preceding municipality as it existed  January  first,  nineteen  hundred
 ninety-four relating to the definition of a rule.
   (i)  Miscellaneous. (1) The certificate of the commissioner of finance
 to the effect that a tax has not been paid, that a return has  not  been
 filed,  or  that  information  has  not  been  supplied  pursuant to the
 provisions of this chapter shall be prima facie evidence thereof.
   (2) Cross-reference: For criminal penalties, see  chapter  forty    of
 this title.
   (j)  Substantial  understatement of liability.  If there is a substan-
 tial understatement of tax for any tax year, there shall be added to the
 tax an amount equal to ten percent of the  amount  of  any  underpayment
 attributable  to  such understatement. For purposes of this subdivision,
 there is a substantial understatement of tax for any  tax  year  if  the
 amount of the understatement for the tax year exceeds the greater of ten
 percent  of the tax required to be shown on the final return for the tax
 year or five thousand dollars. For purposes  of  this  subdivision,  the
 term "understatement" means the excess of the amount of the tax required
 to be shown on the final return for the tax year, over the amount of the
 tax  imposed  which  is  shown on the return, reduced by any rebate. The
 amount of such understatement shall be reduced by that  portion  of  the
 understatement which is attributable to the tax treatment of any item by
 the  taxpayer  if  there is or was substantial authority for such treat-
 ment, or any item with respect to which the relevant facts affecting the
 item's tax treatment are adequately disclosed in  the  return  or  in  a
 statement  attached to the return. The commissioner of finance may waive
 all or any part of the addition to tax provided by this subdivision on a
 showing by the taxpayer that there was reasonable cause for  the  under-
 statement, or part thereof, and that the taxpayer acted in good faith.
   (k)  Aiding or assisting in the giving of fraudulent returns, reports,
 statements or other documents.  (1) Any person who, with the intent that
 tax be evaded, shall, for a fee or other compensation or as an  incident
 to  the  performance  of  other  services for which such person receives
 compensation, aid or assist in, or procure, counsel, or advise the prep-
 aration or presentation under, or in connection with any matter  arising
 under  this  chapter  of any return, report, statement or other document
 which is fraudulent or false as to any material matter,  or  supply  any
 false or fraudulent information, whether or not such falsity or fraud is
 with  the  knowledge  or consent of the person authorized or required to
 present such return, report, statement or other  document  shall  pay  a
 penalty not exceeding ten thousand dollars.
   (2)  For  purposes  of  paragraph  one  of  this subdivision, the term
 "procures" includes ordering, or otherwise causing, a subordinate to  do
 an  act, and knowing of, and not attempting to prevent, participation by
 a subordinate in an act. The term "subordinate" means any other  person,
 whether  or  not a director, officer, employee, or agent of the taxpayer
 S. 8474                            737
 
 involved, over whose activities the person has  direction,  supervision,
 or control.
   (3)  For  purposes  of  paragraph  one  of  this subdivision, a person
 furnishing typing, reproducing,  or  other  mechanical  assistance  with
 respect  to  a document shall not be treated as having aided or assisted
 in the preparation of such document by reason of such assistance.
   (4) The penalty imposed by this subdivision shall be  in  addition  to
 any other penalty provided by law.
   §  11-716    Returns to be secret. a. Except in accordance with proper
 judicial order or as otherwise provided by law, it shall be unlawful for
 the commissioner of finance, the department of finance of the city,  any
 officer or employee of the department of finance of the city, any person
 engaged or retained by such department on an independent contract basis,
 the tax appeals tribunal, any commissioner or employee of such tribunal,
 or any person who, pursuant to this section, is permitted to inspect any
 return  or  to  whom  a  copy, an abstract or a portion of any return is
 furnished, or to  whom  any  information  contained  in  any  return  is
 furnished, to divulge or make known in any manner any information relat-
 ing to the business of a taxpayer contained in any return required under
 this  chapter.  The  officers  charged  with the custody of such returns
 shall not be required to produce any of them  or  evidence  of  anything
 contained  in  them  in any action or proceeding in any court, except on
 behalf of the commissioner of finance in an action or  proceeding  under
 the  provisions of this chapter, or on behalf of any party to any action
 or proceeding under the provisions of this chapter when the  returns  or
 facts  shown thereby are directly involved in such action or proceeding,
 in either of which events the courts may require the production of,  and
 may  admit  in  evidence  so  much of said returns or of the facts shown
 thereby, as are pertinent to the  action  or  proceeding  and  no  more.
 Nothing  in this subdivision shall be construed to prohibit the delivery
 to a taxpayer or the taxpayer's  duly  authorized  representative  of  a
 certified  copy  of  any return filed in connection with his or her tax;
 nor to prohibit the delivery of such a certified copy of such return  or
 of  any  information  contained  in  or  relating thereto, to the United
 States of America or any department thereof, the state of  New  York  or
 any  department  thereof,  any  agency  or any department of the city of
 Staten Island provided the same is requested for official business;  nor
 to  prohibit the inspection for official business of such returns by the
 corporation counsel or other legal representatives of the city or by the
 district attorney of the county of Richmond; nor to prohibit the  publi-
 cation  of  statistics so classified as to prevent the identification of
 particular returns or items thereof.
   b. (1) Any officer or employee of the city who willfully violates  the
 provisions  of  subdivision  a  of  this section shall be dismissed from
 office and be incapable of holding any public office in this city for  a
 period of five years thereafter.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   c.  This section shall be deemed a state statute for purposes of para-
 graph (a) of subdivision two of section eighty-seven of the public offi-
 cers law.
   d. Notwithstanding anything in subdivision a of this  section  to  the
 contrary,  if  a  taxpayer  has  petitioned the tax appeals tribunal for
 administrative review as provided in section one hundred seventy of  the
 charter of the preceding municipality as it existed January first, nine-
 teen  hundred  ninety-four, the commissioner of finance shall be author-
 S. 8474                            738
 
 ized to present to the tribunal any report or return of  such  taxpayer,
 or  any  information contained therein or relating thereto, which may be
 material or relevant to the proceeding  before  the  tribunal.  The  tax
 appeals  tribunal  shall be authorized to publish a copy or a summary of
 any decision rendered pursuant to section one hundred seventy-one of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four.
   § 11-717 Notices and limitation of time. a. Any notice  authorized  or
 required under the provisions of this chapter may be given to the person
 for  whom  it is intended by mailing it in a postpaid envelope addressed
 to such person at the address given in the last  return  filed  by  such
 person  pursuant to the provisions of this chapter or in any application
 made by such person or if no return has been filed or application  made,
 then to such address as may be obtainable. The mailing of a notice as in
 this paragraph provided for shall be presumptive evidence of the receipt
 of the same by the person to whom addressed. Any period of time which is
 determined  according to the provisions of this chapter by the giving of
 notice shall commence to run from the date of mailing of such notice  as
 in this subdivision provided.
   b. The provisions of the civil practice law and rules or any other law
 relative  to  limitations  of time for the enforcement of a civil remedy
 shall not apply to any proceeding or action taken by the city  to  levy,
 appraise,  assess,  determine  or  enforce  the collection of any tax or
 penalty provided by this chapter.   However, except in  the  case  of  a
 wilfully  false  or  fraudulent  return with intent to evade the tax, no
 assessment of additional tax shall be made after the expiration of  more
 than  three  years from the date of the final return for the tax year to
 which the assessment relates; provided, however, that  where  no  return
 has been made as provided by law, the tax may be assessed at any time.
   c. Where before the expiration of the period prescribed herein for the
 assessment  of an additional tax, a person has consented in writing that
 such period be extended, the amount of such additional tax  due  may  be
 determined  at  any  time  within  such  extended  period. The period so
 extended may be further extended by subsequent consents in writing  made
 before the expiration of the extended period.
   d.  If  any  return,  claim,  statement, notice, application, or other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 of any provision of this chapter is, after such  period  or  such  date,
 delivered  by United States mail to the commissioner of finance, the tax
 appeals tribunal, bureau, office, officer or person with which  or  with
 whom  such document is required to be filed, or to which or to whom such
 payment is required to be made, the date of the United  States  postmark
 stamped on the envelope shall be deemed to be the date of delivery. This
 subdivision  shall  apply  only  if  the  postmark date falls within the
 prescribed period or on or before the prescribed date for the filing  of
 such document, or for making the payment, including any extension grant-
 ed  for such filing or payment, and only if such document or payment was
 deposited in the  mail,  postage  prepaid,  properly  addressed  to  the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer  or  person  with  which or with whom the document is required to be
 filed or to which or to whom such payment is required to be made. If any
 document is sent by United States  registered  mail,  such  registration
 shall  be  prima  facie evidence that such document was delivered to the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer or person to which or to whom addressed, and the date  of  registra-
 S. 8474                            739

 tion  shall be deemed the postmark date. The commissioner of finance or,
 where relevant, the tax appeals tribunal is  authorized  to  provide  by
 regulation  the  extent to which the provisions of this subdivision with
 respect  to prima facie evidence of delivery and the postmark date shall
 apply to certified mail. Except as provided in  subdivision  f  of  this
 section,  this subdivision shall apply in the case of postmarks not made
 by the United States postal service only if and to the  extent  provided
 by regulation of the commissioner of finance or, where relevant, the tax
 appeals tribunal.
   e.  When  the  last  day  prescribed  under authority of this chapter,
 including any extension of time, for  performing  any  act  falls  on  a
 Saturday,  Sunday or legal holiday in the state, the performance of such
 act shall be considered timely if it is performed on the next succeeding
 day which is not a Saturday, Sunday or legal holiday.
   f. (1) Any reference in subdivision d of this section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the secretary of the treasury of the United States
 pursuant to section seventy-five hundred two  of  the  internal  revenue
 code  and  any  reference  in  subdivision d of this section to a United
 States postmark shall be treated as including a reference  to  any  date
 recorded  or  marked  in  the  manner  described in section seventy-five
 hundred two of the  internal  revenue  code  by  a  designated  delivery
 service.  If the commissioner of finance finds that any delivery service
 designated by such secretary is inadequate for the needs  of  the  city,
 the  commissioner  of finance may withdraw such designation for purposes
 of this title. The commissioner of finance may also designate additional
 delivery services meeting the criteria of section  seventy-five  hundred
 two  of  the  internal  revenue  code for purposes of this title, or may
 withdraw any such designation if the commissioner of finance finds  that
 a  delivery  service  so  designated  is inadequate for the needs of the
 city. Any reference in subdivision d  of  this  section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the commissioner of finance and any  reference  in
 subdivision  d  of  this  section  to  a United States postmark shall be
 treated as including a reference to any date recorded or marked  in  the
 manner  described  in  section  seventy-five hundred two of the internal
 revenue code by a delivery service designated  by  the  commissioner  of
 finance. Notwithstanding the foregoing, any withdrawal of designation or
 additional  designation  by  the  commissioner  of  finance shall not be
 effective for purposes of service upon the tax appeals tribunal,  unless
 and  until  such  withdrawal of designation or additional designation is
 ratified by the president of the tax appeals tribunal.
   (2) Any equivalent of registered or certified mail designated  by  the
 United  States secretary of the treasury, or as may be designated by the
 commissioner of finance pursuant to  the  same  criteria  used  by  such
 secretary for such designations pursuant to section seventy-five hundred
 two  of  the internal revenue code, shall be included within the meaning
 of registered or certified  mail  as  used  in  subdivision  d  of  this
 section.  If  the  commissioner  of finance finds that any equivalent of
 registered or certified mail designated by such secretary or the commis-
 sioner of finance is inadequate for the needs of the city,  the  commis-
 sioner  of  finance  may  withdraw such designation for purposes of this
 title. Notwithstanding the provisions of this paragraph, any  withdrawal
 of  designation or additional designation by the commissioner of finance
 shall not be effective for purposes of  service  upon  the  tax  appeals
 S. 8474                            740
 
 tribunal,  unless and until such withdrawal of designation or additional
 designation is ratified by the president of the tax appeals tribunal.
   § 11-718 Construction and enforcement. This chapter shall be construed
 in  conformity with chapter two hundred fifty-seven of the laws of nine-
 teen hundred sixty-three, pursuant to which it is enacted.
   § 11-719 Annual report. a. No later than September first, two thousand
 twenty-five, and every September first  thereafter,  the  department  of
 finance  shall  submit to the mayor and speaker of the council, and make
 publicly available online, a report on the  commercial  rent  tax.  Such
 report  shall include the following information for the prior commercial
 rent tax period, on the condition that any category that  only  includes
 one taxpayer shall not be reported for any tax period:
   1.  the  distribution  of  taxable premises and taxpayers by base rent
 range, including the number and zip codes of the  taxable  premises  for
 which the commercial rent tax was collected, the number of taxpayers who
 paid  the tax, the number of taxpayers who paid the tax on more than one
 property and the total amount of commercial rent tax paid for the set of
 taxable premises and taxpayers within each range;
   2. the distribution of taxable premises  and  taxpayers  by  industry,
 including the number and zip codes of the taxable premises for which the
 commercial  rent tax was collected, the number of taxpayers who paid the
 tax, the number of taxpayers who paid the tax on more than one  property
 and  the total amount of commercial rent tax paid for the set of taxable
 premises and taxpayers within each industry;
   3. the total amount of tax collected and the average tax liability per
 premises for each of the prior ten tax years;
   4. the total amount of tax collected and the average tax liability per
 taxpayer for each of the prior ten tax years;
   5. a comparison of the total commercial  rent  tax  collected  to  the
 average  market  value  of  commercial  properties in the city of Staten
 Island as determined by the department for each of  the  prior  ten  tax
 years;
   6.  the number of taxable premises and the number of taxpayers by base
 rent range and industry who received the credit  set  forth  in  section
 11-704.4 of this chapter; and
   7.  any other information deemed relevant for inclusion by the depart-
 ment.
   b. For purposes of the  report  required  by  subdivision  a  of  this
 section, the base rent ranges shall be:
   1. between $250,000 and $274,999;
   2. between $275,000 and $299,999;
   3. between $300,000 and $349,999;
   4. between $350,000 and $399,999;
   5. between $400,000 and $449,999;
   6. between $450,000 and $499,999;
   7. between $500,000 and $549,999;
   8. between $550,000 and $599,999;
   9. between $600,000 and $699,999;
   10. between $700,000 and $799,999;
   11. between $800,000 and $899,999;
   12. between $900,000 and $999,999;
   13. between $1,000,000 and $1,999,999;
   14. between $2,000,000 and $2,999,999;
   15. between $3,000,000 and $3,999,999;
   16. between $4,000,000 and $4,999,999;
   17. between $5,000,000 and $9,999,999; and
 S. 8474                            741
 
   18. more than $10,000,000.
 
                                 CHAPTER 8
            TAX ON COMMERCIAL MOTOR VEHICLES AND MOTOR VEHICLES
                     FOR TRANSPORTATION OF PASSENGERS
   §  11-801  Definitions. When used in this chapter, the following terms
 shall mean or include:
   1. "Person."  An  individual,  partnership,  corporation,  joint-stock
 company, society, association, receiver, lessee, trustee, estate, refer-
 ee,  assignee,  or  any  other person acting in a fiduciary or represen-
 tative capacity, whether appointed by a  court  or  otherwise,  and  any
 combination of individuals.
   2.    "Motor  vehicle."  Any vehicle operated upon a public highway or
 public street propelled by any power other than muscular power.
   3. "Commercial motor vehicle." (a) Each  truck,  tractor,  trailer  or
 semi-trailer,  and  any  other  motor  vehicle  constructed or specially
 equipped for the transportation of goods, wares and merchandise which is
 commonly known as an auto truck or light delivery car;
   (b) Any traction engine, road  roller,  tractor  crane,  truck  crane,
 power  shovel,  road  building  machine,  snow  plow, road sweeper, sand
 spreader, well driller, or well servicing rig; and
   (c) Any earth moving equipment as defined in the vehicle  and  traffic
 law;  provided that such motor vehicles are used principally in the city
 or used principally in connection with a business carried on within  the
 city.
   4.  "Motor  vehicle  for  transportation of passengers." (a) Any motor
 vehicle licensed as a taxicab or as a coach, or any motor  vehicle,  not
 so licensed, which carries passengers for compensation, including limou-
 sine  service,  whether  the  compensation  paid  by or on behalf of the
 passenger is based on mileage, trip, time consumed or any  other  basis;
 and
   (b)  Any  omnibus,  except  one operated pursuant to a franchise when,
 under such franchise or under a contract, relating to transportation  to
 or from airports, with the port of New York authority, the holder of the
 franchise  pays  to  the  city  or  to  the port of New York authority a
 percentage of its gross earnings or gross receipts or  one  used  exclu-
 sively  in interstate commerce; provided such motor vehicles, as defined
 in paragraph (a) or (b) of this subdivision, are  used  regularly,  even
 though  not  principally,  in  the  city; and further provided that this
 definition shall not be deemed to include any motor vehicle used princi-
 pally for the transportation of children to and  from  schools  and  day
 camps  operated by non-profit agencies as defined in subdivision four of
 section 11-803 of this chapter, any motor vehicle used  exclusively  for
 transportation of persons in connection with funerals or any motor vehi-
 cle  for  transportation  of  passengers where neither the owner of such
 motor vehicle nor any person or business engaged in transporting passen-
 gers by motor vehicle for-hire that is affiliated with such owner has  a
 place  of  business  in  such  city, a telephone number in such city, or
 solicits business or specifically advertises in such city.
   5. "Owner." Any person owning a commercial motor vehicle  or  a  motor
 vehicle  for  the  transportation  of  passengers  and  shall  include a
 purchaser under a reserve title contract, conditional sales agreement or
 vendor's lien agreement. In  addition,  an  owner  shall  be  deemed  to
 include  any  lessee,  licensee  or bailee having the exclusive use of a
 commercial motor vehicle or a vehicle for the transportation of  passen-
 gers, under a lease or otherwise, for a period of thirty days or more.
 S. 8474                            742
 
   6.  "Omnibus."  Any motor vehicle for transportation of passengers for
 hire having a seating capacity of more than seven persons.
   7.  "Use."  Any  use  of  a  motor vehicle upon the public highways or
 streets of the city.
   8. "Maximum gross weight." The weight of the motor  vehicle  plus  the
 weight of the maximum load to be carried, if any, by such vehicle.
   9.  "Registered  owner."  The  person who registers a motor vehicle as
 owner thereof pursuant to the registration requirements of  the  vehicle
 and traffic law of the state of New York.
   10.  "Registration  fee."  The full annual fee or charge prescribed in
 the vehicle and traffic law of the state of New York for  the  registra-
 tion of a motor vehicle.
   11. "City." The city of Staten Island.
   12. "Comptroller." The comptroller of the city.
   13.  "Commissioner  of  finance."  The  commissioner of finance of the
 city.
   14. "Tax year." June first of any calendar year  through  May  thirty-
 first of the following calendar year.
   15. "Medallion taxicab." A motor vehicle for transportation of passen-
 gers  which  is  duly  licensed  as  a taxicab by the taxi and limousine
 commission and permitted to accept hails from passengers in the street.
   16. "Tax appeals tribunal." The tax appeals  tribunal  established  by
 section  one hundred sixty-eight of the charter of the preceding munici-
 pality as it existed January first, nineteen hundred ninety-four.
   17. "Commissioner of motor vehicles." The commissioner of motor  vehi-
 cles of the state of New York.
   18. "Taxi and limousine commission." The New York city taxi and limou-
 sine commission.
   § 11-802 Imposition of tax. a. In addition to any and all other taxes,
 including  the  compensating  use tax, there is hereby imposed and there
 shall be paid annually for each tax year beginning June first,  nineteen
 hundred sixty, a tax on the use in the city of motor vehicles to be paid
 by the owners of such vehicles as follows:
   1.  (A)  For  tax years ending on or before May thirty-first, nineteen
 hundred seventy-two, on commercial vehicles,  twenty  dollars  for  each
 such  vehicle  having  a  maximum gross weight of five tons or less, and
 thirty dollars for each such vehicle having a maximum  gross  weight  of
 more  than  five  tons,  provided,  however,  that for each such vehicle
 having a registration fee prescribed in the vehicle and traffic  law  of
 the  state  of New York which is less than twenty dollars, the tax shall
 be an amount equal to such registration fee;
   (B) For tax years beginning on and after June first, nineteen  hundred
 seventy-two  but  before June first, nineteen hundred ninety, on commer-
 cial vehicles, forty dollars for each  such  vehicle  having  a  maximum
 gross weight of five tons or less, and sixty dollars for each such vehi-
 cle  having  a  maximum  gross  weight of more than five tons, provided,
 however, that for each such vehicle having a registration fee prescribed
 in the vehicle and traffic law of the state of New York  which  is  less
 than  forty  dollars, the tax shall be an amount equal to such registra-
 tion fee.
   (C) For tax years beginning on and after June first, nineteen  hundred
 ninety,  on  commercial  vehicles,  forty  dollars for each such vehicle
 having a maximum gross weight  of  ten  thousand  pounds  or  less,  two
 hundred  dollars  for each such vehicle having a maximum gross weight of
 more than ten thousand pounds but not more  than  twelve  thousand  five
 hundred  pounds,  two hundred seventy-five dollars for each such vehicle
 S. 8474                            743
 
 having a maximum gross weight of more than twelve thousand five  hundred
 pounds  but  not  more  than  fifteen  thousand pounds and three hundred
 dollars for each such vehicle having a maximum gross weight of more than
 fifteen  thousand  pounds, provided, however, that for each such vehicle
 having a registration fee prescribed in the vehicle and traffic  law  of
 the state of New York which is less than forty dollars, the tax shall be
 an amount equal to such registration fee.
   2.  (A)  For  tax years ending on or before May thirty-first, nineteen
 hundred ninety, on motor vehicles for the transportation  of  passengers
 other than medallion taxicabs, and for tax years ending on or before May
 thirty-first,  nineteen  hundred eighty-nine, on medallion taxicabs, one
 hundred dollars for each such vehicle.
   (B) For the tax year beginning June first,  nineteen  hundred  eighty-
 nine  and ending May thirty-first, nineteen hundred ninety, on medallion
 taxicabs, five hundred dollars for each such vehicle.
   (C) For tax years beginning on and after June first, nineteen  hundred
 ninety  but before May thirty-first, two thousand nineteen, on medallion
 taxicabs, one thousand dollars for each such vehicle, and on  all  other
 motor  vehicles  for  transportation of passengers, four hundred dollars
 for each such vehicle.
   (D) For tax years beginning on or after June first, two thousand nine-
 teen, on all motor vehicles for transportation of passengers,  including
 medallion taxicabs, four hundred dollars for each such vehicle.
   b.  To  the  extent  that  the tax as imposed by subdivision a of this
 section may be invalid solely because it is based on the use in the city
 of the motor vehicles, the tax shall also be deemed to be based  on  the
 privilege  of  using  the public highways or streets of the city by such
 motor vehicle. Under such circumstances the rate of  tax  shall  be  the
 same  and all other provisions of this chapter shall be equally applica-
 ble.
   c. If the first use of any motor vehicle subject to  the  tax  imposed
 under  this  chapter  occurs on or after December first and before March
 first in any tax year, the tax for that year shall be  one-half  of  the
 tax  hereinabove provided; and, if the first such use occurs on or after
 March first in any tax year, the tax for that tax  year  shall  be  one-
 fourth of such tax.
   d.  In  applying  the tax on commercial motor vehicles with respect to
 tractors, trailers and semi-trailers, the tax shall be measured  by  the
 weight  of  the  tractor plus the maximum gross weight of the trailer or
 semi-trailer with the greatest such maximum gross weight to be drawn  by
 such  tractor.  No trailer or semi-trailer shall be subject to any sepa-
 rate or additional tax under this chapter.
   § 11-803  Exemptions. The provisions of this chapter shall  not  apply
 to  motor vehicles owned and operated, or leased for their exclusive use
 by:
   1. The state of New York,  or  any  public  corporation,  including  a
 corporation  created pursuant to agreement or compact with another state
 or the Dominion of  Canada,  improvement  district  or  other  political
 subdivision of the state;
   2. The United States of America;
   3.  The United Nations or other world-wide international organizations
 of which the United States of America is a member;
   4. Any corporation, or association, or trust, or community chest, fund
 or foundation, organized and operated exclusively for religious,  chari-
 table or educational purposes, or for the prevention of cruelty to chil-
 dren  or animals, and no part of the net earnings of which inures to the
 S. 8474                            744
 
 benefit of any private shareholder or individual and no substantial part
 of the activities of which  is  carrying  on  propaganda,  or  otherwise
 attempting  to influence legislation; provided, however, that nothing in
 this  subdivision shall include an organization operated for the primary
 purpose of carrying on a trade or business for profit,  whether  or  not
 all of its profits are payable to one or more organizations described in
 this subdivision;
   5.  Any  foreign  nation  or  representative  of a foreign nation with
 respect to motor vehicles for which they need not pay a registration fee
 under the provisions of the vehicle and traffic law;
   6. Dealers in new and used motor vehicles where the use of  the  motor
 vehicle is confined solely to demonstrations to prospective customers or
 to  delivery  by or to the dealer and the vehicle bears dealer's license
 plates.
   § 11-804  Presumption and burden of proof.  For  the  purpose  of  the
 proper  administration of this chapter and to prevent evasion of the tax
 hereby imposed, it shall be presumed that all motor vehicles used in the
 city of the types described in paragraphs (a), (b) and (c)  of  subdivi-
 sion three of section 11-801 of this chapter are used principally in the
 city or used principally in connection with a business carried on within
 the  city  and are subject to the tax until the contrary is established;
 and it shall be presumed that all motor vehicles used in the city of the
 types described in paragraphs (a) and (b) of subdivision four of section
 11-801 of this chapter are used regularly, even though  not  principally
 in  the  city  and  are  subject to the tax until the contrary is estab-
 lished.  The burden of proving that a motor vehicle is not taxable under
 this chapter shall be on the owner of the motor vehicle.
   § 11-805  Records to be kept. Every owner of a motor  vehicle  subject
 to tax under this chapter shall keep such records of his or her vehicles
 and of their use in the city in such form as the commissioner of finance
 may by regulation require.  Such records shall be offered for inspection
 and  examination  at any time upon demand by the commissioner of finance
 or the commissioner's duly authorized agent or  employee  and  shall  be
 preserved  for  a  period of three years except that the commissioner of
 finance may consent to their  destruction  within  that  period  or  may
 require that they be kept longer.
   §  11-806  Registration. a. By July thirteenth, nineteen hundred sixty
 or, upon acquiring any motor vehicle subject to tax hereunder after such
 date, within two days of such acquisition, every owner shall  file  with
 the  commissioner  of finance a certificate of registration in such form
 as prescribed by the commissioner of finance.
   b. In order to determine whether motor vehicles are subject to the tax
 under this chapter and to facilitate administration thereof an  informa-
 tion  registration  certificate  in  such  form  as is prescribed by the
 commissioner of finance shall be filed with the commissioner of  finance
 by any person who owns or acquires:
   1. A motor vehicle of a type described in paragraph (a), (b) or (c) of
 subdivision  three of section 11-801 of this chapter which is registered
 in the city under the vehicle and traffic law or is used in the city  in
 connection with a business carried on within the city; or
   2.  A motor vehicle of the type described in paragraphs (a) and (b) of
 subdivision four of section 11-801 of this chapter which  is  registered
 in the city under the vehicle and traffic law or is used in the city.
   Such  an  information  registration certificate shall be filed by July
 thirteenth, nineteen hundred sixty or, if a motor  vehicle  is  acquired
 after such date, within two days after such acquisition.  An information
 S. 8474                            745
 
 registration certificate, however, need not be filed with respect to any
 motor vehicle for which a registration certificate has been filed pursu-
 ant  to subdivision a of this section.  The commissioner of finance may,
 by  regulation,  provide that information registration certificates need
 not be filed with respect to a type of motor vehicle or with respect  to
 any general group within a type of motor vehicle.
   §  11-807  Returns.  a. On or before the twentieth day of June in each
 year commencing with the year nineteen hundred sixty, every owner  of  a
 motor vehicle subject to tax under this chapter shall file a return with
 the  commissioner of finance.  A supplemental return shall also be filed
 by every owner with regard to each motor vehicle subject to tax acquired
 during any tax year at a time subsequent to the filing  of  the  owner's
 regular  return.    Such  supplemental  return  shall  be filed with the
 commissioner of finance within a stated time, as fixed by regulation  of
 the commissioner of finance, after the acquisition of the motor vehicle.
 An  owner  who  acquires  a  motor  vehicle subject to the tax after the
 commencement of a tax year and who has not filed  a  return  or  supple-
 mental  return  with  respect  to such motor vehicle shall file a return
 with respect to it within two days after its acquisition by the owner.
   b.  The commissioner of finance, by regulation, may require that  each
 person  required  under this chapter to file an information registration
 certificate file an information return with the commissioner of  finance
 annually  or  at  such other times as the commissioner deems appropriate
 for proper administration of this chapter.  The commissioner of  finance
 may,  by  regulation, provide that information returns need not be filed
 or that they be filed at different times with respect to a type of motor
 vehicle or with respect to any general group  within  a  type  of  motor
 vehicle or with respect to any particular circumstances.
   c.  The commissioner of finance may permit or require returns, supple-
 mental returns or information returns to be filed at  times  other  than
 those  specified in the commissioner's regulations.  If the commissioner
 deems it necessary in order to insure payment of the tax imposed by this
 chapter, the commissioner of finance may  require  any  return,  supple-
 mental  return  or  information  return to be filed with him or her at a
 time other than that fixed by such commissioner.
   d. The form of returns, supplemental returns and  information  returns
 shall  be  prescribed  by  the commissioner of finance and shall contain
 such information as the commissioner may deem necessary for  the  proper
 administration of this chapter.  The commissioner of finance may require
 amended  returns,  amended  supplemental  returns or amended information
 returns to be filed within twenty days after notice and to  contain  the
 information specified in the notice.
   e.  If  a  return,  supplemental  return  or information return is not
 filed, or if a return of any kind when filed is  incorrect  or  insuffi-
 cient  on its face, the commissioner of finance shall take the necessary
 steps to enforce the filing of such a return or of a corrected return.
   § 11-808  Payment of tax. a. At the time of filing a return or supple-
 mental return the owner shall pay to the commissioner of finance the tax
 imposed by this chapter.  Such tax shall be due and payable on the  last
 day on which such return or supplemental return is required to be filed,
 regardless of whether such a return is filed or whether the return which
 is filed correctly indicates the amount of tax due.
   b. Where an owner of a motor vehicle subject to tax under this chapter
 replaces  it  with  another  motor  vehicle during a tax year, the owner
 shall be entitled, upon approval by the commissioner of finance, to have
 any tax paid with respect to the replaced vehicle  credited  toward  the
 S. 8474                            746
 
 tax  payable  with respect to the replacement vehicle for the balance of
 such tax year, and the owner shall pay no additional tax  for  such  tax
 year  with  respect  to it unless its nature or its maximum gross weight
 requires  the  payment  of  a  higher  amount of tax than that paid with
 respect to the replaced vehicle.  A supplemental return, where required,
 shall be filed with respect to a  replacement  vehicle  irrespective  of
 whether additional tax is payable.  Upon the grant of a waiver of tax by
 the  commissioner  of  finance a purchaser of a motor vehicle subject to
 tax under this chapter who purchases it during a tax year from an  owner
 who  has  paid the tax shall not be required to pay the tax with respect
 to such motor vehicle for the balance of such tax year if, and only  if,
 the  owner  obtains, and submits to the commissioner of finance together
 with his or her return or supplemental  return,  a  certificate  or  its
 equivalent,  as prescribed by the commissioner of finance, signed by the
 prior owner to the effect that the prior owner has not had the tax  paid
 credited toward any replacement vehicle and will not seek to obtain such
 a  credit  for any replacement vehicle purchased in the future.  Nothing
 contained in this subdivision shall be  deemed  to  authorize  a  refund
 merely  because  a  motor vehicle with respect to which the tax has been
 paid is sold or otherwise disposed of during the course of the tax year.
   c. Notwithstanding any other provision of law to the contrary, the tax
 imposed on medallion taxicabs pursuant to subparagraph (C) of  paragraph
 two  of subdivision a of section 11-802 of this chapter shall be due and
 payable in two equal installments, the first of which shall be  due  and
 payable  on  or  before the last day on which the return or supplemental
 return for the tax year is required to be filed, and the second of which
 shall be due and payable on or before the first day of December in  such
 tax  year;  provided,  however,  that if a medallion taxicab is acquired
 subsequent to the first day of November  in  such  tax  year,  the  full
 amount  of  the tax imposed for the tax year shall be due and payable on
 or before the last day on which the supplemental return with respect  to
 such medallion taxicab is required to be filed.
   d. Notwithstanding any other provision of law to the contrary, the tax
 imposed  on medallion taxicabs pursuant to subparagraph (B) of paragraph
 two of subdivision a of section 11-802 of this  chapter  shall,  to  the
 extent  not  previously  paid,  be due and payable on or before December
 first, nineteen hundred eighty-nine; provided, however, that if the  tax
 imposed  on  a  medallion  taxicab would, but for the provisions of this
 subdivision, be due and payable subsequent to December  first,  nineteen
 hundred  eighty-nine, the due date of such tax shall be determined with-
 out regard to this subdivision; and provided, further, that  nothing  in
 this  subdivision  shall be deemed to extend the date for payment of any
 tax imposed by paragraph two of subdivision a of section 11-802 of  this
 chapter.
   e. Notwithstanding any provision of this chapter or of chapter five of
 title  nineteen of the code of the preceding municipality to the contra-
 ry, the taxi and limousine commission may require by rule the payment of
 the tax imposed on medallion taxicabs pursuant  to  this  chapter  as  a
 condition  precedent  of the licensing or license renewal of such medal-
 lion taxicabs, and the taxi and  limousine  commission  shall  have  the
 authority  to  deny the license or the renewal thereof for any medallion
 taxicab that fails to pay such tax.
   § 11-809 Stamps and other indicia of payment. a. The  commissioner  of
 finance  may, by regulation, provide that the payment of the tax imposed
 by this chapter shall be evidenced by suitable stamps or  other  indicia
 of  payment in a form prescribed by the commissioner of finance and that
 S. 8474                            747
 
 every owner shall affix such stamps or other indicia of payment  in  the
 manner  prescribed  by  regulation to each motor vehicle for which a tax
 had been paid, or shall otherwise keep the indicia of payment  with  the
 vehicle,  readily  available for inspection, in the manner prescribed by
 regulation.  The owner or driver of  the  vehicle,  upon  demand,  shall
 exhibit  the  indicia  of  payment to the commissioner of finance or the
 commissioner's duly authorized agent or employee or to any police  offi-
 cer  of  this  city or state.  The commissioner of finance may, by regu-
 lation, make similar provision for the use of stamps  or  other  indicia
 that no tax is payable with respect to particular motor vehicles.
   b.  An owner who sells a motor vehicle shall not transfer any stamp or
 other indicia of payment to the purchaser except on a sale to a purchas-
 er to whom the owner has properly given the certificate provided for  in
 section  11-808  of  this  chapter with regard to not obtaining a credit
 toward any tax payable with respect  to  a  replacement  vehicle.    The
 commissioner   of   finance   shall,  by  regulation,  provide  for  the
 destruction of the stamp or other indicia of payment or  its  return  to
 the  commissioner of finance upon all sales except where transfer to the
 purchaser is permitted and,  where  the  motor  vehicle  sold  has  been
 replaced, for the issuance of replacement stamps or indicia of payment.
   §  11-809.1  Collection  of  tax by commissioner of motor vehicles. a.
 Notwithstanding any provision of this chapter to the contrary,  the  tax
 imposed  by  this chapter on any commercial motor vehicle with a maximum
 gross weight of ten thousand pounds or less and on any motor vehicle for
 transportation of passengers, other than a medallion taxicab,  shall  be
 collected  by the commissioner of motor vehicles, provided that any such
 motor vehicle is registered or required to be registered pursuant to any
 provision of section four hundred one of the vehicle and traffic law.
   The owner of each such motor vehicle shall pay the tax due thereon  to
 the commissioner of motor vehicles on or before the date upon which such
 owner  registers  or renews the registration of such motor vehicle or is
 required to register or  renew  the  registration  thereof  pursuant  to
 section four hundred one of the vehicle and traffic law.
   b.  Notwithstanding any provision of section four hundred of the vehi-
 cle and traffic law to the contrary, payment of the tax with respect  to
 a  motor  vehicle  described in subdivision a of this section shall be a
 condition precedent to the registration or renewal thereof of such motor
 vehicle and to the issuance  of  any  certificate  of  registration  and
 plates  or removable date tag in accordance with the vehicle and traffic
 law and the rules and regulations promulgated thereunder,  and  no  such
 certificate  of  registration, plates or tag shall be issued unless such
 tax has been paid. If the registration period  applicable  to  any  such
 vehicle  is  a  period  of  not  less than two years, as a result of the
 application of the provisions of paragraph  c  of  subdivision  five  of
 section  four  hundred  one  of  the  vehicle  and  traffic law, the tax
 required to be paid pursuant to this section shall  be  the  annual  tax
 specified  in section 11-802 of this chapter multiplied by the number of
 years in the registration period. The commissioner  of  motor  vehicles,
 upon payment of the tax pursuant to this section or upon the application
 of  any  person  exempt therefrom, shall furnish to each taxpayer paying
 the tax a receipt for such tax and to  each  other  taxpayer  or  exempt
 person a statement, document or other form prescribed by the commission-
 er  of motor vehicles, showing that such tax has been paid or is not due
 with respect to such motor vehicle.
   c. Notwithstanding the definition of the term "tax year" contained  in
 subdivision  fourteen of section 11-801 of this chapter, for purposes of
 S. 8474                            748
 
 the taxes payable to the commissioner of motor vehicles pursuant to this
 section, "tax year" shall  mean  the  twelve-month  registration  period
 applicable  to  the  subject motor vehicle under the vehicle and traffic
 law  and,  in  the  case of a registration period of at least two years,
 shall mean each  succeeding  twelve-month  period  falling  within  such
 registration period.
   d.  Where the tax imposed by this chapter has been paid to the commis-
 sioner of finance with respect  to  a  motor  vehicle  for  a  tax  year
 described in subdivision fourteen of section 11-801 of this chapter, and
 subsequent thereto but within such tax year the same taxpayer pays a tax
 to  the  commissioner  of  the motor vehicles with respect to such motor
 vehicle pursuant to this section, such taxpayer shall be entitled  to  a
 refund or credit from the commissioner of finance for the portion of the
 tax  paid  to  the  commissioner of finance which is attributable to the
 period beginning on the first day of the first tax  year,  as  the  term
 "tax  year"  is  defined in subdivision c of this section, for which the
 tax is paid to the commissioner of motor  vehicles  and  ending  on  the
 following  May  thirty-first,  provided, however, that no such refund or
 credit shall be allowed if the amount thereof is less than five dollars.
   Any refund or credit to which a taxpayer is entitled pursuant to  this
 subdivision shall be promptly refunded or credited, without interest, by
 the commissioner of finance, and the commissioner of finance may promul-
 gate such rules as he or she deems necessary to carry out the provisions
 of  this subdivision. Any amount for which the taxpayer is entitled to a
 refund or credit pursuant to this subdivision may be allowed as a credit
 against the tax payable to the commissioner of motor  vehicles  pursuant
 to  this  section  to  the  extent and in the manner provided for in the
 agreement authorized by subdivision k of this section.
   e. Whenever any fee or portion of a fee paid for the registration of a
 motor vehicle under the provisions of the vehicle  and  traffic  law  is
 refunded  pursuant  to  the  provisions  of  subdivision one or one-a of
 section four hundred twenty-eight thereof, the amount of any tax paid to
 the commissioner of motor vehicles pursuant to this  section  upon  such
 registration  shall  also be refunded by the commissioner of motor vehi-
 cles, provided that where a fee  is  refunded  pursuant  to  subdivision
 one-a of such section four hundred twenty-eight, the amount of tax to be
 refunded  shall  be  limited  to  the tax paid for a tax year commencing
 subsequent to the end of the first twelve-month period of such registra-
 tion.
   f. Where the annual registration period  applicable  to  a  particular
 class  of  motor vehicle begins and ends on the same dates for all motor
 vehicles within such class, the tax payable to the commissioner of motor
 vehicles pursuant to this section with respect to a motor vehicle within
 such class which is registered or required to be  registered  after  the
 commencement  of such annual registration period shall be determined for
 such period as follows:
   1. If such motor vehicle is registered or required  to  be  registered
 before  the first day of the seventh month of such period, the tax shall
 be the amount specified in subdivision a of section 11-802 of this chap-
 ter.
   2. If such motor vehicle is registered or required to be registered on
 or after the first day of the seventh month of such  period  but  before
 the  first  day of the tenth month of such period, the tax shall be one-
 half of the amount specified in subdivision a of section 11-802 of  this
 chapter.
 S. 8474                            749
 
   3. If such motor vehicle is registered or required to be registered on
 or  after the first day of the tenth month of such period, the tax shall
 be one-fourth of the amount specified in subdivision a of section 11-802
 of this chapter.
   g.  The  provisions of subdivision b of section 11-808 of this chapter
 shall apply to this section with such modifications  or  adaptations  as
 are  necessary  to  carry out the purposes of this section and to ensure
 collection of the appropriate annual tax specified in subdivision  a  of
 section  11-802  of  this chapter, and with due regard to the respective
 responsibilities of the commissioner of finance and the commissioner  of
 motor  vehicles  under this section and to the definitions of "tax year"
 contained in subdivision c of this section and subdivision  fourteen  of
 section  11-801  of this chapter. The agreement between the commissioner
 of finance and the commissioner of motor vehicles authorized by subdivi-
 sion k of this section may contain such provisions concerning the  divi-
 sion of responsibility for collection of the taxes imposed by this chap-
 ter  and  the granting of refunds or credits as are consistent with this
 section and subdivision b of section 11-808 of  this  chapter,  and  the
 commissioner  of finance and the commissioner of motor vehicles may also
 adopt such rules as they deem necessary for such purposes.
   h. Notwithstanding any provision of section 11-807 of this chapter  to
 the  contrary,  at  the time a tax is required to be paid to the commis-
 sioner of motor vehicles pursuant to this section, the  person  required
 to pay such tax shall file a return with the commissioner of motor vehi-
 cles  in  such  form  and  containing  such information as he or she may
 prescribe. The taxpayer's application for registration  or  the  renewal
 thereof  shall  constitute  the  return  required under this subdivision
 unless the commissioner of motor vehicles  shall  otherwise  provide  by
 rule.  A  return  filed  pursuant  to this subdivision with respect to a
 motor vehicle for a tax year or years shall be in  lieu  of  any  return
 otherwise  required to be filed with respect thereto pursuant to section
 11-807 of this chapter.
   i. In any case in which the tax imposed by this chapter is required to
 be paid to the commissioner of motor vehicles but is not  so  paid,  the
 commissioner of finance shall collect such tax and all of the provisions
 of  this  chapter relating to collection of taxes by the commissioner of
 finance shall apply with respect thereto.
   j. Notwithstanding any provision of section four hundred of the  vehi-
 cle and traffic law to the contrary, in those cases in which the commis-
 sioner  of finance is responsible for collecting the tax imposed by this
 chapter, the commissioner of motor vehicles shall not  issue  a  certif-
 icate  of registration, plates or removable date tag for any motor vehi-
 cle subject to such tax  with  respect  to  which  the  commissioner  of
 finance  has  notified  the commissioner of motor vehicles that such tax
 has not been paid, unless  the  registrant  submits  proof,  in  a  form
 approved  by  the commissioner of motor vehicles, that such tax has been
 paid, or is not due, with respect to such motor vehicle.
   k. The commissioner of finance is hereby authorized and  empowered  to
 enter  into  an  agreement  with  the  commissioner of motor vehicles to
 govern the collection of the taxes imposed by  this  chapter  which  are
 required  to  be  paid to the commissioner of motor vehicles pursuant to
 this section. Such agreement shall provide for the exclusive  method  of
 collection,  custody  and remittal to the commissioner of finance of the
 proceeds of any such tax; for the payment by the city of the  reasonable
 expenses incurred by the department of motor vehicles in connection with
 the  collection  of  any such tax; for the commissioner of finance, or a
 S. 8474                            750
 
 duly designated representative,  upon  his  or  her  request,  not  more
 frequently  than once in each calendar year at a time agreed upon by the
 state comptroller, to audit the accuracy of the payments,  distributions
 and remittances to the city; and for such other matters as may be neces-
 sary  and  proper  to  effectuate  the  purposes of such agreement. Such
 agreement shall have the force and effect of a rule or regulation of the
 commissioner of motor vehicles and  shall  be  filed  and  published  in
 accordance with any statutory requirements relating thereto.
   l. The commissioner of motor vehicles shall promptly notify the corpo-
 ration  counsel  of  the  city of any litigation instituted against such
 commissioner which challenges the constitutionality or validity  of  any
 provision  of  this chapter, or of the enabling act pursuant to which it
 was adopted, or which attempts to limit or question the  application  of
 either  such  law,  and  such  notification  shall include copies of the
 papers served upon such commissioner.
   m. The commissioner of motor vehicles shall begin to collect taxes  in
 accordance with the provisions of this section at such time as is speci-
 fied in the agreement between the commissioner of motor vehicles and the
 commissioner of finance provided for in subdivision k of this section.
   n.  In  addition  to  any  other powers granted to the commissioner of
 motor vehicles in this chapter or any other law, he  or  she  is  hereby
 authorized  and  empowered:   1. to adopt and amend rules appropriate to
 the carrying out of his or her responsibilities under this  chapter;  2.
 to  request information concerning motor vehicles and persons subject to
 the provisions of this chapter from the department of motor vehicles  of
 any  other  state,  the  treasury department of the United States or the
 appropriate officials of any city or county of the state  of  New  York;
 and  to  afford  such  information to such department of motor vehicles,
 treasury department or officials of such city or county,  any  provision
 of  this  chapter to the contrary notwithstanding; 3. to delegate his or
 her functions under this section to a deputy commissioner in the depart-
 ment of motor vehicles or any employee of  such  department  or  to  any
 county clerk or other officer who acts as the agent of such commissioner
 in  the registration of motor vehicles; 4. to require all persons owning
 motor vehicles with respect to which the tax imposed by this chapter  is
 payable to the commissioner of motor vehicles to keep such records as he
 or  she  may  prescribe  and to furnish such information upon his or her
 request; and 5. to extend, for cause shown,  the  time  for  filing  any
 return  required to be filed with the commissioner of motor vehicles for
 a period not exceeding sixty days.
   o. To the extent that any provision of this  section  is  in  conflict
 with any other provision of this chapter, the provisions of this section
 shall be controlling, but in all other respects such other provisions of
 this  chapter  shall remain fully applicable with respect to the imposi-
 tion, administration and collection of the taxes imposed by  this  chap-
 ter.
   §  11-809.2  Collection of tax by the taxi and limousine commission on
 behalf of the commissioner of finance. a. Notwithstanding any  provision
 of  this chapter to the contrary, the tax imposed by this chapter on any
 designated licensed vehicle, as defined in this  subdivision,  shall  be
 collected  by the taxi and limousine commission on behalf of the commis-
 sioner of finance. Except as otherwise provided by subdivision m of this
 section, the owner of each such designated licensed  vehicle  shall  pay
 the  tax  due  thereon to the taxi and limousine commission on or before
 the date upon which such owner licenses or renews the  license  of  such
 designated  licensed  vehicle  or  is  required  to license or renew the
 S. 8474                            751
 
 license thereof pursuant to chapter five of title nineteen of  the  code
 of  the  preceding  municipality. For purposes of this section, the term
 "designated licensed vehicle" shall mean a motor vehicle for the  trans-
 portation  of  passengers,  other  than  a medallion taxicab, the tax on
 which is not collected by the commissioner of motor vehicles pursuant to
 section 11-809.1 of this chapter and which is licensed or required to be
 licensed by the taxi and limousine commission pursuant to any  provision
 of  chapter  five of title nineteen of the code of the preceding munici-
 pality.
   b. Notwithstanding any provision of chapter five of title nineteen  of
 the  code  of the preceding municipality to the contrary, payment of the
 tax with respect to a designated licensed vehicle shall be  a  condition
 precedent  to  the  licensing  or  license  renewal  of  such designated
 licensed vehicle with the taxi and limousine  commission,  and  no  such
 license  or  renewal  thereof  shall  be issued unless such tax has been
 paid. Except as provided in subdivisions f and m of this section, if the
 license period applicable to any such designated licensed vehicle  is  a
 period  of  more  than one year, the tax required to be paid pursuant to
 this section shall be the annual tax specified in section 11-802 of this
 chapter multiplied by the number of years in  the  license  period.  The
 taxi  and limousine commission, upon payment of the tax pursuant to this
 section or upon the application of any person  exempt  therefrom,  shall
 furnish  to  each  taxpayer paying the tax a receipt for such tax and to
 each other taxpayer or exempt person a statement, document or other form
 prescribed by the taxi and limousine commission, showing that  such  tax
 has  been  paid  or  is not due with respect to such designated licensed
 vehicle.
   c. For purposes of this section, the term "tax period" shall mean  the
 license period applicable to the designated licensed vehicle under chap-
 ter  five  of  title  nineteen of the code of the preceding municipality
 and, in the case of a license period of other than one year, shall  mean
 the  number  of  twelve-month periods and any period of less than twelve
 months within such license period. The  term  "tax  period"  shall  also
 include  any  periods  described in subparagraph (A) of paragraph one of
 subdivision m of this section.
   d. Except as provided in subdivision m of this section, where the  tax
 imposed  by  this  chapter  has been paid to the commissioner of finance
 with respect to a motor vehicle for a tax year described in  subdivision
 fourteen  of  section 11-801 of this chapter, and subsequent thereto but
 within such tax year the same taxpayer pays a tax to the taxi and limou-
 sine commission with respect to such  motor  vehicle  pursuant  to  this
 section,  such taxpayer shall be entitled to a refund or credit from the
 commissioner of finance for the portion of the tax paid to  the  commis-
 sioner  of  finance  that is attributable to the period beginning on the
 first day of the first tax period for which the tax is paid to the  taxi
 and  limousine  commission and ending on the following May thirty-first,
 provided, however, that no such refund or credit shall be allowed if the
 amount thereof is less than five dollars. Any refund or credit to  which
 a  taxpayer  is  entitled pursuant to this subdivision shall be promptly
 refunded or credited, without interest, by the commissioner of  finance,
 and  the  commissioner of finance may promulgate such rules as he or she
 deems necessary to carry out the provisions of this subdivision.
   e. If the license for the designated licensed vehicle is  transferred,
 surrendered  or  terminated  for  reasons other than revocation, and the
 applicable license period under chapter five of title  nineteen  of  the
 code  of  the  preceding municipality is for more than one year, and the
 S. 8474                            752
 
 tax paid to the taxi and limousine commission was for a  tax  period  of
 more  than  twelve months, except as otherwise provided in the agreement
 between the taxi  and  limousine  commission  and  the  commissioner  of
 finance  authorized  pursuant  to  subdivision  k  of  this section, the
 commissioner of finance shall refund the tax paid for  any  twelve-month
 period  commencing subsequent to the transfer, surrender or other termi-
 nation of the license described in this subdivision.
   f. Except as provided in subdivision m of this section, for designated
 licensed vehicles whose license period is a two year period that  begins
 and  ends  on  the same dates, the tax payable to the taxi and limousine
 commission pursuant  to  this  section  with  respect  to  a  designated
 licensed  vehicle  that is licensed or required to be licensed after the
 commencement of such license period shall be determined as follows:
   1. If such designated licensed vehicle is licensed or required  to  be
 licensed  before  the first day of the seventh month of such period, the
 tax shall be the amount determined pursuant to  subdivision  b  of  this
 section.
   2.  If  such designated licensed vehicle is licensed or required to be
 licensed on or after the first day of the seventh month of  such  period
 but before the first day of the thirteenth month of such period, the tax
 shall  be three-fourths of the amount determined pursuant to subdivision
 b of this section.
   3. If such designated licensed vehicle is licensed or required  to  be
 licensed  on  or  after the first day of the thirteenth month but before
 the first day of the nineteenth month of such period, the tax  shall  be
 one-half  of  the  amount  determined  pursuant to subdivision b of this
 section.
   4. If such designated licensed vehicle is licensed or required  to  be
 licensed on or after the first day of the nineteenth month of such peri-
 od,  the  tax  shall  be one-fourth of the amount determined pursuant to
 subdivision b of this section.
   5. When the license period described in this section is for  a  period
 of  less  than  two  years,  the  commissioner of finance shall have the
 authority to provide by rule the amount to be payable under this  subdi-
 vision.
   g.  The  provisions of subdivision b of section 11-808 of this chapter
 shall apply to this section with such modifications  or  adaptations  as
 are  necessary  to  carry out the purposes of this section and to ensure
 collection of the appropriate annual tax specified in subdivision  a  of
 section  11-802  of  this chapter, and with due regard to the respective
 responsibilities of the commissioner of finance and the taxi and  limou-
 sine  commission  under this section and to the definition of "tax year"
 contained in subdivision fourteen of section 11-801 of this chapter  and
 to  the  definition  of  "tax period" contained in subdivision c of this
 section. The agreement between the commissioner of finance and the  taxi
 and limousine commission authorized by subdivision k of this section may
 contain  such  provisions  concerning the division of responsibility for
 collection of the taxes imposed by this  chapter  and  the  granting  of
 refunds or credits as are consistent with this section and subdivision b
 of  section  11-808 of this chapter, and the commissioner of finance and
 the taxi and limousine commission may also adopt such rules as they deem
 necessary for such purposes.
   h. Notwithstanding any provision of section 11-807 of this chapter  to
 the  contrary,  at the time a tax is required to be paid to the taxi and
 limousine commission pursuant to this section, the  person  required  to
 pay  such tax shall file a return with the taxi and limousine commission
 S. 8474                            753
 
 in such form and containing such information as the taxi  and  limousine
 commission  may  prescribe.  The taxpayer's application for a license or
 the renewal thereof shall constitute  the  return  required  under  this
 subdivision  unless  the  taxi  and limousine commission shall otherwise
 provide by rule. A  return  filed  pursuant  to  this  subdivision  with
 respect  to  a  designated  licensed vehicle for a tax period or periods
 shall be in lieu of any return  otherwise  required  to  be  filed  with
 respect  thereto  pursuant to section 11-807 of this chapter. Unless the
 taxi and limousine commission otherwise requires, the filing of a return
 shall not be required for the tax periods described in subparagraph  (A)
 of paragraph one of subdivision m of this section.
   i. In any case in which the tax imposed by this chapter is required to
 be  paid  to  the  taxi and limousine commission but is not so paid, the
 commissioner of finance shall collect such tax and all of the provisions
 of this chapter relating to collection of taxes by the  commissioner  of
 finance shall apply with respect thereto.
   j.  Notwithstanding any provision of chapter five of title nineteen of
 the code of the preceding municipality to the contrary, in  those  cases
 in  which  the commissioner of finance is responsible for collecting the
 tax imposed by this chapter, the taxi and limousine commission shall not
 issue or renew a license for any designated licensed vehicle subject  to
 such  tax with respect to which the commissioner of finance has notified
 the taxi and limousine commission that  such  tax  has  not  been  paid,
 unless  the  applicant  for  such license or renewal submits proof, in a
 form approved by the taxi and limousine commission, that  such  tax  has
 been paid, or is not due, with respect to such designated licensed vehi-
 cle.
   k.  The  commissioner of finance is hereby authorized and empowered to
 enter into an agreement with the taxi and limousine commission to govern
 the collection of the taxes imposed by this chapter which  are  required
 to  be  paid  to  the  taxi  and  limousine  commission pursuant to this
 section.   Such agreement  may  provide  for  the  exclusive  method  of
 collection,  custody  and remittal to the commissioner of finance of the
 proceeds of any such tax; for the payment by the commissioner of finance
 of reasonable expenses incurred by the taxi and limousine commission  in
 connection  with the collection of any such tax; for the commissioner of
 finance, or a duly designated representative, upon his or  her  request,
 not  more  frequently  than  once in each calendar year at a time agreed
 upon by the city comptroller, to audit the  accuracy  of  the  payments,
 distributions  and  remittances  to the commissioner of finance; and for
 such other matters as may be necessary  and  proper  to  effectuate  the
 purposes of such agreement.
   l.  The taxi and limousine commission shall promptly notify the corpo-
 ration counsel of the city and the commissioner of finance of any  liti-
 gation instituted against such commission which challenges the constitu-
 tionality  or  validity  of  any  provision  of  this  chapter, or which
 attempts to limit or question the application of this chapter, and  such
 notification shall include copies of the papers served upon such commis-
 sion.
   m.  Except as otherwise provided in the agreement between the taxi and
 limousine commission and  the  commissioner  of  finance  authorized  by
 subdivision  k of this section, or with respect to the periods described
 in paragraph two of this subdivision, the taxi and limousine  commission
 shall  begin  to collect taxes in accordance with the provisions of this
 section on the first day of April in the year  two  thousand  twelve  as
 follows:
 S. 8474                            754
 
   1. The tax due on a designated licensed vehicle, the license for which
 expires  on  or  after  the  first  day of June in the year two thousand
 twelve and before the first day of June in the year two  thousand  four-
 teen, shall be determined as follows:
   (A)  For  a  designated  licensed  vehicle whose license expires on or
 after the first day of June in the year two thousand twelve  and  before
 the  first  day of June in the year two thousand fourteen, the amount of
 tax for the tax period between the first day of June  in  the  year  two
 thousand  twelve  and  the date the license shall expire for such desig-
 nated licensed vehicle pursuant to chapter five of title nineteen of the
 code of the preceding municipality shall be the sum of  (i)  the  annual
 tax  specified  in subparagraph (C) of paragraph two of subdivision a of
 section 11-802 of this chapter for any twelve-month period  within  such
 tax  period,  and  (ii)  the amount determined under subparagraph (B) of
 this paragraph for any period of less than twelve months within such tax
 period. The amount of tax so determined shall be payable  on  or  before
 the  first day of June in the year two thousand twelve. In the event the
 amount of tax due and payable under this  subparagraph  shall  not  have
 been  paid  within  thirty days of the first day of June in the year two
 thousand twelve, the taxi and limousine  commission  shall  suspend  the
 license  for  such  designated licensed vehicle, and the license for any
 such designated licensed vehicle which has expired shall not be  renewed
 until such time as such tax is paid.
   (B)  For purposes of subparagraph (A) of this paragraph, the amount of
 tax for a period of less than  twelve  months  shall  be  determined  as
 follows:  (i) if such period is nine months or more, the amount for such
 period  shall  be the full amount of annual tax provided in subparagraph
 (C) of paragraph two of subdivision a of section 11-802 of this chapter;
 (ii) if such period is more than six months but less than  nine  months,
 the amount for such period shall be three-fourths of the amount of annu-
 al tax provided in subparagraph (C) of paragraph two of subdivision a of
 section  11-802 of this chapter; (iii) if such period is more than three
 months but less than six months, the amount for  such  period  shall  be
 one-half  of  the  amount  of annual tax provided in subparagraph (C) of
 paragraph two of subdivision a of section 11-802 of  this  chapter;  and
 (iv) if such period is less than three months, the amount for such peri-
 od  shall be one-fourth of the amount of annual tax provided in subpara-
 graph (C) of paragraph two of subdivision a of section  11-802  of  this
 chapter.
   2.  Upon  the  date for payment set forth in subparagraph (A) of para-
 graph one of this subdivision, the taxi and limousine  commission  shall
 require  the  taxpayer  to  provide a proof of payment of the tax to the
 commissioner of finance for the period beginning on  the  first  day  of
 June  in the year two thousand eleven and ending on the thirty-first day
 of May in the year two thousand twelve or any part of  such  period  for
 which the taxpayer was subject to the tax. In the event the taxpayer has
 not  paid  such  tax to the commissioner of finance: (i) the license for
 any designated licensed vehicle described in subparagraph  (A)  of  this
 paragraph  shall  not  be  renewed until such time as such tax, together
 with any applicable interest or penalties, has been paid to the  commis-
 sioner  of  finance and (ii) if such tax remains unpaid as of the end of
 the thirty-day period set forth in subparagraph (A) of paragraph one  of
 this  subdivision,  the  license  for  any  designated  licensed vehicle
 described in subparagraph (A) of paragraph one of this subdivision shall
 be suspended until such time as such tax, together with  any  applicable
 interest or penalties, is paid to the commissioner of finance.
 S. 8474                            755
 
   n.  In  addition to any other powers granted to the taxi and limousine
 commission in this chapter or any other  law,  the  taxi  and  limousine
 commission is hereby authorized and empowered:
   1.  to  adopt  and  amend rules appropriate to the carrying out of its
 responsibilities under this chapter;
   2. to  request  information  concerning  motor  vehicles  and  persons
 subject to the provisions of this chapter from the commissioner of motor
 vehicles, the department of motor vehicles of any other state, the trea-
 sury department of the United States or the appropriate officials of any
 city  or county of the state of New York; and to afford such information
 to such department of motor vehicles, treasury department  or  officials
 of  such  city  or county, any provision of this chapter to the contrary
 notwithstanding;
   3. to delegate its functions under this section to any commissioner or
 employee of such commission;
   4. to require any person who is an owner, as defined in  chapter  five
 of title nineteen of the code of the preceding municipality, of a desig-
 nated  licensed  vehicle  to  keep  such records as it prescribes and to
 furnish such information upon its request; and
   5. to extend, for cause shown, the time for filing any return required
 to be filed with the taxi and limousine  commission  for  a  period  not
 exceeding sixty days.
   o.  To  the  extent  that any provision of this section is in conflict
 with any other provision of this chapter, the provisions of this section
 shall be controlling, but in all other respects such other provisions of
 this chapter shall remain fully applicable with respect to  the  imposi-
 tion,  administration  and collection of the taxes imposed by this chap-
 ter.
   § 11-810 Determination of tax. If a return required by this chapter is
 not filed, or if a return when filed is incorrect or  insufficient,  the
 commissioner  of finance shall determine the amount of tax due from such
 information as may be obtainable and, if necessary, may estimate the tax
 on the basis of external indices such as motor vehicle registration with
 the department of motor vehicles and/or any  other  factors.  Notice  of
 such  determination  shall be given to the person liable for the payment
 of the tax. Such determination shall finally and irrevocably fix the tax
 unless the person against whom it is assessed, within ninety days  after
 the  giving  of  notice of such determination or, if the commissioner of
 finance has established a conciliation  procedure  pursuant  to  section
 11-124  of  this  title  and  the  taxpayer has requested a conciliation
 conference in accordance therewith, within ninety days from the  mailing
 of  a  conciliation decision or the date of the commissioner's confirma-
 tion of the discontinuance of  the  conciliation  proceeding,  both  (1)
 serves a petition upon the commissioner of finance and (2) files a peti-
 tion  with the tax appeals tribunal for a hearing, or unless the commis-
 sioner of finance of his or her own motion shall redetermine  the  same.
 Such  hearing and any appeal to the tax appeals tribunal sitting en banc
 from the decision rendered in such hearing shall  be  conducted  in  the
 manner  and  subject  to  the requirements prescribed by the tax appeals
 tribunal pursuant  to  sections  one  hundred  sixty-eight  through  one
 hundred  seventy-two  of the charter of the preceding municipality as it
 existed January first, nineteen hundred ninety-four. After such  hearing
 the tax appeals tribunal shall give notice of its decision to the person
 against  whom the tax is assessed and to the commissioner of finance.  A
 decision of the tax appeals tribunal sitting en banc shall be reviewable
 for error, illegality or unconstitutionality or any other reason whatso-
 S. 8474                            756
 
 ever by a proceeding under article seventy-eight of the  civil  practice
 law  and  rules  if application therefor is made to the supreme court by
 the person against whom the tax was assessed within  four  months  after
 the  giving  of  the  notice  of  such  tax appeals tribunal decision. A
 proceeding under article seventy-eight of the  civil  practice  law  and
 rules  shall  not  be instituted by a taxpayer unless: (a) the amount of
 any tax sought to be reviewed, with penalties and interest  thereon,  if
 any, shall be first deposited with the commissioner of finance and there
 shall  be  filed with the commissioner of finance an undertaking, issued
 by a surety company authorized to transact business in  this  state  and
 approved by the superintendent of insurance of this state as to solvency
 and  responsibility,  in such amount and with such sureties as a justice
 of the supreme court shall approve, to the effect that if such  proceed-
 ing  be  dismissed or the tax confirmed, the taxpayer will pay all costs
 and charges which may accrue in the prosecution of  the  proceeding,  or
 (b)  at  the  option  of  the  taxpayer  such undertaking filed with the
 commissioner of finance may be in a sum sufficient to cover  the  taxes,
 penalties  and  interest  thereon stated in such decision plus the costs
 and charges which may accrue  against  it  in  the  prosecution  of  the
 proceeding, in which event the taxpayer shall not be required to deposit
 such  taxes,  penalties  and  interest  as  a condition precedent to the
 application.
   § 11-811 Refunds. a. In  the  manner  provided  in  this  section  the
 commissioner  of  finance  shall refund or credit, without interest, any
 tax, penalty or interest erroneously,  illegally  or  unconstitutionally
 collected or paid, if written application to the commissioner of finance
 for  such refund shall be made within one year from the payment thereof.
 Whenever a refund or credit is  made  or  denied,  the  commissioner  of
 finance  shall  state his or her reason therefor and give notice thereof
 to the taxpayer in writing. The commissioner of finance may, in lieu  of
 any  refund  required  to be made, allow credit therefor on payments due
 from the applicant.
   b. Any determination of the commissioner of finance denying  a  refund
 or  credit  pursuant to subdivision a of this section shall be final and
 irrevocable unless the applicant for such refund or credit, within nine-
 ty days from the mailing or notice of such  determination,  or,  if  the
 commissioner  of finance has established a conciliation procedure pursu-
 ant to section 11-124 of this title and the applicant  has  requested  a
 conciliation conference in accordance therewith, within ninety days from
 the mailing of a conciliation decision or the date of the commissioner's
 confirmation  of the discontinuance of the conciliation proceeding, both
 (1) serves a petition upon the commissioner of finance and (2)  files  a
 petition  with the tax appeals tribunal for a hearing. Such petition for
 a refund or credit, made as herein provided, shall be deemed an applica-
 tion for a revision of any tax, penalty or interest complained of.  Such
 hearing  and any appeal to the tax appeals tribunal sitting en banc from
 the decision rendered in such hearing shall be conducted in  the  manner
 and  subject  to the requirements prescribed by the tax appeals tribunal
 pursuant to sections one hundred sixty-eight through one hundred  seven-
 ty-two  of the charter of the preceding municipality as it existed Janu-
 ary first, nineteen hundred ninety-four. After  such  hearing,  the  tax
 appeals  tribunal shall give notice of its decision to the applicant and
 to the commissioner of finance.  The  applicant  shall  be  entitled  to
 institute  a  proceeding  pursuant to article seventy-eight of the civil
 practice law and rules to review a decision of the tax appeals  tribunal
 sitting  en  banc  if  application to the supreme court be made therefor
 S. 8474                            757
 
 within four months after the giving of  notice  of  such  decision,  and
 provided,  in  the  case  of  an application by a taxpayer, that a final
 determination of tax due was not  previously  made.  Such  a  proceeding
 shall not be instituted by a taxpayer, unless an undertaking shall first
 be  filed  with the commissioner of finance in such amount and with such
 sureties as a justice of the supreme court shall approve, to the  effect
 that  if such proceeding be dismissed or the tax confirmed, the taxpayer
 will pay all costs and charges which may accrue in  the  prosecution  of
 the proceeding.
   c.  A  person  shall  not  be entitled to a revision, refund or credit
 under this section of a tax, interest or penalty which had  been  deter-
 mined  to  be  due  pursuant to the provisions of section 11-810 of this
 chapter where such person has had a hearing  or  an  opportunity  for  a
 hearing,  as provided in said section, or has failed to avail himself or
 herself of the remedies therein provided. No refund or credit  shall  be
 made  of  a  tax,  interest or penalty paid after a determination by the
 commissioner of finance made pursuant to section 11-810 of this  chapter
 unless  it  be  found  that such determination was erroneous, illegal or
 unconstitutional or otherwise improper,  by  the  tax  appeals  tribunal
 after  a  hearing  or  on the commissioner's own motion, or, if such tax
 appeals tribunal affirms in whole or in part the  determination  of  the
 commissioner  of finance, in a proceeding under article seventy-eight of
 the civil practice law and rules, pursuant to  the  provisions  of  said
 section,  in which event refund or credit without interest shall be made
 of the tax, interest or penalty found to have been overpaid.
   § 11-812 Remedies exclusive. The remedies  provided  by  this  chapter
 shall  be  the exclusive remedies available to any person for the review
 of tax liability imposed  by  this  chapter;  and  no  determination  or
 proposed  determination  of  tax or determination on any application for
 refund by the commissioner of finance,  nor  any  decision  by  the  tax
 appeals  tribunal  or  any  of  its  administrative law judges, shall be
 enjoined or reviewed by an action for declaratory  judgment,  an  action
 for money had and received or by any action or proceeding other than, in
 the  case  of  a decision by the tax appeals tribunal sitting en banc, a
 proceeding under article seventy-eight of the  civil  practice  law  and
 rules;  provided,  however,  that  a taxpayer may proceed by declaratory
 judgment if the taxpayer institutes suit  within  thirty  days  after  a
 deficiency  assessment  is  made  and  pays the amount of the deficiency
 assessment to the commissioner of finance prior to  the  institution  of
 such  suit  and  posts a bond for costs as provided in section 11-810 of
 this chapter.
   § 11-813  Reserves. In cases where the  taxpayer  has  applied  for  a
 refund  and  has  instituted a proceeding under article seventy-eight of
 the civil practice law and rules to review a  determination  adverse  to
 the taxpayer on his or her application for refund, the comptroller shall
 set up appropriate reserves to meet any decision adverse to the city.
   §  11-814    Proceedings  to recover tax. a. Whenever any person shall
 fail to pay any tax or penalty or interest imposed by  this  chapter  as
 herein  provided, the corporation counsel shall, upon the request of the
 commissioner of finance, bring or cause  to  be  brought  an  action  to
 enforce  payment  of  the same against the person liable for the same on
 behalf of the city of Staten Island in any court of  the  state  of  New
 York  or  of  any other state or of the United States.  If, however, the
 commissioner of finance in his or her discretion believes that a taxpay-
 er subject to the provisions of this chapter is about to cease business,
 leave the state or remove or dissipate the assets out of  which  tax  or
 S. 8474                            758
 
 penalties  might  be satisfied and that any such tax or penalty will not
 be paid when due, the commissioner may declare such tax or penalty to be
 immediately due and payable and may issue a warrant immediately.
   b.  As  an additional or alternate remedy, the commissioner of finance
 may issue a warrant, directed to the city sheriff commanding the sheriff
 to levy upon and sell the real and  personal  property  of  such  person
 which may be found within the city, for the payment of the amount there-
 of,  with  any  penalties  and  interest,  and the cost of executing the
 warrant, and to return such warrant to the commissioner of  finance  and
 to  pay to the commissioner the money collected by virtue thereof within
 sixty days after the receipt of such warrant.  The city  sheriff  shall,
 within  five days after the receipt of the warrant, file with the county
 clerk a copy thereof, and thereupon such clerk shall enter in the judge-
 ment docket the name of the person mentioned  in  the  warrant  and  the
 amount  of  the  tax,  penalties  and  interest for which the warrant is
 issued and the date when such copy is filed.  Thereupon  the  amount  of
 such  warrant  so  docketed  shall  become  a lien upon the title to and
 interest in real and personal property of the person  against  whom  the
 warrant is issued.  The city sheriff shall then proceed upon the warrant
 in  the  same  manner  and  with  like effect as that provided by law in
 respect to executions issued against property upon judgments of a  court
 of  record,  and for services in executing the warrant the sheriff shall
 be entitled to the same fees which he or she may  collect  in  the  same
 manner.    In the discretion of the commissioner of finance a warrant of
 like terms, force and effect may be issued and directed to  any  officer
 or  employee  of the department of finance, and in the execution thereof
 such officer or employee shall have all the powers conferred by law upon
 sheriffs, but such officer or employee shall be entitled to  no  fee  or
 compensation in excess of the actual expenses paid in the performance of
 such  duty.  If a warrant is returned not satisfied in full, the commis-
 sioner of finance may from time to time issue  new  warrants  and  shall
 also  have  the same remedies to enforce the amount due thereunder as if
 the city had recovered judgment therefor and execution thereon had  been
 returned unsatisfied.
   c.  Whenever  there  is made a sale, transfer or assignment in bulk of
 any part or the whole of a stock  of  merchandise  or  of  fixtures,  or
 merchandise and of fixtures pertaining to the conducting of the business
 of  the  seller,  transferor or assignor, otherwise than in the ordinary
 course of trade and in the regular prosecution  of  said  business,  the
 purchaser,  transferee or assignee shall at least ten days before taking
 possession of such merchandise, fixtures, or merchandise  and  fixtures,
 or  paying  therefor,  notify  the commissioner of finance by registered
 mail of the proposed sale and of the price, terms and conditions thereof
 whether or not the seller, transferor or assignor, has  represented  to,
 or  informed  the purchaser, transferee or assignee that it owes any tax
 pursuant to this chapter and whether or not the purchaser, transferee or
 assignee has knowledge that such taxes are owing, and whether  any  such
 taxes are in fact owing.
   Whenever  the  purchaser,  transferee  or  assignee shall fail to give
 notice to the commissioner of finance as required by the  opening  para-
 graph of this subdivision, or whenever the commissioner of finance shall
 inform  the  purchaser, transferee or assignee that a possible claim for
 such tax or taxes exists, any sums  of  money,  property  or  choses  in
 action,  or  other  consideration,  which  the  purchaser, transferee or
 assignee is required to transfer  over  to  the  seller,  transferor  or
 assignor  shall  be  subject  to a first priority right and lien for any
 S. 8474                            759
 
 such taxes theretofore or thereafter determined to be due from the sell-
 er, transferor or assignor to the city, and the purchaser, transferee or
 assignee is forbidden to transfer to the seller, transferor or  assignor
 any  such  sums  of money, property or choses in action to the extent of
 the amount of the  city's  claim.    For  failure  to  comply  with  the
 provisions  of  this subdivision, the purchaser, transferee or assignee,
 in addition to being subject to the  liabilities  and  remedies  imposed
 under  the provisions of former section forty-four of the personal prop-
 erty law, shall be personally liable for the payment to the city of  any
 such  taxes  theretofore  or thereafter determined to be due to the city
 from the seller, transferor or  assignor,  and  such  liability  may  be
 assessed  and enforced in the same manner as the liability for tax under
 this chapter.
   d. The commissioner of finance, if he or she finds that the  interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the  commissioner  of finance may require, may release any property from
 the lien of any warrant or vacate such warrant for unpaid  taxes,  addi-
 tions  to tax, penalties and interest filed pursuant to subdivision b of
 this section, and such  release  or  vacating  of  the  warrant  may  be
 recorded  in  the  office of any recording officer in which such warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   § 11-815  General powers of the commissioner of finance.  In  addition
 to all other powers granted to the commissioner of finance in this chap-
 ter, the commissioner is hereby authorized and empowered:
   1.  To  make, adopt and amend rules and regulations appropriate to the
 carrying out of this chapter and the purposes thereof;
   2. To extend, for cause shown, the time for filing any kind of  return
 for a period not exceeding sixty days; and to compromise disputed claims
 in connection with the taxes hereby imposed;
   3.    To  request  information  concerning  motor vehicles and persons
 subject to the provisions of this chapter from the department  of  motor
 vehicles and from the department of taxation and finance of the state of
 New York or any successor to their duties, or the treasury department of
 the  United  States relative to any person; and to afford information to
 such department of motor vehicles, department of taxation and finance or
 any successor to their duties, or to such treasury  department  relative
 to  any  person,  any  other  provision  of this chapter to the contrary
 notwithstanding;
   4. To delegate the commissioner's  functions  hereunder  to  a  deputy
 commissioner  of  finance or any employee or employees of the department
 of finance;
   5. To assess, reassess,  determine,  revise  and  readjust  the  taxes
 imposed under this chapter;
   6. To provide methods for identifying motor vehicles not subject to or
 exempt from the tax imposed under this chapter;
   7.  To  provide  that  a certificate of registration need not be filed
 with respect to any or all types of motor vehicles, or to  provide  that
 such  certificate  of  registration  with respect to any or all types of
 motor vehicles shall be contained on or  combined  with  any  return  or
 supplemental return required to be filed under this chapter.
   §  11-816    Administration  of oaths and compelling testimony. a. The
 commissioner of finance, the commissioner's  employees  duly  designated
 and  authorized by the commissioner, the tax appeals tribunal and any of
 its duly designated and authorized employees shall have power to  admin-
 ister  oaths and take affidavits in relation to any matter or proceeding
 S. 8474                            760
 
 in the exercise of their powers  and  duties  under  this  chapter.  The
 commissioner of finance and the tax appeals tribunal shall have power to
 subpoena  and  require the attendance of witnesses and the production of
 books,  papers  and  documents  to  secure  information pertinent to the
 performance of the duties of the commissioner  or  of  the  tax  appeals
 tribunal hereunder and of the enforcement of this chapter and to examine
 them  in  relation thereto, and to issue commissions for the examination
 of witnesses who are out of the state or unable  to  attend  before  the
 commissioner or the tax appeals tribunal or excused from attendance.
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 testimony  of  witnesses  and  the  production and examination of books,
 papers and documents called for by the subpoena of the  commissioner  of
 finance or the tax appeals tribunal under this chapter.
   c.  Cross-reference; criminal penalties. For failure to obey subpoenas
 or for testifying falsely, see  section  11-4007  of  the  code  of  the
 preceding  municipality;  for supplying false or fraudulent information,
 see section 11-4009 of the code of the preceding municipality.
   d. The officers who serve the summons or subpoena of the  commissioner
 of finance or the tax appeals tribunal hereunder and witnesses attending
 in response thereto shall be entitled to the same fees as are allowed to
 officers  and  witnesses  in  civil cases in courts of record, except as
 herein otherwise provided. Such officers shall be the city sheriff,  and
 the  sheriff's  duly  appointed deputies or any officers or employees of
 the department of finance or the tax  appeals  tribunal,  designated  to
 serve such process.
   §  11-817  Interest  and penalties. (a) Interest on underpayments.  If
 any amount of tax is not paid on or before the last date prescribed  for
 payment,  without  regard  to any extension of time granted for payment,
 interest on such amount at the rate set by the commissioner  of  finance
 pursuant  to  subdivision (g) of this section, or, if no rate is set, at
 the rate of seven and one-half percent per annum, shall be paid for  the
 period  from  such  last  date  to the date of payment. In computing the
 amount of interest to be paid, such interest shall be compounded  daily.
 Interest  under this subdivision shall not be paid if the amount thereof
 is less than one dollar.
   (b) (1) Failure to file return. (A) In  case  of  failure  to  file  a
 return  under  this chapter on or before the prescribed date, determined
 with regard to any extension of time for filing, unless it is shown that
 such failure is due to reasonable cause and not due to willful  neglect,
 there  shall  be added to the amount required to be shown as tax on such
 return five percent of the amount of such tax if the failure is for  not
 more than one month, with an additional five percent for each additional
 month  or  fraction  thereof  during  which  such failure continues, not
 exceeding twenty-five percent in the aggregate.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to any extension of time for filing, unless it is shown that such  fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion  to  tax under subparagraph (A) of this paragraph shall not be less
 than the lesser of one hundred dollars or one  hundred  percent  of  the
 amount required to be shown as tax on such return.
   (C)  For  purposes of this paragraph, the amount of tax required to be
 shown on the return shall be reduced by the amount of any  part  of  the
 tax  which  is  paid on or before the date prescribed for payment of the
 S. 8474                            761
 
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2) Failure to pay tax shown on return.  In case of failure to pay the
 amount  shown as tax on a return required to be filed under this chapter
 on or before the prescribed date, determined with regard to  any  exten-
 sion of time for payment, unless it is shown that such failure is due to
 reasonable cause and not due to willful neglect, there shall be added to
 the  amount  shown  as tax on such return one-half of one percent of the
 amount of such tax if the failure is not for more than one  month,  with
 an additional one-half of one percent for each additional month or frac-
 tion  thereof during which such failure continues, not exceeding twenty-
 five percent in the aggregate. For the purpose of computing the addition
 for any month the amount of tax shown on the return shall be reduced  by
 the  amount of any part of the tax which is paid on or before the begin-
 ning of such month and by the amount of any credit against the tax which
 may be claimed upon the return. If the amount  of  tax  required  to  be
 shown  on  a return is less than the amount shown as tax on such return,
 this paragraph shall be applied by substituting such lower amount.
   (3) Failure to pay tax required to be shown on return.    In  case  of
 failure  to pay any amount in respect of any tax required to be shown on
 a return required to be filed under this chapter which is not so  shown,
 including  a determination made pursuant to section 11-810 of this chap-
 ter, within ten days of the date of a notice and demand therefor, unless
 it is shown that such failure is due to reasonable cause and not due  to
 willful  neglect,  there  shall  be added to the amount of tax stated in
 such notice and demand one-half of one percent of such tax if the  fail-
 ure  is  not for more than one month, with an additional one-half of one
 percent for each additional month or fraction thereof during which  such
 failure  continues,  not exceeding twenty-five percent in the aggregate.
 For the purpose of computing the addition for any month, the  amount  of
 tax  stated  in  the notice and demand shall be reduced by the amount of
 any part of the tax which is paid before the beginning of such month.
   (4) Limitations on additions.
   (A) With respect to any return, the amount of the addition under para-
 graph one of this subdivision shall be reduced  by  the  amount  of  the
 addition  under paragraph two of this subdivision for any month to which
 an addition applies under both such paragraphs one and two.  In any case
 described in subparagraph (B) of paragraph one of this subdivision,  the
 amount  of  the  addition  under such paragraph one shall not be reduced
 below the amount provided in such subparagraph.
   (B) With respect to any return, the maximum  amount  of  the  addition
 permitted  under paragraph three of this subdivision shall be reduced by
 the amount of the addition under  paragraph  one  of  this  subdivision,
 determined  without  regard  to  subparagraph (B) of such paragraph one,
 which is attributable to the tax for which the notice and demand is made
 and which is not paid within ten days of such notice and demand.
   (c) Underpayment due to negligence. (1) If any part of an underpayment
 of tax is due to negligence or intentional disregard of this chapter  or
 any rules or regulations hereunder, but without intent to defraud, there
 shall  be added to the tax a penalty equal to five percent of the under-
 payment.
   (2) There shall be added to the tax, in addition to the amount  deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under subdivision (a)  of  this  section
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to the negligence or intentional  disre-
 S. 8474                            762
 
 gard  referred to in such paragraph one, for the period beginning on the
 last date prescribed by law for payment of such underpayment, determined
 without regard to any extension, and ending on the date of  the  assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
   (d)  Underpayment  due to fraud. (1) If any part of an underpayment of
 tax is due to fraud, there shall be added to the tax a penalty equal  to
 fifty percent of the underpayment.
   (2) There shall be added to the tax, in addition to the penalty deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under subdivision (a)  of  this  section
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to fraud, for the  period  beginning  on
 the  last day prescribed by law for payment of such underpayment, deter-
 mined without regard to any extension, and ending on  the  date  of  the
 assessment  of  the  tax, or, if earlier, the date of the payment of the
 tax.
   (3) The penalty under this subdivision shall be in lieu of  any  other
 addition to tax imposed by subdivision (b) or (c) of this section.
   (e) Additional penalty.  Any person who, with fraudulent intent, shall
 fail to pay any tax imposed by this chapter, or to make, render, sign or
 certify  any  return,  or  to  supply  any  information  within the time
 required by or under this chapter, shall be liable for a penalty of  not
 more  than  one  thousand  dollars,  in  addition  to  any other amounts
 required under this chapter to be imposed, assessed and collected by the
 commissioner of finance. The commissioner  of  finance  shall  have  the
 power,  in  his  or  her  discretion, to waive, reduce or compromise any
 penalty under this subdivision.
   (f) The interest and penalties imposed by this section shall  be  paid
 and  disposed of in the same manner as other revenues from this subchap-
 ter. Unpaid interest and penalties may be enforced in the same manner as
 the tax imposed by this chapter.
   (g) (1) Authority to set interest rates.  The commissioner of  finance
 shall set the rate of interest to be paid pursuant to subdivision (a) of
 this section, but if no such rate of interest is set, such rate shall be
 deemed  to  be  set  at seven and one-half percent per annum.  Such rate
 shall be the rate prescribed in paragraph two of  this  subdivision  but
 shall  not  be  less than seven and one-half percent per annum. Any such
 rate set by the commissioner of finance shall apply  to  taxes,  or  any
 portion  thereof,  which  remain  or  become due on or after the date on
 which such rate becomes effective and shall apply only with  respect  to
 interest  computed  or  computable  for  periods  or portions of periods
 occurring in the period in which such rate is in effect.
   (2) General rule. The rate of  interest  set  under  this  subdivision
 shall  be  the  sum of (i) the federal short-term rate as provided under
 paragraph three of this subdivision, plus (ii) seven percentage points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A) The federal short-term rate for any month  shall  be  the  federal
 short-term  rate determined by the United States secretary of the treas-
 ury during such month in  accordance  with  subsection  (d)  of  section
 twelve  hundred  seventy-four  of  the  internal revenue code for use in
 connection with section six  thousand  six  hundred  twenty-one  of  the
 internal  revenue  code.  Any  such rate shall be rounded to the nearest
 full percent, or, if a multiple of one-half of one  percent,  such  rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
 S. 8474                            763
 
   (i)  In  general.  Except  as provided in clause (ii) of this subpara-
 graph, the federal short-term rate for the first month in each  calendar
 quarter  shall  apply  during the first calendar quarter beginning after
 such month.
   (ii)  Special rule for the month of September, nineteen hundred eight-
 y-nine. The federal short-term rate for the  month  of  April,  nineteen
 hundred  eighty-nine  shall  apply  with  respect to setting the rate of
 interest for the month of September, nineteen hundred eighty-nine.
   (4) Publication of interest rate. The commissioner  of  finance  shall
 cause  to  be  published  in the City Record, and give other appropriate
 general notice of, the interest rate to be set under this subdivision no
 later than twenty days preceding the first day of the  calendar  quarter
 during  which such interest rate applies. The setting and publication of
 such interest rate shall not be included within paragraph (a) of  subdi-
 vision five of section one thousand forty-one of the city charter of the
 preceding  municipality  as  it  existed January first, nineteen hundred
 ninety-four relating to the definition of a rule.
   (h)  Miscellaneous. (1) The certificate of the commissioner of finance
 to the effect that a tax has not been paid, that a motor vehicle has not
 been registered, that a return has not been filed, or  that  information
 has  not been supplied pursuant to the provisions of this chapter, shall
 be presumptive evidence thereof.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   § 11-818 Information and records to be secret.  a. Except  in  accord-
 ance  with  proper  judicial  order, or as otherwise provided by law, it
 shall be unlawful for the  commissioner  of  finance,  the  tax  appeals
 tribunal, any other agency, officer or employee of the city, the commis-
 sioner  of  motor vehicles, any officer or employee of the department of
 motor vehicles, any agent of the commissioner of motor vehicles, or  any
 other  person who, pursuant to this section, is permitted to inspect any
 registration or return filed pursuant to this  chapter,  or  to  whom  a
 copy,  an abstract or portion of any registration or return filed pursu-
 ant to this chapter is furnished, or to whom any  information  contained
 in  any  registration  or  return  filed  pursuant  to  this  chapter is
 furnished, to divulge or make known in any manner any information relat-
 ing to or contained in any registration or  any  kind  of  return  filed
 pursuant to this chapter.  The officers charged with the custody of such
 registration and returns pertaining to the tax assessed pursuant to this
 chapter  shall  not  be  required  to produce any of them or evidence of
 anything contained in them in any action or  proceeding  in  any  court,
 except  on behalf of the city, the commissioner of finance, the state or
 the commissioner of motor vehicles, in an action or proceeding under the
 provisions of this chapter, or on behalf of any party to any  action  or
 proceeding  under  the provisions of this chapter when the registration,
 return or facts shown therein are directly involved in  such  action  or
 proceeding,  in  either  of  which  events,  the  court  may require the
 production of, and may admit in evidence, so much of said  registration,
 return, or of the facts shown therein, as are pertinent to the action or
 proceeding  and  no more. The commissioner of finance may, nevertheless,
 publish a copy or a summary of any determination  or  decision  rendered
 after a formal hearing held pursuant to section 11-810 or 11-811 of this
 chapter. Nothing herein shall be construed to prohibit the delivery to a
 person  or  such  person's duly authorized representative of a certified
 copy of any registration or return filed by such person; nor to prohibit
 the delivery of any original return, with any notation that the  commis-
 S. 8474                            764

 sioner  of finance or the commissioner of motor vehicles may cause to be
 made thereon, to the person filing the return, whether such person files
 the return on his or her own behalf or on behalf of another, or  to  the
 person  on whose behalf the return is filed; nor to prohibit the commis-
 sioner of finance from providing by rule for the display  or  production
 of  any original return, as an indicium of payment of the tax imposed by
 this chapter; nor to prohibit the publication of statistics  so  classi-
 fied  as  to  prevent the identification of particular registrations and
 returns and the items thereof; nor to prohibit the delivery of a  certi-
 fied  copy of any registration or return to the United States of America
 or any department thereof, the state of New York or any department ther-
 eof, the city of New York or  any  department  thereof  provided  it  is
 requested  for  official business, nor to prohibit the inspection by the
 corporation counsel or other legal  representatives  of  the  city,  the
 attorney general of the state of New York or other legal representatives
 of  the department of motor vehicles, or by the district attorney of any
 county within the city of the registration or return of any  person  who
 shall  bring  action to set aside or review any tax assessed pursuant to
 this section, or against whom an action or proceeding under this chapter
 is instituted. Returns, or  reproductions  thereof,  pertaining  to  any
 motor vehicle registered pursuant to this section shall be preserved for
 three  years  and  thereafter  until  the commissioner of finance or the
 commissioner of motor vehicles permits them to be destroyed.
   b. (1) Any officer or employee of the city or the state  of  New  York
 who  willfully  violates the provisions of subdivision a of this section
 shall be dismissed from office and be incapable of  holding  any  public
 office  in this city or the state of New York for a period of five years
 thereafter.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   c. This section shall be deemed a state statute for purposes of  para-
 graph (a) of subdivision two of section eighty-seven of the public offi-
 cers law.
   d.  Notwithstanding  anything  in subdivision a of this section to the
 contrary, if a taxpayer has petitioned  the  tax  appeals  tribunal  for
 administrative  review as provided in section one hundred seventy of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four, the commissioner of finance shall  be  author-
 ized  to  present to the tribunal any report or return of such taxpayer,
 or any information contained therein or relating thereto, which  may  be
 material  or  relevant  to  the  proceeding before the tribunal. The tax
 appeals tribunal shall be authorized to publish a copy or a  summary  of
 any decision rendered pursuant to section one hundred seventy-one of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four.
   §  11-819 Notices and limitations of time. a. Any notice authorized or
 required under the provisions of this chapter may be given to the person
 for whom it is intended by mailing it in a postpaid  envelope  addressed
 to  such person at the address given in the last registration of a motor
 vehicle filed by such person pursuant to the provisions of this chapter,
 or in any application made by such person, or if  no  such  registration
 has  been  filed  or  application  made,  then to such address as may be
 obtainable.  The mailing of a notice as in this subdivision provided for
 shall be presumptive evidence of the receipt of the same by  the  person
 to  whom addressed.  Any period of time which is determined according to
 the provisions of this chapter by the giving of notice shall commence to
 S. 8474                            765
 
 run from the date of mailing of  such  notice  as  in  this  subdivision
 provided.
   b. The provisions of the civil practice law and rules or any other law
 relative  to  limitations  of time for the enforcement of a civil remedy
 shall not apply to any proceeding or action taken by the city  to  levy,
 appraise,  assess,  determine  or  enforce  the collection of any tax or
 penalty provided by this chapter.   However, except in  the  case  of  a
 wilfully false or fraudulent registration or return with intent to evade
 the tax, no assessment of additional tax shall be made after the expira-
 tion  of  more  than three years from the date of such return; provided,
 however, that where no registration  or  no  return  has  been  made  as
 provided by law, the tax may be assessed at any time.
   c.  Where  before  the  expiration  of  the  period prescribed in this
 section for the assessment of an additional tax, a person has  consented
 in  writing  that such period be extended, the amount of such additional
 tax due may be determined at any time within such extended period.   The
 period  so  extended  may  be further extended by subsequent consents in
 writing made before the expiration of the extended period.
   d. If any return, claim,  statement,  notice,  application,  or  other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 of  any  provision  of  this chapter is, after such period or such date,
 delivered by United States mail to the commissioner of finance,  commis-
 sioner  of  motor  vehicles,  the  tax appeals tribunal, bureau, office,
 officer or person with which or with whom such document is  required  to
 be  filed,  or  to which or to whom such payment is required to be made,
 the date of the United States postmark stamped on the envelope shall  be
 deemed  to be the date of delivery. This subdivision shall apply only if
 the postmark date falls within the prescribed period or on or before the
 prescribed date for the filing of  such  document,  or  for  making  the
 payment, including any extension granted for such filing or payment, and
 only  if  such  document  or  payment was deposited in the mail, postage
 prepaid, properly addressed to the commissioner of finance, commissioner
 of motor vehicles, the tax appeals tribunal, bureau, office, officer  or
 person  with  which or with whom the document is required to be filed or
 to which or to whom such payment is required to be made. If any document
 is sent by United States registered mail,  such  registration  shall  be
 prima facie evidence that such document was delivered to the commission-
 er of finance, commissioner of motor vehicles, the tax appeals tribunal,
 bureau, office, officer or person to which or to whom addressed, and the
 date of registration shall be deemed the postmark date. The commissioner
 of finance or, where relevant, the tax appeals tribunal is authorized to
 provide  by regulation the extent to which the provisions of this subdi-
 vision with respect to prima facie evidence of delivery and the postmark
 date shall apply to certified mail. Except as provided in subdivision  f
 of  this  section, this subdivision shall apply in the case of postmarks
 not made by the United States postal service only if and to  the  extent
 provided  by rule of the commissioner of finance or, where relevant, the
 tax appeals tribunal.
   e. When the last day  prescribed  under  authority  of  this  chapter,
 including  any  extension  of  time,  for  performing any act falls on a
 Saturday, Sunday or legal holiday in the state of New York, the perform-
 ance of such act shall be considered timely if it is  performed  on  the
 next succeeding day which is not a Saturday, Sunday or legal holiday.
   f.  (1)  Any  reference in subdivision d of this section to the United
 States mail shall be treated as including a reference  to  any  delivery
 S. 8474                            766
 
 service designated by the secretary of the treasury of the United States
 pursuant  to  section  seventy-five  hundred two of the internal revenue
 code and any reference in subdivision d of  this  section  to  a  United
 States  postmark  shall  be treated as including a reference to any date
 recorded or marked in  the  manner  described  in  section  seventy-five
 hundred  two  of  the  internal  revenue  code  by a designated delivery
 service. If the commissioner of finance finds that any delivery  service
 designated  by  such  secretary is inadequate for the needs of the city,
 the commissioner of finance may withdraw such designation  for  purposes
 of this title. The commissioner of finance may also designate additional
 delivery  services  meeting the criteria of section seventy-five hundred
 two of the internal revenue code for purposes  of  this  title,  or  may
 withdraw  any such designation if the commissioner of finance finds that
 a delivery service so designated is inadequate  for  the  needs  of  the
 city.  Any  reference  in  subdivision  d  of this section to the United
 States mail shall be treated as including a reference  to  any  delivery
 service  designated  by the commissioner of finance and any reference in
 subdivision d of this section to  a  United  States  postmark  shall  be
 treated  as  including a reference to any date recorded or marked in the
 manner described in section seventy-five hundred  two  of  the  internal
 revenue  code  by  a  delivery service designated by the commissioner of
 finance. Notwithstanding the provisions of  this  paragraph,  any  with-
 drawal  of  designation or additional designation by the commissioner of
 finance shall not be effective for purposes  of  service  upon  the  tax
 appeals  tribunal,  unless  and  until such withdrawal of designation or
 additional designation is ratified by the president of the  tax  appeals
 tribunal.
   (2)  Any  equivalent of registered or certified mail designated by the
 United States secretary of the treasury, or as may be designated by  the
 commissioner  of  finance  pursuant  to  the  same criteria used by such
 secretary for such designations pursuant to section seventy-five hundred
 two of the internal revenue code, shall be included within  the  meaning
 of  registered  or  certified  mail  as  used  in  subdivision d of this
 section. If the commissioner of finance finds  that  any  equivalent  of
 registered or certified mail designated by such secretary or the commis-
 sioner  of  finance is inadequate for the needs of the city, the commis-
 sioner of finance may withdraw such designation  for  purposes  of  this
 title.  Notwithstanding the provisions of this paragraph, any withdrawal
 of designation or additional designation by the commissioner of  finance
 shall  not  be  effective  for  purposes of service upon the tax appeals
 tribunal, unless and until such withdrawal of designation or  additional
 designation is ratified by the president of the tax appeals tribunal.
   §  11-820    Construction  and  enforcement.  This  chapter  shall  be
 construed and enforced in conformity with chapter one  thousand  thirty-
 two  of  the  laws  of  nineteen  hundred sixty, pursuant to which it is
 enacted.
 
                                 CHAPTER 9
                    TAX UPON FOREIGN AND ALIEN INSURERS
   § 11-901 Definitions. Wherever used in  this  chapter,  the  following
 words and phrases shall mean and include:
   "Alien  insurer." Any insurer incorporated or organized under the laws
 of any foreign nation, or of any  province  or  territory  not  included
 under the definition of a foreign insurer.
   "Foreign  insurer."  Any  insurer,  except  a mutual insurance company
 taxed under the provisions of section nine thousand one hundred five  of
 S. 8474                            767
 
 the  insurance  law,  incorporated  or  organized  under the laws of any
 state, as herein defined, other than this state.
   "Fire insurance corporation, association or individuals." Any insurer,
 regardless of the name, designation or authority under which it purports
 to  act,  which  insures  property of any kind or nature against loss or
 damage by fire.
   "Loss or damage by fire." Loss or damage by fire, lightning, smoke  or
 anything  used  to  combat fire, regardless of whether such risks or the
 premiums therefor are stated or charged separately and  apart  from  any
 other risk or premium.
   "State." Any state of the United States and the District of Columbia.
   "Commissioner  of finance." The commissioner of finance of the city or
 any other officer of the city designated to perform the same functions.
   "Department of finance." The department of finance of the city or  any
 other agency or department designated to perform the same functions.
   "Fire commissioner." The fire commissioner of the city.
   "Comptroller." The comptroller of the city.
   "Tax  appeals  tribunal."  The  tax  appeals  tribunal  established by
 section one hundred sixty-eight of the charter of the preceding  munici-
 pality as it existed January first, nineteen hundred ninety-four.
   §  11-902  General powers of the commissioner of finance.  In addition
 to  all  other  powers granted to the commissioner of finance under this
 chapter, the commissioner is hereby authorized and empowered:
   1.  To make, adopt and amend rules and regulations appropriate to  the
 carrying out of this chapter and the purposes thereof.
   2.    To  compromise  disputed  claims in connection with taxes hereby
 imposed.
   3.   To delegate his or her functions  hereunder  to  any  officer  or
 employee of the department of finance.
   4.    To  prescribe reasonable methods, approved by the New York state
 superintendent of insurance, for determining  the  amounts  of  premiums
 subject to the tax.
   5.  To require any foreign or alien insurer subject to the tax to keep
 detailed records of the premiums in a manner reasonably designed to show
 the  amounts  thereof subject to the tax and to furnish such information
 on request.
   6.  To assess, determine, revise and adjust the tax imposed under this
 chapter.
   7.  To audit the reports of any insurer.
   8.  To allow an extension of time not in excess  of  thirty  days  for
 filing  the report and paying the tax required by this chapter, provided
 the taxpayer requests such  extension  in  writing  prior  to  the  date
 prescribed  for  such  filing  and  such  payment by sections 11-904 and
 11-903 of this chapter.
   §  11-903  Tax on premiums on policies of foreign and alien  insurers.
 There shall be paid to the department of finance for the use and benefit
 of the fire department of the city, on or before the first day of March,
 in  each  year  by  every  foreign and alien fire insurance corporation,
 association or individuals which insure property against loss or  damage
 by fire, the sum of two percent of all gross direct premiums less return
 premiums which, during the year ending on the preceding thirty-first day
 of December, shall have been received by any such insurer for any insur-
 ance against loss or damage by fire in the city.  Any such insurer which
 in  any  year  shall cease or terminate doing business in the city shall
 pay the tax for such year within thirty days  after  such  cessation  or
 termination.
 S. 8474                            768
 
   §  11-904 Report of premiums by insurers. Each insurer required to pay
 a tax under this chapter shall, at the time such tax is paid or payable,
 whichever is sooner, render to the commissioner of  finance  a  verified
 report  setting forth such information as may be required by the commis-
 sioner for the determination of the tax and the proper administration of
 this  chapter.  The commissioner of finance shall prescribe the form and
 furnish the necessary  forms  to  enable  such  insurers  to  make  such
 reports.  The  commissioner  or  the commissioner's designated represen-
 tative or the tax appeals  tribunal  or  its  designated  representative
 shall  have  power to examine any such insurer under oath and to require
 the production by such insurer of all books and papers  as  the  commis-
 sioner  or  the tax appeals tribunal may deem necessary. All expenses of
 collecting such tax shall be paid by the commissioner  of  finance  from
 the  funds received under this chapter prior to the distribution thereof
 as hereinafter authorized.
   § 11-905 Interest and penalties. (a) Interest on underpayments. If any
 amount of tax is not paid on or before  the  last  date  prescribed  for
 payment,  without  regard  to any extension of time granted for payment,
 interest on such amount at the underpayment rate set by the commissioner
 of finance pursuant to subdivision (g) of this section, or, if  no  rate
 is  set,  at  the rate of seven and one-half percent per annum, shall be
 paid for the period from such last date  to  the  date  of  payment.  In
 computing  the  amount  of  interest  to be paid, such interest shall be
 compounded daily. Interest under this subdivision shall not be  paid  if
 the amount thereof is less than one dollar.
   (b)  (1)  Failure  to  file  return.  (A) In case of failure to file a
 return under this chapter on or before the prescribed  date,  determined
 with regard to any extension of time for filing, unless it is shown that
 such  failure is due to reasonable cause and not due to willful neglect,
 there shall be added to the amount required to be shown as tax  on  such
 return  five percent of the amount of such tax if the failure is for not
 more than one month, with an additional five percent for each additional
 month or fraction thereof  during  which  such  failure  continues,  not
 exceeding twenty-five percent in the aggregate.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to  any extension of time for filing, unless it is shown that such fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion to tax under subparagraph (A) of this paragraph shall not  be  less
 than  the  lesser  of  one hundred dollars or one hundred percent of the
 amount required to be shown as tax on such return.
   (C) For purposes of this paragraph, the amount of tax required  to  be
 shown  on  the  return shall be reduced by the amount of any part of the
 tax which is paid on or before the date prescribed for  payment  of  the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2)  Failure to pay tax shown on return. In case of failure to pay the
 amount shown as tax on a return required to be filed under this  chapter
 on  or  before the prescribed date, determined with regard to any exten-
 sion of time for payment, unless it is shown that such failure is due to
 reasonable cause and not due to willful neglect, there shall be added to
 the amount shown as tax on such return one-half of one  percent  of  the
 amount  of  such tax if the failure is not for more than one month, with
 an additional one-half of one percent for each additional month or frac-
 tion thereof during which such failure continues, not exceeding  twenty-
 five percent in the aggregate. For the purpose of computing the addition
 S. 8474                            769
 
 for  any month the amount of tax shown on the return shall be reduced by
 the amount of any part of the tax which is paid on or before the  begin-
 ning of such month and by the amount of any credit against the tax which
 may  be  claimed  upon  the  return. If the amount of tax required to be
 shown on a return is less than the amount shown as tax on  such  return,
 this paragraph shall be applied by substituting such lower amount.
   (3)  Failure  to  pay  tax  required to be shown on return. In case of
 failure to pay any amount in respect of any tax required to be shown  on
 a  return required to be filed under this chapter which is not so shown,
 including a determination made pursuant to section 11-906 of this  chap-
 ter, within ten days of the date of a notice and demand therefor, unless
 it  is shown that such failure is due to reasonable cause and not due to
 willful neglect, there shall be added to the amount  of  tax  stated  in
 such  notice and demand one-half of one percent of such tax if the fail-
 ure is not for more than one month, with an additional one-half  of  one
 percent  for each additional month or fraction thereof during which such
 failure continues, not exceeding twenty-five percent in  the  aggregate.
 For  the  purpose of computing the addition for any month, the amount of
 tax stated in the notice and demand shall be reduced by  the  amount  of
 any part of the tax which is paid before the beginning of such month.
   (4) Limitations on additions.
   (A) With respect to any return, the amount of the addition under para-
 graph  one  of  this  subdivision  shall be reduced by the amount of the
 addition under paragraph two of this subdivision for any month to  which
 an  addition  applies under both paragraphs one and two of this subdivi-
 sion.  In any case described in subparagraph (B)  of  paragraph  one  of
 this  subdivision,  the  amount of the addition under such paragraph one
 shall not be reduced below the amount provided in such subparagraph.
   (B) With respect to any return, the maximum  amount  of  the  addition
 permitted  under paragraph three of this subdivision shall be reduced by
 the amount of the addition under  paragraph  one  of  this  subdivision,
 determined  without  regard  to  subparagraph  (B) of such paragraph one
 which is attributable to the tax for which the notice and demand is made
 and which is not paid within ten days of such notice and demand.
   (c) Underpayment due to negligence. (1) If any part of an underpayment
 of tax is due to negligence or intentional disregard of this chapter  or
 any  rules  and  regulations  hereunder,  but without intent to defraud,
 there shall be added to the tax a penalty equal to five percent  of  the
 underpayment.
   (2)  There shall be added to the tax, in addition to the amount deter-
 mined under paragraph one of this subdivision an amount equal  to  fifty
 percent  of  the  interest payable under subdivision (a) of this section
 with respect to the portion of the underpayment described in such  para-
 graph  one which is attributable to the negligence or intentional disre-
 gard referred to in such paragraph one, for the period beginning on  the
 last date prescribed by law for payment of such underpayment, determined
 without  regard  to any extension, and ending on the date of the assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
   (d) Underpayment due to fraud. (1) If any part of an  underpayment  of
 tax  is due to fraud, there shall be added to the tax a penalty equal to
 fifty percent of the underpayment.
   (2) There shall be added to the tax, in addition to the penalty deter-
 mined under paragraph one of this subdivision, an amount equal to  fifty
 percent  of  the  interest payable under subdivision (a) of this section
 with respect to the portion of the underpayment described in such  para-
 graph  one  which  is attributable to fraud, for the period beginning on
 S. 8474                            770
 
 the last day prescribed by law for payment of such underpayment,  deter-
 mined  without  regard  to  any extension, and ending on the date of the
 assessment of the tax, or, if earlier, the date of the  payment  of  the
 tax.
   (3)  The penalty under this subdivision  shall be in lieu of any other
 addition to tax imposed by subdivision (b) or (c) of this section.
   (e) Additional penalty. Any insurer who, with fraudulent intent, shall
 fail to pay any tax imposed by this chapter, or to make, render, sign or
 certify any return,  or  to  supply  any  information  within  the  time
 required  by or under this chapter, shall be liable for a penalty of not
 more than one  thousand  dollars,  in  addition  to  any  other  amounts
 required under this chapter to be imposed, assessed and collected by the
 commissioner  of  finance.  The  commissioner  of finance shall have the
 power, in his or her discretion, to  waive,  reduce  or  compromise  any
 penalty under this subdivision.
   (f)  The  interest and penalties imposed by this section shall be paid
 and disposed of in the same manner as other revenues from this  chapter.
 Unpaid  interest and penalties may be enforced in the same manner as the
 tax imposed by this chapter.
   (g) (1) Authority to set interest rates. The commissioner  of  finance
 shall  set the overpayment and underpayment rates of interest to be paid
 pursuant to subdivision (a) of  this  section  and  subdivision  (a)  of
 section  11-906  of  this  chapter,  but  if no such overpayment rate of
 interest are set, such rate or rates shall be deemed to be  set  at  six
 percent  per  annum and such underpayment rate shall be deemed to be set
 at seven and one-half percent per annum. Such rates shall be  the  over-
 payment  and  underpayment  rates  prescribed  in  paragraph two of this
 subdivision but the underpayment rate shall not be less than  seven  and
 one-half  percent  per  annum. Any such rates set by the commissioner of
 finance shall apply to taxes, or any portion thereof,  which  remain  or
 become  due  or overpaid on or after the date on which such rates become
 effective and shall apply only with  respect  to  interest  computed  or
 computable for periods or portions of periods occurring in the period in
 which such rates are in effect.
   (2) General rule. (A) Overpayment rate. The overpayment rate set under
 this  subdivision shall be the sum of (i) the federal short-term rate as
 provided under paragraph  three  of  this  subdivision,  plus  (ii)  two
 percentage points.
   (B)  Underpayment  rate. The underpayment rate set under this subdivi-
 sion shall be the sum of (i) the federal  short-term  rate  as  provided
 under  paragraph  three  of this subdivision, plus (ii) seven percentage
 points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A) The federal short-term rate for any month  shall  be  the  federal
 short-term  rate determined by the United States secretary of the treas-
 ury during such month in  accordance  with  subsection  (d)  of  section
 twelve  hundred  seventy-four  of  the  internal revenue code for use in
 connection with section six  thousand  six  hundred  twenty-one  of  the
 internal  revenue  code.  Any  such rate shall be rounded to the nearest
 full percent, or, if a multiple of one-half of one  percent,  such  rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i)  In  general.  Except  as provided in clause (ii) of this subpara-
 graph, the federal short-term rate for the first month in each  calendar
 quarter  shall  apply  during the first calendar quarter beginning after
 such month.
 S. 8474                            771
 
   (ii) Special rule for the month of September, nineteen hundred  eight-
 y-nine.  The  federal  short-term  rate for the month of April, nineteen
 hundred eighty-nine shall apply with respect  to  setting  the  rate  of
 interest for the month of September, nineteen hundred eighty-nine.
   (4)  Publication  of  interest rate. The commissioner of finance shall
 cause to be published in the City Record,  and  give  other  appropriate
 general notice of, the interest rate to be set under this subdivision no
 later  than  twenty days preceding the first day of the calendar quarter
 during which such interest rate applies. The setting and publication  of
 such  interest rate shall not be included within paragraph (a) of subdi-
 vision five of section one thousand forty-one of the city charter of the
 preceding municipality as it existed  January  first,  nineteen  hundred
 ninety-four relating to the definition of a rule.
   § 11-906  Assessment, refund, collection, review and reserves. (a) The
 provisions of the civil practice law and rules or any other law relative
 to  limitations  of time for the enforcement of a civil remedy shall not
 apply to any proceeding or action by  the  commissioner  of  finance  to
 levy,  assess,  determine  or enforce the collection of tax, interest or
 penalty imposed by this chapter.   However, except  in  the  case  of  a
 wilfully  false  or  fraudulent report, no assessment of additional tax,
 interest or penalty shall be made after  the  expiration  of  more  than
 three  years from the date of the filing of a report, provided, however,
 that where no report has been filed as provided by law the  tax  may  be
 assessed  at any time. The commissioner of finance shall refund or cred-
 it, with interest at the overpayment rate set  by  the  commissioner  of
 finance  pursuant  to  subdivision (g) of section 11-905 of this chapter
 or, if no rate is set, at the rate of six  percent  per  annum  computed
 from  the date of overpayment to a date, to be determined by the commis-
 sioner of finance, preceding the date of a refund check by not more than
 thirty days, any tax, penalty  or  interest  erroneously,  illegally  or
 unconstitutionally  collected or paid if application to the commissioner
 of finance for such refund shall be made  within  six  months  from  the
 payment  thereof.  Notice  of  any  determination of the commissioner of
 finance with respect to an assessment of tax,  interest  or  penalty  or
 with  respect  to  a  claim  for  refund  or any other notice, demand or
 request shall be given by mailing the same to the insurer to the address
 of its city of Staten Island office last filed with the commissioner  of
 finance  or,  if  there  is  no  such office, to the address of its main
 office last filed with the commissioner of finance or, in the absence of
 any filed address, to such address as may be obtainable. The mailing  of
 any  notice,  demand  or request by the commissioner of finance shall be
 presumptive evidence of its receipt by the insurer  and  any  period  of
 time  to  be  determined  with  reference  to the giving of such notice,
 demand or request shall commence to run from the date of  such  mailing.
 The determination of the commissioner of finance shall finally and irre-
 vocably  fix  the  amount  of  any tax, interest or penalty due or to be
 refunded unless the taxpayer, within ninety days  after  the  giving  of
 notice  of  such  determination,  or  if the commissioner of finance has
 established a conciliation procedure pursuant to section 11-124 of  this
 title  and  the  taxpayer  has  requested  a  conciliation conference in
 accordance therewith, within ninety days from the mailing of  a  concil-
 iation  decision  or  the date of the commissioner's confirmation of the
 discontinuance of the conciliation proceeding, both (1) serves  a  peti-
 tion  upon the commissioner of finance and (2) files a petition with the
 tax appeals tribunal for  a  hearing,  or  unless  the  commissioner  of
 finance  of his or her own motion shall redetermine the same. Such hear-
 S. 8474                            772
 
 ing and any appeal to the tax appeals tribunal sitting en banc from  the
 decision  rendered  in such hearing shall be conducted in the manner and
 subject to the requirements  prescribed  by  the  tax  appeals  tribunal
 pursuant  to sections one hundred sixty-eight through one hundred seven-
 ty-two of the charter of the preceding municipality as it existed  Janu-
 ary  first,  nineteen  hundred ninety-four.   After such hearing the tax
 appeals tribunal shall give notice of its decision to the  taxpayer  and
 to  the commissioner of finance with reference to the amount of the tax,
 interest or penalty assessed or to be refunded. The decision of the  tax
 appeals tribunal sitting en banc shall be reviewable for error, illegal-
 ity  or  unconstitutionality  or any other reason, by a proceeding under
 article seventy-eight of the  civil  practice  law  and  rules  if  such
 proceeding  is commenced by the person against whom the tax was assessed
 within four months after the giving of the notice of  such  tax  appeals
 tribunal decision. Such proceeding shall not be commenced by the taxpay-
 er  unless: (1) the amount of any tax assessed and sought to be reviewed
 with penalties and interest thereon, if any, shall  be  first  deposited
 with  the  commissioner  of  finance  and  there shall be filed with the
 commissioner of finance an undertaking in  such  amount  and  with  such
 sureties  as a justice of the supreme court shall approve, to the effect
 that if such proceeding be dismissed  or  the  decision  confirmed,  the
 taxpayer  will  pay  all  costs and charges which may accrue against the
 taxpayer in the prosecution of the proceeding, or (2) in the case  of  a
 review of a decision assessing any taxes, penalties and interest, at the
 option  of  the taxpayer, such undertaking may be in a sum sufficient to
 cover all of the taxes, penalties and interest assessed by such decision
 plus the costs and charges which may accrue against the taxpayer in  the
 prosecution  of the proceeding, in which event the taxpayer shall not be
 required to deposit such taxes, penalties and interest  as  a  condition
 precedent  to  the  commencement  of the proceeding. No determination or
 proposed determination of tax, interest or penalty due or to be refunded
 shall be reviewed or enjoined in any manner except as set forth herein.
   (b) In cases where the taxpayer has  applied  for  a  refund  and  has
 commenced a proceeding under article seventy-eight of the civil practice
 law  and  rules to review a decision of the tax appeals tribunal adverse
 to such taxpayer on its application for a refund,  the  commissioner  of
 finance  shall  set up appropriate reserves to meet any decision adverse
 to the city.
   (c) In computing the amount of interest to be paid under this section,
 such interest shall be compounded daily.
   §  11-907  Place of business to be reported.   Every  insurer,  on  or
 before the first day of March in each year, and as often in each year as
 such  insurer  shall change its principal place of business or change or
 terminate any office or place of business in the city, shall  report  in
 writing,  to  the commissioner of finance, the location of its principal
 place of business and any new principal place of business or of any  new
 office  or  place  of  business in the city or of the termination of any
 such office or place of business.  In the event of such change or termi-
 nation, such report shall be made no later than fifteen days after  such
 change  or termination.   Any insurer who fails or neglects to make such
 report within the time limited therefor shall be subject to a penalty of
 one hundred dollars and, in addition thereto,  fifty  dollars  for  each
 month  or part  thereof during which such report is not made.  The total
 of such penalties shall not exceed one thousand dollars.
   §  11-908  Suits for violations.  The tax provided to be paid by  this
 chapter,  and  the  pecuniary penalties and interest imposed therein, or
 S. 8474                            773
 
 any or either of them, may be sued for  and  recovered,  with  costs  of
 suit, in any court of record, by the commissioner of finance.
   § 11-909 Distribution of tax on policies covering property in the city
 of Staten Island. (a) The moneys received by the commissioner of finance
 as a tax on policies covering property in the city shall be disbursed by
 the commissioner of finance as follows:
   1.  Ten percent to the firemen's association of the state of New York,
 for the endowment, benefit and maintenance of  the  volunteer  firemen's
 home  at  Hudson, but in no event to exceed the sum of thirty-five thou-
 sand dollars annually.
   2. The balance to the general fund of the city established pursuant to
 section one hundred nine of the charter, except as provided in paragraph
 three of this subdivision.
   3. a. Volunteer firemen's benevolent fund; trustee. From  the  balance
 specified in paragraph two of this subdivision, a sum, not to exceed one
 hundred  fifty  thousand  dollars  in any one year, shall be paid into a
 fund to be known as the volunteer firemen's benevolent fund, which shall
 be administered as provided by the fire commissioner, as trustee of such
 fund, for the benefit of indigent volunteer firefighters, their  surviv-
 ing spouses and orphans.
   b.  Persons  entitled to benefits from fund. All funds received by the
 fire commissioner as trustee under this paragraph shall be  expended  by
 the fire commissioner for the relief of:
   (i) all indigent volunteer firefighters who served as such for a peri-
 od  of  five  years  in  a  duly organized volunteer fire company in the
 former towns of New Lots, Flatlands, Gravesend, New Utrecht and Flatbush
 in the county of Kings, or in the territory now included in the city  of
 Staten  Island,  or  in  the  territory  now  included in the borough of
 Queens, or in the territory now included in the borough  of  the  Bronx,
 and  who  were honorably discharged after such five years of service, or
 who having been members of a duly organized volunteer fire company with-
 in any such town or territory, which company was disbanded by reason  of
 the  installation  of  a  paid fire department, and were members of such
 company for at least one year prior to its disbandment;
   (ii) the surviving spouses and orphans of  any  such  volunteer  fire-
 fighters.
   c.  Fund  benefits  of  beneficiaries  on rolls as of December thirty-
 first, nineteen hundred fifty-one. During the lifetime of  those  relief
 beneficiaries  who  appear as such as of December thirty-first, nineteen
 hundred fifty-one upon the records of the trustees of the  exempt  fire-
 men's  benevolent fund of the county of Kings, or of the trustees of the
 exempt firemen's benevolent fund of the borough of  Queens,  or  of  the
 trustees  of  the  exempt  firemen's  benevolent  fund of the borough of
 Staten Island, or of the trustees of  the  exempt  firemen's  benevolent
 fund  of  the  borough  of  the  Bronx, it shall be the duty of the fire
 commissioner, as such trustee, to pay to  such  beneficiaries  from  the
 volunteer  firemen's  benevolent  fund  referred to in subparagraph a of
 this paragraph, the same amounts as were being periodically paid to such
 beneficiaries as of June thirtieth, nineteen hundred fifty-two.
   d. Fund benefits of residents of firemen's home. It shall be the  duty
 of  the  fire  commissioner,  as  such  trustee,  to  pay from such fund
 referred to in subparagraph a of this paragraph, the sum of ten  dollars
 monthly  to  each  volunteer  firefighter  in residence at the volunteer
 firemen's home at Hudson, who qualified for entrance into such  home  by
 reason  of  service  as  a  volunteer  firefighter  within  the area now
 included within the boundaries of the city. No other payments  shall  be
 S. 8474                            774
 
 made from such fund to any such volunteer firefighter while in residence
 at such home.
   e. Eligibility of persons who applied for fund benefits after December
 thirty-first, nineteen hundred fifty-one, and prior to the establishment
 of  fund.   Upon the establishment of the volunteer firemen's benevolent
 fund referred to in subparagraph a of this paragraph, the  fire  commis-
 sioner or the fire commissioner's authorized subordinates shall investi-
 gate  and  determine  the  need  for  benefits of all persons who, after
 December thirty-first, nineteen  hundred  fifty-one  and  prior  to  the
 establishment  of  such volunteer firemen's benevolent fund, applied for
 benefits payable from any of the benevolent funds mentioned in  subpara-
 graph  c  of this paragraph, and who are receiving benefits therefrom at
 the time of the establishment of such fund referred to in subparagraph a
 of this paragraph.  No such person shall be found to be in need of bene-
 fits, nor shall any such person be paid any benefits from such last-men-
 tioned fund unless the fire  commissioner  or  the  fire  commissioner's
 authorized subordinates shall determine that such person is indigent. In
 the  event that any such person is thus found to be in need of benefits,
 the fire commissioner shall pay to such person from such  last-mentioned
 fund,  the  same  periodic amounts as the trustees mentioned in subpara-
 graph c of this paragraph were paying as  of  June  thirtieth,  nineteen
 hundred  fifty-two,  to  a  person  who  had the same status and who was
 receiving benefits from the  borough  or  county  fund  which  would  be
 currently liable for the payment of benefits to such person, but for the
 provision  of  section 13-532 of the code of the preceding municipality.
 It shall be the duty of the fire commissioner and the  fire  commission-
 er's  authorized  subordinates  to  maintain and carry out continuously,
 such investigation procedures as may be necessary to assure  that  bene-
 fits  will not be paid from such fund to any persons who are not in need
 as herein specified.
   f. Eligibility for benefits of persons applying therefor after  estab-
 lishment  of  fund.  All persons applying after the establishment of the
 volunteer firemen's benevolent fund for benefits payable therefrom shall
 be investigated as to need by the fire commissioner or the fire  commis-
 sioner's  authorized  subordinates,  and the eligibility of such persons
 for benefits and the amount thereof to be awarded and paid to them shall
 be determined by  the  fire  commissioner  or  the  fire  commissioner's
 authorized  subordinates  in  accordance with the standards specified in
 subparagraph e of this paragraph.  Benefits shall be paid from such fund
 to eligible persons in accordance with such determination and  it  shall
 be  the duty of the fire commissioner and the fire commissioner's subor-
 dinates continuously to maintain and carry out as to such persons inves-
 tigation procedures such as are described  in  subparagraph  e  of  this
 paragraph. The fire commissioner, as part of his or her investigation to
 determine  eligibility  of persons for fund benefits, shall request from
 the duly appointed representative of the volunteer firefighters in  each
 borough  a  report  on  such person's service and indigency. Such report
 shall be solely for the information of the fire commissioner  and  shall
 not be binding upon the fire commissioner in arriving at a determination
 as to eligibility. In the event that such report is not submitted within
 ten days from the date of request, the fire commissioner shall determine
 eligibility  on the basis of the facts developed in the fire commission-
 er's own investigation.
   g. Excess moneys. In the event that the  benefits  paid  by  the  fire
 commissioner, as trustee, during any period of one year beginning on the
 first day of February shall not equal the sum of one hundred fifty thou-
 S. 8474                            775
 
 sand dollars, the unexpended balance shall be paid into the general fund
 of  the  city  established  pursuant  to section one hundred nine of the
 charter, except that the fire commissioner may retain in  the  volunteer
 firemen's  benevolent  fund  such amount as may be necessary to meet the
 commitments of such fund until the revenue from the tax collected  under
 this chapter in the ensuing taxable year shall become available.
   h.   Depositories.  The  fire  commissioner,  as  trustee,  is  hereby
 empowered and directed to receive all moneys  and  assets  belonging  or
 payable  to  such  volunteer firemen's benevolent fund and shall deposit
 all such moneys to the credit of such fund in banks and trust  companies
 to be selected by the fire commissioner.
   i.  Bond. The fire commissioner, as trustee of such fund, shall give a
 bond with one or more sureties, in a sum  sufficient  for  the  faithful
 performance  of his or her duties, such bond to be approved as to amount
 and adequacy, by the comptroller and filed in the comptroller's office.
   j. Records. The officers and employees of the fire department who  are
 responsible for the maintenance of the books and records of the New York
 fire department pension fund shall have charge of, and keep the accounts
 of  the  fire commissioner as trustee of the volunteer firemen's benevo-
 lent fund.
   k. Reports. The fire commissioner, as trustee of such volunteer  fire-
 men's  benevolent fund, shall submit to the mayor on or before the first
 day of April of each year, a verified report in which shall be set forth
 the account of the  fire  commissioner's  proceedings  as  such  trustee
 during the twelve-month period ending on the thirty-first day of January
 immediately  preceding.  Such  report  shall  include a statement of all
 receipts and disbursements on account of such benevolent fund, a list of
 the names, residences and as nearly as possible, the ages of the benefi-
 ciaries of such fund and the respective amounts paid to them during such
 period.
   1. Audit. The comptroller shall have the power to audit the books  and
 records  of  the fire commissioner as trustee of the volunteer firemen's
 benevolent fund.
   (b) The moneys received by the fire commissioner as  trustee  pursuant
 to  the provisions of paragraph three of subdivision (a) of this section
 shall be expended by the fire commissioner  only  as  provided  in  such
 paragraph.
 
                                CHAPTER 10
           OCCUPANCY TAX FOR LOW RENT HOUSING AND SLUM CLEARANCE
   §  11-1001  Legislative  findings.    It is hereby declared that:   In
 certain areas of the city of Staten Island  there  exist  unsanitary  or
 substandard  housing  conditions owing to overcrowding and concentration
 of population, improper planning, excessive land coverage, lack of prop-
 er light, air and space, unsanitary design and arrangement, or  lack  of
 proper  sanitary  facilities; there is not an adequate supply of decent,
 safe and sanitary dwelling accommodations for  persons  of  low  income;
 these  conditions  cause an increase and spread of disease and crime and
 constitute a menace to the health, safety, morals, welfare  and  comfort
 of  the  citizens of the state, and impair economic values; these condi-
 tions cannot be remedied by the ordinary  operation  of  private  enter-
 prise;  the  clearance,  replanning  and  reconstruction of the areas in
 which unsanitary or substandard housing conditions exist and the provid-
 ing of decent, safe and sanitary dwelling accommodations in  such  areas
 and elsewhere for persons of low income are public uses and purposes for
 S. 8474                            776
 
 which public money may be spent and private property acquired; therefore
 the  necessity  in  the  public interest to enact the provisions of this
 chapter is hereby declared, as a matter of legislative determination.
   § 11-1002 Low rent housing and slum clearance; governmental functions.
 It  is hereby declared as a matter of legislative determination that the
 clearing of areas in which the conditions described in  section  11-1001
 of  this  chapter  exist  and the furnishing of low rent housing for the
 occupants thereof be hereafter a function of the government of the  city
 of Staten Island.
   §  11-1003  Housing  authority; agent for city.  It is hereby declared
 that the city housing authority be and it hereby  is  appointed  as  the
 agent for the city of Staten Island to carry out the functions described
 in section 11-1002 of this chapter.
   § 11-1004 Definitions.  When used in this chapter:  a. The word "occu-
 pation"  means the use or possession for a consideration of any premises
 under any lease, concession, permit, right of access, license to use, or
 other agreement, for any gainful purpose.
   b. The word "occupant" means any person who uses or  possesses  for  a
 consideration any premises under any lease, concession, permit, right of
 access, license to use or other agreement for any gainful purpose.
   c.  The  word  "person"  means an individual, co-partnership, society,
 association, joint-stock company, corporation, estate, receiver,  assig-
 nee, trustee or any other person acting in a fiduciary capacity, whether
 appointed by a court or otherwise, and any combination of individuals.
   d.  The  word "premises" means any real property, or any part thereof,
 any kind of space, or structure, except premises,  as  defined  in  this
 subdivision,  which  are  located  in,  upon,  above or under any public
 street, highway or public place, separately  occupied  in  the  city  of
 Staten  Island  by any person for his or her own use for gainful purpose
 or by any concessionaire for such use for gainful  purpose,  whether  by
 ownership, lease, sublease, profit-sharing arrangement or otherwise.
   e. The words "rental value" mean the amount of the consideration annu-
 ally fixed or charged against any person for the occupation of any prem-
 ises  during  the period of one year commencing on July sixteenth of the
 year prior to the year in which the tax is due and terminating  on  July
 fifteenth of the year in which the tax is due, or if computed on a basis
 other than an annual basis, then the amount which would be equivalent to
 an annual charge for the occupation of the premises.
   f.  The  words "non-federal project" shall mean a project not aided or
 financed in whole or in part by the federal government  and  where  such
 government  does  not  reserve  the  right  to  approve or supervise the
 construction or operation of the project.
   g. The words "vending machine" mean a machine  which  vends  or  sells
 tangible personal property; and shall also include but not be limited to
 amusement  devices, automatic sanitary facilities and all other machines
 vending services.
   § 11-1005 Imposition of the tax.  a. To provide additional  funds  for
 the  purpose  of  fulfilling  any  contract  to make capital or periodic
 subsidies to the city housing authority in aid of a  low  rent  or  slum
 clearance  project or for the purpose of paying an indebtedness incurred
 for a low rent or slum clearance project, every occupant of premises for
 a year or any part thereof in excess of one month and fifteen days shall
 pay annually to the commissioner of finance on June  twentieth  of  each
 year  until and including June twentieth, nineteen hundred eighty-one, a
 tax for each separate premises occupied  at  the  rates  computed,  with
 S. 8474                            777
 
 reference  to  the  rental  value  for  separate premises in the city of
 Staten Island, as specified in the following table:
   ======================================================================
 When the rental                  And not        The amount of
 value is at least                more than      the tax shall be
 ________________________________________________________________________
    $1.00...................      $1,000.99          $2.00
 1,001.00...................       2,000.99           4.00
 2,001.00...................       3,000.99           6.00
 3,001.00...................       4,000.99           8.00
 4,001.00...................       5,000.99          10.00
 5,001.00 and over...........................        12.00
 ========================================================================
   b.  Where  the  premises  are  occupied by vending machines which sell
 tangible personal property the tax shall be computed as specified in the
 following table:
 ========================================================================
 When the total value of the
 coins used in such vending             The amount of
 machines is                            the tax shall be
 ________________________________________________________________________
     $.01...................................        $  .20
      .02 to .14 incl.......................           .40
      .15 to .24 incl.......................          1.00
      .25 and over..........................          2.00
 ========================================================================
   c. Where the premises are occupied  by  vending  machines  other  than
 those which sell tangible personal property the tax shall be computed as
 specified in the following table:
 ========================================================================
 When the total value of the
 coins used in such vending                  The amount of
 machines is                                 the tax shall be
 ________________________________________________________________________
     $.01.....................................        $.40
      .02 and over............................        2.00
 ========================================================================
   §  11-1006  Exemptions.  No  tax as imposed by section 11-1005 of this
 chapter shall be due or payable in any event for the occupation  of  any
 of  the premises described in this section to the extent so occupied and
 no return need be made therefor pursuant to the provisions of this chap-
 ter if any of the following conditions be demonstrated to the  satisfac-
 tion of the commissioner of finance:
   1. That the premises are occupied by:
   (a) Peddlers.
   (b)  Bootblacks,  excluding  shoe  shine machines or enterprises where
 services other than the shining of shoes are rendered.
   (c) Operators of pushcarts.
   (d) Operators of kiosk or subway stands engaged solely and exclusively
 in the sale of newspapers, magazines and periodicals, or any combination
 thereof.
   (e) Operators of stoop line stands licensed pursuant to chapter two of
 title twenty of the code of the preceding municipality.
   (f) Operators of newspaper stands licensed pursuant to chapter two  of
 title twenty of the code of the preceding municipality.
 S. 8474                            778
 
   2.  That the premises are occupied for a period of less than one month
 and fifteen days during the period of one year preceding July  fifteenth
 of the year in which the tax is due.
   3. That the premises are occupied by a co-operative corporation organ-
 ized  under  the  provisions  of the cooperative corporations law of the
 state of New York, or an agricultural co-operative organized  under  the
 authority of the federal government.
   4.  That  the  premises  are occupied by the state of New York, or any
 public corporation, including a public corporation created  pursuant  to
 agreement  or  compact  with  another  state  or the dominion of Canada,
 improvement district or other political subdivision of the  state  where
 it is the purchaser, user or consumer.
   5.  That  the  premises  are  occupied  by the United Nations or other
 world-wide international organizations of which  the  United  States  of
 America is a member.
   6. That the premises are occupied by a corporation, or association, or
 trust,  or  community  chest, fund or foundation, organized and operated
 exclusively for religious, charitable, or educational purposes,  or  for
 the  prevention  of  cruelty  to children or animals, no part of the net
 earnings of which inures to the benefit of any  private  shareholder  or
 individual, and no substantial part of the activities of which is carry-
 ing  on  propaganda,  or  otherwise attempting to influence legislation;
 provided, however, that nothing in this  subdivision  shall  include  an
 organization  operated for the primary purpose of carrying on a trade or
 business for profit, whether or not all of its profits  are  payable  to
 one or more organizations described in this subdivision.
   7.  That  the  premises  are  occupied by the United States of America
 under circumstances which make the premises immune from taxation.
   § 11-1007 Returns; payment of taxes.  On or before the  twentieth  day
 of  June  in  each  year, every person subject to a tax hereunder, shall
 file a return with the  commissioner  of  finance  on  the  form  to  be
 furnished  by  the  commissioner of finance.  At the time of filing such
 return each person shall pay to the  commissioner  of  finance  the  tax
 imposed  pursuant  to  this  chapter.  Such tax shall be due and payable
 annually upon the twentieth day of June, whether  or  not  a  return  is
 filed.
   §  11-1008 Presumption and burden of proof.  It shall be presumed that
 the occupant of any premises is subject to the tax until the contrary is
 established, and the burden of proving that any occupation  of  premises
 is exempt from taxation shall be upon such occupant.
   §  11-1009 Determination of tax by the commissioner of finance.  a. If
 a return required by this chapter is not filed,  or  if  a  return  when
 filed  is  incorrect  or  insufficient  and  the  maker  fails to file a
 corrected or sufficient return within twenty days after it  is  required
 by  a  notice  from  the  commissioner  of  finance, the commissioner of
 finance shall tentatively determine the amount  of  tax  due  from  such
 information  as  he  or she may be able to obtain and, if necessary, may
 estimate the tax on the basis of external indices.  The commissioner  of
 finance  shall  give  notice of the amount so fixed to the person liable
 for the tax.  Unless the person against whom the tax is  assessed  shall
 within  fifteen days after the giving of such notice apply in writing to
 the commissioner of finance for a hearing to  correct  such  assessment,
 such  notice  shall  constitute a final and irrevocable determination of
 the tax.   After such hearing the commissioner  of  finance  shall  give
 notice of his or her decision to the person liable for the tax.
 S. 8474                            779
 
   b.  Such determination and the decision of the commissioner of finance
 upon any application to correct may be reviewed for error, illegality or
 unconstitutionality or for any reason whatsoever by a  proceeding  under
 article  seventy-eight of the civil practice law and rules in the nature
 of  a  certiorari  proceeding  if  application  therefor  is made to the
 supreme court within thirty days after the  giving  of  notice  thereof.
 Whenever  under  this  chapter  a proceeding to review is instituted, it
 shall not be allowed unless the amount of any tax sought to be reviewed,
 with penalties thereon, if  any,  shall  be  first  deposited  with  the
 commissioner  of finance, and an undertaking filed with the commissioner
 of finance, in such amount and with such sureties as a  justice  of  the
 supreme  court  shall  approve, to the effect that if such proceeding be
 dismissed or the tax confirmed, such  person  will  pay  all  costs  and
 charges which may accrue in the prosecution of such proceeding.
   §  11-1010 Refunds.   The commissioner of finance shall refund any tax
 erroneously, illegally or unconstitutionally collected by or paid to him
 or her, under protest in  writing,  stating  in  detail  the  ground  or
 grounds  of  the  protest,  if application therefor shall be made to the
 commissioner of finance within one year from the payment thereof.    For
 like cause and within the same period a refund may be made on the initi-
 ative  of  the  commissioner of finance.   Whenever a refund is made the
 commissioner of finance shall state his or her reasons therefor in writ-
 ing.  A person shall not be entitled to a hearing in connection with any
 application for a refund if he or she has already been given the  oppor-
 tunity  of a hearing as provided in section 11-1009 of this chapter.  No
 refund shall be made of a tax or penalty paid  pursuant  to  a  determi-
 nation  of the commissioner of finance as provided in section 11-1009 of
 this chapter, unless the commissioner of finance, after a hearing as  in
 said  section  provided, or of his or her own motion, shall have reduced
 the tax or penalty, or it shall have been established  in  a  proceeding
 under  article  seventy-eight  of  the civil practice law and rules that
 such determination was erroneous, illegal, unconstitutional,  or  other-
 wise  improper,  in  which event a refund with interest shall be made as
 provided upon the determination of such proceeding.  An application  for
 a refund made as provided in this chapter shall be deemed an application
 for  a revision of any tax or penalty complained of and the commissioner
 of finance may receive evidence with respect thereto.  After making  his
 or her determination the commissioner of finance shall give notice ther-
 eof to the person interested who shall be entitled to review such deter-
 mination  by a proceeding under article seventy-eight of the civil prac-
 tice law and rules if application to the supreme court be made  therefor
 within  thirty  days  after  such determination and an undertaking shall
 first be filed with the commissioner of finance in such amount and  with
 such  sureties  as  a justice of the supreme court shall approve, to the
 effect that if such order be dismissed or the tax confirmed, the  appli-
 cant  for  the  order will pay all costs and charges which may accrue in
 the prosecution of the certiorari proceeding.
   § 11-1011 Remedies  exclusive.    The  remedies  provided  by  section
 11-1009 of this chapter shall be the exclusive remedies available to any
 person  for  the review of tax liability imposed by this chapter; and no
 determination of tax or determination on an application for refund shall
 be enjoined or reviewed by an action for declaratory judgment, an action
 for money had and received or  by  any  legal  or  equitable  action  or
 proceeding other than one under article seventy-eight of the civil prac-
 tice law and rules.
 S. 8474                            780
 
   §  11-1012  Reserves.    In  cases where the taxpayer has paid any tax
 under written protest stating in detail the ground or grounds  therefor,
 or  has applied for a refund and an order under article seventy-eight of
 the civil practice law and rules to review a  determination  adverse  to
 the  taxpayer on the taxpayer's application for refund, or has deposited
 the amount of tax assessed in connection with a proceeding under section
 11-1009 of this chapter the commissioner of finance shall set up  appro-
 priate reserves to meet any decision adverse to the city.
   §  11-1013  Proceeding to recover tax.  a. The commissioner of finance
 may issue a warrant directed to any officer or employee of  the  depart-
 ment of finance commanding him or her to levy upon and sell the real and
 personal property of the person from whom the tax is due for the payment
 of  the  amount  thereof,  with penalties, and the cost of executing the
 warrants, and to return such warrant to the commissioner of finance  and
 to  pay  to him or her the money collected by virtue thereof, and in the
 execution thereof such officer or employee shall  have  all  the  powers
 conferred  by  law  upon sheriffs, but he or she shall be entitled to no
 fee or compensation in  excess  of  the  actual  expenses  paid  in  the
 performance  of  such  duty.   If a warrant is returned not satisfied in
 full, the commissioner of finance  may  from  time  to  time  issue  new
 warrants and shall also have the same remedies to enforce the amount due
 pursuant  to this section as if the city had recovered judgment therefor
 and the execution thereon had been returned not satisfied.   A  copy  of
 any warrant issued may be filed with the county clerk in Richmond county
 and  thereupon such clerk shall enter in the judgment docket the name of
 the person mentioned in the warrant and the amount of the tax and penal-
 ty for which the warrant is issued and the date when such copy is filed.
 Thereupon the amount of such warrant so docketed  shall  become  a  lien
 upon  the title to and interest in the real and personal property of the
 person against whom the warrant is issued.
   b. As an additional or alternate remedy the  commissioner  of  finance
 may  request  the  corporation counsel to bring an action in the name of
 the city to enforce payment of a tax or penalty  which  any  person  has
 failed to pay.
   c.  The commissioner of finance, if he or she finds that the interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the commissioner of finance may require, may release any  property  from
 the  lien  of any warrant or vacate such warrant for unpaid taxes, addi-
 tions to tax, penalties and interest filed pursuant to subdivision a  of
 this  section,  and  such  release  or  vacating  of  the warrant may be
 recorded in the office of any recording officer in  which  such  warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   § 11-1014 Notices and limitation of time.  a. Any notice authorized or
 required  under  the  provisions of this chapter may be given by mailing
 the same to the person for whom it is intended in a post  paid  envelope
 addressed  to  such  person  at the address given in the return filed by
 such person pursuant to the provisions of this chapter or if  no  return
 has  been  filed then to such address as may be obtainable.  The mailing
 of such notice shall be presumptive evidence of the receipt of the  same
 by the person to whom addressed.  Any period of time which is determined
 according  to  the  provisions  of  this chapter by the giving of notice
 shall commence to run from the date of mailing of such notice.
   b. The provisions of the civil practice  law  and  rules  relative  to
 limitations  of  time  for  the  enforcement of a civil remedy shall not
 apply to any proceeding or action by the city taken to  levy,  appraise,
 S. 8474                            781
 
 assess,  determine  or  enforce  the  collection  of  any tax or penalty
 provided by this chapter.
   §  11-1015  Penalties  and interest.   a. Any person failing to file a
 return or corrected return or to pay any tax or any portion thereof that
 may be required by this chapter shall be subject to a  penalty  of  five
 times  the  amount  of the tax due, plus five per centum of such tax for
 each month of  delay  or  fraction  thereof,  but  the  commissioner  of
 finance, if satisfied that the delay was excusable, may remit all or any
 part  of such penalty, but not interest.  Penalties shall be paid to the
 commissioner of finance and disposed of in the manner as other  receipts
 under this chapter.  Unpaid penalties may be enforced in the same manner
 as the tax imposed by this chapter.
   b.  Any  person filing or causing to be filed any return, certificate,
 affidavit or statement required or authorized by this chapter, which  is
 wilfully  false  and  any  person  who shall fail to file a return or to
 furnish a statement or other information as required under this chapter,
 shall be guilty of a misdemeanor, punishment for which shall be  a  fine
 of  not more than one thousand dollars or imprisonment for not more than
 one year, or both such fine and imprisonment.
   A certificate of the commissioner of finance to the effect that a  tax
 has not been paid, that a return has not been filed, or that information
 has  not been supplied pursuant to the provisions of this chapter, shall
 be prima facie evidence thereof.
   § 11-1016 General powers of the  commissioner  of  finance.    In  the
 administration  of  this chapter, the commissioner of finance is author-
 ized to:
   1. Make and publish reasonable rules and regulations as may be  neces-
 sary  for  the exercise of the commissioner's powers and the performance
 of the commissioner's duties under this chapter.
   2. Assess the tax authorized to be imposed under this chapter.
   3. Subpoena and require the attendance of witnesses and the production
 of books, papers and other documents, and to take testimony and  proofs,
 under  oath, with reference to any matter within the line of the commis-
 sioner's official duty under this chapter.
   4. Delegate the commissioner's functions hereunder to a deputy commis-
 sioner of finance or other employee or employees of  the  department  of
 finance.
   5.  Prescribe  methods  for determining the rental values of premises,
 the occupant of which is taxable pursuant  to  the  provisions  of  this
 chapter.
   6. Require any person who receives or is entitled to receive a consid-
 eration  for  the  occupation  of premises to furnish a statement to the
 commissioner of finance, upon his or her request, containing information
 as to the name of each occupant and rental value of each for the occupa-
 tion of such premises.
   7. Nothing contained in section 11-1017 of  this  chapter  or  in  any
 other provision of this chapter shall be construed to limit the authori-
 ty  of  the  commissioner  of finance, hereby authorized, to furnish any
 information, whether or not contained in a return, to the tax commission
 or any other agency or department of the state of New York,  or  to  the
 treasury  department  of the United States, or to any agency of the city
 of Staten Island, or to the district attorney of Richmond county.
   8. To extend, for cause shown, the time for filing any  return  for  a
 period not exceeding twenty days.
   §  11-1017  Returns  to be secret.  Except in accordance with judicial
 order, or upon subpoena issued by a court of competent jurisdiction,  it
 S. 8474                            782
 
 shall  be  unlawful  for  the  commissioner of finance or any officer or
 employee of the city to divulge or make known in any manner, any  infor-
 mation  contained in any return required under this chapter.  Nothing in
 this  section  shall be construed to prohibit the delivery to a taxpayer
 of a certified copy of any return filed by the taxpayer, nor to prohibit
 the publication of statistics so classified as to prevent the  identifi-
 cation of particular returns, or the inspection by the corporation coun-
 sel  of  the return to any taxpayer who shall bring action or proceeding
 to set aside or review the tax based thereon, or against whom an  action
 or  proceeding has been instituted or is contemplated for the collection
 of a tax or penalty.  Returns shall be preserved  for  three  years  and
 thereafter   until  the  commissioner  of  finance  orders  them  to  be
 destroyed.
   § 11-1018 Disposition of revenue.  All revenues and moneys  heretofore
 or hereafter collected resulting from the imposition of taxes and penal-
 ties  imposed  by  this chapter shall be deposited in the city treasury,
 and credited to a separate account.  During each fiscal year, an  amount
 not  in excess of the amount of the subsidies to be made, and the amount
 of indebtedness incurred for low rent or slum clearance projects  to  be
 paid, during such fiscal year shall be charged to such account and cred-
 ited to the general fund.  No other payments shall be charged to such an
 account.    The mayor may contract to make capital or periodic subsidies
 to the city housing authority in aid of a low rent project, or may incur
 indebtedness for a low rent slum clearance project,  but  such  periodic
 subsidies  shall  not be contracted for a period longer than the life of
 such project and in no event for more than fifty years.   If the  amount
 of  any  such  periodic  subsidy  shall  be equal to or greater than the
 interest on and the amounts required annually for  the  payment  of  the
 indebtedness  contracted  by the authority on account of such project in
 each year, such contract shall constitute a guarantee of  the  principal
 of  and  the  interest  on  such indebtedness, and such contract and the
 payments thereunder may be pledged by the authority as security in addi-
 tion to all other security which the authority may give for such  bonds.
 No  such contract or periodic subsidies shall be made until the plan for
 such project shall have been approved in  the  manner  provided  by  the
 public housing law.
   § 11-1019 Application; construction.  If any provision of this chapter
 shall  be adjudged by any court of competent jurisdiction to be invalid,
 such judgment shall not affect, impair or invalidate the remainder ther-
 eof, but shall be confined in its operation to  the  provision  directly
 involved  in  the  controversy  in  which  such judgment shall have been
 rendered.  This chapter shall be construed in conformity with the public
 housing law.
 
                                CHAPTER 11
                                UTILITY TAX
   § 11-1101  Definitions. When used in this chapter the following  terms
 shall mean or include:
   1.   "Person."  Includes any individual, partnership, society, associ-
 ation, joint-stock company, corporation, estate, receiver, lessee, trus-
 tee, assignee, assignee of rents, referee, or any other person acting in
 a fiduciary or representative capacity, whether appointed by a court  or
 otherwise, and any combination of individuals.
   2.  "Comptroller."  The comptroller of the city.
   3.  "Commissioner  of  finance."    The commissioner of finance of the
 city.
 S. 8474                            783
 
   4. "Gross income." All receipts received in or by reason of  any  sale
 made  including  receipts  from  the  sale of residuals and by-products,
 except sale of real property, or service rendered in the city, including
 cash, credits and property of any kind or nature, whether  or  not  such
 sale  is  made  or  such  service  is  rendered  for profit, without any
 deduction therefrom on account of the cost of  the  property  sold,  the
 cost  of  material  used,  labor  or services, delivery costs, any other
 costs whatsoever, interest or discount paid, or any other expense  what-
 soever;  also profits from the sale of securities; also profits from the
 sale of real property growing out of the ownership or use of or interest
 in such property; also profit from the sale of personal property,  other
 than property of a kind which would properly be included in the invento-
 ry  of  the  taxpayer  if on hand at the close of the taxable period for
 which a return is made;  also  receipts  from  interest,  dividends  and
 royalties  without  any  deductions therefrom for any expense whatsoever
 incurred in connection with the  receipt  thereof,  and  also  gains  or
 profits  from  any source whatsoever; but shall not include gross income
 of railroads from the transportation of freight, gross income  from  the
 operation  of  hotels, multiple dwellings or office buildings by persons
 in the business of operating or leasing sleeping or parlor railroad cars
 or of operating railroads other  than  street  surface,  rapid  transit,
 subway  and elevated railroads, or interest or dividends received from a
 corporation by such persons or by persons subject to taxation under  the
 provisions  of section one hundred eighty-six-a of the tax law. Rents or
 rentals shall not be deemed to be gross receipts subject to tax,  except
 rents  or  rentals  derived  from facilities used in the public service;
 provided, however, that in the case of persons in the business of  oper-
 ating  or leasing sleeping or parlor railroad cars or of operating rail-
 roads other than street surface, rapid  transit,  subways  and  elevated
 railroads,  such last-mentioned rents or rentals derived from other such
 utilities with respect to the operation of terminal facilities shall not
 be deemed to be gross income subject to tax except  for  the  amount  in
 excess  of  a user proportion of New York city real property and special
 franchise taxes and expenses of maintenance and operation. Notwithstand-
 ing anything to the contrary in this subdivision or any other  provision
 of  law,  for  taxable  periods  beginning on or after August first, two
 thousand two, gross income shall include eighty-four percent of  charges
 for  the provision of mobile telecommunications services where the place
 of primary use of the mobile telecommunications services is  within  the
 territorial  limits of the city except to the extent that such inclusion
 would result in the taxation of charges  for  the  provision  of  mobile
 telecommunications services that is prohibited by federal law.
   5.  "Gross  operating  income."  Includes  receipts  received in or by
 reason of any sale  made  or  service  rendered,  of  the  property  and
 services  specified  in  subdivision  seven of this section in the city,
 including cash, credits and property of any kind or nature,  whether  or
 not  such  sale  is made or such service is rendered for profit, without
 any deduction therefrom on account of the cost of the property sold, the
 cost of materials used, labor or other services, delivery costs  or  any
 other  costs whatsoever, interest or discount paid or any other expenses
 whatsoever, provided however,  that  if  a  vendor  of  utility  service
 purchases  gas, electricity, steam, water or refrigeration or gas, elec-
 tric, steam,  water  or  refrigeration  service  in  a  transaction  the
 receipts  from which are not subject to the tax imposed under this chap-
 ter, the gross operating  income  derived  by  such  vendor  of  utility
 service  from  the  resale  of  such  gas,  electricity, steam, water or
 S. 8474                            784
 
 refrigeration or such  gas,  electric,  steam,  water  or  refrigeration
 service to its tenants as an incident to such vendor's activity of rent-
 ing premises to tenants, shall, if subject to the tax imposed under this
 chapter  on  such  vendor,  be  conclusively presumed to be equal to the
 amount of such vendor's cost, including  any  associated  transportation
 cost, for the purchase of such gas, electricity, steam, water or refrig-
 eration  or  gas,  electric,  steam,  water or refrigeration service for
 resale by such vendor. Notwithstanding anything to the contrary in  this
 subdivision or any other provision of law, for taxable periods beginning
 on or after August first, two thousand two, gross operating income shall
 include eighty-four percent of charges for the provision of mobile tele-
 communications  services  where  the  place of primary use of the mobile
 telecommunications services is within the territorial limits of the city
 except to the extent that such inclusion would result in the taxation of
 charges for the provision of mobile telecommunications services that  is
 prohibited by federal law.
   6.  "Utility."  Every person subject to the supervision of the depart-
 ment of public service and, for taxable periods beginning  on  or  after
 August  first, two thousand two, every person, whether or not supervised
 by the department of public service, eighty percent or more of the gross
 receipts of which consists of charges for the provision of mobile  tele-
 communications  services  to  customers. Notwithstanding anything to the
 contrary in any other provision of law, for purposes  of  this  subdivi-
 sion,  the  gross  receipts  of  a  person  shall  not include the gross
 receipts of any other related or unrelated person.
   7. "Vendor of utility services."  Every  person  not  subject  to  the
 supervision  of  the  department  of public service, and not otherwise a
 utility as defined in subdivision six of this section, who furnishes  or
 sells  gas,  electricity, steam, water or refrigeration, or furnishes or
 sells gas, electric, steam, water, refrigeration  or  telecommunications
 services, or who operates omnibuses, whether or not such operation is on
 the  public  streets;  regardless of whether such furnishing, selling or
 operation constitutes the main activity of  such  person  or  is  merely
 incidental thereto.
   8.  "Return."  Includes  any  return  filed or required to be filed as
 provided under this chapter.
   9. "Telecommunications services." Telephony or  telegraphy,  or  tele-
 phone  or  telegraph  service, including, but not limited to, any trans-
 mission of voice image, data, information and paging, through the use of
 wire, cable, fiber-optic, laser, microwave,  radio  wave,  satellite  or
 similar media or any combination thereof and shall include services that
 are  ancillary  to  the provision of telephone service, such as, but not
 limited to,  dial  tone,  basic  service,  directory  information,  call
 forwarding,  caller-identification,  call waiting and the like, and also
 include any equipment and services provided therewith; provided,  howev-
 er, that the definition of telecommunication services shall not apply to
 separately  stated  charges  for any service that alters the substantive
 content of the message received by the recipient  from  that  sent;  and
 that  such services shall not include (i) cable television services that
 consist of the transmitting to subscribers of programs broadcast by  one
 or more television or radio stations or any other programs originated by
 any person by means of wire, cable, microwave or any other means or (ii)
 air  safety and navigation services where such telecommunication service
 is provided by an organization, at least ninety percent of which,  if  a
 corporation,  ninety  percent  of  the  voting stock of which, is owned,
 directly or indirectly, by air carriers, and which organization's  prin-
 S. 8474                            785
 
 cipal  function  is  to  fulfill  the  requirements  of  (a) the federal
 aviation administration, or the successor thereto, or (b)  the  interna-
 tional  civil  aviation organization, or the successor thereto, relating
 to  the  existence  of  a  communication  system  between  aircraft  and
 dispatcher, aircraft and air  traffic  control  or  ground  station  and
 ground  station,  or  any  combination  of such, for the purposes of air
 safety and navigation.
   10. "Limited fare omnibus company." An omnibus company whose principal
 source of revenue is derived from the daily transportation of passengers
 wholly within the city on a route or zoned portion thereof pursuant to a
 franchise agreement with, or consent of,  the  city,  at  the  following
 fares:  for  the  period  from August first, nineteen hundred sixty-five
 until and including December  thirty-first,  nineteen  hundred  seventy-
 five,  at  a  fare not in excess of thirty-five cents per passenger; for
 the period from January first, nineteen hundred  seventy-six  until  and
 including June twenty-seventh, nineteen hundred eighty, at a fare not in
 excess  of  fifty  cents per passenger; for the period from June twenty-
 eighth, nineteen hundred eighty until and including August thirty-first,
 nineteen hundred eighty, at a fare not in  excess  of  sixty  cents  per
 passenger;  for the period from September first, nineteen hundred eighty
 and thereafter, at a fare not in excess of  the  regular  rate  of  fare
 charged  per  passenger for comparable service both local and express on
 regular rapid transit and surface lines operated by the  New  York  city
 transit  authority.  For purposes of this subdivision, the term "regular
 rate of fare" shall be exclusive of  fares  for  special  train  or  bus
 service,  or  additional  charges for bridge or tunnel tolls or transfer
 privileges.
   11. "Commuter service."  Mass  transportation  service,  exclusive  of
 limited  stop  service to airports, racetracks or any place where enter-
 tainment, amusement or sport activities are held or  where  recreational
 facilities  are  supplied,  provided  pursuant  to  a franchise with, or
 consent of, the city of New York.
   12. "Tax appeals tribunal." The tax appeals  tribunal  established  by
 section  one hundred sixty-eight of the charter of the preceding munici-
 pality.
   13. "Base Year." Means the calendar year ending immediately  prior  to
 the  calendar  year containing the taxable period or periods for which a
 return is required to be filed pursuant to  the  provisions  of  section
 11-1104 of this chapter.
   14.  "Taxable Period." Means the period for which a return is required
 to be filed pursuant to the provisions of  this  chapter  and  shall  be
 either  (i)  the semiannual period beginning the first day of January or
 the first day of July of the calendar year, or (ii) the calendar month.
   15. "Premises." Means for purposes of section 11-1102 of this chapter,
 any real property or part thereof, and any structure  thereon  or  space
 therein.
   16.  "Tenant."  Means  a  person  paying, or required to pay, rent for
 premises as a lessee, sublessee, licensee or concessionaire.
   17. "Mobile telecommunications services." Telecommunications  services
 that are commercial mobile radio services.
   18.  "Commercial  mobile  radio  services."  Commercial  mobile  radio
 services as defined in section 20.3 of title forty-seven of the Code  of
 Federal  Regulations  as in effect on June first, nineteen hundred nine-
 ty-nine.
   19. "Charges for mobile telecommunications services." Any charge  for,
 or  associated with, the provision of mobile telecommunications services
 S. 8474                            786
 
 and any charge for, or associated with, a service provided as an adjunct
 to mobile telecommunications services that is billed to the customer  by
 or  for the customer's home service provider regardless of whether indi-
 vidual  transmissions originate or terminate within the licensed service
 area of the home service provider.
   20. "Place of primary use." The street address representative of where
 the customer's use of the mobile telecommunications  services  primarily
 occurs,  which must be (i) the residential street address or the primary
 business street address of the customer; and (ii)  within  the  licensed
 service area of the home service provider.
   21.  "Licensed  service  area."  The geographic area in which the home
 service provider is authorized by law or contract to provide  commercial
 mobile radio services to the customer.
   22.  "Home service provider." The facilities-based carrier or reseller
 with which the customer contracts for the provision of mobile telecommu-
 nications services.
   23. "Customer." The person or entity  that  contracts  with  the  home
 service provider for mobile telecommunications services. If the end user
 of  mobile  telecommunications  services  is  not the contracting party,
 then, solely for purposes of subdivision twenty  of  this  section,  the
 term "customer" shall mean the end user of the mobile telecommunications
 services.  The term customer does not include a reseller of mobile tele-
 communications services, or a serving carrier under  an  arrangement  to
 serve  the customer outside the home service provider's licensed service
 area.
   24. "Reseller." A provider who purchases  telecommunications  services
 from  another telecommunications service provider and then resells, uses
 as a component part of, or integrates  the  purchased  services  into  a
 mobile  telecommunications service. The term reseller does not include a
 serving carrier with which a home  service  provider  arranges  for  the
 services  to  its customers outside the home service provider's licensed
 service area.
   25. "Serving carrier." A  facilities-based  carrier  providing  mobile
 telecommunications  service to a customer outside a home service provid-
 er's or reseller's licensed service area.
   26. "Cogeneration facility" means (i) a facility that was in operation
 before January first, two thousand four and that produces electric ener-
 gy and steam or other forms of useful energy, such thermal energy,  that
 are  supplied  to  and used by tenants and/or occupants of a cooperative
 corporation for industrial, commercial, or residential heating or  cool-
 ing  purposes; or (ii) a cogeneration facility, as defined in clause (i)
 of this subparagraph, that has been replaced by any other facility  used
 to  generate electricity and steam or other forms of useful energy, such
 as thermal energy, when such electricity and steam  or  other  forms  of
 useful  energy,  such  as  thermal  energy,  are supplied to and used by
 tenants and/or occupants of a cooperative corporation.
   27. "Enhanced zip code." A United States postal zip code  of  nine  or
 more digits.
   28.  "Cooperative corporation" means a corporation organized under the
 laws of New York, at least some of the stockholders of which  are  enti-
 tled,  by reason of the stockholders' ownership interest of stock in the
 corporation, to occupy for dwelling purposes an apartment in a  building
 owned by the corporation pursuant to a lease or occupancy agreement with
 the corporation.
   §  11-1102  Imposition  of  excise tax. a.   Notwithstanding any other
 provisions of law to the contrary, for the privilege of  exercising  its
 S. 8474                            787
 
 franchise or franchises, or of holding property, or of doing business in
 the  city,  on or after August first, nineteen hundred sixty-five, every
 utility shall pay to the commissioner of finance  an  excise  tax  which
 shall be equal to two per centum of its gross income until and including
 December  thirty-first,  nineteen hundred sixty-five, and shall be equal
 to two and thirty-five hundredths per centum thereafter, except that the
 rate as to persons engaged in the business of operating omnibuses with a
 carrying capacity of more than seven persons shall  be  one  per  centum
 until  and including December thirty-first, nineteen hundred sixty-five,
 and one and seventeen hundredths per centum thereafter, and except  that
 as  to  persons engaged in the business of operating or leasing sleeping
 and parlor railroad cars or of operating  railroads  other  than  street
 surface, rapid transit, subway and elevated railroads, the rate shall be
 three  per  centum  until  and including December thirty-first, nineteen
 hundred sixty-five, and three and fifty-two one  hundredths  per  centum
 thereafter,  and  every vendor of utility services in the city shall pay
 to the commissioner of finance an excise tax which shall be equal to two
 per centum of its gross operating income until  and  including  December
 thirty-first, nineteen hundred sixty-five, and shall be equal to two and
 thirty-five  one  hundredths  per  centum  thereafter, except that as to
 persons engaged in the business of operating omnibuses with  a  carrying
 capacity  of  more than seven persons other than   omnibuses used exclu-
 sively for the transportation of children to and from  schools  operated
 under  contracts  made  pursuant to the provisions of the education law,
 and not subject to the jurisdiction of the department of public service,
 the rate shall be one per centum of its gross operating income until and
 including December thirty-first, nineteen hundred  sixty-five,  and  one
 and  seventeen  hundredths  per centum thereafter.  Such tax shall be in
 addition to any and all other taxes, charges and  fees  imposed  by  any
 other  provision  of law and shall be paid at the time and in the manner
 provided in this section, but any  person  to  the  extent  that  it  is
 subject  to  tax pursuant to this section shall not be liable to any tax
 under any other of the local laws of the preceding  municipality  as  it
 existed  January first, nineteen hundred ninety-four enacted pursuant to
 chapter ninety-three of the  laws  of  nineteen  hundred  sixty-five  as
 amended,  or  the  former  article  two-b  of the general city law, with
 respect to its gross income or gross operating income taxed pursuant  to
 this section, as the case may be.
   b. So much of the gross income of a utility shall be excluded from the
 measure of the tax imposed by this chapter, as is derived from sales for
 resale to vendors of utility services validly subject to the tax imposed
 by  this chapter, except to the extent that such gross income is derived
 from sales of gas, electricity, steam, water or refrigeration  or  sales
 or  rendering of gas, electric, steam, water or refrigeration service to
 a vendor of utility services for resale to its tenants as an incident to
 such vendor's activity of renting premises to tenants.
   c. For the purpose of proper administration of  this  chapter  and  to
 prevent evasion of the tax imposed by this section, it shall be presumed
 that  the  gross  income or gross operating income of any person taxable
 pursuant to this  section  is  taxable  and  is  derived  from  business
 conducted  wholly  within  the  territorial limits of the city until the
 contrary is established, and the burden of proving that any part of  its
 gross  income  or gross operating income is not so derived shall be upon
 such person.  Notwithstanding anything to the contrary in this  subdivi-
 sion  or in any provision of section twenty-b of the general city law or
 any other provision of law, for taxable periods beginning  on  or  after
 S. 8474                            788
 
 August  first, two thousand two, gross income and gross operating income
 derived from the provision of mobile telecommunications  services  shall
 be deemed to be derived from business conducted wholly within the terri-
 torial  limits  of the city where the place of primary use of the mobile
 telecommunications services is within  the  territorial  limits  of  the
 city.
   d.  The tax imposed by this chapter shall be inapplicable to the gross
 income received by a limited fare omnibus company  until  and  including
 August thirty-first, nineteen hundred eighty. Thereafter, such tax shall
 be  applicable  to  such gross income received as follows: (1) for gross
 income received from commuter service  from  September  first,  nineteen
 hundred  eighty  until  and  including  December  thirty-first, nineteen
 hundred eighty-three, the rate of tax shall be one hundredth of one  per
 centum; (2) for gross income received from commuter service from January
 first,  nineteen  hundred  eighty-four  and  thereafter, the rate of tax
 shall be one tenth of one per centum; and (3) for gross income  received
 from all other sources, the rate of tax shall be as provided in subdivi-
 sion a of this section.
   e.  The gross operating income of a vendor of utility services derived
 from sales to its tenants of gas, electricity, steam, water, or  refrig-
 eration  or  sales  or rendering to its tenants of gas, electric, steam,
 water or refrigeration service, as an incident to such vendor's activity
 of renting premises to tenants, shall be excluded from  the  measure  of
 the  tax  imposed  by  this  chapter,  but,  with regard to sales to its
 tenants of gas, electricity, or steam  or  sales  or  rendering  to  its
 tenants  of  gas, electric or steam service, only to the extent that the
 tax imposed by this chapter  has  been  validly  paid  or  accrued  with
 respect  to  a  prior  sale of such gas, electricity or steam or sale or
 rendering of gas, electric or steam service.
   f. (1) Notwithstanding anything  contained  in  this  chapter  to  the
 contrary,  for  taxable  periods beginning on or after August first, two
 thousand two, if a partnership is subject to the  tax  imposed  by  this
 chapter  as  a utility or as a vendor of utility services, no person who
 is a partner in such a partnership shall be subject to the  tax  imposed
 by this chapter on such partner's distributive share of the gross income
 or gross operating income of such partnership.
   (2)  If  a  person  is  a  partner in a partnership subject to the tax
 imposed by this chapter and that person is  separately  subject  to  the
 supervision of the state department of public service or is a utility or
 a  vendor  of  utility services based on its activities exclusive of any
 activities of such partnership, for  taxable  periods  beginning  on  or
 after  August  first,  two thousand two, such person shall be subject to
 the tax imposed by this chapter only on its  separate  gross  income  or
 separate  gross  operating income, which shall not include such person's
 distributive share of the gross income or gross operating income of such
 partnership.
   (3) For purposes of this subdivision, the term "partner" shall include
 a person who receives a distributive share of the gross income or  gross
 operating  income,  directly  or indirectly through one or more tiers of
 partnerships, of a partnership subject to the tax imposed by this  chap-
 ter.
   g.  Notwithstanding  anything  else  contained  in this chapter to the
 contrary, for the taxable periods beginning on or after  January  first,
 two  thousand  six,  if  a  cooperative  corporation containing at least
 fifteen  hundred  apartments  furnishes  or  sells  electricity,  steam,
 refrigeration or water, or furnishes or sells electric, steam, refriger-
 S. 8474                            789
 
 ation or water services that are (i) metered, (ii) generated or produced
 by  a cogeneration facility owned or operated by such cooperative corpo-
 ration, and (iii) such electricity, steam, refrigeration or water and/or
 electric,  steam,  refrigeration  or  water  services are distributed to
 tenants and/or occupants of a cooperative corporation, then such cooper-
 ative corporation shall pay to the commissioner of finance an excise tax
 which shall be equal to zero per centum of its gross income or its gross
 operating income, as the case may be.
   § 11-1103 Records to be kept. Every person subject to tax pursuant  to
 this  chapter shall keep records of its business and in such form as the
 commissioner of finance may by regulation require.   Such records  shall
 be  offered  for  inspection  and examination at any time upon demand by
 such commissioner or his or her duly authorized agent  or  employee  and
 shall  be preserved for a period of three years, except that the commis-
 sioner of finance may consent to their destruction within that period or
 may require that they be kept longer.
   § 11-1104 Returns;  requirements  as  to.    a.  Except  as  otherwise
 provided  in subdivision e of this section with respect to taxable peri-
 ods beginning after nineteen hundred  ninety-eight,  on  or  before  the
 twenty-fifth  day  of  September, nineteen hundred sixty-five, and on or
 before the twenty-fifth day of  every  month  thereafter,  every  person
 subject  to  tax  pursuant  to this chapter shall file a return with the
 commissioner of finance on a form to be prescribed by such commissioner.
 Such return shall state the gross income or gross  operating  income  as
 the  case may be for the preceding calendar month, and shall contain any
 other data, information  or  other  matter  which  the  commissioner  of
 finance  may require to be included therein. The commissioner of finance
 may require at any further  time  a  supplemental  return,  which  shall
 contain  any  data  upon  such matters as such commissioner may specify.
 Notwithstanding the provisions of this subdivision  and  notwithstanding
 the  provisions  of  subdivision  e of this section, a vendor of utility
 services, all of whose gross operating income is excluded from the meas-
 ure of the tax imposed by this chapter  pursuant  to  subdivision  e  of
 section  11-1102 of this chapter during any taxable period, shall not be
 required to file a return for such taxable  period,  provided,  however,
 that  on  or  before  the  first day of September of each year, any such
 vendor of utility services who was not required to file a return for any
 taxable period during the period covered by the statement required to be
 filed by such date pursuant to subdivision a of section 11-208.1 of this
 title shall file an information return covering such period in such form
 and containing such information as the commissioner of finance may spec-
 ify.
   b. The commissioner of finance may require amended returns to be filed
 within twenty days after notice and to contain the information specified
 in the notice.
   c. If a return required by this chapter is not filed or  if  a  return
 when filed is incorrect or insufficient on its face, the commissioner of
 finance  shall  take  the  necessary steps to enforce the filing of such
 return or of a corrected return.
   d. Where the state tax commission changes  or  corrects  a  taxpayer's
 sales and compensating use tax liability with respect to the purchase or
 use  of  items  for which a sales or compensating use tax credit against
 the tax imposed by this chapter was claimed, the taxpayer  shall  report
 such  change  or correction to the commissioner of finance within ninety
 days of the final determination of such  change  or  correction,  or  as
 required  by the commissioner of finance, and shall concede the accuracy
 S. 8474                            790

 of such determination or state wherein it  is  erroneous.  Any  taxpayer
 filing  an amended return or report with the state tax commission relat-
 ing to the purchase or use of such items shall also file  within  ninety
 days thereafter a copy of such amended return or report with the commis-
 sioner of finance.
   e.  With  respect  to taxable periods beginning after nineteen hundred
 ninety-eight, notwithstanding the provisions of subdivision  a  of  this
 section,  if  the  amount of tax imposed pursuant to this section on any
 person in the base year does not exceed one  hundred  thousand  dollars,
 the taxable period for which such person is required to file a return is
 the  semiannual  period described in paragraph i of subdivision fourteen
 of section 11-1101 of this chapter, and such person shall file a  return
 for  each  semiannual  period of the first calendar year beginning after
 the base year on or before the twenty-fifth day of the  month  following
 the end of each such taxable period. Such return shall be filed with the
 commissioner of finance on a form to be prescribed by such commissioner.
   Such  return shall state the gross income or gross operating income as
 the case may be for the preceding taxable period and shall  contain  any
 other  data,  information  or  other  matter  which  the commissioner of
 finance may require to be included therein. The commissioner of  finance
 may  require  at  any  further  time  a supplemental return, which shall
 contain any data upon such matters as such commissioner may specify. For
 the purposes of this subdivision, if the amount of tax imposed  pursuant
 to  this chapter on such person in the base year is for a period of less
 than one year, the amount of tax imposed on such person shall be annual-
 ized by multiplying the amount of tax imposed by a fraction, the denomi-
 nator of which is the number of months or parts thereof during which the
 person was subject to the tax imposed pursuant to this chapter  and  the
 numerator  of  which  is  twelve. Notwithstanding the provisions of this
 subdivision, a person that first becomes subject to the tax pursuant  to
 this  chapter shall file a return for each month in the calendar year in
 which such person first becomes subject to such tax in  accordance  with
 subdivision a of this section.
   §  11-1105  Payment  of tax; credit for certain sales and compensating
 use taxes. a. At the time of  filing  each  return,  as  provided  under
 section  11-1104  of  this chapter, each person taxable pursuant to this
 chapter shall pay to the commissioner of finance the  taxes  imposed  by
 this  chapter  upon  its  gross income or gross operating income, as the
 case may be, for the taxable period covered by  such  return,  less  any
 credit  to which such person may be entitled under subdivision b of this
 section. Such taxes shall be due and payable on the last  day  on  which
 the return for such period is required to be filed, regardless of wheth-
 er  a  return  is  filed  or whether the return which is filed correctly
 indicates the amount of tax due.
   b. (1) A taxpayer shall be allowed a credit against the taxes  imposed
 by  this  chapter  for  the  amount  of sales and compensating use taxes
 imposed by section eleven hundred seven of  the  tax  law  which  became
 legally  due  on  or after, and which were paid on or after, July first,
 nineteen hundred seventy-seven but within the taxable period for which a
 credit is claimed, with respect to the purchase or use by  the  taxpayer
 of  machinery  or equipment for use or consumption directly and predomi-
 nantly in the production of steam for sale, by  manufacturing,  process-
 ing,  generating,  assembling,  refining, mining or extracting, or tele-
 phone central  office  equipment  or  station  apparatus  or  comparable
 telegraph  equipment  for use directly and predominantly in receiving at
 destination or initiating and switching telephone or telegraph  communi-
 S. 8474                            791
 
 cation,  but  not including parts with a useful life of one year or less
 or tools or supplies used in connection with such  machinery,  equipment
 or apparatus.
   (2)  The amount of the credit provided in paragraph one of this subdi-
 vision shall be limited to the amount of such sales and compensating use
 taxes paid during the taxable period covered by the  return  under  this
 chapter  on  which  the credit is taken less the amount of any credit or
 refund of such sales and compensating  use  taxes  during  such  taxable
 period.  If  such  credit  exceeds  the amount of tax under this chapter
 payable for the taxable period in question, such excess amount shall  be
 refunded  or credited except in the case of a vendor of utility services
 who is entitled to a credit and/or refund for such sales and  compensat-
 ing  use  taxes  under  chapter  five  or  six of this title. The credit
 allowed under this subdivision shall be deemed an erroneous  payment  of
 tax  by  the  taxpayer to be credited or refunded in accordance with the
 provisions of section 11-1108  of  this  chapter,  except  as  otherwise
 provided in this paragraph.
   (3)  Where the taxpayer receives a refund or credit of any tax imposed
 under section eleven hundred seven of the tax law for which the taxpayer
 has claimed a credit under the provisions of this subdivision in a prior
 taxable period, the amount of such refund or credit shall  be  added  to
 the tax imposed by section 11-1102 of this chapter of the taxable period
 in which such refund or credit of tax under section eleven hundred seven
 of the tax law is received.
   § 11-1105.1 Credit for rebates of charges for energy. A taxpayer shall
 be  allowed a credit against the amount of taxes imposed by this chapter
 for the amount of special rebates and discounts made in accordance  with
 the  provisions  of  section 22-602 of the code of the preceding munici-
 pality and for the amount of  special  rebates  and  discounts  made  in
 accordance  with the provisions of section twenty-five-bb of the general
 city law.  Such credit shall be applied against the amount of tax other-
 wise required to be paid as provided in subdivision a of section 11-1105
 of this chapter and shall be claimed for the taxable period  immediately
 succeeding  the  taxable  period  in which such rebates or discounts are
 made.
   § 11-1105.2 Relocation and employment assistance program credit. (a) A
 taxpayer that has obtained the certifications required by chapter  six-B
 of  title  twenty-two of the code of the preceding municipality shall be
 allowed a credit against the tax  imposed  by  this  chapter,  provided,
 however,  that a taxpayer that is a vendor of utility services shall not
 be allowed the credit against the tax imposed by this chapter unless  it
 elects  as  provided in subdivision (d) of section 22-622 of the code of
 the preceding municipality to take the credit against the tax imposed by
 this chapter. The amount of the credit shall be the amount determined by
 multiplying one thousand dollars or, in the case of an eligible business
 that has obtained pursuant to chapter six-B of such title  twenty-two  a
 certification of eligibility dated on or after July first, two thousand,
 for  a  relocation  to eligible premises located within a revitalization
 area defined in subdivision (n) of section 22-621 of  the  code  of  the
 preceding  municipality, three thousand dollars, by the number of eligi-
 ble aggregate employment shares maintained by the  taxpayer  during  the
 calendar  year with respect to particular premises to which the taxpayer
 has relocated; provided, however, with respect to a relocation for which
 no application for a certificate of eligibility is  submitted  prior  to
 July  first,  two thousand three, to eligible premises that are within a
 revitalization area, if the date of such relocation as determined pursu-
 S. 8474                            792
 
 ant to subdivision (j) of section 22-621 of the code  of  the  preceding
 municipality is on or after January first, nineteen hundred ninety-nine,
 and  before July first, two thousand, the amount to be multiplied by the
 number  of  eligible  aggregate  employment shares shall be one thousand
 dollars; provided, however, that no credit  shall  be  allowed  for  the
 relocation  of  any retail activity or hotel services; and provided that
 in the case of an eligible business that has obtained pursuant to  chap-
 ter  six-B  of  such  title twenty-two certifications of eligibility for
 more than one relocation, the portion of the total  amount  of  eligible
 aggregate employment shares to be multiplied by the dollar amount speci-
 fied  in  this  subdivision  for each such certification of a relocation
 shall be the number of total attributed  eligible  aggregate  employment
 shares  determined  with respect to such relocation pursuant to subdivi-
 sion (o) of section 22-621 of the code of  the  preceding  municipality.
 For  purposes of this subdivision, the terms "eligible aggregate employ-
 ment shares", "relocate", "retail activity" and "hotel  services"  shall
 have  the meanings ascribed by section 22-621 of the code of the preced-
 ing municipality.
   (b) The credit allowed under this subdivision with respect to eligible
 aggregate employment shares maintained with respect to particular  prem-
 ises  to which the taxpayer has relocated shall be allowed for the taxa-
 ble periods in the first calendar year during which such eligible aggre-
 gate employment shares are maintained with respect to such premises  and
 for  taxable  periods  in  any  of  the twelve succeeding calendar years
 during which eligible aggregate employment shares  are  maintained  with
 respect to such premises, provided that the credit allowed for the taxa-
 ble  periods in the twelfth succeeding calendar year shall be calculated
 by multiplying the number of eligible aggregate employment shares  main-
 tained  with respect to such premises in the twelfth succeeding calendar
 year by the lesser of one and a fraction the numerator of which  is  the
 number  of  days  in  the calendar year of relocation less the number of
 days the eligible business maintained employment shares in the  eligible
 premises in the calendar year of relocation and the denominator of which
 is  the number of days in such twelfth succeeding year during which such
 eligible aggregate employment shares are maintained with respect to such
 premises. The credit allowable  under  this  section  shall  be  applied
 against  the  amount  of  tax otherwise required to be paid for the last
 taxable period of the calendar year as  provided  in  subdivision  a  of
 section  11-1105  of this chapter, shall be deducted from the taxpayer's
 tax prior to the deduction of the credit provided in  subdivision  b  of
 such  section, and shall be claimed on the tax return for the last taxa-
 ble period of the calendar year. Except as provided in  subdivision  (c)
 of this section, if the amount of the credit allowable under this subdi-
 vision for any calendar year exceeds the tax imposed for such last taxa-
 ble  period  in  such  calendar year, the excess may be carried over, in
 order, to the immediately succeeding taxable periods in the  five  imme-
 diately  succeeding  calendar  years  and,  to the extent not previously
 allowable, shall be applied against the tax  otherwise  required  to  be
 paid  for such periods. Such carryover credit shall be deducted from the
 taxpayer's tax prior to the deduction of the credit provided in subdivi-
 sion b of section 11-1105 of this chapter.  With  respect  to  the  last
 taxable  period  in  a  calendar year, the credit for such calendar year
 shall be taken prior to any carryover credit. If in any period there are
 carryover credits available from more than one year, such credits  shall
 be  applied  against the tax in the order in which they were earned with
 the oldest available credit being taken first.
 S. 8474                            793
 
   (c) In the case of a taxpayer that has  obtained  a  certification  of
 eligibility pursuant to chapter six-B of title twenty-two of the code of
 the  preceding  municipality  dated on or after July first, two thousand
 for a relocation to eligible premises located within the  revitalization
 area  defined  in  subdivision  (n) of section 22-621 of the code of the
 preceding municipality, the credits allowed under this  section,  or  in
 the case of a taxpayer that has relocated more than once, the portion of
 such credits attributed to such certification of eligibility pursuant to
 subdivision (a) of this section, against the tax imposed by this chapter
 for the calendar year of such relocation and for the four calendar years
 immediately  succeeding  the  calendar year of such relocation, shall be
 deemed to be erroneous payments of tax by the taxpayer to be credited or
 refunded, in accordance with the provisions of section 11-1108  of  this
 chapter.  For  such calendar years, such credits or portions thereof may
 not be carried over to any succeeding taxable year;  provided,  however,
 that  this  subdivision  shall  not apply to any relocation for which an
 application for a certification of eligibility was not  submitted  prior
 to  July first, two thousand three unless the date of such relocation is
 on or after July first, two thousand.
   § 11-1105.3 Lower Manhattan relocation employment  assistance  credit.
 (a)  A taxpayer that has obtained the certifications required by chapter
 six-C of title twenty-two of the  code  of  the  preceding  municipality
 shall  be  allowed  a  credit  against  the tax imposed by this chapter,
 provided, however, that a taxpayer that is a vendor of utility  services
 shall  not be allowed the credit against the tax imposed by this chapter
 unless it elects as provided in subdivision (d) of section 22-624 of the
 code of the preceding municipality to take the credit  against  the  tax
 imposed  by  this  chapter. The amount of the credit shall be the amount
 determined by multiplying three thousand dollars by the number of eligi-
 ble aggregate employment shares maintained by the  taxpayer  during  the
 calendar  year  with  respect to eligible premises to which the taxpayer
 has relocated; provided, however, that no credit shall  be  allowed  for
 the relocation of any retail activity or hotel services. For purposes of
 this  subdivision,  the  terms  "eligible  aggregate employment shares",
 "eligible premises", "relocate", "retail activity" and "hotel  services"
 shall  have  the  meanings ascribed by section 22-623 of the code of the
 preceding municipality.
   (b) The credit allowed under this section  with  respect  to  eligible
 aggregate employment shares maintained with respect to eligible premises
 to  which  the  taxpayer  has relocated shall be allowed for the taxable
 period in which the relocation to eligible premises takes place and  for
 succeeding taxable periods in the calendar year of the relocation and in
 any of the twelve succeeding calendar years during which eligible aggre-
 gate employment shares are maintained with respect to eligible premises,
 provided  that the credit allowed for the taxable periods in the twelfth
 succeeding calendar year shall be calculated by multiplying  the  number
 of  eligible  aggregate  employment  shares  maintained  with respect to
 eligible premises in the twelfth succeeding calendar year by the  lesser
 of  one  and  a fraction the numerator of which is the number of days in
 the calendar year of relocation less the number  of  days  the  taxpayer
 maintained  employment  shares in eligible premises in the calendar year
 of relocation and the denominator of which is the number of days in such
 twelfth succeeding calendar year during which  such  eligible  aggregate
 employment  shares  are  maintained  with  respect to such premises. The
 credit allowable under this section shall be applied against the  amount
 of  tax otherwise required to be paid for the last taxable period of the
 S. 8474                            794
 
 calendar year as provided in subdivision a of section  11-1105  of  this
 chapter,  shall  be  deducted  from  the  taxpayer's  tax  prior  to the
 deduction of the credit provided in subdivision b of  such  section  but
 after  the credit provided for in section 11-1105.2 of this chapter, and
 shall be claimed on the tax return for the last taxable  period  of  the
 calendar year. Except as provided in subdivision (c) of this section, if
 the amount of the credit allowable under this subdivision for any calen-
 dar  year  exceeds  the tax imposed for such last taxable period in such
 calendar year, the excess may be carried over, in order,  to  the  imme-
 diately  succeeding  taxable  periods in the five immediately succeeding
 calendar years and, to the extent not  previously  allowable,  shall  be
 applied  against the tax otherwise required to be paid for such periods.
 Such carryover credit shall be deducted from the taxpayer's tax prior to
 the deduction of the credit provided in subdivision b of section 11-1105
 of this chapter but after the credit provided for in  section  11-1105.2
 of  this  chapter. With respect to the last taxable period in a calendar
 year, the credit for such calendar year shall  be  taken  prior  to  any
 carryover credit. If in any period there are carryover credits available
 from  more  than one year, such credits shall be applied against the tax
 in the order in which they were earned with the oldest available  credit
 being taken first.
   (c) The credits allowed under this section, against the tax imposed by
 this  chapter  for  the calendar year of the relocation and for the four
 taxable years immediately succeeding the calendar  year  of  such  relo-
 cation,  shall be deemed to be overpayments of tax by the taxpayer to be
 credited  or  refunded,  without  interest,  in  accordance   with   the
 provisions  of section 11-1108 of this chapter. For such calendar years,
 such credits or portions thereof may not be carried over to any succeed-
 ing calendar year.
   § 11-1106 Determination of tax. In case the return  required  by  this
 chapter shall be insufficient or unsatisfactory or if such return is not
 filed, the commissioner of finance shall determine the amount of the tax
 due from such information as is obtainable, and if necessary the tax may
 be estimated upon the basis of external indices. Notice of such determi-
 nation  shall  be given to the person liable for the payment of the tax.
 Such determination shall finally and irrevocably fix such tax unless the
 person against whom it is assessed, within ninety days after the  giving
 of  notice  of such determination or, if the commissioner of finance has
 established a conciliation procedure pursuant to section 11-124 of  this
 title  and  the  taxpayer  has  requested  a  conciliation conference in
 accordance therewith, within ninety days from the mailing of  a  concil-
 iation  decision  or  the date of the commissioner's confirmation of the
 discontinuance of the conciliation proceeding, both (1) serves  a  peti-
 tion  upon the commissioner of finance and (2) files a petition with the
 tax appeals tribunal for a hearing, or unless such commissioner  of  his
 or  her  own  motion  shall  redetermine  the same. Such hearing and any
 appeal to the tax appeals tribunal sitting en  banc  from  the  decision
 rendered in such hearing shall be conducted in the manner and subject to
 the  requirements  prescribed  by  the  tax appeals tribunal pursuant to
 sections one hundred sixty-eight through one hundred seventy-two of  the
 charter of the preceding municipality as it existed January first, nine-
 teen  hundred ninety-four.   After such hearing the tax appeals tribunal
 shall give notice of its decision to the person against whom the tax  is
 assessed  and  to  the  commissioner of finance.   A decision of the tax
 appeals tribunal sitting en banc shall be reviewable for error, illegal-
 ity, unconstitutionality or any other reason whatsoever by a  proceeding
 S. 8474                            795
 
 under  article  seventy-eight  of  the  civil  practice law and rules if
 instituted by the person against whom the tax was assessed  within  four
 months after the giving of the notice of such tax appeals tribunal deci-
 sion. A proceeding under such article of such law and rules shall not be
 instituted  by  a taxpayer unless (a) the amount of any tax sought to be
 reviewed with penalties and interest thereon, if  any,  shall  first  be
 deposited with the commissioner of finance and there shall be filed with
 such  commissioner an undertaking, issued by a surety company authorized
 to transact business in this state and approved by the superintendent of
 insurance of this state as  to  solvency  and  responsibility,  in  such
 amount  and  with  such sureties as a justice of the supreme court shall
 approve, to the effect that if such proceeding be dismissed or  the  tax
 confirmed,  the taxpayer will pay all costs and charges which may accrue
 in the prosecution of the proceeding,  or  (b)  at  the  option  of  the
 taxpayer  such undertaking filed with the commissioner of finance may be
 in a sum sufficient to cover the taxes, penalties and  interest  thereon
 stated  in  such  decision,  plus the costs and charges which may accrue
 against it in the prosecution of the  proceeding,  in  which  event  the
 taxpayer  shall  not  be  required  to deposit such taxes, penalties and
 interest as a condition precedent to the application.
   § 11-1107 Assessment of tax where change or correction  of  sales  and
 compensating  use  tax  liability  involved.  a.  If a taxpayer fails to
 comply with subdivision d of section 11-1104  of  this  chapter  in  not
 reporting  a  change or correction of its sales and compensating use tax
 liability or in not filing a copy of an amended return or report  relat-
 ing to its sales and compensating use tax liability, instead of the mode
 and  time of assessment provided for in section 11-1106 of this chapter,
 the commissioner of finance may assess  a  deficiency  based  upon  such
 changed  or  corrected sales and compensating use tax liability, as same
 relates to credits claimed under this chapter, by mailing to the taxpay-
 er a notice of additional tax due specifying the amount of the deficien-
 cy, and such deficiency, together with the interest and penalties stated
 in such notice, shall be deemed assessed on  the  date  such  notice  is
 mailed  unless  within  thirty  days  after the mailing of such notice a
 report of the state change or correction or a copy of an amended  return
 or  report,  where  such  copy  was  required, is filed accompanied by a
 statement showing wherein such state determination and  such  notice  of
 additional tax due are erroneous. Such notice shall not be considered as
 a  notice  of  determination for the purposes of section 11-1106 of this
 chapter.
   b. If a report filed pursuant to subdivision d of section  11-1104  of
 this  chapter  concedes  the accuracy of a state change or correction of
 sales and compensating use tax liability, any deficiency in tax  result-
 ing therefor shall be deemed assessed on the date of filing such report.
   §  11-1108  Refunds.  a.  In  the  manner provided in this section the
 commissioner of finance shall refund or credit,  without  interest,  any
 tax,  penalty  or  interest erroneously, illegally or unconstitutionally
 collected or paid, if application for such refund shall be made  to  the
 commissioner  of finance within three years from the time the return was
 filed or two years from the time the tax was  paid,  whichever  of  such
 periods  expires later, or if no return was filed, within two years from
 the time the tax was paid. If the claim is filed within  the  three-year
 period,  the amount of the credit or refund shall not exceed the portion
 of the tax paid within the three years immediately preceding the  filing
 of  the  claim  plus  the period of any extension of time for filing the
 return. Whenever a refund or credit is made or denied by the commission-
 S. 8474                            796

 er of finance, he or she shall state his or her reason therefor and give
 notice thereof to the taxpayer in writing. The commissioner  of  finance
 may, in lieu of any refund required to be made, allow credit therefor on
 payments due from the applicant.
   b.  Any  determination of the commissioner of finance denying a refund
 or credit pursuant to subdivision a of this section shall be  final  and
 irrevocable unless the applicant for such refund or credit, within nine-
 ty  days  from  the  mailing of notice of such determination, or, if the
 commissioner of finance has established a conciliation procedure  pursu-
 ant  to  section  11-124 of this title and the applicant has requested a
 conciliation conference in accordance therewith, within ninety days from
 the mailing of a conciliation decision or the date of the commissioner's
 confirmation of the discontinuance of the conciliation proceeding,  both
 (1)  serves  a petition upon the commissioner of finance and (2) files a
 petition with the tax appeals tribunal for a hearing. Such petition  for
 a refund or credit, made as provided in this section, shall be deemed an
 application  for  a  revision of any tax, penalty or interest complained
 of. Such hearing and any appeal to the tax appeals tribunal  sitting  en
 banc  from  the  decision rendered in such hearing shall be conducted in
 the manner and subject to the requirements prescribed by the tax appeals
 tribunal pursuant  to  sections  one  hundred  sixty-eight  through  one
 hundred  seventy-two  of the charter of the preceding municipality as it
 existed January first, nineteen hundred ninety-four. After such hearing,
 the tax appeals tribunal shall give notice of its decision to the appli-
 cant and to the commissioner of finance. The applicant shall be entitled
 to institute a proceeding under article seventy-eight of the civil prac-
 tice law and rules to review a decision  of  the  tax  appeals  tribunal
 sitting  en  banc  if  application to the supreme court be made therefor
 within four months after the giving of  notice  of  such  decision,  and
 provided,  in the case of an application by a taxpayer, a final determi-
 nation of tax due was not previously made.
   c. If a taxpayer is required by subdivision d of  section  11-1104  of
 this  chapter  to file a report or amended return in respect of a change
 or correction of its sales and compensating use tax liability, claim for
 credit or refund of any resulting overpayment of tax shall be  filed  by
 the taxpayer within one year from the time such report or amended return
 was required to be filed with the commissioner of finance. This subdivi-
 sion  shall  not  affect the time within which or the amount for which a
 claim for credit or refund may be filed apart from this subdivision.
   d. A person shall not be entitled to  a  revision,  refund  or  credit
 under  this  section of a tax, interest or penalty which had been deter-
 mined to be due pursuant to the provisions of section 11-1106 or 11-1107
 of this chapter where he or she has had a hearing or an opportunity  for
 a  hearing, as provided in such sections, or has failed to avail himself
 or herself of the remedies therein provided. No refund or  credit  shall
 be  made of a tax, interest or penalty paid after a determination by the
 commissioner of finance made pursuant to section 11-1106 or  11-1107  of
 this  chapter  unless it be found that such determination was erroneous,
 illegal or unconstitutional or otherwise improper, by  the  tax  appeals
 tribunal  after a hearing or of the commissioner of finance's own motion
 or, if such tax appeals tribunal affirms in whole or in part the  deter-
 mination  of  the commissioner of finance, in a proceeding under article
 seventy-eight of the civil  practice  law  and  rules  pursuant  to  the
 provisions  of  said  section,  in  which event refund or credit without
 interest shall be made of the tax, interest or  penalty  found  to  have
 been overpaid.
 S. 8474                            797
 
   §  11-1109  Reserves.    In cases where the taxpayer has applied for a
 refund and has instituted a proceeding under  article  seventy-eight  of
 the  civil  practice  law and rules to review a determination adverse to
 him or her on his or her application for refund, the  comptroller  shall
 set up appropriate reserves to meet any decision adverse to the city.
   §  11-1110  Remedies  exclusive. The remedies provided by this chapter
 shall be the exclusive remedies available to any person for  the  review
 of  tax  liability  imposed  by  this  chapter;  and no determination or
 proposed determination of tax or determination on  any  application  for
 refund  by  the  commissioner  of  finance,  nor any decision by the tax
 appeals tribunal or any of  its  administrative  law  judges,  shall  be
 enjoined  or  reviewed  by an action for declaratory judgment, an action
 for money had and received or by any action or proceeding other than, in
 the case of a decision by the tax appeals tribunal sitting  en  banc,  a
 proceeding  under  article  seventy-eight  of the civil practice law and
 rules; provided, however, that a taxpayer may proceed by  a  declaratory
 judgment  if  he or she institutes suit within thirty days after a defi-
 ciency assessment is made and pays the amount of the deficiency  assess-
 ment  to  the  commissioner  of finance prior to the institution of such
 suit and posts a bond for costs as provided in section 11-1106  of  this
 chapter.
   §  11-1111  Proceedings  to recover tax. a.  Whenever any person shall
 fail to pay any tax or penalty or interest imposed by  this  chapter  as
 provided  in  this  section,  the  corporation  counsel  shall, upon the
 request of the commissioner of finance, bring or cause to be brought  an
 action  to enforce payment of the same against the person liable for the
 same on behalf of the city of Staten Island in any court of the state of
 New York or of any other state or of the United States.    If,  however,
 such  commissioner  in  his  or  her discretion believes that a taxpayer
 subject to the provisions of this chapter is about  to  cease  business,
 leave  the  state  or remove or dissipate the assets out of which tax or
 penalties might be satisfied and that any such tax or penalty  will  not
 be  paid when due, he or she may declare such tax or penalty to be imme-
 diately due and payable and may issue a warrant immediately.
   b.  As a further additional or alternate remedy, the  commissioner  of
 finance  may  issue  a warrant, directed to the city sheriff, commanding
 him or her to levy upon and sell the real and personal property of  such
 person which may be found within the city, for the payment of the amount
 thereof, with any penalties and the cost of executing the warrant and to
 return  such  warrant  to such commissioner and to pay to him or her the
 money collected by virtue thereof within sixty days after the receipt of
 such warrant.   The city sheriff  shall,  within  five  days  after  the
 receipt  of  the  warrant, file with the county clerk a copy thereof and
 thereupon such clerk shall enter in the judgment docket the name of  the
 person  mentioned in the warrant and the amount of the tax and penalties
 for which the warrant is issued and the date when such  copy  is  filed.
 Thereupon  the  amount  of  such warrant so docketed shall have the full
 force and effect of a judgment and shall become a lien upon the title to
 and interest in real and personal property of the  person  against  whom
 the  warrant  is  issued.   The city sheriff shall then proceed upon the
 warrant in the same manner and with like effect as that provided by  law
 in  respect  to executions against property upon judgments of a court of
 record, and for services in executing the warrant he  or  she  shall  be
 entitled  to  the  same  fees  which  he  or she may collect in the same
 manner.  In the discretion of the commissioner of finance a  warrant  of
 like  terms,  force and effect may be issued and directed to any officer
 S. 8474                            798
 
 or employee of the department of finance and in  the  execution  thereof
 such  officer or employee shall have all the power conferred by law upon
 sheriffs, but he or she shall be entitled to no fee or  compensation  in
 excess  of the actual expenses paid in the performance of such duty.  If
 a warrant is returned not satisfied in full, the commissioner of finance
 may from time to time issue new warrants and shall also  have  the  same
 remedies  to enforce the amount due thereunder as if the city had recov-
 ered judgment therefor and execution thereon had been returned  unsatis-
 fied.
   c.    Whenever there is made a sale, transfer or assignment in bulk of
 any part or the whole of a stock of merchandising  or  of  fixtures,  or
 merchandise and of fixtures pertaining to the conducting of the business
 of  the  seller,  transferor or assignor, otherwise than in the ordinary
 course of trade and in the regular prosecution  of  said  business,  the
 purchaser,  transferee or assignee shall at least ten days before taking
 possession of such merchandise, fixtures, or merchandise  and  fixtures,
 or  paying  therefor,  notify  the commissioner of finance by registered
 mail of the proposed sale and of the price, terms and conditions  there-
 of,  whether  or not the seller, transferor or assignor, has represented
 to, or informed the purchaser, transferee or assignee that it  owes  any
 tax  pursuant  to this chapter, whether or not the purchaser, transferee
 or assignee has knowledge that such taxes are owing, and whether or  not
 any such taxes are in fact owing.
   Whenever  the purchaser, transferee or assignee shall fail to give the
 notice to the commissioner of finance required by this  subdivision,  or
 whenever  such  commissioner  shall  inform the purchaser, transferee or
 assignee that a possible claim for such tax or taxes exists, any sums of
 money, property or choses in action, or other consideration,  which  the
 purchaser,  transferee  or  assignee is required to transfer over to the
 seller, transferor or assignor shall be  subject  to  a  first  priority
 right  and  lien for any such taxes theretofore or thereafter determined
 to be due from the seller, transferor or assignor to the city,  and  the
 purchaser,  transferee or assignee is forbidden to transfer to the sell-
 er, transferor or assignor any such sums of money, property or choses in
 action to the extent of the amount of the city's claim.  For failure  to
 comply with the provisions of this subdivision the purchaser, transferee
 or  assignee,  in addition to being subject to the liabilities and reme-
 dies imposed under the provisions of former article six of  the  uniform
 commercial  code  shall be personally liable for the payment to the city
 of any such taxes theretofore or thereafter determined to be due to  the
 city  from  the seller, transferor or assignor and such liability may be
 assessed and enforced in the same manner as the  liability  for  tax  is
 imposed under this chapter.
   d.  The commissioner of finance, if he or she finds that the interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the commissioner of finance may require, may release any  property  from
 the  lien  of any warrant or vacate such warrant for unpaid taxes, addi-
 tions to tax, penalties and interest filed pursuant to subdivision b  of
 this  section,  and  such  release  or  vacating  of  the warrant may be
 recorded in the office of any recording officer in  which  such  warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   §  11-1112  General powers of the commissioner of finance. In addition
 to the powers granted to the commissioner of finance in this chapter, he
 or she is hereby authorized and empowered:
 S. 8474                            799

   1.  To make, adopt and amend rules and regulations appropriate to  the
 carrying  out of this chapter and the purposes thereof; and to prescribe
 the form of blanks, reports and other records relating to  the  enforce-
 ment and administration of this chapter;
   2.   To prescribe methods for determining the amount of "gross income"
 and "gross operating income" received by a person subject to tax  pursu-
 ant to this chapter;
   3.  To request information from the tax commission of the state of New
 York or treasury department of the United States relative to any person;
 and to afford returns, reports and other information to such tax commis-
 sion  or  such  treasury  department  relative  to any person, any other
 provision in this chapter to the contrary notwithstanding;
   4.  To extend, for cause shown, the time for filing any return  for  a
 period  not  exceeding thirty days; and to compromise disputed claims in
 connection with the taxes imposed pursuant to this chapter;
   5.  To delegate his or her functions hereunder to a deputy commission-
 er of finance or other  employee  or  employees  of  the  department  of
 finance of the city;
   6.   To assess, determine, revise and readjust the taxes imposed under
 this chapter.
   § 11-1113 Administration of oaths and  compelling  testimony.  a.  The
 commissioner  of  finance,  his  or  her  employees  duly designated and
 authorized by him or her, the tax appeals tribunal and any of  its  duly
 designated and authorized employees shall have power to administer oaths
 and  take  affidavits  in  relation  to any matter or proceedings in the
 exercise of their powers and duties under this chapter.    Such  commis-
 sioner  and  the  tax  appeals tribunal shall have power to subpoena and
 require the attendance of witnesses and the production of books,  papers
 and  documents to secure information pertinent to the performance of the
 duties of such commissioner or of the tax appeals tribunal hereunder and
 of the enforcement of this chapter, and  to  examine  them  in  relation
 thereto,  and  to issue commissions for the examination of witnesses who
 are out of the state or unable to attend before the commissioner or  the
 tax appeals tribunal or excused from attendance.
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 testimony  of  witnesses  and  the  production and examination of books,
 papers and documents called for by the subpoena of the  commissioner  of
 finance or the tax appeals tribunal under this chapter.
   c.  Cross-reference; criminal penalties. For failure to obey subpoenas
 or for testifying falsely,  see  section  11-4007  of  this  title;  for
 supplying  false  or fraudulent information, see section 11-4002 of this
 title.
    d. The officers who serve the summons or subpoena of the commissioner
 of finance or the  tax  appeals  tribunal  and  witnesses  attending  in
 response  thereto  shall  be entitled to the same fees as are allowed to
 officers and witnesses in civil cases in courts  of  record,  except  as
 herein  otherwise provided. Such officers shall be the city sheriff, and
 his or her duly appointed deputies or any officers or employees  of  the
 department  of  finance or the tax appeals tribunal, designated to serve
 such process.
   § 11-1114 Interest and penalties. (a) Interest  on  underpayments.  If
 any  amount of tax is not paid on or before the last date prescribed for
 payment, without regard to any extension of time  granted  for  payment,
 interest  on  such amount at the rate set by the commissioner of finance
 pursuant to subdivision (g) of this section, or, if no rate is  set,  at
 S. 8474                            800
 
 the  rate of seven and one-half percent per annum, shall be paid for the
 period from such last date to the date  of  payment.  In  computing  the
 amount  of interest to be paid, such interest shall be compounded daily.
 Interest  under this subdivision shall not be paid if the amount thereof
 is less than one dollar.
   (b) (1) Failure to file return. (A) In  case  of  failure  to  file  a
 return  under  this chapter on or before the prescribed date, determined
 with regard to any extension of time for filing, unless it is shown that
 such failure is due to reasonable cause and not due to willful  neglect,
 there  shall  be added to the amount required to be shown as tax on such
 return five percent of the amount of such tax if the failure is for  not
 more than one month, with an additional five percent for each additional
 month  or  fraction  thereof  during  which  such failure continues, not
 exceeding twenty-five percent in the aggregate.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to any extension of time for filing, unless it is shown that such  fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion  to  tax under subparagraph (A) of this paragraph shall not be less
 than the lesser of one hundred dollars or one  hundred  percent  of  the
 amount required to be shown as tax on such return.
   (C)  For  purposes of this paragraph, the amount of tax required to be
 shown on the return shall be reduced by the amount of any  part  of  the
 tax  which  is  paid on or before the date prescribed for payment of the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2) Failure to pay tax shown on return. In case of failure to pay  the
 amount  shown as tax on a return required to be filed under this chapter
 on or before the prescribed date, determined with regard to  any  exten-
 sion of time for payment, unless it is shown that such failure is due to
 reasonable  cause  and not due to  willful neglect, there shall be added
 to the amount shown as tax on such return one-half of one percent of the
 amount of such tax if the failure is not for more than one  month,  with
 an additional one-half of one percent for each additional month or frac-
 tion  thereof during which such failure continues, not exceeding twenty-
 five percent in the aggregate. For the purpose of computing the addition
 for any month the amount of tax shown on the return shall be reduced  by
 the  amount of any part of the tax which is paid on or before the begin-
 ning of such month and by the amount of any credit against the tax which
 may be claimed upon the return. If the amount  of  tax  required  to  be
 shown  on  a return is less than the amount shown as tax on such return,
 this paragraph shall be applied by substituting such lower amount.
   (3) Failure to pay tax required to be shown  on  return.  In  case  of
 failure  to pay any amount in respect of any tax required to be shown on
 a return required to be filed under this chapter which is not so  shown,
 including a determination made pursuant to section 11-1106 of this chap-
 ter, within ten days of the date of a notice and demand therefor, unless
 it  is shown that such failure is due to reasonable cause and not due to
 willful neglect, there shall be added to the amount  of  tax  stated  in
 such  notice and demand one-half of one percent of such tax if the fail-
 ure is not for more than one month, with an additional one-half  of  one
 percent  for each additional month or fraction thereof during which such
 failure continues, not exceeding twenty-five percent in  the  aggregate.
 For  the  purpose of computing the addition for any month, the amount of
 tax stated in the notice and demand shall be reduced by  the  amount  of
 any part of the tax which is paid before the beginning of such month.
 S. 8474                            801
 
   (4) Limitations on additions.
   (A) With respect to any return, the amount of the addition under para-
 graph  one  of  this  subdivision  shall be reduced by the amount of the
 addition under paragraph two of this subdivision for any month to  which
 an  addition  applies under both paragraphs one and two of this subdivi-
 sion.  In any case described in subparagraph (B)  of  paragraph  one  of
 this  subdivision,  the  amount of the addition under such paragraph one
 shall not be reduced below the amount provided in such subparagraph.
   (B) With respect to any return, the maximum  amount  of  the  addition
 permitted  under paragraph three of this subdivision shall be reduced by
 the amount of the addition under  paragraph  one  of  this  subdivision,
 determined  without  regard  to  subparagraph  (B) of such paragraph one
 which is attributable to the tax for which the notice and demand is made
 and which is not paid within ten days of such notice and demand.
   (c) Underpayment due to negligence. (1) If any part of an underpayment
 of tax is due to negligence or intentional disregard of this chapter  or
 any rules or regulations hereunder, but without intent to defraud, there
 shall  be added to the tax a penalty equal to five percent of the under-
 payment.
   (2) There shall be added to the tax, in addition to the amount  deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under subdivision (a)  of  this  section
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to the negligence or intentional  disre-
 gard  referred to in such paragraph one, for the period beginning on the
 last date prescribed by law for payment of such underpayment, determined
 without regard to any extension, and ending on the date of  the  assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
   (3)  If  any payment is shown on a return made by a payor with respect
 to dividends, patronage dividends and interest under subsection  (a)  of
 section  six  thousand forty-two, subsection (a) of section six thousand
 forty-four or subsection (a) of section  six thousand forty-nine of  the
 internal  revenue code of nineteen hundred fifty-four, respectively, and
 the payee fails to include any portion of such payment in  gross  income
 or  gross  operating  income,  when required under this chapter to be so
 included, any portion of an underpayment attributable  to  such  failure
 shall be treated, for purposes of this subdivision, as due to negligence
 in  the absence of clear and convincing evidence to the contrary. If any
 penalty is imposed under this subdivision by reason of  this  paragraph,
 the  amount  of the penalty imposed by paragraph one of this subdivision
 shall be five percent of  the  portion  of  the  underpayment  which  is
 attributable to the failure described in this paragraph.
   (d)  Underpayment  due to fraud. (1) If any part of an underpayment of
 tax is due to fraud, there shall be added to the tax a penalty equal  to
 two times of the underpayment.
   (2)  The  penalty under this subdivision shall be in lieu of any other
 addition to tax imposed by subdivision (b) or (c) of this section.
   (e) Additional penalty. Any person who, with fraudulent intent,  shall
 fail to pay any tax imposed by this chapter, or to make, render, sign or
 certify  any  return,  or  to  supply  any  information  within the time
 required by or under this chapter, shall be liable for a penalty of  not
 more  than  one  thousand  dollars,  in  addition  to  any other amounts
 required under this chapter to be imposed, assessed and collected by the
 commissioner of finance. The commissioner  of  finance  shall  have  the
 power,  in  his  or  her  discretion, to waive, reduce or compromise any
 penalty under this subdivision.
 S. 8474                            802
 
   (f) The interest and penalties imposed by this section shall  be  paid
 and  disposed of in the same manner as other revenues from this chapter.
 Unpaid interest and penalties may be enforced in the same manner as  the
 tax imposed by this chapter.
   (g)  (1)  Authority to set interest rates. The commissioner of finance
 shall set the rate of interest to be paid pursuant to subdivision (a) of
 this section, but if no such rate of interest is set, such rate shall be
 deemed to be set at seven and one-half percent per  annum.    Such  rate
 shall  be  the  rate prescribed in paragraph two of this subdivision but
 shall not be less than seven and one-half percent per  annum.  Any  such
 rate  set  by  the  commissioner of finance shall apply to taxes, or any
 portion thereof, which remain or become due on  or  after  the  date  on
 which  such  rate becomes effective and shall apply only with respect to
 interest computed or computable  for  periods  or  portions  of  periods
 occurring in the period in which such rate is in effect.
   (2)  General  rule.  The  rate  of interest set under this subdivision
 shall be the sum of (i) the federal short-term rate  as  provided  under
 paragraph three of this subdivision, plus (ii) seven percentage points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A)  The  federal  short-term  rate for any month shall be the federal
 short-term rate determined by the United States secretary of the  treas-
 ury  during  such  month  in  accordance  with subsection (d) of section
 twelve hundred seventy-four of the internal  revenue  code  for  use  in
 connection  with  section  six  thousand  six  hundred twenty-one of the
 internal revenue code. Any such rate shall be  rounded  to  the  nearest
 full  percent,  or,  if a multiple of one-half of one percent, such rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i) In general. Except as provided in clause  (ii)  of  this  subpara-
 graph,  the federal short-term rate for the first month in each calendar
 quarter shall apply during the first calendar  quarter  beginning  after
 such month.
   (ii)  Special rule for the month of September, nineteen hundred eight-
 y-nine. The federal short-term rate for the  month  of  April,  nineteen
 hundred  eighty-nine  shall  apply  with  respect to setting the rate of
 interest for the month of September, nineteen hundred eighty-nine.
   (4) Publication of interest rate. The commissioner  of  finance  shall
 cause  to  be  published  in the City Record, and give other appropriate
 general notice of, the interest rate to be set under this subdivision no
 later than twenty days preceding the first day of the  calendar  quarter
 during  which such interest rate applies. The setting and publication of
 such interest rate shall not be included within paragraph (a) of  subdi-
 vision five of section one thousand forty-one of the city charter of the
 preceding  municipality  as  it  existed January first, nineteen hundred
 ninety-four relating to the definition of a rule.
   (h) Miscellaneous. (1) The certificate of the commissioner of  finance
 to  the  effect that a tax has not been paid, that a return has not been
 filed, or that  information  has  not  been  supplied  pursuant  to  the
 provisions of this chapter shall be prima facie evidence thereof.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   (i) Substantial understatement of liability. If there is a substantial
 understatement  of  tax  for any taxable period, there shall be added to
 the tax an amount equal to ten percent of the amount of any underpayment
 attributable to such understatement. For purposes of  this  subdivision,
 there  is  a substantial understatement of tax for any taxable period if
 S. 8474                            803
 
 the amount of the understatement for  the  taxable  period  exceeds  the
 greater of ten percent of the tax required to be shown on the return for
 the taxable period or five thousand dollars. For purposes of this subdi-
 vision,  the term "understatement" means the excess of the amount of the
 tax required to be shown on the return for the taxable period, over  the
 amount  of  the tax imposed which is shown on the return, reduced by any
 rebate.  The amount of such understatement  shall  be  reduced  by  that
 portion of the understatement which is attributable to the tax treatment
 of any item by the taxpayer if there is or was substantial authority for
 such  treatment,  or  any  item with respect to which the relevant facts
 affecting the item's tax  treatment  are  adequately  disclosed  in  the
 return  or  in  a  statement attached to the return. The commissioner of
 finance may waive all or any part of the addition  to  tax  provided  by
 this  subdivision on a showing by the taxpayer that there was reasonable
 cause for the understatement, or part thereof,  and  that  the  taxpayer
 acted in good faith.
   (j)  Aiding or assisting in the giving of fraudulent returns, reports,
 statements or other documents. (1) Any person who, with the intent  that
 tax  be evaded, shall, for a fee or other compensation or as an incident
 to the performance of other services  for  which  such  person  receives
 compensation, aid or assist in, or procure, counsel, or advise the prep-
 aration  or presentation under, or in connection with any matter arising
 under this title of any return,  report,  statement  or  other  document
 which  is  fraudulent  or false as to any material matter, or supply any
 false or fraudulent information, whether or not such falsity or fraud is
 with the knowledge or consent of the person authorized  or  required  to
 present  such  return,  report,  statement or other document shall pay a
 penalty not exceeding ten thousand dollars.
   (2) For purposes of  paragraph  one  of  this  subdivision,  the  term
 "procures"  includes ordering, or otherwise causing, a subordinate to do
 an act, and knowing of, and not attempting to prevent, participation  by
 a  subordinate in an act. The term "subordinate" means any other person,
 whether or not a director, officer, employee, or agent of  the  taxpayer
 involved,  over  whose activities the person has direction, supervision,
 or control.
   (3) For purposes of  paragraph  one  of  this  subdivision,  a  person
 furnishing  typing,  reproducing,  or  other  mechanical assistance with
 respect to a document shall not be treated as having aided  or  assisted
 in the preparation of such document by reason of such assistance.
   (4)  The  penalty  imposed by this subdivision shall be in addition to
 any other penalty provided by law.
   (k) Failure to include on  return  information  relating  to  issuer's
 allocation  percentage. Where a return is filed but does not contain (1)
 the information necessary to compute the taxpayer's issuer's  allocation
 percentage,  as defined in subparagraph one of paragraph (b) of subdivi-
 sion three of section 11-604 of this title, where the same is called for
 on the return, or, (2) the taxpayer's  issuer's  allocation  percentage,
 where the same is called for on the return but where all of the informa-
 tion  necessary for the computation of such percentage is not called for
 on the return, then unless it is shown  that  such  failure  is  due  to
 reasonable  cause and not due to willful neglect there shall be added to
 the tax a penalty of five hundred dollars.
   (l) False or fraudulent document penalty. Any taxpayer that submits  a
 false  or  fraudulent  document  to the department shall be subject to a
 penalty of one hundred dollars per document submitted, or  five  hundred
 S. 8474                            804
 
 dollars  per  tax return submitted. Such penalty shall be in addition to
 any other penalty or addition provided by law.
   §  11-1115  Notices and limitations of time. a.  Any notice authorized
 or required under the provisions of this chapter may be given by mailing
 the same to the person for whom it is intended in  a  postpaid  envelope
 addressed  to  such person at the address given in the last return filed
 by such person pursuant to the provisions of  this  chapter  or  in  any
 application  made  by  him  or  her,  or, if no return has been filed or
 application made, then to such address as may be obtainable.  The  mail-
 ing  of  such notice shall be presumptive evidence of the receipt of the
 same by the person to whom addressed.   Any  period  of  time  which  is
 determined  according to the provisions of this chapter by the giving of
 notice shall commence to run from the date of mailing of such notice.
   b. The provisions of the civil practice law and rules or any other law
 relative to limitations of time for the enforcement of  a  civil  remedy
 shall  not  apply to any proceeding or action by the city taken to levy,
 appraise, assess, determine or enforce the  collection  of  any  tax  or
 penalty  provided  by  this  chapter.   However, except in the case of a
 wilfully false or fraudulent return with intent to  evade  the  tax,  no
 assessment of additional tax imposed under a local law for the preceding
 municipality  enacted subsequent to July first, nineteen hundred thirty-
 eight, shall be made after the expiration of more than three years  from
 the  date  of  the  filing of a return, provided, however, that where no
 return has been filed, or where the taxpayer fails to file a  report  or
 return  in  respect of a change or correction in the amount of sales and
 compensating use tax liability as  provided  by  law,  the  tax  may  be
 assessed  at  any  time.  Where the taxpayer files a report or return in
 respect of a change or correction in  sales  and  compensating  use  tax
 liability, as required by subdivision d of section 11-1104 of this chap-
 ter,  an  assessment may be made at any time within two years after such
 report or return was filed, provided, however, that this sentence  shall
 not affect the time within which an assessment may otherwise be made.
   c.  Where,  before  the expiration of the period prescribed herein for
 the assessment of an additional tax, a taxpayer has consented in writing
 that such period be extended, the amount of such additional tax due  may
 be  determined  at  any time within such extended period.  The period so
 extended may be further extended by subsequent consents in writing  made
 before the expiration of the extended period.
   d.  If  any  return,  claim,  statement, notice, application, or other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 of any provision of this chapter is, after such  period  or  such  date,
 delivered  by United States mail to the commissioner of finance, the tax
 appeals tribunal, bureau, office, officer or person with which  or  with
 whom  such document is required to be filed, or to which or to whom such
 payment is required to be made, the date of the United  States  postmark
 stamped on the envelope shall be deemed to be the date of delivery. This
 subdivision  shall  apply  only  if  the  postmark date falls within the
 prescribed period or on or before the prescribed date for the filing  of
 such document, or for making the payment, including any extension grant-
 ed  for such filing or payment, and only if such document or payment was
 deposited in the  mail,  postage  prepaid,  properly  addressed  to  the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer  or  person  with  which or with whom the document is required to be
 filed or to which or to whom such payment is required to be made. If any
 document is sent by United States  registered  mail,  such  registration
 S. 8474                            805
 
 shall  be  prima  facie evidence that such document was delivered to the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer or person to which or to whom addressed, and the date  of  registra-
 tion  shall be deemed the postmark date. The commissioner of finance or,
 where relevant, the tax appeals tribunal is  authorized  to  provide  by
 regulation the extent to which the provisions such with respect to prima
 facie  evidence  of delivery and the postmark date shall apply to certi-
 fied mail. Except as provided in subdivision f  of  this  section,  this
 subdivision  shall apply in the case of postmarks not made by the United
 States postal service only if and to the extent provided  by  regulation
 of the commissioner of finance or where relevant, the tax appeals tribu-
 nal.
   e.  When  the  last  day  prescribed  under authority of this chapter,
 including any extension of time, for  performing  any  act  falls  on  a
 Saturday,  Sunday or legal holiday in the state, the performance of such
 act shall be considered timely if it is performed on the next succeeding
 day which is not a Saturday, Sunday or legal holiday.
   f. (1) Any reference in subdivision d of this section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the secretary of the treasury of the United States
 pursuant to section seventy-five hundred two  of  the  internal  revenue
 code  and  any  reference  in  subdivision d of this section to a United
 States postmark shall be treated as including a reference  to  any  date
 recorded  or  marked  in  the  manner  described in section seventy-five
 hundred two of the  internal  revenue  code  by  a  designated  delivery
 service.  If the commissioner of finance finds that any delivery service
 designated by such secretary is inadequate for the needs  of  the  city,
 the  commissioner  of finance may withdraw such designation for purposes
 of this title. The commissioner of finance may also designate additional
 delivery services meeting the criteria of section  seventy-five  hundred
 two  of  the  internal  revenue  code for purposes of this title, or may
 withdraw any such designation if the commissioner of finance finds  that
 a  delivery  service  so  designated  is inadequate for the needs of the
 city. Any reference in subdivision d  of  this  section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the commissioner of finance and any  reference  in
 subdivision  d  of  this  section  to  a United States postmark shall be
 treated as including a reference to any date recorded or marked  in  the
 manner  described  in  section  seventy-five hundred two of the internal
 revenue code by a delivery service designated  by  the  commissioner  of
 finance;  provided, however, any withdrawal of designation or additional
 designation by the commissioner of finance shall not  be  effective  for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal  of  designation or additional designation is ratified by the
 president of the tax appeals tribunal.
   (2) Any equivalent of registered or certified mail designated  by  the
 United  States secretary of the treasury, or as may be designated by the
 commissioner of finance pursuant to  the  same  criteria  used  by  such
 secretary for such designations pursuant to section seventy-five hundred
 two  of  the internal revenue code, shall be included within the meaning
 of registered or certified  mail  as  used  in  subdivision  d  of  this
 section.  If  the  commissioner  of finance finds that any equivalent of
 registered or certified mail designated by such secretary or the commis-
 sioner of finance is inadequate for the needs of the city,  the  commis-
 sioner  of  finance  may  withdraw such designation for purposes of this
 title. Notwithstanding the foregoing, any withdrawal of  designation  or
 S. 8474                            806

 additional  designation  by  the  commissioner  of  finance shall not be
 effective for purposes of service upon the tax appeals tribunal,  unless
 and  until  such  withdrawal of designation or additional designation is
 ratified by the president of the tax appeals tribunal.
   §  11-1116  Returns  to be secret. a. Except in accordance with proper
 judicial order or as otherwise provided by law, it shall be unlawful for
 the commissioner of finance, the tax appeals tribunal, or any officer or
 employee of the department of finance or the  tax  appeals  tribunal  to
 divulge  or make known in any manner, the receipts or any other informa-
 tion relating to the business of a  taxpayer  contained  in  any  return
 required  under  this  chapter. The officers charged with the custody of
 such returns shall not be required to produce any of them or evidence of
 anything contained in them in any action or  proceeding  in  any  court,
 except  on  behalf  of  the  city  or the commissioner of finance, or on
 behalf of any party to any action or proceeding under the provisions  of
 this  chapter  when  the  returns  or  facts  shown thereby are directly
 involved in such action or proceeding, in either of  which  events,  the
 court  may require the production of, and may admit in evidence, so much
 of said returns or of the facts shown thereby, as are pertinent  to  the
 action  or proceeding and no more.  Nothing in this subdivision shall be
 construed to prohibit the delivery to a taxpayer  or  his  or  her  duly
 authorized  representative  of  a  certified copy of any return filed in
 connection with his or her tax,  nor  to  prohibit  the  publication  of
 statistics  so classified as to prevent the identification of particular
 returns and the items thereof, or  the  inspection  by  the  corporation
 counsel  of  the city or other legal representatives of such city of the
 return of any taxpayer who shall bring action or proceeding to set aside
 or review the tax based thereon, or against whom an action or proceeding
 has been instituted or is contemplated for  the  collection  of  a  tax,
 penalty  or  interest.  Returns  shall  be preserved for three years and
 thereafter  until  the  commissioner  of  finance  permits  them  to  be
 destroyed.
   b.  (1) Any officer or employee of the city who willfully violates the
 provisions of subdivision a of this  section  shall  be  dismissed  from
 office  and be incapable of holding any public office in this city for a
 period of five years thereafter.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   c. This section  shall be deemed a state statute for purposes of para-
 graph (a) of subdivision two of section eighty-seven of the public offi-
 cers law.
   d. Notwithstanding anything in subdivision a of this  section  to  the
 contrary,  if  a  taxpayer  has  petitioned the tax appeals tribunal for
 administrative review as provided in section one hundred seventy of  the
 charter of the preceding municipality as it existed January first, nine-
 teen  hundred  ninety-four, the commissioner of finance shall be author-
 ized to present to the tribunal any report or return of  such  taxpayer,
 or  any  information contained therein or relating thereto, which may be
 material or relevant to the proceeding  before  the  tribunal.  The  tax
 appeals  tribunal  shall be authorized to publish a copy or a summary of
 any decision rendered pursuant to section one hundred seventy-one of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four.
   §  11-1117  Construction  and  enforcement.  This  chapter  shall   be
 construed  and  enforced  in conformity with chapter ninety-three of the
 S. 8474                            807
 
 laws of nineteen hundred sixty-five, as amended, pursuant to which it is
 enacted.
   §  11-1118  Disposition  of  revenues. All revenues resulting from the
 imposition of the tax under this chapter shall be paid into the treasury
 of the city and shall be credited to and deposited in the  general  fund
 of  the city, but no part of such revenues may be expended unless appro-
 priated in the annual budget of the city.
   § 11-1119 Determinations of place of primary use of wireless  telecom-
 munications  services.  a.  A home service provider shall be responsible
 for obtaining and maintaining the customer's place  of  primary  use  as
 defined in subdivision twenty of section 11-1101 of this chapter. Except
 as  provided  in  subdivision  b  of  this  section, if the home service
 provider's reliance on the information provided by its  customer  is  in
 good  faith:  (1)  the  home service provider can rely on the applicable
 residential or business street address  supplied  by  the  home  service
 provider's customer; and (2) the home service provider shall not be held
 liable  for any additional taxes under this chapter based on a different
 determination of the place of primary use.
   b. The commissioner of finance, or the commissioner  of  taxation  and
 finance  of  the  state  of  New  York  on behalf of the commissioner of
 finance, may determine that the address used by a home service  provider
 for  purposes  of  this chapter does not meet the definition of place of
 primary use as defined in subdivision twenty of section 11-1101 of  this
 chapter  and  may  give  binding  notice to the home service provider to
 change the place of primary use on a prospective basis from the date  of
 notice of determination if:
   (1)  where  the  determination is made by the commissioner of finance,
 such commissioner obtains the consent of all affected  taxing  jurisdic-
 tions within this state before giving such notice of determination; and
   (2) before the commissioner of finance or the commissioner of taxation
 and finance of the state of New York gives such notice of determination,
 the  customer is given an opportunity to demonstrate, in accordance with
 applicable procedures established by the commissioner of finance  making
 the  determination, that that address is the customer's place of primary
 use.
   c. Except as provided in subdivision b of this section, a home service
 provider may treat the address used by the  home  service  provider  for
 purposes  of  this  chapter for the last taxable period beginning before
 August first, two  thousand  two,  for  any  customer  under  a  service
 contract  or agreement in effect on July twenty-eighth, two thousand two
 as that customer's place of primary use for the remaining term  of  such
 service  contract  or  agreement,  excluding any extension or renewal of
 such service contract or agreement.
   § 11-1120 Assignment of place of  primary  use  of  telecommunications
 services  to the city. a. If an electronic database meeting the require-
 ments of subsection a of section one hundred nineteen of title  four  of
 the  United  States  Code  is provided by the state of New York, or by a
 designated database provider as defined in subsection three  of  section
 one   hundred  twenty-four  of  such  title,  and  the  requirements  of
 subsection b of such section  one  hundred  nineteen  are  met,  a  home
 service  provider  shall  use  that  database  to  determine whether the
 customer's place of primary use is within the territorial limits of  the
 city  and  shall  reflect  changes  to  such database in accordance with
 subsection c of such section one hundred nineteen.
   b. A home service provider using the data contained in  an  electronic
 database  described in subdivision a of this section shall be held harm-
 S. 8474                            808

 less from any tax liability that otherwise would be due under this chap-
 ter solely as a result  of  any  error  or  omission  in  such  database
 provided  the  home  service  provider has properly reflected changes to
 such  database  in  accordance  with subsection c of section one hundred
 nineteen of title four of the United States Code.
   c. (1) If no electronic database is provided as described in  subdivi-
 sion  a  of this section, a home service provider shall be held harmless
 from any tax liability under this chapter that otherwise  would  be  due
 solely  as a result of an assignment of a street address to an incorrect
 taxing jurisdiction if, subject to subdivision d of  this  section,  the
 home service provider employs an enhanced zip code to assign each street
 address  to  a  specific  taxing  jurisdiction  for each level of taxing
 jurisdiction and exercises due diligence at each level of taxing  juris-
 diction  to  ensure  that  each  such  street address is assigned to the
 correct taxing jurisdiction. If an enhanced zip code overlaps boundaries
 of taxing jurisdictions of the same level,  the  home  service  provider
 must  designate  one specific jurisdiction within such enhanced zip code
 for use in taxing the activity for such enhanced zip code for each level
 of taxing jurisdiction. Any enhanced  zip  code  assignment  changed  in
 accordance with subdivision d of this section is deemed to be in compli-
 ance with this subdivision. For purposes of this subdivision, there is a
 rebuttable  presumption  that  a home service provider has exercised due
 diligence if such home service provider demonstrates that it has:    (i)
 expended reasonable resources to implement and maintain an appropriately
 detailed  electronic  database  of  street address assignments to taxing
 jurisdictions;  (ii)  implemented  and  maintained  reasonable  internal
 controls  to  promptly  correct  misassignments  of  street addresses to
 taxing jurisdictions; and  (iii)  used  all  reasonably  obtainable  and
 usable  data  pertaining to municipal annexations, incorporations, reor-
 ganizations and any other  changes  in  jurisdictional  boundaries  that
 materially affect the accuracy of such database.
   (2)  Paragraph  one  of  this  subdivision  applies  to a home service
 provider that is in compliance with the requirements of  such  paragraph
 until  the  later of:  (i) eighteen months after the nationwide standard
 numeric code described in subsection (a) of section one hundred nineteen
 of title four of the United States Code has been approved by the  feder-
 ation  of  tax administrators and the multistate tax commission; or (ii)
 six months after the state of New York or a designated database provider
 provides a database as prescribed in subdivision a of this section.
   d. The commissioner of finance, or the commissioner  of  taxation  and
 finance  of  the  state  of  New  York  on behalf of the commissioner of
 finance, may determine that the assignment of  a  street  address  to  a
 taxing  jurisdiction  by  a home service provider under subdivision c of
 this section does not reflect the correct taxing jurisdiction  and  give
 binding  notice to the home service provider to change the assignment on
 a prospective basis from the date of notice of determination  if:    (1)
 where  the  determination  is  made by the commissioner of finance, such
 commissioner obtains the consent of all  affected  taxing  jurisdictions
 within  this  state  before giving such notice of determination; and (2)
 the home service provider is given  an  opportunity  to  demonstrate  in
 accordance with applicable procedures established by the commissioner of
 finance  making  the  determination  that  the  assignment  reflects the
 correct taxing jurisdiction.
 S. 8474                            809
 
                                CHAPTER 12
                         HORSE RACE ADMISSIONS TAX
   §  11-1201  Definitions. When used in this chapter the following terms
 shall mean or include:
   1.   "Racing corporation or association."   A  racing  corporation  or
 association  or other person owning or operating race meeting grounds or
 enclosures located wholly or partly within the city  of  Staten  Island,
 and/or  a  racing  corporation or association or other person conducting
 race meetings at such grounds or enclosures.
   2.  "Person."  Includes an individual, partnership,  society,  associ-
 ation,  joint-stock  company,  corporation,  estate,  receiver, trustee,
 assignee, referee, or any other person acting in a fiduciary  or  repre-
 sentative  capacity,  whether appointed by a court or otherwise, and any
 combination of individuals.
   3.  "Return."  Includes any return filed or required to  be  filed  as
 herein provided.
   4.  "Comptroller."  The comptroller of the city.
   5.    "Commissioner  of finance."   The commissioner of finance of the
 city.
   6.   "Admissions."   The charge required to be  paid  by  patrons  for
 admission to a running horse race meeting, including any charge required
 to  be  paid  by  such  patrons  for admission to the clubhouse or other
 special facilities within the race meeting grounds or enclosure at which
 the running race meeting is conducted.
   7. "Tax appeals tribunal." The tax  appeals  tribunal  established  by
 section  one hundred sixty-eight of the charter of the preceding munici-
 pality as it existed January first, nineteen hundred ninety-four.
   § 11-1202  Imposition of tax.  A tax is hereby imposed on  all  admis-
 sions  to  running horse race meetings conducted at race meeting grounds
 or enclosures located wholly or partly within the city of Staten  Island
 at the rate of three percent of the admission price.  The racing associ-
 ation  or  corporation conducting a running horse race meeting shall, in
 addition to the admission price, collect such tax on all tickets sold or
 otherwise disposed of to patrons for admission with the  sole  exception
 of  those  issued  free  passes,  cards or badges in accordance with the
 specific authority of the laws of the state of New York.    In  case  of
 failure  to  collect  such  tax  the  tax shall be imposed on the racing
 corporation or association conducting such meeting.
   §  11-1203  Payment of the tax.  a.  The tax imposed by  this  chapter
 shall  be  paid  by the racing corporation or association to the commis-
 sioner of finance daily after each day of each race meeting, by deposit-
 ing it to the account of the city in such bank or banks as may be desig-
 nated by the city in accordance with  the  provisions  of  section  four
 hundred  twenty-one  of  the charter of the preceding municipality as it
 existed January first, nineteen hundred ninety-four or at  such  regular
 intervals as the commissioner of finance may require.
   b.   The amount of the tax paid on admissions pursuant to this chapter
 shall be the property of the city of Staten Island and shall be held  by
 the  racing  corporation or association as trustee for and on account of
 the city of Staten Island and  the  racing  corporation  or  association
 shall  be  liable  for  the tax.   Officers of the racing corporation or
 association shall be personally liable for the tax collected or required
 to be collected hereunder.
   c.  Every racing corporation or association conducting  running  horse
 race  meetings  at  race meeting grounds or enclosures located wholly or
 partly within the city of Staten Island shall, on or before April first,
 S. 8474                            810
 
 nineteen hundred fifty-two and annually thereafter, before  the  opening
 of any race meeting in each year, execute and file with the commissioner
 of  finance  a  bond  issued  by a surety company authorized to transact
 business  in  this state and approved by the superintendent of insurance
 of this state as to solvency and responsibility in an amount  sufficient
 to  secure the payment of the taxes and/or penalties and interest due or
 which may become due pursuant to  this  section,  to  be  fixed  by  the
 commissioner of finance.
   §    11-1204   Returns.   a.   Every racing corporation or association
 shall file with the commissioner of finance daily after each day of each
 race meeting or at such regular intervals as the commissioner of finance
 may require and upon such forms as shall be prescribed  by  the  commis-
 sioner  of finance a return showing the taxes collected pursuant to this
 chapter and the number of persons admitted to meetings conducted by  the
 racing  corporation  or  association  during  the periods covered by the
 return, together with any and all other information  which  the  commis-
 sioner  of  finance  shall  require  to be included and reported in such
 return.  The commissioner of finance may require  at  any  time  supple-
 mental  or  amended returns of such additional information or data as he
 or she may specify.
   b.  Every return required pursuant to this section shall have  annexed
 thereto  an affidavit of an officer of the racing corporation or associ-
 ation to the effect that the statements contained therein are true.
   §  11-1205  Records to be kept and audits by commissioner of finance.
 Every racing corporation or association shall keep such records  as  may
 be  prescribed  by  the  commissioner  of finance, of all admissions and
 taxes collected pursuant to this chapter.  Such records shall be  avail-
 able  for  inspection  and  examination  at  any time upon demand by the
 commissioner of finance or the commissioner's duly authorized agents  or
 employees,  and  such  records  shall be preserved for a period of three
 years, except that the commissioner of  finance  may  consent  to  their
 destruction within that period, and may require that they be kept longer
 than three years.
   §  11-1206  Determination of tax. If a return required by this chapter
 is not filed, or if a return when filed is incorrect or insufficient the
 amount of tax due shall be determined by  the  commissioner  of  finance
 from  such  information  as may be obtainable and, if necessary, the tax
 may be estimated on the basis of external indices,  such  as  number  of
 race  meetings  held, admissions, paid attendance, and/or other factors.
 Notice of such determination shall be given to the person liable for the
 collection and/or payment of the tax.  Such determination shall  finally
 and  irrevocably  fix  the  tax  unless  the  person  against whom it is
 assessed, within ninety days after giving the notice  of  such  determi-
 nation,  or,  if  the  commissioner of finance has established a concil-
 iation procedure pursuant to  section  11-124  of  this  title  and  the
 taxpayer  has  requested  a conciliation conference in accordance there-
 with, within ninety days from the mailing of a conciliation decision  or
 the date of the commissioner's confirmation of the discontinuance of the
 conciliation proceeding, both (1) serves a petition upon the commission-
 er of finance and (2) files a petition with the tax appeals tribunal for
 a  hearing,  or  unless  the  commissioner  of finance of his or her own
 motion shall redetermine the same. Such hearing and any  appeal  to  the
 tax  appeals tribunal sitting en banc from the decision rendered in such
 hearing shall be conducted in the manner and subject to the requirements
 prescribed by the tax appeals tribunal pursuant to sections one  hundred
 sixty-eight  through  one  hundred  seventy-two  of  the  charter of the
 S. 8474                            811
 
 preceding municipality as it existed  January  first,  nineteen  hundred
 ninety-four.  After  such  hearing  the  tax appeals tribunal shall give
 notice of its decision to the person liable  for  the  tax  and  to  the
 commissioner of finance.  A decision of the tax appeals tribunal sitting
 en banc shall be reviewable for error, illegality or unconstitutionality
 or  any  other  reason whatsoever by a proceeding under article seventy-
 eight of the civil practice law and rules  if  application  therefor  is
 made  to  the  supreme  court  by  the  person  against whom the tax was
 assessed within four months after the giving of the notice of  such  tax
 appeals  tribunal decision.  A proceeding under article seventy-eight of
 the civil practice law and rules shall not be  instituted  by  a  person
 liable  for  the  tax unless the amount of any tax sought to be reviewed
 with interest and penalties thereon, if any, shall  be  first  deposited
 with  the  commissioner  of  finance  and  there shall be filed with the
 commissioner of finance an  undertaking,  issued  by  a  surety  company
 authorized to transact business in this state and approved by the super-
 intendent  of insurance of this state as to solvency and responsibility,
 in such amount as a justice of the supreme court shall  approve  to  the
 effect  that  if such proceeding be dismissed or the tax confirmed, such
 person will pay all costs and charges which may  accrue  in  the  prose-
 cution of the proceeding, or at the option of such person such undertak-
 ing filed with the commissioner of finance may be in a sum sufficient to
 cover  the taxes, penalties and interest thereon stated in such decision
 plus the costs and charges which may accrue against  it  in  the  prose-
 cution  of  the  proceeding,  in  which  event  such person shall not be
 required to deposit such taxes, penalties and interest  as  a  condition
 precedent to the application.
   §    11-1207    Refunds. a. In the manner provided in this section the
 commissioner of finance shall refund or credit,  without  interest,  any
 tax,  penalty  or interest erroneously, illegally, or unconstitutionally
 collected or paid if application to the commissioner of finance for such
 refund shall be made within one year from the payment thereof.  Whenever
 a  refund or credit is made or denied by the commissioner of finance, he
 or she shall state his or her reason therefor and give notice thereof to
 the applicant in writing. The commissioner of finance may,  in  lieu  of
 any  refund  required  to be made, allow credit therefor on payments due
 from the applicant.
   b. Any determination of the commissioner of finance denying  a  refund
 or  credit  pursuant to subdivision a of this section shall be final and
 irrevocable unless the applicant for such refund or credit, within nine-
 ty days from the mailing of notice of such  determination,  or,  if  the
 commissioner of finance has established a conciliation procedure, pursu-
 ant  to  section  11-124 of this title and the applicant has requested a
 conciliation conference in accordance therewith, within ninety  days  of
 the mailing of a conciliation decision or the date of the commissioner's
 confirmation  of the discontinuance of the conciliation proceeding, both
 (1) serves a petition upon the commissioner of finance and (2)  files  a
 petition  with the tax appeals tribunal for a hearing. Such petition for
 a refund or credit, made as provided under this section, shall be deemed
 an application for a revision of any tax, penalty or interest complained
 of. Such hearing and any appeal to the tax appeals tribunal  sitting  en
 banc  from  the  decision rendered in such hearing shall be conducted in
 the manner and subject to the requirements prescribed by the tax appeals
 tribunal pursuant to section one hundred sixty-eight through one hundred
 seventy-two of the charter of the preceding municipality as  it  existed
 January first, nineteen hundred ninety-four. After such hearing, the tax
 S. 8474                            812
 
 appeals  tribunal shall give notice of its decision to the applicant and
 to the commissioner of finance.  The  applicant  shall  be  entitled  to
 institute  a  proceeding  pursuant to article seventy-eight of the civil
 practice  law and rules to review a decision of the tax appeals tribunal
 sitting en banc, provided such  proceeding  is  instituted  within  four
 months after the giving of the notice of such decision, and provided, in
 the  case of an application by a person liable for the tax, that a final
 determination of tax due was not  previously  made.  Such  a  proceeding
 shall  not be instituted by a person liable for the tax unless an under-
 taking is filed with the commissioner of finance in such amount and with
 such sureties as a justice of the supreme court  shall  approve  to  the
 effect  that  if such proceeding be dismissed or the tax confirmed, such
 person will pay all costs and charges which may  accrue  in  the  prose-
 cution of such proceeding.
   c.  A  person  shall  not  be entitled to a revision, refund or credit
 under this section of a tax, interest or penalty which has  been  deter-
 mined  to  be  due pursuant to the provisions of section 11-1206 of this
 chapter where such person has had a hearing  or  an  opportunity  for  a
 hearing,  as provided in said section, or has failed to avail himself or
 herself of the remedies therein provided. No refund or credit  shall  be
 made  of  a  tax,  interest or penalty paid after a determination by the
 commissioner of finance made pursuant to section 11-1206 of this chapter
 unless it be found that such determination  was  erroneous,  illegal  or
 unconstitutional  or  otherwise  improper,  by  the tax appeals tribunal
 after a hearing or of the commissioner's own motion,  or,  if  such  tax
 appeals  tribunal  affirms  in whole or in part the determination of the
 commissioner of finance, in a proceeding under article seventy-eight  of
 the  civil  practice  law  and rules, pursuant to the provisions of said
 section, in which event refund or credit without interest shall be  made
 of the tax, interest or penalty found to have been overpaid.
   §    11-1208    Reserves.    In cases where a person has applied for a
 refund and has instituted a proceeding under  article  seventy-eight  of
 the  civil  practice  law and rules to review a determination adverse to
 such person on his or her application for refund, the comptroller  shall
 set up appropriate reserves to meet any decision adverse to the city.
   §  11-1209  Remedies  exclusive.  The  remedies  provided  by sections
 11-1206 and 11-1207 of this chapter shall be exclusive  remedies  avail-
 able to any person for the review of tax liability imposed by this chap-
 ter,  and  no determination or proposed determination of tax or determi-
 nation on any application for refund by the commissioner of finance, nor
 any decision by the tax appeals tribunal or any  of  its  administrative
 law  judges,  shall be enjoined or reviewed by an action for declaratory
 judgment, an action for money had and  received  or  by  any  action  or
 proceeding  other  than,  in  the  case of a decision by the tax appeals
 tribunal sitting en banc, a proceeding in the  nature  of  a  certiorari
 proceeding  under  article  seventy-eight  of the civil practice law and
 rules; provided, however, that such person may  proceed  by  declaratory
 judgment if such person institutes suit within ninety days after a defi-
 ciency  assessment is made and pays the amount of the deficiency assess-
 ment to the commissioner of finance prior to  the  institution  of  such
 suit  and  posts a bond for costs as provided in section 11-1206 of this
 chapter.
   §  11-1210   Proceedings to recover tax.   a.    Whenever  any  racing
 corporation  or  association  or any of its officers or any other person
 shall fail to collect and pay over any tax or to pay any tax, penalty or
 interest imposed by this chapter as therein  provided,  the  corporation
 S. 8474                            813
 
 counsel  shall, upon the request of the commissioner of finance bring or
 cause to be brought an action to enforce the  payment  of  the  same  on
 behalf  of  the  city  of Staten Island in any court of the state of New
 York  or  of  any other state or of the United States.  If, however, the
 commissioner of finance in his or her discretion believes that a  person
 subject  to  the  provisions of this chapter is about to cease business,
 leave the state or remove or dissipate the assets out of which  the  tax
 or  penalties  might be satisfied, and that any such tax or penalty will
 not be paid when due, the commissioner of finance may declare  such  tax
 or  penalty  to  be  immediately due and payable and may issue a warrant
 immediately.
   b.  As an additional or alternate remedy, the commissioner of  finance
 may issue a warrant, directed to the city sheriff commanding the sheriff
 to  levy  upon  and  sell  the  real and personal property of the racing
 corporation or association or its officers or any other person which may
 be found within the city, for the payment of the  amount  thereof,  with
 any  penalties  and interest, and the cost of executing the warrant, and
 to return such warrant to the commissioner of finance and to pay to  the
 commissioner  of  finance  the  money collected by virtue thereof within
 sixty days after the receipt of such warrant.   The city  sheriff  shall
 within  five  days after the receipt of the warrant file with the county
 clerk a copy thereof, and thereupon such clerk shall enter in the  judg-
 ment  docket  the  name  of  the person mentioned in the warrant and the
 amount of the tax, penalties and  interest  for  which  the  warrant  is
 issued  and  the  date when such copy is filed.  Thereupon the amount of
 such warrant so docketed shall become a  lien  upon  the  title  to  and
 interest  in  real  and personal property of the person against whom the
 warrant is issued.  The city sheriff shall then proceed upon the warrant
 in the same manner, and with like effect, as that  provided  by  law  in
 respect  to executions issued against property upon judgments of a court
 of record and for services in executing the warrants  the  city  sheriff
 shall  be  entitled to the same fees, which the city sheriff may collect
 in the same manner.  In the discretion of the commissioner of finance  a
 warrant  of  like  terms, force and effect may be issued and directed to
 any officer or employee  of  the  department  of  finance,  and  in  the
 execution  thereof  such  officer  or employee shall have all the powers
 conferred by law upon sheriffs, but shall  be  entitled  to  no  fee  or
 compensation in excess of the actual expenses paid in the performance of
 such  duty.  If a warrant is returned not satisfied in full, the commis-
 sioner of finance may from time to time issue  new  warrants  and  shall
 also  have  the same remedies to enforce the amount due thereunder as if
 the city had recovered judgment therefor and execution thereon had  been
 returned unsatisfied.
   c.   Whenever a corporation or association shall make a sale, transfer
 or assignment in bulk or any part or  the  whole  of  its  race  meeting
 grounds  or  enclosures  and the building and structures thereon, or its
 lease, license or other agreement or right to possess  or  operate  such
 race  meeting  grounds  or  enclosures  or  of the equipment, machinery,
 fixtures or supplies, or of the said race meeting grounds or  enclosures
 and  the  building  and  structures  thereon, or lease, license or other
 agreement or right to possess or operate such race  meeting  grounds  or
 enclosures,  and the equipment, machinery, fixtures or supplies pertain-
 ing to the conduct or the operation of the said race meeting grounds  or
 enclosures,  otherwise  than  in the ordinary course of trade and in the
 regular prosecution of  said  business,  the  purchaser,  transferee  or
 assignee  shall  at least ten days before taking possession of such race
 S. 8474                            814
 
 meeting grounds or enclosures and the building and  structures  thereon,
 or lease, license or other agreement or right to possess or operate such
 race meeting grounds or enclosures or the equipment, machinery, fixtures
 or  supplies,  or of the said race meeting grounds or enclosures and the
 building and structures thereon, or lease, license or other agreement or
 right to possess or operate such race meeting grounds or enclosures, and
 the equipment, machinery, fixtures or supplies or paying thereof, notify
 the commissioner of finance by registered mail of the proposed sale  and
 of  the  price,  terms and conditions thereof whether or not the seller,
 transferor or assignor, has represented to, or informed  the  purchaser,
 transferee or assignee that it owes any tax pursuant to this chapter and
 whether  or not the purchaser, transferee or assignee has knowledge that
 such taxes are owing, and whether any such taxes are in fact owing.
   Whenever the purchaser, transferee or  assignee  shall  fail  to  give
 notice  to  the commissioner of finance as required by the opening para-
 graph of this subdivision, or whenever the commissioner of finance shall
 inform the purchaser, transferee or assignee that a possible  claim  for
 such  tax  or  taxes  exists,  any  sums of money, property or choses in
 action, or other  consideration,  which  the  purchaser,  transferee  or
 assignee  is  required  to  transfer  over  to the seller, transferor or
 assignor shall be subject to a first priority right  and  lien  for  any
 such taxes theretofore or thereafter determined to be due from the sell-
 er, transferor or assignor to the city, and the purchaser, transferee or
 assignee  is forbidden to transfer to the seller, transferor or assignor
 any such sums of money, property or choses in action to  the  extent  of
 the  amount  of  the  city's  claim.    For  failure  to comply with the
 provisions of this subdivision, the purchaser, transferee  or  assignee,
 in  addition  to  being  subject to the liabilities and remedies imposed
 under the provisions of former article six  of  the  uniform  commercial
 code, shall be personally liable for the payment to the city of any such
 taxes  theretofore  or  thereafter determined to be due to the city from
 the seller, transferor or assignor, and such liability may  be  assessed
 and  enforced  in  the  same  manner as the liability for tax under this
 chapter.
   d. The commissioner of finance, if he or she finds that the  interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the  commissioner  of finance may require, may release any property from
 the lien of any warrant or vacate such warrant for unpaid  taxes,  addi-
 tions  to tax, penalties and interest filed pursuant to subdivision b of
 this section, and such  release  or  vacating  of  the  warrant  may  be
 recorded  in  the  office of any recording officer in which such warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   § 11-1211 General powers of the commissioner of finance.  In  addition
 to  the  powers  granted to the commissioner of finance in this chapter,
 such commissioner is hereby authorized and empowered:
   1.  To make, adopt and amend rules and regulations appropriate to  the
 carrying out of this chapter and the purposes thereof;
   2.    To extend, for cause shown, the time for filing any return for a
 period not exceeding thirty days; and to compromise disputed  claims  in
 connection with the taxes hereby imposed;
   3.    To  request  information  from the racing commission and the tax
 commission of the state of New York, or any other state or the  treasury
 department  of  the  United States relative to any person; and to afford
 information to such commission or such treasury department  relative  to
 S. 8474                            815

 any person, any other provision of this chapter to the contrary notwith-
 standing;
   4.    To  delegate his or her functions under this section to a deputy
 commissioner of finance or any employee or employees of  the  department
 of finance;
   5.   To prescribe methods for determining the amount of the admissions
 and for determining the tax;
   6.  To require racing corporations or associations  to  keep  detailed
 records  of all race meetings and all attendance thereat, and to furnish
 such information upon request to the commissioner of finance;
   7.  To require that the amount of the tax be  printed,  separate  from
 the price of admission, on tickets of admission.
   §   11-1212   Administration of oaths and compelling testimony. a. The
 commissioner of finance, his or her employees or agents duly  designated
 and  authorized by the commissioner of finance, the tax appeals tribunal
 and any of its duly designated and authorized employees or agents  shall
 have  power  to  administer oaths and take affidavits in relation to any
 matter or proceeding in the exercise of their powers  and  duties  under
 this  chapter.  The commissioner of finance and the tax appeals tribunal
 shall have power to subpoena and require the attendance of witnesses and
 the production of books, papers  and  documents  to  secure  information
 pertinent to the performance of the duties of the commissioner or of the
 tax  appeals  tribunal under this section and of the enforcement of this
 chapter and to examine them in relation thereto, and  to  issue  commis-
 sions  for  the  examination  of  witnesses  who are out of the state or
 unable to attend before the commissioner of finance or the  tax  appeals
 tribunal or excused from attendance.
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 testimony  of  witnesses  and  the  production and examination of books,
 papers and documents called for by the subpoena of the  commissioner  of
 finance or the tax appeals tribunal under this chapter.
   c. Cross-reference; criminal penalties.  For failure to obey subpoenas
 or  for  testifying  falsely,  see  section  11-4007  of this title; for
 supplying false or fraudulent information, see section 11-4009  of  this
 title.
   d.  The officers who serve the summons or subpoena of the commissioner
 of finance or the  tax  appeals  tribunal  and  witnesses  attending  in
 response  thereto  shall  be entitled to the same fees as are allowed to
 officers and witnesses in civil cases in courts  of  record,  except  as
 herein  otherwise  provided. Such officers shall be the city sheriff and
 his or her duly appointed deputies, or any officers or employees of  the
 department  of  finance or the tax appeals tribunal, designated to serve
 such process.
   § 11-1213 Interest and penalties. (a) Interest on underpayments.    If
 any  amount  of  tax is not paid over or paid on or before the last date
 prescribed for payment, without regard to any extension of time  granted
 for payment, interest on such amount at the rate set by the commissioner
 of  finance  pursuant to subdivision (g) of this section, or, if no rate
 is set, at the rate of seven and one-half percent per  annum,  shall  be
 paid  for  the  period  from  such  last date to the date of payment. In
 computing the amount of interest to be  paid,  such  interest  shall  be
 compounded  daily.  Interest under this subdivision shall not be paid if
 the amount thereof is less than one dollar.
   (b) (1) Failure to file return.   (A) In case of  failure  to  file  a
 return  under  this chapter on or before the prescribed date, determined
 S. 8474                            816
 
 with regard to any extension of time for filing, unless it is shown that
 such failure is due to reasonable cause and not due to willful  neglect,
 there  shall  be added to the amount required to be shown as tax on such
 return  five percent of the amount of such tax if the failure is for not
 more than one month, with an additional five percent for each additional
 month or fraction thereof  during  which  such  failure  continues,  not
 exceeding twenty-five percent in the aggregate.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to  any extension of time for filing, unless it is shown that such fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion to tax under subparagraph (A) of this paragraph shall not  be  less
 than  the  lesser  of  one hundred dollars or one hundred percent of the
 amount required to be shown as tax on such return.
   (C) For purposes of this paragraph, the amount of tax required  to  be
 shown  on  the  return shall be reduced by the amount of any part of the
 tax which is paid on or before the date prescribed for  payment  of  the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2) Failure to pay tax shown on return.  In case of failure to pay the
 amount  shown as tax on a return required to be filed under this chapter
 on or before the prescribed date, determined with regard to  any  exten-
 sion of time for payment, unless it is shown that such failure is due to
 reasonable cause and not due to willful neglect, there shall be added to
 the  amount  shown  as tax on such return one-half of one percent of the
 amount of such tax if the failure is not for more than one  month,  with
 an additional one-half of one percent for each additional month or frac-
 tion  thereof during which such failure continues, not exceeding twenty-
 five percent in the aggregate. For the purpose of computing the addition
 for any month the amount of tax shown on the return shall be reduced  by
 the  amount of any part of the tax which is paid on or before the begin-
 ning of such month and by the amount of any credit against the tax which
 may be claimed upon the return. If the amount  of  tax  required  to  be
 shown  on  a return is less than the amount shown as tax on such return,
 this paragraph shall be applied by substituting such lower amount.
   (3) Failure to pay tax required to be shown on return.    In  case  of
 failure  to pay any amount in respect of any tax required to be shown on
 a return required to be filed under this chapter which is not so  shown,
 including a determination made pursuant to section 11-1206 of this chap-
 ter, within ten days of the date of a notice and demand therefor, unless
 it  is shown that such failure is due to reasonable cause and not due to
 willful neglect, there shall be added to the amount  of  tax  stated  in
 such  notice and demand one-half of one percent of such tax if the fail-
 ure is not for more than one month, with an additional one-half  of  one
 percent  for each additional month or fraction thereof during which such
 failure continues, not exceeding twenty-five percent in  the  aggregate.
 For  the  purpose of computing the addition for any month, the amount of
 tax stated in the notice and demand shall be reduced by  the  amount  of
 any part of the tax which is paid before the beginning of such month.
   (4)  Limitations  on  additions.  (A)  With respect to any return, the
 amount of the addition under paragraph one of this subdivision shall  be
 reduced by the amount of the addition under paragraph two of this subdi-
 vision  for any month to which an addition applies under both paragraphs
 one and two.  In any case described in subparagraph (B) of paragraph one
 of this subdivision, the amount of the addition under such paragraph one
 shall not be reduced below the amount provided in such subparagraph.
 S. 8474                            817
 
   (B) With respect to any return, the maximum  amount  of  the  addition
 permitted  under paragraph three of this subdivision shall be reduced by
 the amount of the addition under  paragraph  one  of  this  subdivision,
 determined  without  regard  to  subparagraph (B) of such paragraph one,
 which is attributable to the tax for which the notice and demand is made
 and which is not paid within ten days of such notice and demand.
   (c)  Underpayment  due to negligence.  (1) If any part of an underpay-
 ment of tax is due to negligence or intentional disregard of this  chap-
 ter  or  any  rules  or  regulations  hereunder,  but  without intent to
 defraud, there shall be added to the tax a penalty equal to five percent
 of the underpayment.
   (2) There shall be added to the tax, in addition to the amount  deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under subdivision (a)  of  this  section
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to the negligence or intentional  disre-
 gard  referred to in such paragraph one, for the period beginning on the
 last date prescribed by law for payment of such underpayment, determined
 without regard to any extension, and ending on the date of  the  assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
   (d)  Underpayment due to fraud.  (1) If any part of an underpayment of
 tax is due to fraud, there shall be added to the tax a penalty equal  to
 fifty percent of the underpayment.
   (2) There shall be added to the tax, in addition to the penalty deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under subdivision (a)  of  this  section
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to fraud, for the  period  beginning  on
 the  last day prescribed by law for payment of such underpayment, deter-
 mined without regard to any extension, and ending on  the  date  of  the
 assessment  of  the  tax, or, if earlier, the date of the payment of the
 tax.
   (3) The penalty under this subdivision shall be in lieu of  any  other
 addition to tax imposed by subdivision (b) or (c) of this section.
   (e) Additional penalty.  Any person who, with fraudulent intent, shall
 fail to pay any tax imposed by this chapter, or to make, render, sign or
 certify  any  return,  or  to  supply  any  information  within the time
 required by or under this chapter, shall be liable for a penalty of  not
 more  than  one  thousand  dollars,  in  addition  to  any other amounts
 required under this chapter to be imposed, assessed and collected by the
 commissioner of finance. The commissioner  of  finance  shall  have  the
 power,  in  his  or  her  discretion, to waive, reduce or compromise any
 penalty under this subdivision.
   (f) The interest and penalties imposed by this section shall  be  paid
 and  disposed of in the same manner as other revenues from this chapter.
 Unpaid interest and penalties may be enforced in the same manner as  the
 tax imposed by this chapter.
   (g)(1)  Authority  to set interest rates.  The commissioner of finance
 shall set the rate of interest to be paid pursuant to subdivision (a) of
 this section, but if no such rate of interest is set, such rate shall be
 deemed to be set at seven and one-half percent per  annum.    Such  rate
 shall  be  the  rate prescribed in paragraph two of this subdivision but
 shall not be less than seven and one-half percent per  annum.  Any  such
 rate  set  by  the  commissioner of finance shall apply to taxes, or any
 portion thereof, which remain or become due on  or  after  the  date  on
 which  such  rate becomes effective and shall apply only with respect to
 S. 8474                            818
 
 interest computed or computable  for  periods  or  portions  of  periods
 occurring in the period in which such rate is in effect.
   (2)  General  rule.  The  rate  of interest set under this subdivision
 shall be the sum of (i) the federal short-term rate  as  provided  under
 paragraph three of this subdivision, plus (ii) seven percentage points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A)  The  federal  short-term  rate for any month shall be the federal
 short-term rate determined by the United States secretary of the  treas-
 ury  during  such  month  in  accordance  with subsection (d) of section
 twelve hundred seventy-four of the internal  revenue  code  for  use  in
 connection  with  section  six  thousand  six  hundred twenty-one of the
 internal revenue code. Any such rate shall be  rounded  to  the  nearest
 full  percent,  or,  if a multiple of one-half of one percent, such rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i) In general. Except as provided in clause  (ii)  of  this  subpara-
 graph,  the federal short-term rate for the first month in each calendar
 quarter shall apply during the first calendar  quarter  beginning  after
 such month.
   (ii)  Special rule for the month of September, nineteen hundred eight-
 y-nine. The federal short-term rate for the  month  of  April,  nineteen
 hundred  eighty-nine  shall  apply  with  respect to setting the rate of
 interest for the month of September, nineteen hundred eighty-nine.
   (4) Publication of interest rate. The commissioner  of  finance  shall
 cause  to  be  published  in the City Record, and give other appropriate
 general notice of, the interest rate to be set under this subdivision no
 later than twenty days preceding the first day of the  calendar  quarter
 during  which such interest rate applies. The setting and publication of
 such interest rate shall not be included within paragraph (a) of  subdi-
 vision five of section one thousand forty-one of the city charter of the
 preceding  municipality  as  it  existed January first, nineteen hundred
 ninety-four relating to the definition of a rule.
   (h) Miscellaneous. (1) Officers of a racing corporation or association
 shall be personally liable for the  tax  collected  or  required  to  be
 collected  under  this  chapter, and subject to the penalties imposed by
 this section.
   (2) The certificate of the commissioner of finance to the effect  that
 a  tax  has  not been paid, that a return or bond has not been filed, or
 that information has not been supplied pursuant  to  the  provisions  of
 this chapter, shall be presumptive evidence thereof.
   (3) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   §  11-1214   Returns to be secret. a. Except in accordance with proper
 judicial order, or as otherwise provided by law, it  shall  be  unlawful
 for the commissioner of finance or the tax appeals tribunal or any offi-
 cer or employee of the department of finance to divulge or make known in
 any manner any of the information relating to the business of any person
 contained  in  any  return  required  under this chapter.   The officers
 charged with the custody of  such  returns  shall  not  be  required  to
 produce  any  of  them  or evidence of anything contained in them in any
 action or proceeding in any court, except on behalf of the  commissioner
 of finance in an action or proceeding under the provisions of this chap-
 ter,  or  on  behalf  of any party to any action or proceeding under the
 provisions of this chapter, when the returns or facts shown thereby  are
 directly  involved  in  such  action  or  proceeding, in either of which
 events the courts may require  the  production  of,  and  may  admit  in
 S. 8474                            819

 evidence,  so much of said returns or of the facts shown thereby, as are
 pertinent to the action or proceeding and no more. The  commissioner  of
 finance  may,  nevertheless, publish a copy or a summary of any determi-
 nation  or  decision  rendered  after  a formal hearing held pursuant to
 section 11-1206 or 11-1207 of this  chapter.  Nothing  in  this  section
 shall be construed to prohibit the delivery to a person or such person's
 duly  authorized  representative of a certified copy of any return filed
 by such person nor to prohibit the publication of statistics so  classi-
 fied  as  to  prevent  the  identification of particular returns and the
 items thereof, or the inspection by the  corporation  counsel  or  other
 legal  representatives of the city, or by the district attorney of Rich-
 mond county, of the return of any person who shall bring action  to  set
 aside  or  review  the  tax  based thereon, or against whom an action or
 proceeding has been instituted for the collection of a tax  or  penalty.
 Returns  shall  be  preserved  for  three years and thereafter until the
 commissioner of finance permits them to be destroyed.
   b. (1)  Any officer or employee of the city who willfully violates the
 provisions of subdivision a of this  section  shall  be  dismissed  from
 office  and be incapable of holding any public office in this city for a
 period of five years thereafter.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   c. This section  shall be deemed a state statute for purposes of para-
 graph (a) of subdivision two of section eighty-seven of the public offi-
 cers law.
   d. Notwithstanding anything in subdivision a of this  section  to  the
 contrary,  if  a  taxpayer  has  petitioned the tax appeals tribunal for
 administrative review as provided in section one hundred seventy of  the
 charter of the preceding municipality as it existed January first, nine-
 teen  hundred  ninety-four, the commissioner of finance shall be author-
 ized to present to the tribunal any report or return of  such  taxpayer,
 or  any  information contained therein or relating thereto, which may be
 material or relevant to the proceeding  before  the  tribunal.  The  tax
 appeals  tribunal  shall be authorized to publish a copy or a summary of
 any decision rendered pursuant to section one hundred seventy-one of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four.
   §  11-1215  Notices and limitations of time.  a.   Any notice  author-
 ized  or  required  under the provisions of this chapter may be given by
 mailing the same to the person for whom it is  intended  in  a  postpaid
 envelope  addressed  to  such  person  at  the address given in the last
 return filed by such person pursuant to the provisions of  this  chapter
 or in any application made by such person or if no return has been filed
 or  application  made,  then  to such address as may be obtainable.  The
 mailing of such notice shall be presumptive evidence of the  receipt  of
 the  same  by the person to whom addressed.  Any period of time which is
 determined according to the provisions of this chapter by the giving  of
 notice shall commence to run from the date of mailing of such notice.
   b.    The  provisions of the civil practice law and rules or any other
 law relative to limitations of time for the enforcement of a civil reme-
 dy shall not apply to any proceeding or action  taken  by  the  city  to
 levy,  appraise,  assess, determine or enforce the collection of any tax
 or penalty provided by this chapter.  However, except in the case  of  a
 wilfully  false  or  fraudulent  return with intent to evade the tax, no
 assessment of additional tax shall be made after the expiration of  more
 than three years from the date of the filing of a return, provided, that
 S. 8474                            820
 
 where  no  return  has  been  filed  as  provided  by law the tax may be
 assessed at any time.
   c.    Where, before the expiration of the period prescribed under this
 section for the assessment of an additional tax, a person has  consented
 in  writing  that such period be extended, the amount of such additional
 tax due may be determined at any time within such extended period.   The
 period  so  extended  may  be further extended by subsequent consents in
 writing made before the expiration of the extended period.
   d. If any return, claim,  statement,  notice,  application,  or  other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 of  any  provision  of  this chapter is, after such period or such date,
 delivered by United States mail to the commissioner of finance, the  tax
 appeals  tribunal,  bureau, office, officer or person with which or with
 whom such document is required to be filed, or to which or to whom  such
 payment  is  required to be made, the date of the United States postmark
 stamped on the envelope shall be deemed to be the date of delivery. This
 subdivision shall apply only if  the  postmark  date  falls  within  the
 prescribed  period or on or before the prescribed date for the filing of
 such document, or for making the payment, including any extension grant-
 ed for such filing or payment, and only if such document or payment  was
 deposited  in  the  mail,  postage  prepaid,  properly  addressed to the
 commissioner of finance, bureau, office, officer or person with which or
 with whom the document is required to be filed or to which  or  to  whom
 such  payment  is required to be made. If any document is sent by United
 States registered mail, such registration shall be prima facie  evidence
 that such document was delivered to the commissioner of finance, the tax
 appeals  tribunal, bureau, office, officer or person to which or to whom
 addressed, and the date of registration shall  be  deemed  the  postmark
 date.  The  commissioner  of finance or, where relevant, the tax appeals
 tribunal is authorized to provide by regulation the extent to which  the
 provisions  of  the  preceding  sentence  with  respect  to  prima facie
 evidence of delivery and the postmark  date  shall  apply  to  certified
 mail. Except as provided in subdivision f of this section, this subdivi-
 sion  shall apply in the case of postmarks not made by the United States
 postal service only if and to the extent provided by regulation  of  the
 commissioner of finance or, where relevant, the tax appeals tribunal.
   e.  When  the  last  day  prescribed  under authority of this chapter,
 including any extension of time, for  performing  any  act  falls  on  a
 Saturday,  Sunday or legal holiday in the state, the performance of such
 act shall be considered timely if it is performed on the next succeeding
 day which is not a Saturday, Sunday or legal holiday.
   f. (1) Any reference in subdivision d of this section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the secretary of the treasury of the United States
 pursuant to section seventy-five hundred two  of  the  internal  revenue
 code  and  any  reference  in  subdivision d of this section to a United
 States postmark shall be treated as including a reference  to  any  date
 recorded  or  marked  in  the  manner  described in section seventy-five
 hundred two of the  internal  revenue  code  by  a  designated  delivery
 service.  If the commissioner of finance finds that any delivery service
 designated by such secretary is inadequate for the needs  of  the  city,
 the  commissioner  of finance may withdraw such designation for purposes
 of this title. The commissioner of finance may also designate additional
 delivery services meeting the criteria of section  seventy-five  hundred
 two  of  the  internal  revenue  code for purposes of this title, or may
 S. 8474                            821
 
 withdraw any such designation if the commissioner of finance finds  that
 a  delivery  service  so  designated  is inadequate for the needs of the
 city. Any reference in subdivision d  of  this  section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the commissioner of finance and any  reference  in
 subdivision  d  of  this  section  to  a United States postmark shall be
 treated as including a reference to any date recorded or marked  in  the
 manner  described  in  section  seventy-five hundred two of the internal
 revenue code by a delivery service designated  by  the  commissioner  of
 finance.  Notwithstanding  the  provisions  of this paragraph, any with-
 drawal of designation or additional designation by the  commissioner  of
 finance  shall  not  be  effective  for purposes of service upon the tax
 appeals tribunal, unless and until such  withdrawal  of  designation  or
 additional  designation  is ratified by the president of the tax appeals
 tribunal.
   (2) Any equivalent of registered or certified mail designated  by  the
 United  States secretary of the treasury, or as may be designated by the
 commissioner of finance pursuant to  the  same  criteria  used  by  such
 secretary for such designations pursuant to section seventy-five hundred
 two  of  the internal revenue code, shall be included within the meaning
 of registered or certified  mail  as  used  in  subdivision  d  of  this
 section.  If  the  commissioner  of finance finds that any equivalent of
 registered or certified mail designated by such secretary or the commis-
 sioner of finance is inadequate for the needs of the city,  the  commis-
 sioner  of  finance  may  withdraw such designation for purposes of this
 title. Notwithstanding the foregoing, any withdrawal of  designation  or
 additional  designation  by  the  commissioner  of  finance shall not be
 effective for purposes of service upon the tax appeals tribunal,  unless
 and  until  such  withdrawal of designation or additional designation is
 ratified by the president of the tax appeals tribunal.
   §  11-1216  Disposition of revenues.  All revenues resulting from  the
 imposition  of  the  tax  under  this chapter at race meeting grounds or
 enclosures located wholly within the city  of  Staten  Island  shall  be
 credited and deposited in the general fund of the city.
 
                                CHAPTER 13
                               CIGARETTE TAX
   §  11-1301  Definitions. When used in this chapter the following words
 shall have the meanings herein indicated:
   1. "Cigarette." (a) Any roll for smoking made wholly  or  in  part  of
 tobacco  or  any  other  substance  wrapped  in  paper  or  in any other
 substance not containing tobacco, and (b)  any  roll  for  smoking  made
 wholly or in part of tobacco wrapped in any substance containing tobacco
 which,  because  of  its  appearance,  the  type  of tobacco used in the
 filler, or its packaging and labeling, is likely to be  offered  to,  or
 purchased  by,  consumers  as  a cigarette described in paragraph (a) of
 this subdivision. However, a roll will not be considered to be  a  ciga-
 rette  for  purposes  of  paragraph (b) of this subdivision if it is not
 treated as a cigarette for federal excise tax purposes under the  appli-
 cable  federal  statute  in  effect  on April first, two thousand eight.
 "Cigarette" shall not include a research tobacco product.
   2. "Person." Any individual, partnership, society, association, joint-
 stock company, corporation, estate, receiver, trustee, assignee, referee
 or any other person acting in a fiduciary  or  representative  capacity,
 S. 8474                            822
 
 whether  appointed by a court or otherwise, and any combination of indi-
 viduals.
   3.  "Sale  or  purchase." Any transfer of title or possession or both,
 exchange or barter, conditional or otherwise, in any manner  or  by  any
 means whatsoever or any agreement therefor.
   4.  "Use."  Any  exercise of a right or power, actual or constructive,
 and shall include but is not limited to the  receipt,  storage,  or  any
 keeping  or  retention  for  any  length  of time, but shall not include
 possession for sale by a dealer.
   5. "Dealer." Any wholesale dealer  or  retail  dealer  as  defined  in
 subdivisions six and seven of this section.
   6.  "Wholesale  dealer."  Any  person  who sells cigarettes or tobacco
 products to retail dealers or other persons for purposes of resale only,
 and any person who owns, operates or maintains  one  or  more  cigarette
 vending  machines in, at or upon premises owned or occupied by any other
 person.
   7. "Retail dealer." Any person other than a wholesale  dealer  engaged
 in  selling  cigarettes  or  tobacco  products. For the purposes of this
 chapter, the possession or transportation at any one time of five  thou-
 sand  or more cigarettes or little cigars, or more than fifty cigars, or
 more than one pound of loose tobacco, smokeless tobacco, snus or shisha,
 or any combination thereof, by any person other than a manufacturer,  an
 agent,  a licensed wholesale dealer or a person delivering cigarettes or
 tobacco products in the regular course of business for  a  manufacturer,
 an  agent or a licensed wholesale or retail dealer, shall be presumptive
 evidence that such person is a retail dealer.
   8. "Package." The individual package, box or  other  container  in  or
 from  which  retail sales of cigarettes are normally made or intended to
 be made.
   9. "Agent." Any person authorized to purchase and  affix  adhesive  or
 meter  stamps  under  this  chapter who is designated as an agent by the
 commissioner of finance.
   10. "Comptroller." The comptroller of the city.
   11. "Commissioner of finance." The  commissioner  of  finance  of  the
 city.
   12. "City." The city of Staten Island.
   13.  "Tax  appeals  tribunal." The tax appeals tribunal established by
 section one hundred sixty-eight of the charter of the preceding  munici-
 pality as it existed January first, nineteen hundred ninety-four.
   14.  "Cigar."  Any roll of tobacco for smoking that is wrapped in leaf
 tobacco or in any substance containing tobacco, with or without a tip or
 mouthpiece. Cigar does not include a little cigar  as  defined  in  this
 section.
   15. "Little cigar." Any roll of tobacco for smoking that is wrapped in
 leaf  tobacco  or in any substance containing tobacco and that weighs no
 more than four pounds per thousand or has a cellulose acetate  or  other
 integrated filter.
   16.  "Loose  tobacco."  Any  product  that consists of loose leaves or
 pieces of tobacco that is intended for use by consumers in a pipe, roll-
 your-own cigarette, or similar product or device.
   17. "Smokeless tobacco." Any tobacco product  that  consists  of  cut,
 ground,  powdered,  or leaf tobacco and that is intended to be placed in
 the oral or nasal cavity.
   18. "Snus." Any smokeless tobacco product marketed and sold  as  snus,
 and sold in ready-to-use pouches or loose as a moist powder.
 S. 8474                            823
 
   19.  "Tobacco  product."  Any  product  which contains tobacco that is
 intended for human consumption, including any component, part, or acces-
 sory of such product. Tobacco product shall include, but not be  limited
 to,  any  cigar, little cigar, chewing tobacco, pipe tobacco, roll-your-
 own  tobacco, snus, bidi, snuff, shisha, or dissolvable tobacco product.
 Tobacco product shall not include cigarettes or  any  product  that  has
 been approved by the United States food and drug administration for sale
 as  a  tobacco  use  cessation product or for other medical purposes and
 that is being marketed and  sold  solely  for  such  purposes.  "Tobacco
 products" shall not include research tobacco products.
   20.  "Shisha."  Any  product  that  contains  tobacco and is smoked or
 intended to be smoked in a hookah or water pipe.
   21. "Research tobacco product." A tobacco product or cigarette that is
 labeled as a research  tobacco  product,  is  manufactured  for  use  in
 research  for  health,  scientific, or similar experimental purposes, is
 exclusively used for such purposes by an accredited college,  university
 or  hospital,  or  a  researcher  affiliated with an accredited college,
 university or hospital, and is not offered for sale or sold to consumers
 for any purpose.
   §  11-1302  Imposition of tax.  a.  There is hereby imposed and  shall
 be paid a tax on:
   1.    All cigarettes possessed in the city for sale except as provided
 in this section;
   2.  The use of all cigarettes in the city except as provided  in  this
 section;
   3. It is intended that the ultimate incidence of and liability for the
 tax shall be upon the consumer, and that any agent, distributor or deal-
 er  who  shall  pay the tax to the commissioner of finance shall collect
 the tax from the purchaser or consumer. Such tax shall be at the rate of
 four cents for each ten cigarettes or fraction thereof, provided, howev-
 er, that if a package of cigarettes  contains  more  than  twenty  ciga-
 rettes,  the  rate of tax on the cigarettes in such package in excess of
 twenty shall be two cents for each five cigarettes or fraction  thereof.
 Provided  further,  however, that on and after July second, two thousand
 two, such tax shall be at the rate of seventy-five cents  for  each  ten
 cigarettes  or fraction thereof, provided, however, that if a package of
 cigarettes contains more than twenty cigarettes, the rate of tax on  the
 cigarettes  in  such  package  in excess of twenty shall be thirty-eight
 cents for each five cigarettes or fraction thereof. Such  tax  shall  be
 imposed only once on the same package of cigarettes.
   b.  The tax imposed by this section shall not apply to:
   1.    The  use, otherwise than for sale, of four hundred cigarettes or
 less brought into the city, on or in possession of, any person;
   2.  Cigarettes sold to the United States;
   3.  Cigarettes sold to or by a voluntary  unincorporated  organization
 of  the armed forces of the United States operating a place for the sale
 of goods pursuant to regulations promulgated by the  appropriate  execu-
 tive agency of the United States;
   4.   Cigarettes possessed in the city by any agent or wholesale dealer
 for sale to a dealer outside the city or for sale and  shipment  to  any
 person  in another state for use there, provided such agent or wholesale
 dealer complies with the regulations relating thereto.
   c.  The tax imposed under this section shall be in addition to any and
 all other taxes.
   d.  It shall be presumed that all sales  or  uses  mentioned  in  this
 section  are  subject  to tax until the contrary is established, and the
 S. 8474                            824
 
 burden of proof that a sale or use is not  taxable  under  this  section
 shall be upon the vendor or the purchaser.
   e.  Except  as provided in this section, the tax shall be advanced and
 paid by the agent or distributor.   The agent shall be  liable  for  the
 collection  and  payment  of  the  tax to the commissioner of finance by
 purchasing from the commissioner of  finance  adhesive  stamps  of  such
 design  and  denomination  as  may  be  prescribed by such commissioner,
 subject to the approval  of  the  state  commissioner  of  taxation  and
 finance.   The tax may also be paid by the use of such metering machines
 as are prescribed by the commissioner of finance subject to the approval
 of the state commissioner of taxation and finance.
   f.  Within twenty-four hours after liability for the tax on the use of
 cigarettes accrues each person liable for the tax shall  file  with  the
 commissioner  of  finance  a  return in such form as the commissioner of
 finance may prescribe, together with a remittance of the tax shown to be
 due thereon.
   g.  Agents located within or without the city  shall  purchase  stamps
 and  affix them in the manner prescribed to packages of cigarettes to be
 sold within the city.
   h.  The amount of taxes advanced and paid by the agent or  distributor
 as  provided  in this section shall be added to and collected as part of
 the sales price of the cigarettes.
   i.  The commissioner of finance, notwithstanding any  other  provision
 of  this chapter, may, subject to the approval of the state commissioner
 of taxation and finance, provide by regulation that the tax  imposed  by
 this section shall be collected without the use of stamps.
   §  11-1302.1.  Imposition of tax on tobacco products. a. In accordance
 with section one hundred ten of the public housing law, an excise tax on
 the sale of tobacco products is hereby imposed and shall be paid on  all
 tobacco  products  possessed  in  the  city for sale, except as provided
 under this section. It is intended that the ultimate  incidence  of  and
 liability for the tax shall be upon the consumer. Any dealer or distrib-
 utor  who  pays the tax to the commissioner of finance shall collect the
 tax from the purchaser or consumer. Such tax shall be at the rate of ten
 percent of the price floor for a package of the  specified  category  of
 tobacco  product,  exclusive  of  sales  tax, set forth in the following
 table, which shall be consistent with  the  price  floors  described  in
 subdivision  d  of section 17-176.1 of the code of the preceding munici-
 pality:
 
     Tobacco Product     Price floor              Amount of OTP tax
                         (excluding OTP and       (excluding sales tax)
                         sales taxes)
 
    Cigar                $8.00 per cigar sold     $0.80 per cigar; for
                         individually; for a      a package, $0.80 for
                         package, number of       first cigar, plus
                         cigars multiplied by     $0.175 for each
                         $1.75 plus $6.25         additional cigar
 
    Little cigar        $10.95 per pack of 20    $1.09 per pack
                        little cigars
 
    Smokeless tobacco   $8.00 per 1.2 oz. pack-  $0.80 per 1.2 oz. plus
                        age plus $2.00 for each  an additional $0.20 for
                        additional 0.3 oz. or    each 0.3 oz. or any
 S. 8474                            825
 
                        any fraction thereof in  fraction thereof in
                        excess of 1.2 oz.        excess of 1.2 oz.
 
    Snus                $8.00 per 0.32 oz. pack- $0.80 per 0.32 oz.
                        age plus $2.00 for each  plus an additional
                        additional 0.08 oz. or   $0.20 for each 0.08 oz.
                        any fraction thereof in  or any fraction thereof
                        excess of 0.32 oz.       in excess of 0.32 oz.
 
    Shisha              $17.00 per 3.5 oz. pack- $1.70 per 3.5 oz. plus
                        age plus $3.40 for each  an additional $0.34 for
                        additional 0.7 oz. or    for each 0.7 oz. or any
                        any fraction thereof in  fraction thereof in
                        excess of 3.5 oz.        excess of 3.5 oz.
 
    Loose tobacco       $2.55 per 1.5 oz. pack-  $0.25 per 1.5 oz. pack-
                        age plus $0.51 for each  age plus an additional
                        additional 0.3 oz. or    $0.05 for each 0.3 oz.
                        any fraction thereof     or any fraction thereof
                        in excess of 1.5 oz.     in excess of 1.5 oz.
 
   b. The tax imposed hereunder shall not apply to:
   1.  The  state  of  New  York,  or any public corporation, including a
 public corporation created pursuant to agreement or compact with another
 state or the Dominion of Canada, improvement district or other political
 subdivision of the state where it is the purchaser, user or consumer;
   2. The United States of America, in so far as it is immune from  taxa-
 tion;
   3.  The United Nations or other world-wide international organizations
 of which the United States of America is a member;
   4. Any corporation, or association, or trust, or community chest, fund
 or foundation, organized and operated exclusively for religious,  chari-
 table,  or  educational  purposes,  or  for the prevention of cruelty to
 children or animals, no part of the net earnings of which inures to  the
 benefit  of  any  private  shareholder or individual, and no substantial
 part of the activities of which is carrying on propaganda, or  otherwise
 attempting  to influence legislation; provided, however, that nothing in
 this paragraph shall include an organization operated  for  the  primary
 purpose  of  carrying  on a trade or business for profit, whether or not
 all of its profits are payable to one or more organizations described in
 this paragraph; and
   5. Tobacco products possessed in the  city  by  any  dealer  for  sale
 outside the city or for sale and shipment to any person in another state
 for use there, provided such dealer complies with the regulations relat-
 ing thereto.
   c.  Nothing in subdivision b of this section shall exempt sales by any
 shop or store operated by any college, university  or  other  public  or
 private  institution  for  higher  education from the taxes described in
 this section.
   d. The tax imposed under this section shall be in addition to any  and
 all other taxes.
   e.  It  shall be presumed that all sales mentioned in this section are
 subject to tax until the contrary is  established,  and  the  burden  of
 proof  that  a  sale is not taxable under this section shall be upon the
 dealer or the purchaser.
 S. 8474                            826
 
   f. 1. Except as  provided  in  this  subdivision,  the  tax  shall  be
 advanced and paid by the wholesale dealer. The wholesale dealer shall be
 liable  for the collection and payment of the tax to the commissioner of
 finance as required under subdivision g of this section. The commission-
 er  may  require the wholesale dealer to keep tobacco products for which
 the tax has not yet been paid separately from tobacco products for which
 the tax has been paid. For purposes of this chapter,  retention  by  the
 wholesale  dealer of any tobacco products beyond the time prescribed for
 payment under this section, without having made the  requisite  payment,
 or storing any such products in violation of any separation requirements
 prescribed  by the commissioner, shall be presumptive evidence that such
 tobacco products are possessed in violation of the  provisions  of  this
 chapter.
   2.  Every  retail  dealer  shall  be liable for the tax on all tobacco
 products in his or her possession at any time, upon which  tax  has  not
 been  paid,  and the failure of any retail dealer to produce and exhibit
 to the commissioner of finance or such  commissioner's  duly  authorized
 representatives  upon  demand, an invoice by a licensed wholesale dealer
 for any tobacco products in his or her possession, shall be  presumptive
 evidence  the  tax thereon has not been paid, that such retail dealer is
 liable for the tax thereon, and the tobacco products  are  possessed  in
 violation  of  this  chapter, unless evidence of such invoice or payment
 shall later be produced.
   g. 1. Each wholesale  dealer  shall  file  with  the  commissioner  of
 finance  a  return,  on a form required by such commissioner, indicating
 the amount of tax due pursuant to this section and any other information
 the commissioner may require, on a monthly basis, or on such other regu-
 lar interval as such commissioner may prescribe. Each  wholesale  dealer
 shall  file  the  return on the twentieth day of the month following the
 end of the month or other interval covered by  the  return,  unless  the
 commissioner  of  finance  prescribes a greater number of days following
 the end of the month or a different reporting interval.  Each  wholesale
 dealer shall pay the amount of tax due upon filing the return unless the
 commissioner prescribes a different date or time for such payment.
   2. The commissioner of finance may:
   (A)  Authorize  another  person, including a distributor as defined in
 subdivision twelve of section four hundred seventy of the tax  law,  who
 is not a wholesale dealer, to advance and pay the tax imposed under this
 section;
   (B)  Exempt  wholesale  dealers from the requirements of this subdivi-
 sion, upon such conditions as may be imposed by such commissioner, if he
 or she is satisfied the tax on the tobacco products has been or is being
 advanced and paid by another wholesale dealer or a  distributor  author-
 ized under this subdivision.
   h.  The  amount  of  taxes  advanced  and paid by the wholesale dealer
 pursuant to this section shall be added to and collected as part of  the
 sales price of the tobacco products.
   §  11-1303 License.  a. License required of wholesale and retail deal-
 ers.  1. It shall be unlawful for a person to engage in  business  as  a
 wholesale  or  retail  dealer  without  a  license as prescribed in this
 section or subchapter one of chapter two of title twenty of the code  of
 the preceding municipality, whichever is applicable.
   2. It shall be unlawful for a person to permit any premises under such
 person's  control  to  be used by any other person in violation of para-
 graph one of subdivision a of this section.
 S. 8474                            827
 
   b. Application for license. 1. Wholesale tobacco license. In order  to
 obtain  a  license to engage in business as a wholesale dealer, a person
 shall file application with the commissioner of finance for one  license
 for  each  place of business that he or she desires to have for the sale
 of  cigarettes  or tobacco products in the city. Every application for a
 wholesale tobacco license shall be  made  upon  a  form  prescribed  and
 prepared  by the commissioner of finance and shall set forth such infor-
 mation as the commissioner shall require. The  commissioner  of  finance
 may,  for  cause,  refuse  to  issue  a  wholesale tobacco license. Upon
 approval of the application, the commissioner of finance shall grant and
 issue to the applicant a wholesale tobacco license  for  each  place  of
 business within the city set forth in the application. Wholesale tobacco
 licenses shall not be assignable and shall be valid only for the persons
 in whose names such licenses have been issued and for the transaction of
 business  in  the  places  designated  therein and shall at all times be
 conspicuously displayed at the places for which issued.
   2. Retail tobacco license. In order to obtain a license to  engage  in
 business  as  a  retail dealer, a person shall file application with the
 commissioner of consumer affairs and  worker  protection  in  accordance
 with the provisions of section 20-202 of the code of the preceding muni-
 cipality.
   c. Duplicate licenses. Whenever any license issued by the commissioner
 of finance under the provisions of this section is defaced, destroyed or
 lost, the commissioner of finance shall issue a duplicate license to the
 holder  of  the defaced, destroyed or lost license upon the payment of a
 fee of fifteen  dollars.  A  duplicate  retail  dealer  license  may  be
 obtained  from  the  commissioner  of  consumer and worker protection as
 provided in section 20-204 of the code of the preceding municipality.
   d. Suspension or revocation of licenses.  (1)  After  a  hearing,  the
 commissioner  of  finance  may  suspend  or  revoke  a wholesale tobacco
 license and the commissioner of consumer  and  worker  protection,  upon
 notice  from the commissioner of finance, may suspend or revoke a retail
 tobacco license whenever the commissioner  of  finance  finds  that  the
 holder  thereof  has failed to comply with any of the provisions of this
 chapter or any rules of the commissioner of finance prescribed,  adopted
 and promulgated under this chapter.
   (2) The commissioner of finance may also suspend or revoke a wholesale
 tobacco  license  in  accordance  with  the  requirements  of  any other
 sections of this code or any rules promulgated thereunder which  author-
 izes the suspension or revocation of a wholesale tobacco license.
   (3)  The  commissioner  of  consumer  and  worker  protection may also
 suspend or revoke a  retail  tobacco  license  in  accordance  with  the
 requirements  of any other section of this code or any rules promulgated
 thereunder which authorize suspension or revocation of a retail  tobacco
 license.
   (4)  Upon  suspending  or  revoking any wholesale tobacco license, the
 commissioner of finance shall direct the holder thereof to surrender  to
 the  commissioner  of finance immediately all wholesale tobacco licenses
 or duplicates thereof issued to such holder and the holder shall surren-
 der promptly all  such  licenses  to  the  commissioner  of  finance  as
 directed.  Before  the  commissioner  of  finance  suspends or revokes a
 wholesale tobacco license or notifies the commissioner of  consumer  and
 worker  protection  of  a  finding  of  a violation of this chapter with
 respect to a retail tobacco license pursuant to paragraph  one  of  this
 subdivision, the commissioner of finance shall notify the holder and the
 holder shall be entitled to a hearing, if desired, if the holder, within
 S. 8474                            828
 
 ninety  days from the date of such notification, or, if the commissioner
 of finance has established a conciliation procedure pursuant to  section
 11-124  of  this  title  and  the  taxpayer has requested a conciliation
 conference  in accordance therewith, within ninety days from the mailing
 of a conciliation decision or the date of the  commissioner's  confirma-
 tion  of  the  discontinuance  of  the conciliation proceeding, both (A)
 serves a petition upon the commissioner of finance and (B) files a peti-
 tion with the tax appeals tribunal for a hearing.  After  such  hearing,
 the  commissioner of finance, good cause appearing therefor, may suspend
 or revoke the wholesale tobacco license, and, in the case  of  a  retail
 tobacco   license,  notify  the  commissioner  of  consumer  and  worker
 protection of a violation of this chapter or any rules promulgated ther-
 eunder. Upon such notification, the commissioner of consumer and  worker
 protection  may suspend or revoke a retail cigarette license as provided
 in subdivision b of section 20-206 of the code of the preceding  munici-
 pality. The commissioner of finance may, by rule, provide for granting a
 similar  hearing  to an applicant who has been refused a wholesale ciga-
 rette license by the commissioner of finance.
   e. Prohibited sales and purchases. No agent or dealer shall sell ciga-
 rettes or tobacco products to an unlicensed wholesale or retail  dealer,
 or  to  a wholesale or retail dealer whose license has been suspended or
 revoked.
   No dealer shall purchase  cigarettes  or  tobacco  products  from  any
 person other than a manufacturer or a licensed wholesale dealer.
   f.  Retail  dealers.  The  commissioner of finance may, after hearing,
 issue an order prohibiting a retail dealer from selling cigarettes,  for
 such  period  as the order shall specify, for failure to comply with any
 of the provisions of this chapter or any rules  or  regulations  of  the
 commissioner  of  finance prescribed, adopted and promulgated under this
 chapter.
   g. License fees; numbering and registering of licenses; term.  1.  The
 annual  fee  for  a  wholesale  dealer's  license  shall  be six hundred
 dollars, and the annual fee for a retail dealer's license  shall  be  as
 provided in subdivision c of section 20-202 of the code of the preceding
 municipality.
   2.  Wholesale  tobacco  licenses  shall be regularly numbered and duly
 registered.
   3. Wholesale tobacco licenses shall  expire  on  January  thirty-first
 next succeeding the date of issuance unless sooner suspended or revoked.
   §    11-1304    Preparation  and sale of stamps; commissions.  a.  The
 commissioner of finance shall, subject to the approval of the state  tax
 commission,  prescribe, prepare and furnish stamps of such denominations
 and quantities as may be necessary for the payment of the tax imposed by
 this chapter, and may, from time to time, provide for the  issuance  and
 exclusive  use of stamps of a new design and forbid the use of stamps of
 any other design.  Such stamps shall be in the form of  a  single  stamp
 for  the payment of the tax imposed by this chapter or, in lieu thereof,
 a joint single stamp to be prepared and issued by the state of New  York
 and  the city for the payment of the tax imposed by this chapter and the
 taxes imposed by article twenty of the tax law.    The  commissioner  of
 finance may make such arrangements with the state tax commission for the
 method  of  acquiring  and the manner of sharing the costs of such joint
 single stamps as he or she  deems  appropriate.    The  commissioner  of
 finance,  subject  to the approval of the state commissioner of taxation
 and finance, shall make provisions for the sale of such stamps  at  such
 S. 8474                            829
 
 places  as  he  or she may deem necessary, and may appoint fiscal agents
 for such purpose.
   b.  The commissioner of finance may appoint wholesale dealers of ciga-
 rettes  and  any  other  person  within or without the city as agents to
 affix stamps to be used in paying the tax hereby imposed, but  an  agent
 shall  at  all  times have the right to appoint the person in his or her
 employ who is to affix the stamps to any cigarettes  under  the  agent's
 control.    Whenever  the commissioner of finance shall sell, consign or
 deliver to any such agent any such stamps, such agent shall be  entitled
 to  receive  as  compensation  for  his  or her services and expenses in
 affixing such stamps, and to retain out of the moneys to be paid by  the
 agent  for  such  stamps,  a  commission on the par value thereof.   The
 commissioner of finance is hereby authorized to prescribe a schedule  of
 commissions  not  exceeding five per centum, allowable to such agent for
 affixing such  stamps;  provided,  however,  that  the  commissioner  of
 finance  may  authorize  commissions  to agents and temporary agents not
 exceeding ten per centum for a special period not exceeding fifteen days
 immediately following the enactment of this chapter to cover the initial
 stamping of packages of cigarettes.  Such schedule shall be uniform  for
 each  type  and  denomination  of  stamp used, and may be on a graduated
 scale with respect to the number of stamps purchased.  In the event that
 a joint stamp is issued, the commissions  allowed  shall  be  determined
 jointly  by  the  state  commissioner  of taxation   and finance and the
 commissioner of finance and shall be based on the full par value of such
 stamp.  The extent to which the city and the state  of  New  York  shall
 bear  the  expense  of such commissions shall be determined by agreement
 between the commissioner  of taxation and finance and  the  commissioner
 of  finance.    The commissioner of finance may in his or her discretion
 permit an agent to pay for such stamps within thirty days after the date
 of sale, consignment or delivery of such stamps to such agents, and  may
 require  any such agent to file with the commissioner of finance a bond,
 issued by a surety company approved by the superintendent  of  insurance
 as to solvency and responsibility and authorized to transact business in
 the  state,  in  such amounts as the commissioner of finance may fix, to
 secure the payment of any sums from such agent pursuant to this chapter.
   c.  The commissioner of finance may redeem unused stamps  lawfully  in
 the  possession  of any person.   No person shall sell or offer for sale
 any stamp issued under this chapter, except by written permission of the
 commissioner of finance.   The commissioner  of  finance  may  prescribe
 rules  and  regulations  concerning refunds, sales of stamps and redemp-
 tions under the provisions of this chapter.
   d. (1) Except as provided in this subdivision, it  shall  be  unlawful
 for any person to sell, offer for sale, possess or transport any affixed
 or  unaffixed  false,  altered  or  counterfeit  cigarette  tax  stamps,
 imprints or impressions.
   (2) Paragraph one of this subdivision shall not apply to:
   (A) a person, other than a retail dealer, in possession of  twenty  or
 fewer affixed tax stamps;
   (B)  public officers or employees in the performance of their official
 duties requiring possession or control of affixed  or  unaffixed  false,
 altered or counterfeit cigarette tax stamps, imprints or impressions; or
   (C)  any  person  authorized  by  the  commissioner  of finance or the
 commissioner of the department of taxation and finance of the  state  of
 New York to perform law enforcement functions.
   §   11-1305   Affixation and cancellation of stamps; presumptions.  a.
 Each agent shall affix to each package of cigarettes  stamps  evidencing
 S. 8474                            830
 
 the  payment of tax imposed by this chapter and shall cancel such stamps
 prior to delivery of such cigarettes to any dealer in the  city,  unless
 stamps  have  been  affixed to such packages of cigarettes and cancelled
 before such agent received them.
   b.    Each  dealer, other than an agent, in the city shall immediately
 upon the receipt of any cigarettes at his or her place of business  mark
 in  ink  on  each  unopened box, carton or other container of such ciga-
 rettes the word "received" and the year, month, day  and  hour  of  such
 receipt  and shall affix his or her signature thereto or shall mark them
 in any other manner prescribed by the commissioner of finance.  In addi-
 tion, each retail dealer shall, within twenty-four hours  after  receipt
 of  any cigarettes at his or her place of business and prior to exposing
 for sale or sale by such retail dealer of  such  cigarettes,  open  such
 box,  carton or other container and, unless such stamps have been previ-
 ously affixed, immediately  notify  the  dealer  from  whom  he  or  she
 purchased  such cigarettes and arrange for the replacement by the dealer
 of such cigarettes by cigarettes with such stamps affixed  within  twen-
 ty-four hours.
   c.  Stamps shall be cancelled in the manner prescribed by regulation.
   d.    Whenever  any cigarettes are found in the place of business of a
 dealer without the stamps affixed and cancelled, or not marked as having
 been received within the preceding twenty-four hours,  the  prima  facie
 presumption  shall  arise  that  such  cigarettes  are  kept  therein in
 violation of the provisions of this chapter.
   e.  Stamps shall be affixed to each package of cigarettes of an aggre-
 gate denomination not less than the amount of the tax upon the  contents
 therein,  and  shall  be  affixed in such manner as to be visible to the
 purchaser.
   §  11-1306   Possession and transportation  of  unstamped  cigarettes.
 Every  person  who  shall possess or transport upon the public highways,
 roads or streets of this city  more  than  four  hundred  cigarettes  in
 unstamped  packages,  shall  be  required  to  have in his or her actual
 possession invoices or delivery tickets for such cigarettes.   All  such
 invoices or delivery tickets shall show the true name and address of the
 consignor  or  seller,  the  true  name  and address of the consignee or
 purchaser and the quantity and brands  of  the  cigarettes  transported.
 The  absence  of  such invoices or delivery tickets shall be prima facie
 evidence that such person is a dealer in  cigarettes  in  the  city  and
 subject to the provisions of this chapter.
   §    11-1307    Records to be kept; examination.  a. 1. At the time of
 delivering cigarettes to any person in the city, each agent or wholesale
 dealer shall make a true duplicate invoice showing the date of delivery,
 the number of packages and the number of cigarettes contained therein in
 each shipment of cigarettes delivered, and the name of the purchaser  to
 whom  delivery  is made, and shall retain the same for a period of three
 years subject to the use and inspection of the commissioner of  finance.
 Each  dealer  shall  procure  and  retain invoices showing the number of
 packages and the number of cigarettes contained therein in each shipment
 of cigarettes received by such dealer, the date thereof, and the name of
 the shipper, and shall retain the same  for  a  period  of  three  years
 subject to the use and inspection of the commissioner of finance.
   2.  At  the  time  of delivering tobacco products to any person in the
 city, each wholesale dealer shall make a true duplicate invoice  showing
 the  date  of delivery, the number of packages and the number of tobacco
 products contained therein as well as any tobacco products not in  pack-
 ages in each shipment of tobacco products delivered, and the name of the
 S. 8474                            831
 
 purchaser to whom delivery is made and shall retain the same for a peri-
 od  of three years subject to the use and inspection of the commissioner
 of finance. Each dealer shall procure and retain  invoices  showing  the
 number  of packages and the number of tobacco products contained therein
 as well as any tobacco products not in  packages  in  each  shipment  of
 tobacco products received by such dealer, the date thereof, and the name
 of  the  shipper,  and shall retain the same for a period of three years
 subject to the use and inspection of the commissioner of finance.
   3. Each dealer shall retain any other records and in such form as  may
 be  required  by  the  commissioner  of  finance indicating proof of the
 payment of the tax imposed under section 11-1302.1 of this chapter.  Any
 failure  to  provide  such  records  upon request by the commissioner of
 finance or such commissioner's duly authorized representatives shall  be
 presumptive evidence that the dealer has violated the provisions of this
 chapter.
   b. The commissioner of finance by regulation may provide that whenever
 cigarettes  or  tobacco products are shipped into the city, the railroad
 company, express company, trucking company, or carrier transporting  any
 shipment  thereof  shall file with the commissioner of finance a copy of
 the freight bill within ten days after the delivery in the city of  each
 shipment.
   c.    All  dealers shall maintain and keep for a period of three years
 such other records of cigarettes or tobacco products  received  or  sold
 within  the city as may be required by the commissioner of finance.  All
 wholesale dealers shall maintain and keep for a period  of  three  years
 such  other  records  of cigarettes or tobacco products delivered within
 the city.
   d. Without limiting the powers granted the  commissioner  of  consumer
 and  worker  protection  pursuant  to  title  twenty  of the code of the
 preceding municipality and any rules promulgated thereunder, the commis-
 sioner of finance or the commissioner's duly authorized  representatives
 are  hereby  authorized to examine the books, papers, invoices and other
 records, and stock of cigarettes or tobacco products  in  and  upon  any
 premises  where  the  same are placed, stored and sold, and equipment of
 any such agent or dealer pertaining to the sale and  delivery  of  ciga-
 rettes  or  tobacco  products  taxable under this chapter. To verify the
 accuracy of the tax imposed and assessed  by  this  chapter,  each  such
 person  is  hereby  directed and required to give to the commissioner of
 finance or  the  commissioner's  duly  authorized  representatives,  the
 means,  facilities  and  opportunity for such examinations as are herein
 provided for and required.
   e.  The commissioner of finance shall investigate any failure  to  pay
 the  tax  required  by  this chapter or any other failure to comply with
 this chapter or the rules or  regulations  promulgated  thereunder,  and
 shall take the necessary steps to enforce compliance therewith.
   §  11-1308 General powers of the commissioner of finance.  In addition
 to the powers granted to the commissioner of finance in this chapter, he
 or she is hereby authorized and empowered:
   1.  To make, adopt and amend rules and regulations appropriate to  the
 carrying  out  of  this chapter and the purposes thereof; and to require
 the filing of reports by agents and/or dealers;
   2.  To prescribe the method and the means to be used in the  cancella-
 tion of stamps;
   3.  To fix the denominations and the method of sale of stamps;
   4.    To  delegate  his or her powers to a deputy or other employee or
 employees of the department of finance;
 S. 8474                            832
 
   5.  To extend, for cause shown, the time  for  filing  any  return  or
 reports  for  a  period  not  exceeding  thirty  days; and to compromise
 disputed claims in connection with the taxes hereby imposed;
   6.    To  assess, determine, revise and adjust the taxes imposed under
 this chapter;
   7.  To request information from the state commissioner of taxation and
 finance, the treasury department of the  United  States  or  the  taxing
 officials  of  any other state or city that imposes a similar tax to any
 tax imposed by this chapter, and to afford information to  such  commis-
 sion,  department  or other taxing official, any other provision of this
 chapter to the contrary notwithstanding;
   8.  To enter into an arrangement with the state commissioner of  taxa-
 tion  and  finance  with  respect to cooperative collection, auditing or
 administration of the taxes  imposed  by  this  chapter  and  the  taxes
 imposed by article twenty of the tax law of the state of New York.
   9.  To prescribe forms to be filled out by the vendor or purchaser, or
 both,  in each instance in which a sale is made by an agent or wholesale
 dealer to a person outside the state or the city or to a dealer  in  the
 city for purposes of resale outside the state or the city.
   10.    To  appoint  any  dealer  as a temporary agent to buy and affix
 stamps for a period not in excess of fifteen days.
   11.  In furtherance of the purposes of paragraph three of  subdivision
 a  of  section  11-1302 of this chapter, to provide by appropriate regu-
 lation for the maintenance of such differentials in wholesale and retail
 prices of cigarettes sold by any vendor, other than the manufacturer, so
 as to reflect the amounts of tax attributable to the  tar  and  nicotine
 content  of cigarettes sold.  In so doing he or she may use and consider
 the factory price of various brands of cigarettes.    In  addition,  the
 commissioner  may  consider the mode or method by which retail sales are
 effected and limit his or her regulations so as to  affect  any  one  or
 more or all of such modes or methods.
   §  11-1309   Notifying taxpayers of assessments.  a.  The owner of any
 lot, piece or parcel of land in the city of Staten Island or any  person
 interested  in  such  lot,  piece or parcel, may file with the bureau of
 city collections a statement containing  a  brief  description  of  such
 land,  together  with the section, block and lot number thereof, or such
 other designation as at the time is established  by  the  department  of
 finance,  and  a statement of the applicant's interest therein, together
 with a written request that such lot, piece or parcel of land be  regis-
 tered  in  such bureau, in the name of the applicant.  In such statement
 the applicant shall designate a post office address to  which  notifica-
 tions addressed to such applicant shall be sent.  A brief description of
 such lot, piece or parcel of land corresponding to the description ther-
 eof  in  the statement so filed, together with the name of the applicant
 and his or her post office address and the  date  of  such  application,
 shall  thereupon  be registered in the offices of such bureau as herein-
 after provided.
   b.  As soon as any assessment for a local improvement shall have  been
 confirmed, including assessments confirmed by a court of record, and the
 list  thereof  shall  have  been entered and filed in the bureau of city
 collections, such assessment list shall be examined and thereupon, with-
 in twenty days after such entry there shall be mailed a notice addressed
 to each person in whose name any lot, piece or parcel of land,  affected
 by such assessment, is registered, at the post office address registered
 in  the  records  of  such  bureau, which notice shall contain the brief
 description of the lot, piece or parcel of land registered in  the  name
 S. 8474                            833
 
 of the person to whom such notice is addressed, together with the amount
 assessed  thereon, date of entry, and title of the improvement for which
 such assessment is made, and a statement of  the  rate  of  interest  or
 penalty imposed for the nonpayment of such assessment, and the date from
 which  the interest or penalty will be computed.  Failure to comply with
 the provisions of this section, however, shall in no manner  affect  the
 validity  or  collectibility  of  any assessment heretofore or hereafter
 confirmed, nor shall any claim arise or exist against  the  comptroller,
 the  commissioner  of  finance, the city collector or any officer of the
 city by reason of such failure.
   c.  The city collector shall for the purpose of this  section  provide
 appropriate  records  for  each  section  of  the city as the same shall
 appear upon the tax maps of the city.
   § 11-1310 Determination of tax. If any person fails to pay the tax, or
 to file a return required by this chapter or if a return, when filed, is
 insufficient and the maker fails  to  file  a  corrected  or  sufficient
 return within ten days after the same may be required by notice from the
 commissioner of finance, the commissioner of finance shall determine the
 amount  of  tax due from such information as may be obtainable or on the
 basis of external indices, such as number  of  cigarettes  purchased  or
 sold,  number  of  tobacco  products  purchased  or sold, stock on hand,
 volume of sales by similar dealers or other factors.    Notice  of  such
 determination shall be given to the person liable for the payment of the
 tax. Such determination shall finally and irrevocably fix the tax unless
 the  person against whom it is assessed shall, within ninety days of the
 giving of such notice, or, if the commissioner  of  finance  has  estab-
 lished a conciliation procedure pursuant to section 11-124 of this title
 and  the  person liable for the tax has requested a conciliation confer-
 ence in accordance therewith, within ninety days from the mailing  of  a
 conciliation  decision or the date of the commissioner's confirmation of
 the discontinuance of the conciliation proceeding,  both  (1)  serves  a
 petition  upon the commissioner of finance and (2) files a petition with
 the tax appeals tribunal for a hearing, or unless  the  commissioner  of
 finance  shall of his or her own motion redetermine such tax. Such hear-
 ing and any appeal to the tax appeals tribunal sitting en banc from  the
 decision  rendered  in such hearing shall be conducted in the manner and
 subject to the requirements  prescribed  by  the  tax  appeals  tribunal
 pursuant  to sections one hundred sixty-eight through one hundred seven-
 ty-two of the charter of the preceding municipality as it existed  Janu-
 ary  first,  nineteen  hundred ninety-four.   After such hearing the tax
 appeals tribunal shall give notice of its decision to the person  liable
 for  the  tax and to the commissioner of finance.  A decision of the tax
 appeals tribunal sitting en banc shall be reviewable for error, illegal-
 ity, unconstitutionality or any other reason whatsoever by a  proceeding
 under  article  seventy-eight  of  the  civil  practice law and rules if
 instituted by the person against whom the tax was assessed  within  four
 months after the giving of the notice of such tax appeals tribunal deci-
 sion;  provided  however,  that if such decision regards the tax imposed
 under section 11-1302.1 of this chapter, such proceeding must be  insti-
 tuted by the person against whom the tax was assessed within thirty days
 after  the  giving  of the notice of such tax appeals tribunal decision.
 Such proceeding shall not be instituted by a person liable for  the  tax
 unless  the  amount  of  any tax sought to be reviewed with interest and
 penalties thereon, if any, shall have  first  been  deposited  with  the
 commissioner  of  finance and an undertaking filed with the commissioner
 of finance in such amount and with such sureties as  a  justice  of  the
 S. 8474                            834

 supreme  court  shall  approve, to the effect that if such proceeding be
 dismissed or the tax confirmed, such  person  will  pay  all  costs  and
 charges which may accrue in the prosecution of the proceeding.
   § 11-1311  Refunds.  a. In the manner provided in this subdivision the
 commissioner  of finance shall refund, without interest, any tax, inter-
 est or penalty erroneously, illegally or unconstitutionally collected or
 paid. In addition, whenever any cigarettes upon which stamps  have  been
 affixed have been sold and shipped to a dealer outside the city for sale
 there  or  to  any person in another state for use there, or have become
 unfit for use and consumption or unsalable, or have been destroyed,  the
 dealer shall be entitled to a refund of the amount of tax paid, less the
 applicable commission, with respect to such cigarettes.
   In  any  event  no  refund  shall be granted unless application to the
 commissioner of finance therefor is made  within  two  years  after  the
 stamps  were affixed to such cigarettes or the tax was paid, except if a
 person has consented in writing  to  an  extension  of  the  period  for
 assessment  of  additional  tax  pursuant  to  subdivision  c of section
 11-1315 of this chapter, and such consent is given within  the  two-year
 period for making a refund application provided in this subdivision, the
 period  for  making  a  refund application shall not expire prior to six
 months after the expiration of the period  within  which  an  assessment
 could be made pursuant to such consent or any extension thereof.
   Whenever  a  refund  is made or denied by the commissioner of finance,
 the commissioner shall state his or her reasons therefor and give notice
 thereof to the applicant in writing. A person shall not be entitled to a
 hearing in connection with such application for a refund if such  person
 has already had a hearing or had been given the opportunity of a hearing
 as  provided  in  section 11-1310 of this chapter or has failed to avail
 himself or herself of the remedies therein provided. No refund shall  be
 made  of  a tax, interest or penalty paid pursuant to a determination of
 the commissioner of finance as provided in section 11-1310 of this chap-
 ter, unless the tax appeals tribunal, after a hearing as in said section
 provided or the commissioner of finance, of his or her own motion, shall
 have reduced the tax or penalty, or it shall have been established in  a
 proceeding,  pursuant to article seventy-eight of the civil practice law
 and rules that such determination was  erroneous,  illegal,  unconstitu-
 tional  or  otherwise improper, in which event a refund without interest
 shall be made as provided upon the determination of such proceeding. Any
 determination of the commissioner of finance denying a  refund  pursuant
 to  this subdivision shall be final and irrevocable unless the applicant
 for such refund, within ninety days from the mailing of notice  of  such
 determination,  or,  if  the  commissioner  of finance has established a
 conciliation procedure pursuant to section 11-124 of this title and  the
 applicant  has  requested a conciliation conference in accordance there-
 with, within ninety days from the mailing of a conciliation decision  or
 the date of the commissioner's confirmation of the discontinuance of the
 conciliation proceeding, both (1) serves a petition upon the commission-
 er of finance and (2) files a petition with the tax appeals tribunal for
 a hearing.
   Such  petition for a refund made as provided in this subdivision shall
 be deemed an application for a revision of any tax, penalty or  interest
 complained  of.  Such hearing and any appeal to the tax appeals tribunal
 sitting en banc from the decision rendered  in  such  hearing  shall  be
 conducted  in  the  manner and subject to the requirements prescribed by
 the tax appeals tribunal pursuant to sections  one  hundred  sixty-eight
 through  one hundred seventy-two of the charter of the preceding munici-
 S. 8474                            835
 
 pality. After such hearing, the tax appeals tribunal shall  give  notice
 of  its  decision  to  the applicant and to the commissioner of finance.
 The applicant shall be entitled to maintain a proceeding  under  article
 seventy-eight  of  the civil practice law and rules to review a decision
 of the tax appeals tribunal sitting en  banc,  provided,  however,  that
 such  proceeding  is  instituted within four months after such decision,
 provided however, that if such decision regards the tax   imposed  under
 section  11-1302.1  of  this chapter, such proceeding must be instituted
 within thirty days after such decision, and provided,  further,  in  the
 case  of  an  application  by  a person liable for the tax, that a final
 determination of tax due was not previously made, and that an  undertak-
 ing shall first be filed by such person with the commissioner of finance
 in  such amount and with such sureties as a justice of the supreme court
 shall approve, to the effect that if such proceeding be dismissed or the
 tax confirmed such person will pay  all  costs  and  charges  which  may
 accrue in the prosecution of such proceeding.
   b.  If  the  commissioner  of  finance is satisfied that any dealer is
 entitled to a refund the commissioner shall issue to such dealer  stamps
 of sufficient value to cover the refund or to make such refund.
   §   11-1312   Reserves.  In cases where the taxpayer has applied for a
 refund and has instituted proceedings under article seventy-eight of the
 civil practice law and rules to review a determination  adverse  to  the
 taxpayer  on  his  or  her  application  for refund or has deposited the
 amount of tax assessed in  connection  with  proceedings  under  section
 11-1310  of  this  chapter,  the  comptroller  shall  set up appropriate
 reserves to meet any decision adverse to the city.
   § 11-1313  Remedies  exclusive.  The  remedies  provided  by  sections
 11-1310  and  11-1311  of  this  chapter shall be the exclusive remedies
 available to any person for the review of tax liability imposed by  this
 chapter; and no determination or proposed determination of tax or deter-
 mination  on  an  application for refund by the commissioner of finance,
 nor any decision by the tax appeals tribunal or any of  its  administra-
 tive law judges, shall be enjoined or reviewed by an action for declara-
 tory  judgment, an action for money had and received, or by any legal or
 equitable action or proceeding other than, in the case of a decision  by
 the  tax  appeals  tribunal  sitting en banc, a proceeding under article
 seventy-eight of the civil practice law and  rules;  provided,  however,
 that  a  taxpayer  may  proceed  by declaratory judgment if the taxpayer
 institutes suit within thirty days after a deficiency assessment is made
 and pays the amount of the deficiency assessment to the commissioner  of
 finance prior to the institution of such suit and posts a bond for costs
 as provided in section 11-1310 of this chapter.
   §  11-1314  Proceedings to recover tax.  a.  Whenever any person shall
 fail  to  pay  any  tax,  penalty or interest imposed by this chapter as
 herein provided, the corporation counsel shall, upon the request of  the
 commissioner  of  finance,  bring  or  cause  to be brought an action to
 enforce the payment of the same on behalf of the city in  any  court  of
 the  state  of  New  York or of any other state or of the United States.
 If, however, the commissioner  of  finance  in  his  or  her  discretion
 believes  that  a  taxpayer subject to the provisions of this chapter is
 about to cease business, leave the state  or  remove  or  dissipate  the
 assets  out  of  which the tax, interest or penalties might be satisfied
 and that any such tax, interest or penalty will not be paid when due, he
 or she may declare such tax, interest or penalty to be  immediately  due
 and payable and may issue a warrant immediately.
 S. 8474                            836
 
   b.  In addition to all other remedies for the collection of any taxes,
 penalties  or  interest  due  under  the provisions of this chapter, the
 commissioner of finance may  with  respect  to  any  tax  imposed  under
 section  11-1302  of  this  chapter or any penalties or interest related
 thereto  issue  a  warrant,  directed to the city sheriff commanding the
 sheriff to levy upon and sell the real  and  personal  property  of  the
 person  liable  for  the tax which may be found within the city, for the
 payment of the amount thereof, with any penalties and interest  and  the
 cost of executing the warrant, and to return such warrant to the commis-
 sioner  of finance and to pay to the commissioner the money collected by
 virtue thereof within sixty days after the receipt of such warrant.  The
 city sheriff shall within five days after the  receipt  of  the  warrant
 file  with  the  county  clerk  a copy thereof, and thereupon such clerk
 shall enter in the judgment docket the name of the person  mentioned  in
 the  warrant and the amount of the taxes, penalty and interest for which
 the warrant is issued and the date when such copy is filed.    Thereupon
 the  amount  of  such  warrant shall become a lien upon the title to and
 interest in real and personal property of the person  against  whom  the
 warrant is issued.  The city sheriff shall then proceed upon the warrant
 in  the  same  manner  and  with  like effect as that provided by law in
 respect to executions issued against property upon judgments of a  court
 of  record,  and  for services in executing the warrant the city sheriff
 shall be entitled to the same fees which he or she may  collect  in  the
 same manner.  In the discretion of the commissioner of finance a warrant
 of  like terms, force and effect may be issued and directed to any offi-
 cer or employee of the department of finance, and in the execution ther-
 eof such officer or employee shall have all the powers conferred by  law
 upon sheriffs, but shall be entitled to no fee or compensation in excess
 of  the  actual  expenses  paid  in the performance of such duty.   If a
 warrant is returned not satisfied in full, the commissioner  of  finance
 may  from  time to time issue new warrants and shall have the same reme-
 dies to enforce the amount due thereunder as if the city  had  recovered
 judgment therefor and execution thereon had been returned unsatisfied.
   c.  The commissioner of finance, if he or she finds that the interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the commissioner of finance may require, may release any  property  from
 the  lien  of any warrant or vacate such warrant for unpaid taxes, addi-
 tions to tax, penalties and interest filed pursuant to subdivision b  of
 this  section,  and  such  release  or  vacating  of  the warrant may be
 recorded in the office of any recording officer in  which  such  warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   §   11-1315   Notices and limitations of time.  a.  Any notice author-
 ized or required under the provisions of this chapter may  be  given  by
 mailing  the  same  to  the person for whom it is intended in a postpaid
 envelope addressed to such person at  the  address  given  in  the  last
 return  filed  by such person pursuant to the provisions of this chapter
 or in any application made by such person or,  if  no  return  has  been
 filed  or  application  made, then to such address as may be obtainable.
 The mailing of such notice shall be presumptive evidence of the  receipt
 of  the  same by the person to whom addressed.  Any period of time which
 is determined according to the provisions of this chapter by the  giving
 of notice shall commence to run from the date of mailing of such notice.
   b.    The  provisions of the civil practice law and rules or any other
 law relative to limitations of time for the enforcement of a civil reme-
 dy shall not apply to any proceeding or action  taken  by  the  city  to
 S. 8474                            837
 
 levy,  appraise, assess, determine or enforce the collection of any tax,
 interest or penalty provided by this chapter.   However, except  in  the
 case  of  a wilfully false or fraudulent return with intent to evade the
 tax,  no assessment of additional tax shall be made after the expiration
 of more than three years from the  date  of  the  filing  of  a  return,
 provided, that where no return has been filed as provided by law the tax
 may be assessed at any time.
   c.    Where, before the expiration of the period prescribed herein for
 the assessment of an additional tax, a person has consented  in  writing
 that  such period be extended, the amount of such additional tax due may
 be determined at any time within such extended period.   The  period  so
 extended  may be further extended by subsequent consents in writing made
 before the expiration of the extended period.
   d. If any return, claim,  statement,  notice,  application,  or  other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 of  any  provision  of  this chapter is, after such period or such date,
 delivered by United States mail to the commissioner of finance, the  tax
 appeals  tribunal,  bureau, office, officer or person with which or with
 whom such document is required to be filed, or to which or to whom  such
 payment  is  required to be made, the date of the United States postmark
 stamped on the envelope shall be deemed to be the date of delivery. This
 subdivision shall apply only if  the  postmark  date  falls  within  the
 prescribed  period or on or before the prescribed date for the filing of
 such document, or for making the payment, including any extension grant-
 ed for such filing or payment, and only if such document or payment  was
 deposited  in  the  mail,  postage  prepaid,  properly  addressed to the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer or person with which or with whom the document  is  required  to  be
 filed or to which or to whom such payment is required to be made. If any
 document  is  sent  by  United States registered mail, such registration
 shall be prima facie evidence that such document was  delivered  to  the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer  or  person to which or to whom addressed, and the date of registra-
 tion shall be deemed the postmark date. The commissioner of finance  or,
 where  relevant,  the  tax  appeals tribunal is authorized to provide by
 regulation the extent to which the provisions of this  subdivision  with
 respect  to prima facie evidence of delivery and the postmark date shall
 apply to certified mail. Except as provided in  subdivision  f  of  this
 section,  this subdivision shall apply in the case of postmarks not made
 by the United States postal service only if and to the  extent  provided
 by regulation of the commissioner of finance or, where relevant, the tax
 appeals tribunal.
   e.  When  the  last  day  prescribed  under authority of this chapter,
 including any extension of time, for  performing  any  act  falls  on  a
 Saturday,  Sunday or legal holiday in the state, the performance of such
 act shall be considered timely if it is performed on the next succeeding
 day which is not a Saturday, Sunday or legal holiday.
   f. (1) Any reference in subdivision d of this section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the secretary of the treasury of the United States
 pursuant to section seventy-five hundred two  of  the  internal  revenue
 code  and  any  reference  in  subdivision d of this section to a United
 States postmark shall be treated as including a reference  to  any  date
 recorded  or  marked  in  the  manner  described in section seventy-five
 hundred two of the  internal  revenue  code  by  a  designated  delivery
 S. 8474                            838
 
 service.  If the commissioner of finance finds that any delivery service
 designated by such secretary is inadequate for the needs  of  the  city,
 the  commissioner  of finance may withdraw such designation for purposes
 of this title. The commissioner of finance may also designate additional
 delivery  services  meeting the criteria of section seventy-five hundred
 two of the internal revenue code for purposes  of  this  title,  or  may
 withdraw  any such designation if the commissioner of finance finds that
 a delivery service so designated is inadequate  for  the  needs  of  the
 city.  Any  reference  in  subdivision  d  of this section to the United
 States mail shall be treated as including a reference  to  any  delivery
 service  designated  by the commissioner of finance and any reference in
 subdivision d of this section to  a  United  States  postmark  shall  be
 treated  as  including a reference to any date recorded or marked in the
 manner described in section seventy-five hundred  two  of  the  internal
 revenue  code  by  a  delivery service designated by the commissioner of
 finance, provided, however, any withdrawal of designation or  additional
 designation  by  the  commissioner of finance shall not be effective for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal of designation or additional designation is ratified  by  the
 president of the tax appeals tribunal.
   (2)  Any  equivalent of registered or certified mail designated by the
 United States secretary of the treasury, or as may be designated by  the
 commissioner  of  finance  pursuant  to  the  same criteria used by such
 secretary for such designations pursuant to section seventy-five hundred
 two of the internal revenue code, shall be included within  the  meaning
 of  registered  or  certified  mail  as  used  in  subdivision d of this
 section. If the commissioner of finance finds  that  any  equivalent  of
 registered or certified mail designated by such secretary or the commis-
 sioner  of  finance is inadequate for the needs of the city, the commis-
 sioner of finance may withdraw such designation  for  purposes  of  this
 title,  provided,  however,  any withdrawal of designation or additional
 designation by the commissioner of finance shall not  be  effective  for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal  of  designation or additional designation is ratified by the
 president of the tax appeals tribunal.
   § 11-1317 Penalties and interest.  a.  (1) Any person failing to pay a
 tax payable under section 11-1302 of this  chapter  when  due  shall  be
 subject  to  a penalty of fifty per centum of the amount of tax due, but
 the commissioner of finance, if satisfied that the delay was  excusable,
 may  remit  all  or any part of such penalty. Such penalty shall be paid
 and disposed of in the same manner as other revenues under this chapter.
 Unpaid penalties may be enforced in the same manner as the  tax  imposed
 by section 11-1302 of this chapter.
   (2) Any person failing to pay a tax payable under section 11-1302.1 of
 this chapter when due shall be subject to a penalty of three hundred per
 centum  of  the  amount  of tax due, but the commissioner of finance, if
 satisfied that the delay was excusable, may remit all  or  any  part  of
 such  penalty.  Such  penalty  shall be paid and disposed of in the same
 manner as other revenues from the tax imposed under section 11-1302.1 of
 this chapter. Unpaid penalties may be enforced in the same manner as the
 tax imposed by section 11-1302.1 of this chapter.
   b. (1) In addition to any other penalty imposed by this  section,  the
 commissioner  of  finance  may (a) impose a penalty of not more than one
 hundred dollars for each two hundred cigarettes or fraction  thereof  in
 excess  of  one  thousand  cigarettes in unstamped or unlawfully stamped
 packages in the possession or under the control of any  person  and  (b)
 S. 8474                            839
 
 impose  a  penalty  of  not  more  than two hundred dollars for each ten
 affixed or unaffixed false, altered or counterfeit cigarette tax stamps,
 imprints or impressions, or fraction thereof, in excess of  one  hundred
 affixed or unaffixed false, altered or counterfeit cigarette tax stamps,
 imprints  or  impressions  in the possession or under the control of any
 person. Such penalty shall be determined as provided in section  11-1310
 of this chapter, and may be reviewed only pursuant to such section. Such
 penalty  may  be  enforced in the same manner as the tax imposed by this
 chapter. The commissioner of finance, in  his  or  her  discretion,  may
 remit  all  or  part  of  such  penalty.  Such penalty shall be paid and
 disposed of in the same manner as other revenues under this chapter.
   (2) The penalties imposed by this paragraph  may  be  imposed  by  the
 commissioner of finance in addition to any other penalty imposed by this
 section,  but  in  lieu  of the penalties imposed by subparagraph (a) of
 paragraph one of this subdivision: (a) not less than thirty dollars  but
 not  more  than  two hundred dollars for each two hundred cigarettes, or
 fraction thereof, in excess of one thousand cigarettes but less than  or
 equal  to  five  thousand  cigarettes in unstamped or unlawfully stamped
 packages knowingly in the possession or knowingly under the  control  of
 any person; (b) not less than seventy-five dollars but not more than two
 hundred dollars for each two hundred cigarettes, or fraction thereof, in
 excess  of  five  thousand  cigarettes  but less than or equal to twenty
 thousand cigarettes in unstamped or unlawfully stamped packages knowing-
 ly in the possession or knowingly under the control of any  person;  and
 (c)  not  less  than  one  hundred dollars but not more than two hundred
 dollars for each two hundred cigarettes, or fraction thereof, in  excess
 of  twenty  thousand cigarettes in unstamped or unlawfully stamped pack-
 ages, knowingly in the possession or knowingly under the control of  any
 person.  Such penalty shall be determined as provided in section 11-1310
 of this chapter, and may be reviewed only pursuant to such section. Such
 penalty may be enforced in the same manner as the tax  imposed  by  this
 chapter.  The  commissioner  of  finance,  in his or her discretion, may
 remit all or part of such  penalty.  Such  penalty  shall  be  paid  and
 disposed of in the same manner as other revenues under this chapter.
   c.  (1) The possession within the city of more than four hundred ciga-
 rettes in unstamped or unlawfully stamped packages shall be  presumptive
 evidence  that  such  cigarettes  are subject to tax as provided by this
 chapter.
   (2) Nothing in this section shall apply to common or contract carriers
 or warehousemen  while  engaged  in  lawfully  transporting  or  storing
 unstamped  packages of cigarettes as merchandise, nor to any employee of
 such carrier or warehouseman acting within  the  scope  of  his  or  her
 employment,  nor  to  public officers or employees in the performance of
 their official duties requiring possession or control  of  unstamped  or
 unlawfully  stamped  packages of cigarettes, nor to temporary incidental
 possession by employees  or  agents  of  persons  lawfully  entitled  to
 possession, nor to persons whose possession is for the purpose of aiding
 police officers in performing their duties.
   d.  (1)  If  any  amount of tax is not paid on or before the last date
 prescribed for payment, without regard to any extension of time  granted
 for payment, interest on such amount at the rate set by the commissioner
 of finance pursuant to paragraph two of this subdivision, or, if no rate
 is  set,  at  the rate of seven and one-half percent per annum, shall be
 paid for the period from such last date  to  the  date  of  payment.  In
 computing  the  amount  of  interest  to be paid, such interest shall be
 compounded daily. Interest under this subdivision shall not be  paid  if
 S. 8474                            840
 
 the amount thereof is less than one dollar. The interest imposed by this
 subdivision  shall  be  paid and disposed of in the same manner as other
 revenues from this chapter. Unpaid interest may be enforced in the  same
 manner as the tax imposed by this chapter.
   (2)  (A) The commissioner of finance shall set the rate of interest to
 be paid pursuant to paragraph one of this subdivision, but  if  no  such
 rate  of  interest  is set, such rate shall be deemed to be set at seven
 and one-half percent per annum. Such rate shall be the  rate  prescribed
 in  subparagraph  (B) of this paragraph but shall not be less than seven
 and one-half percent per annum. Any such rate set by the commissioner of
 finance shall apply to taxes, or any portion thereof,  which  remain  or
 become due on or after the date on which such rate becomes effective and
 shall  apply  only  with  respect to interest computed or computable for
 periods or portions of periods occurring in the  period  in  which  such
 rate is in effect.
   (B)  General  rule.  The  rate  of interest set under this subdivision
 shall be the sum of (i) the federal short-term rate  as  provided  under
 paragraph three of this subdivision, plus (ii) seven percentage points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A)  The  federal  short-term  rate for any month shall be the federal
 short-term rate determined by the United States secretary of the  treas-
 ury  during  such  month  in  accordance  with subsection (d) of section
 twelve hundred seventy-four of the internal  revenue  code  for  use  in
 connection  with  section  six  thousand  six  hundred twenty-one of the
 internal revenue code. Any such rate shall be  rounded  to  the  nearest
 full  percent,  or,  if a multiple of one-half of one percent, such rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i) In general. Except as provided in clause  (ii)  of  this  subpara-
 graph,  the federal short-term rate for the first month in each calendar
 quarter shall apply during the first calendar  quarter  beginning  after
 such month.
   (ii)  Special rule for the month of September, nineteen hundred eight-
 y-nine. The federal short-term rate for the  month  of  April,  nineteen
 hundred  eighty-nine  shall  apply  with  respect to setting the rate of
 interest for the month of September, nineteen hundred eighty-nine.
   (4) Publication of interest rate. The commissioner  of  finance  shall
 cause  to  be  published  in the City Record, and give other appropriate
 general notice of, the interest rate to be set under this subdivision no
 later than twenty days preceding the first day of the  calendar  quarter
 during  which such interest rate applies. The setting and publication of
 such interest rate shall not be included within paragraph (a) of  subdi-
 vision  five  of  section  one  thousand forty-one of the charter of the
 preceding municipality as it existed  January  first,  nineteen  hundred
 ninety-four relating to the definition of a rule.
   e.  Cross-reference: For criminal penalties, see chapter forty of this
 title.
   § 11-1318 Disposition of revenues. a. All revenues resulting from  the
 imposition  of  the  tax  under section 11-1302 of this chapter shall be
 paid into the treasury of the city and shall be credited to and deposit-
 ed in the general fund of the city, except that, after  the  payment  of
 refunds  with  respect  to such tax, effective on and after July second,
 two thousand two, forty-six and one-half percent and, effective  on  and
 after  April first, two thousand three, forty-six percent of such reven-
 ues, including taxes, interest  and  penalties,  collected  or  received
 shall be paid to the state comptroller.
 S. 8474                            841
 
   (b)  All  revenues  resulting  from  the  imposition  of the tax under
 section 11-1302.1 of this chapter during a fiscal  year,  including  any
 interest  and  penalties, shall be paid into the treasury of the city in
 accordance with section one hundred twelve of the  public  housing  law,
 and shall be payable from the city to the New York city housing authori-
 ty in such fiscal year.
   §    11-1319    Construction  and enforcement. Section 11-1302 and the
 provisions of this  chapter  related  thereto  shall  be  construed  and
 enforced  in conformity with chapter two hundred thirty-five of the laws
 of nineteen hundred fifty-two.  Section 11-1302.1 and the provisions  of
 this chapter related thereto shall be construed and enforced in conform-
 ity  with  subdivision  e  of  section  one hundred ten and sections one
 hundred eleven, one hundred twelve  and  one  hundred  thirteen  of  the
 public housing law.
 
                                CHAPTER 14
                    TAX ON TRANSFER OF TAXICAB LICENSES
   § 11-1401  Definitions.  When used in this chapter the following terms
 shall mean or include:
   1.  "City."  The city of Staten Island.
   2.    "Commissioner  of finance."   The commissioner of finance of the
 city of Staten Island.
   3.  "Comptroller."  The comptroller of the city of Staten Island.
   4.  "Consideration."  The total price paid or agreed to  be  paid  for
 the  transfer  of a taxicab license or interest therein, whether paid or
 agreed to be paid in money, property,  or  any  other  thing  of  value,
 including  the  cancellation  or  discharge  of an indebtedness or obli-
 gation, without any deduction whatsoever.
   5.   "Person."   An  individual,  partnership,  society,  association,
 joint-stock  company,  corporation, estate, receiver, trustee, assignee,
 referee or any other person acting  in  a  fiduciary  or  representative
 capacity,  whether appointed by a court or otherwise, any combination of
 individuals, and any other form of unincorporated  enterprise  owned  or
 conducted by two or more persons.
   6.    "Taxi and limousine commission."  The city of Staten Island taxi
 and limousine commission.
   7.  "Taxicab."  Any motor vehicle carrying passengers for hire in  the
 city,  duly  licensed as a taxicab by the taxi and limousine commission,
 and permitted to accept hails from passengers in the street.
   8.  "Taxicab license."  A license issued by  the  taxi  and  limousine
 commission to operate a taxicab.
   9.  "Taxpayer."  Any person subject to tax under this chapter.
   10.  "Transfer."  Any transfer of interest, whether or not such inter-
 est  constitutes  title,  or  possession,  or  both, exchange or barter,
 rental, lease, or license to  use,  conditional  or  otherwise,  in  any
 manner  or by any means whatsoever for a consideration, or any agreement
 therefor.
   11.  "Transferee."  The person to whom a taxicab license  or  interest
 therein  is  transferred, in a transfer as defined in subdivision ten of
 this section.
   12.  "Transferor."   The person who transfers  a  taxicab  license  or
 interest  pursuant to this chapter, in a transfer as defined in subdivi-
 sion ten of this section.
   13. "Tax appeals tribunal." The tax appeals  tribunal  established  by
 section  one hundred sixty-eight of the charter of the preceding munici-
 pality as it existed January first, nineteen hundred ninety-four.
 S. 8474                            842
 
   § 11-1402  Imposition of tax.  a.   On and after  March  twenty-first,
 two  thousand seventeen, there is hereby imposed and there shall be paid
 a tax on each transfer of a taxicab license or interest therein, at  the
 rate of one-half percent of the consideration given for such transfer.
   b.    Where  there is a transfer of the economic interest in a taxicab
 license or interest therein, effected by the transfer of shares of stock
 of a corporation which hold such taxicab license or interest therein  or
 by  the transfer of an interest or interests in a partnership or associ-
 ation which holds such taxicab license or interest therein, such  trans-
 fer  of  shares of stock or of an interest or interests in a partnership
 or association shall be treated as a transfer of the taxicab license  or
 interest therein, and shall be subject to the tax imposed by subdivision
 a of this section.
   c.    Notwithstanding  any  other  provision  of this chapter, the tax
 imposed hereby shall not apply to a transfer made  pursuant  to  a  bona
 fide  written  contract  or  agreement  made  and executed prior to July
 first, nineteen hundred eighty, provided such contract or  agreement  is
 registered  with  the taxi and limousine commission prior to July first,
 nineteen hundred eighty, and provided further that one or more  payments
 were made pursuant to such contract or agreement on or before June twen-
 tieth, nineteen hundred eighty.
   d.    Where a taxicab or any other property is transferred to a trans-
 feree in conjunction with the transfer of a taxicab license or  interest
 therein,  the tax imposed by this section shall be computed on the total
 consideration for the transfer of such license or interest  therein  and
 the taxicab or other property so transferred, less the fair market value
 of such taxicab or other property.
   e.    The  tax imposed by this chapter shall be in addition to any and
 all other taxes.
   § 11-1403 Payment of tax.  The tax imposed by this  chapter  shall  be
 paid by the transferee to the taxi and limousine commission, as agent of
 the commissioner of finance, at the time of approval of such transfer by
 the  taxi  and  limousine  commission, but in no event later than thirty
 days following the transfer. The transferor shall also be liable for the
 payment of such tax at such time in the event that the amount of tax due
 is not paid by the transferee.  Notwithstanding any other  provision  of
 law to the contrary, no transfer of a taxicab license or interest there-
 in  shall be approved or effective until the tax imposed by this chapter
 has been paid. All moneys received as such  payments  by  the  taxi  and
 limousine  commission during any day shall be transmitted to the commis-
 sioner of finance at the close of business on such day or at such  other
 time as the commissioner of finance may require.
   §  11-1404  Returns.    a.  A  joint return shall be filed by both the
 transferee and the transferor. Such return shall be filed at the time of
 payment of any tax imposed pursuant to this  chapter,  and  such  filing
 shall be accomplished by delivering the return to the taxi and limousine
 commission  for  transmittal to the commissioner of finance. The commis-
 sioner of finance shall prescribe the form of the return and the  infor-
 mation  which it shall contain. The return shall be signed under oath by
 both the transferee and the transferor. Where either the  transferee  or
 the  transferor has failed to sign the return, it shall be accepted as a
 return, but the party who has failed to sign the return or file a  sepa-
 rate return shall be subject to the penalties applicable to a person who
 has  failed  to file a return, and the period of limitations for assess-
 ment of tax or of additional tax shall not apply to such party.
 S. 8474                            843
 
   b. Returns shall be preserved for three years and thereafter until the
 commissioner of finance permits them to be destroyed.
   c. The commissioner of finance may require amended returns to be filed
 within twenty days after notice and to contain the information specified
 in the notice.
   d.  If a return required by this chapter is not filed, or if a return,
 when filed, is incorrect or insufficient on its face,  the  commissioner
 of  finance shall take the necessary steps to enforce the filing of such
 a return or of a corrected return.
   § 11-1405 Exemptions.  a. The tax imposed under this chapter shall not
 be imposed on any transaction by or with the following:
   1. The state of New York, or any of its  agencies,  instrumentalities,
 public  corporations, including a public corporation created pursuant to
 agreement or compact with another state or Canada, or political subdivi-
 sions where it is the purchaser, user or consumer;
   2. The United States of America, and any of its agencies  and  instru-
 mentalities  insofar  as  it  is  immune  from  taxation where it is the
 purchaser, user or consumer;
   3. The United Nations or other international  organizations  of  which
 the United States of America is a member; and
   4. Any corporation, or association, or trust, or community chest, fund
 or  foundation, organized and operated exclusively for religious, chari-
 table, or educational purposes, or for  the  prevention  of  cruelty  to
 children  or animals, and no part of the net earnings of which inures to
 the benefit of any private shareholder or individual, and no substantial
 part of the activities of which is carrying on propaganda, or  otherwise
 attempting  to influence legislation; provided, however, that nothing in
 this paragraph shall include an organization operated  for  the  primary
 purpose  of  carrying  on a trade or business for profit, whether or not
 all of its profits are payable to one or more organizations described in
 this subdivision.
   b. The tax imposed by this chapter shall not apply to the transfer  of
 a  taxicab  license  or interest therein by means of a lease, license or
 other rental arrangement, where the term of such lease, license or other
 rental arrangement, including the maximum period for  which  it  can  be
 extended or renewed, does not exceed six months.
   §  11-1406  Determination of tax. If a return required by this chapter
 is not filed, or if a return when filed is  incorrect  or  insufficient,
 the amount of tax due shall be determined by the commissioner of finance
 from  external  indices and such other information as may be obtainable.
 Notice of such determination shall be given to the person liable for the
 tax. Such determination shall finally and irrevocably fix the tax unless
 the person against whom it is assessed, within  ninety  days  after  the
 giving  of  notice  of  such  determination,  or, if the commissioner of
 finance has established a conciliation  procedure  pursuant  to  section
 11-124  of  this  title  and  the  taxpayer has requested a conciliation
 conference in accordance therewith, within ninety days from the  mailing
 of  a  conciliation decision or the date of the commissioner's confirma-
 tion of the discontinuance of  the  conciliation  proceeding,  both  (1)
 serves a petition upon the commissioner of finance and (2) files a peti-
 tion  with the tax appeals tribunal for a hearing, or unless the commis-
 sioner of finance of his or her own motion shall redetermine  the  same.
 Such  hearing and any appeal to the tax appeals tribunal sitting en banc
 from the decision rendered in such hearing shall  be  conducted  in  the
 manner  and  subject  to  the requirements prescribed by the tax appeals
 tribunal pursuant  to  sections  one  hundred  sixty-eight  through  one
 S. 8474                            844
 
 hundred  seventy-two  of the charter of the preceding municipality as it
 existed January first, nineteen hundred ninety-four. After such  hearing
 the tax appeals tribunal shall give notice of its decision to the person
 against  whom the tax is assessed and to the commissioner of finance.  A
 decision of the tax appeals tribunal sitting en banc shall be reviewable
 for error, illegality or unconstitutionality or any other reason whatso-
 ever by a proceeding under article seventy-eight of the  civil  practice
 law  and  rules  if application therefor is made to the supreme court by
 the person against whom the tax was assessed within  four  months  after
 the  giving  of  the  notice  of  such  tax appeals tribunal decision. A
 proceeding under article seventy-eight of the  civil  practice  law  and
 rules  shall  not  be instituted by a taxpayer unless: (a) the amount of
 any tax sought to be reviewed, with penalties and interest  thereon,  if
 any, shall be first deposited with the commissioner of finance and there
 shall  be  filed with the commissioner of finance an undertaking, issued
 by a surety company authorized to transact business in  this  state  and
 approved by the superintendent of insurance of this state as to solvency
 and  responsibility,  in such amount and with such sureties as a justice
 of the supreme court shall approve, to the effect that if such  proceed-
 ing  be  dismissed or the tax confirmed, the taxpayer will pay all costs
 and charges which may accrue in the prosecution of  the  proceeding;  or
 (b)  at  the  option  of  the  taxpayer  such undertaking filed with the
 commissioner of finance may be in a sum sufficient to cover  the  taxes,
 penalties  and  interest  thereon stated in such decision plus the costs
 and charges which may accrue  against  it  in  the  prosecution  of  the
 proceeding, in which event the taxpayer shall not be required to deposit
 such  taxes,  penalties  and  interest  as  a condition precedent to the
 application.
   § 11-1407  Refunds. a. In the manner  provided  in  this  section  the
 commissioner  of  finance  shall refund or credit, without interest, any
 tax, penalty or interest erroneously,  illegally  or  unconstitutionally
 collected or paid if application to the commissioner of finance for such
 refund shall be made within one year from the payment thereof.  Whenever
 a  refund  is made or denied by the commissioner of finance, the commis-
 sioner shall state his or her reason therefor and give notice thereof to
 the taxpayer in writing. Such application may be made by the  transferee
 or  transferor  who  has  actually  paid  the tax.   The commissioner of
 finance may, in lieu of any refund required to  be  made,  allow  credit
 therefor on payments due from the applicant.
   b.   Any determination of the commissioner of finance denying a refund
 or credit pursuant to subdivision a of this section shall be  final  and
 irrevocable unless the applicant for such refund or credit, within nine-
 ty  days  from  the  mailing of notice of such determination, or, if the
 commissioner of finance has established a conciliation procedure  pursu-
 ant  to  section  11-124 of this title and the applicant has requested a
 conciliation conference in accordance therewith, within ninety days from
 the mailing of a conciliation decision or the date of the commissioner's
 confirmation of the discontinuance of the conciliation proceeding,  both
 (1)  serves  a petition upon the commissioner of finance and (2) files a
 petition with the tax appeals tribunal for a hearing. Such petition  for
 a  refund  or  credit, made pursuant to this section, shall be deemed an
 application for a revision of any tax, penalty  or  interest  complained
 of.  Such  hearing and any appeal to the tax appeals tribunal sitting en
 banc from the decision rendered in such hearing shall  be  conducted  in
 the manner and subject to the requirements prescribed by the tax appeals
 tribunal  pursuant  to  sections  one  hundred  sixty-eight  through one
 S. 8474                            845
 
 hundred seventy-two of the charter of the preceding municipality  as  it
 existed January first, nineteen hundred ninety-four. After such hearing,
 the tax appeals tribunal shall give notice of its decision to the appli-
 cant and to the commissioner of finance. The applicant shall be entitled
 to  review  a  decision of the tax appeals tribunal sitting en banc by a
 proceeding pursuant to article seventy-eight of the civil  practice  law
 and  rules,  provided  such  proceeding is instituted within four months
 after the giving of notice of such decision, and provided, in  the  case
 of  an  application by a taxpayer, that a final determination of tax due
 was not previously made. Such a proceeding shall not be instituted by  a
 taxpayer unless an undertaking is filed with the commissioner of finance
 in  such amount and with such sureties as a justice of the supreme court
 shall approve to the effect that if such proceeding be dismissed or  the
 tax  confirmed,  the  taxpayer  will pay all costs and charges which may
 accrue in the prosecution of such proceeding.
   c. A person shall not be entitled to  a  revision,  refund  or  credit
 under  this section of a tax, or penalty which had been determined to be
 due pursuant to the provisions of section 11-1406 of this chapter  where
 such  person  has  had  a  hearing  or  an opportunity for a hearing, as
 provided in said section, or has failed to avail himself or  herself  of
 the  remedies  therein  provided. No refund or credit shall be made of a
 tax, interest or penalty paid after a determination by the  commissioner
 of finance made pursuant to section 11-1406 of this chapter unless it be
 found that such determination was erroneous, illegal or unconstitutional
 or  otherwise  improper, by the tax appeals tribunal after a hearing, or
 on the commissioner's own motion,  or,  is  such  tax  appeals  tribunal
 affirms  in  whole  or  in part the determination of the commissioner of
 finance, in a proceeding under article seventy-eight of the civil  prac-
 tice law and rules, pursuant to the provisions of said section, in which
 event refund or credit without interest shall be made of the tax, inter-
 est or penalty found to be overpaid.
   §  11-1408  Reserves.  In cases where the transferee or transferor has
 applied for a refund and  has  instituted  a  proceeding  under  article
 seventy-eight  of  the civil practice law and rules to review a determi-
 nation adverse to the transferee or transferor on his or her application
 for refund, the comptroller shall set up appropriate  reserves  to  meet
 any decisions adverse to the city.
   §  11-1409  Remedies  exclusive.  The  remedies  provided  by sections
 11-1406 and 11-1407 of this chapter  shall  be  the  exclusive  remedies
 available  to any person for the review of tax liability imposed by this
 chapter; and no determination or proposed determination of tax or deter-
 mination on any application for refund by the commissioner  of  finance,
 nor  any  decision by the tax appeals tribunal or any of its administra-
 tive law judges shall be enjoined or reviewed by an action for  declara-
 tory  judgment, an action for money had and received or by any action or
 proceeding other than, in the case of a  decision  by  the  tax  appeals
 tribunal  sitting  en  banc,  a proceeding in the nature of a certiorari
 proceeding under article seventy-eight of the  civil  practice  law  and
 rules;  provided,  however,  that  a taxpayer may proceed by declaratory
 judgment if the taxpayer institutes suit  within  thirty  days  after  a
 deficiency  assessment  is  made  and  pays the amount of the deficiency
 assessment to the commissioner of finance prior to  the  institution  of
 such  suit  and posts a bond for costs as provided in section 11-1406 of
 this chapter.
   § 11-1410 Proceedings to recover tax.  a. Whenever any  transferee  or
 transferor  shall  fail  to  pay any tax, penalty or interest imposed by
 S. 8474                            846

 this chapter as herein provided, the corporation counsel shall, upon the
 request of the commissioner of finance bring or cause to be  brought  an
 action  to  enforce  the  payment  of  the same on behalf of the city of
 Staten  Island  in  any  court  of the state of New York or of any other
 state or of the United States. If, however, the commissioner of  finance
 in his or her discretion believes that any such transferee or transferor
 subject  to  the  provisions of this chapter is about to cease business,
 leave the state or remove or dissipate the assets out of which  the  tax
 or penalty might be satisfied, and that any such tax or penalty will not
 be paid when due, the commissioner may declare such tax or penalty to be
 immediately due and payable and may issue a warrant immediately.
   b.  As  an additional or alternate remedy, the commissioner of finance
 may issue a warrant, directed to the city sheriff commanding the sheriff
 to levy upon and sell the real and personal property of  the  transferee
 or  transferor  or  other  person  liable for the tax which may be found
 within the city, for the payment of the amount thereof, with any penalty
 and interest, and the cost of executing the warrant, and to return  such
 warrant  to  the  commissioner of finance and to pay to the commissioner
 the money collected by  virtue  thereof  within  sixty  days  after  the
 receipt  of  such warrant. The city sheriff shall within five days after
 the receipt of the warrant file with the county clerk  a  copy  thereof,
 and  thereupon such clerk shall enter in the judgment docket the name of
 the person mentioned in the warrant and the amount of the  tax,  penalty
 and interest for which the warrant is issued and the date when such copy
 is  filed. Thereupon the amount of such warrant so docketed shall become
 a lien upon the title to and the interest in real and personal  property
 of the person against whom the warrant is issued. The city sheriff shall
 then  proceed upon the warrant in the same manner, and with like effect,
 as that provided by law in respect to executions issued against property
 upon judgments of a court of record and for services  in  executing  the
 warrant  the sheriff shall be entitled to the same fees, which he or she
 may collect in the same manner. In the discretion of the commissioner of
 finance a warrant of like terms, force and  effect  may  be  issued  and
 directed  to an officer or employee of the department of finance, and in
 the execution thereof such officer or employee shall have all the powers
 conferred by law upon sheriffs, but shall  be  entitled  to  no  fee  or
 compensation in excess of the actual expenses paid in the performance of
 such  duty.  If a warrant is returned not satisfied in full, the commis-
 sioner of finance may from time to time issue  new  warrants  and  shall
 also  have  the same remedies to enforce the amount due thereunder as if
 the city had recovered judgment therefor and execution thereon had  been
 returned unsatisfied.
   c.  Whenever  there  is made a sale, transfer or assignment in bulk or
 any part of the whole of a stock  of  merchandise  or  of  fixtures,  or
 merchandise and of fixtures pertaining to the conducting of the business
 of  the  seller,  transferor or assignor, otherwise than in the ordinary
 course of trade and in the regular prosecution  of  said  business,  the
 purchaser,  transferee or assignee shall at least ten days before taking
 possession of such merchandise, fixtures, or merchandise  and  fixtures,
 or  paying  therefor,  notify  the commissioner of finance by registered
 mail of the proposed sale and of the price, terms and conditions thereof
 whether or not the seller, transferor or assignor, has  represented  to,
 or  informed  the purchaser, transferee or assignee that it owes any tax
 pursuant to this chapter and whether or not the purchaser, transferee or
 assignee has knowledge that such taxes are owing, and whether  any  such
 taxes are in fact owing.
 S. 8474                            847
 
   d.  Whenever, the purchaser, transferee or assignee shall fail to give
 notice to the commissioner of finance as required by  subdivision  c  of
 this  section,  or whenever the commissioner of finance shall inform the
 purchaser, transferee or assignee that a possible claim for such tax  or
 taxes  exists, any sums of money, property or choses in action, or other
 consideration, which the purchaser, transferee or assignee  is  required
 to  transfer  over to the seller or assignor shall be subject to a first
 priority right and lien for any such  taxes  theretofore  or  thereafter
 determined  to  be  due  from  the seller, transferor or assignor to the
 city, and the purchaser, transferee or assignee is forbidden to transfer
 to the seller, transferor or assignor any such sums of  money,  property
 or choses in action to the extent of the amount of the city's claim. For
 failure  to comply with the provisions of this subdivision, the purchas-
 er, transferee or assignee shall be personally liable for the payment to
 the city of any such taxes theretofore or thereafter  determined  to  be
 due  to  the  city  from  the  seller,  transferor or assignor, and such
 liability may be assessed and enforced in the same manner as the liabil-
 ity for tax under this chapter.
   e. The commissioner of finance, if he or she finds that the  interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the  commissioner  of finance may require, may release any property from
 the lien of any warrant or vacate such warrant for unpaid  taxes,  addi-
 tions  to tax, penalties and interest filed pursuant to subdivision b of
 this section, and such  release  or  vacating  of  the  warrant  may  be
 recorded  in  the  office of any recording officer in which such warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   § 11-1411 General powers of the commissioner of finance.  In  addition
 to the powers granted to the commissioner of finance in this chapter, he
 or she is hereby authorized and empowered:
   1.  To  make, adopt and amend rules and regulations appropriate to the
 carrying out of this chapter and the purposes thereof;
   2. To extend, for cause shown, the time for filing any  return  for  a
 period  not  exceeding ninety days; and to compromise disputed claims in
 connection with the taxes imposed under this chapter;
   3. To request information from the taxi and limousine commission,  the
 tax  commission  of  the state of New York or the treasury department of
 the United States relative to any person; and to afford returns, reports
 and other information to such taxi and limousine commission, tax commis-
 sion or treasury department relative to any person, any other  provision
 of this chapter to the contrary notwithstanding;
   4. To delegate his or her functions hereunder to a deputy commissioner
 of finance or any employee or employees of the department of finance;
   5.  To prescribe the methods for determining the consideration subject
 to the tax, and if there is a transfer of a taxicab or other property in
 conjunction with the transfer of a taxicab license or interest  therein,
 to  prescribe rules and methods for determining the fair market value of
 such taxicab or other property;
   6. To require any transferee or transferor to keep such  records,  and
 for  such  lengths  of  time  as may be required for the proper adminis-
 tration of this chapter and to furnish such records to the  commissioner
 of finance or the taxi and limousine commission upon request;
   7.  To  assess,  determine,  revise and adjust the taxes imposed under
 this chapter.
   § 11-1412  Administration of oaths and compelling  testimony.  a.  The
 commissioner  of finance, the employees or agents duly designated by him
 S. 8474                            848
 
 or her, the tax appeals tribunal and any  of  its  duly  designated  and
 authorized  employees or agents shall have power to administer oaths and
 take affidavits in relation to any matter or proceeding in the  exercise
 of  their  powers  and  duties  under  this chapter. The commissioner of
 finance and the tax appeals tribunal shall have power  to  subpoena  and
 require  the attendance of witnesses and the production of books, papers
 and documents to secure information pertinent to the performance of  the
 duties  of the commissioner or of the tax appeals tribunal hereunder and
 of the enforcement of this chapter and to examine them in relation ther-
 eto, and to issue commissions for the examination of witnesses  who  are
 out  of the state or unable to attend before the commissioner or the tax
 appeals tribunal or excused from attendance.
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 testimony of witnesses and the  production  and  examination  of  books,
 papers  and  documents called for by the subpoena of the commissioner of
 finance or the tax appeals tribunal under this chapter.
   c. Cross-reference; criminal penalties. For failure to obey  subpoenas
 or  for  testifying  falsely,  see  section  11-4007  of this title; for
 supplying false or fraudulent information, see section 11-4009  of  this
 title.
   d.  The officers who serve the summons or subpoena of the commissioner
 of finance or the  tax  appeals  tribunal  and  witnesses  attending  in
 response  thereto  shall  be entitled to the same fees as are allowed to
 officers and witnesses in civil cases in courts  of  record,  except  as
 herein  otherwise  provided. Such officers shall be the city sheriff and
 his or her duly appointed deputies or any officers or employees  of  the
 department  of  finance or the tax appeals tribunal, designated to serve
 such process.
   § 11-1413 Interest and penalties. (a) Interest on underpayments.    If
 any  amount of tax is not paid on or before the last date prescribed for
 payment, without regard to any extension of time  granted  for  payment,
 interest  on  such amount at the rate set by the commissioner of finance
 pursuant to subdivision (g) of this section, or, if no rate is  set,  at
 the  rate of seven and one-half percent per annum, shall be paid for the
 period from such last date to the date  of  payment.  In  computing  the
 amount  of interest to be paid, such interest shall be compounded daily.
 Interest under this subdivision shall not be paid if the amount  thereof
 is less than one dollar.
   (b)  (1)  Failure  to  file return. (A)   In case of failure to file a
 return under this chapter on or before the prescribed  date,  determined
 with regard to any extension of time for filing, unless it is shown that
 such  failure is due to reasonable cause and not due to willful neglect,
 there shall be added to the amount required to be shown as tax  on  such
 return  five percent of the amount of such tax if the failure is for not
 more than one month, with an additional five percent for each additional
 month or fraction thereof  during  which  such  failure  continues,  not
 exceeding twenty-five percent in the aggregate.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to  any extension of time for filing, unless it is shown that such fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion to tax under subparagraph (A) of this paragraph shall not  be  less
 than  the  lesser  of  one hundred dollars or one hundred percent of the
 amount required to be shown as tax on such return.
 S. 8474                            849
 
   (C) For purposes of this paragraph, the amount of tax required  to  be
 shown  on  the  return shall be reduced by the amount of any part of the
 tax which is paid on or before the date prescribed for  payment  of  the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2)  Failure to pay tax shown on return. In case of failure to pay the
 amount shown as tax on a return required to be filed under this  chapter
 on  or  before the prescribed date, determined with regard to any exten-
 sion of time for payment, unless it is shown that such failure is due to
 reasonable cause and not due to willful neglect, there shall be added to
 the amount shown as tax on such return one-half of one  percent  of  the
 amount  of  such tax if the failure is not for more than one month, with
 an additional one-half of one percent for each additional month or frac-
 tion thereof during which such failure continues, not exceeding  twenty-
 five percent in the aggregate. For the purpose of computing the addition
 for  any month the amount of tax shown on the return shall be reduced by
 the amount of any part of the tax which is paid on or before the  begin-
 ning of such month and by the amount of any credit against the tax which
 may  be  claimed  upon  the  return. If the amount of tax required to be
 shown on a return is less than the amount shown as tax on  such  return,
 this paragraph shall be applied by substituting such lower amount.
   (3)  Failure  to  pay  tax required to be shown on return.  In case of
 failure to pay any amount in respect of any tax required to be shown  on
 a  return required to be filed under this chapter which is not so shown,
 including a determination made pursuant to section 11-1406 of this chap-
 ter, within ten days of the date of a notice and demand therefor, unless
 it is shown that such failure is due to reasonable cause and not due  to
 willful  neglect,  there  shall  be added to the amount of tax stated in
 such notice and demand one-half of one percent of such tax if the  fail-
 ure  is  not for more than one month, with an additional one-half of one
 percent for each additional month or fraction thereof during which  such
 failure  continues,  not exceeding twenty-five percent in the aggregate.
 For the purpose of computing the addition for any month, the  amount  of
 tax  stated  in  the notice and demand shall be reduced by the amount of
 any part of the tax which is paid before the beginning of such month.
   (4) Limitations on additions.
   (A) With respect to any return, the amount of the addition under para-
 graph one of this subdivision shall be reduced  by  the  amount  of  the
 addition  under paragraph two of this subdivision for any month to which
 an addition applies under both paragraphs  one  and  two.  In  any  case
 described  in subparagraph (B) of paragraph one of this subdivision, the
 amount of the addition under such paragraph one  shall  not  be  reduced
 below the amount provided in such subparagraph.
   (B)  With  respect  to  any return, the maximum amount of the addition
 permitted under paragraph three of this subdivision shall be reduced  by
 the  amount  of  the  addition  under paragraph one of this subdivision,
 determined without regard to subparagraph (B)  of  such  paragraph  one,
 which is attributable to the tax for which the notice and demand is made
 and which is not paid within ten days of such notice and demand.
   (c)  Underpayment  due to negligence. (1)  If any part of an underpay-
 ment of tax is due to negligence or intentional disregard of this  chap-
 ter  or  any  rules  or  regulations  hereunder,  but  without intent to
 defraud, there shall be added to the tax a penalty equal to five percent
 of the underpayment.
   (2) There shall be added to the tax, in addition to the amount  deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 S. 8474                            850
 
 percent of the interest payable under subdivision (a)  of  this  section
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to the negligence or intentional  disre-
 gard  referred to in such paragraph one, for the period beginning on the
 last date prescribed by law for payment of such underpayment, determined
 without regard to any extension, and ending on the date of  the  assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
   (d)  Underpayment due to fraud. (1)  If any part of an underpayment of
 tax is due to fraud, there shall be added to the tax a penalty equal  to
 fifty percent of the underpayment.
   (2) There shall be added to the tax, in addition to the penalty deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under subdivision (a)  of  this  section
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to fraud, for the  period  beginning  on
 the  last day prescribed by law for payment of such underpayment, deter-
 mined without regard to any extension, and ending on  the  date  of  the
 assessment  of  the  tax, or, if earlier, the date of the payment of the
 tax.
   (3) The penalty under this subdivision shall be in lieu of  any  other
 addition to tax imposed by subdivision (b) or (c) of this section.
   (e) Additional penalty.  Any person who, with fraudulent intent, shall
 fail to pay any tax imposed by this chapter, or to make, render, sign or
 certify  any  return,  or  to  supply  any  information  within the time
 required by or under this chapter, shall be liable for a penalty of  not
 more  than  one  thousand  dollars,  in  addition  to  any other amounts
 required under this chapter to be imposed, assessed and collected by the
 commissioner of finance. The commissioner  of  finance  shall  have  the
 power,  in  his  or  her  discretion, to waive, reduce or compromise any
 penalty under this subdivision.
   (f) The interest and penalties imposed by this section shall  be  paid
 and  disposed of in the same manner as other revenues from this chapter.
 Unpaid interest and penalties may be enforced in the same manner as  the
 tax imposed by this chapter.
   (g)(1)  Authority  to set interest rates.  The commissioner of finance
 shall set the rate of interest to be paid pursuant to subdivision (a) of
 this section, but if no such rate of interest is set, such rate shall be
 deemed to be set at seven and one-half percent per  annum.    Such  rate
 shall  be  the  rate prescribed in paragraph two of this subdivision but
 shall not be less than seven and one-half percent per  annum.  Any  such
 rate  set  by  the  commissioner of finance shall apply to taxes, or any
 portion thereof, which remain or become due on  or  after  the  date  on
 which  such  rate becomes effective and shall apply only with respect to
 interest computed or computable  for  periods  or  portions  of  periods
 occurring in the period in which such rate is in effect.
   (2)  General  rule.  The  rate  of interest set under this subdivision
 shall be the sum of (i) the federal short-term rate  as  provided  under
 paragraph three of this subdivision, plus (ii) seven percentage points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A)  The  federal  short-term  rate for any month shall be the federal
 short-term rate determined by the United States secretary of the  treas-
 ury  during  such  month  in  accordance  with subsection (d) of section
 twelve hundred seventy-four of the internal  revenue  code  for  use  in
 connection  with  section  six  thousand  six  hundred twenty-one of the
 internal revenue code. Any such rate shall be  rounded  to  the  nearest
 S. 8474                            851
 
 full  percent,  or,  if a multiple of one-half of one percent, such rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i)  In  general.  Except  as provided in clause (ii) of this subpara-
 graph, the federal short-term rate for the first month in each  calendar
 quarter  shall  apply  during the first calendar quarter beginning after
 such month.
   (ii) Special rule for the month of September, nineteen hundred  eight-
 y-nine.  The  federal  short-term  rate for the month of April, nineteen
 hundred eighty-nine shall apply with respect  to  setting  the  rate  of
 interest for the month of September, nineteen hundred eighty-nine.
   (4)  Publication  of  interest rate. The commissioner of finance shall
 cause to be published in the City Record,  and  give  other  appropriate
 general notice of, the interest rate to be set under this subdivision no
 later  than  twenty days preceding the first day of the calendar quarter
 during which such interest rate applies. The setting and publication  of
 such  interest rate shall not be included within paragraph (a) of subdi-
 vision five of section one thousand forty-one  of  the  charter  of  the
 preceding  municipality  as  it  existed January first, nineteen hundred
 ninety-four relating to the definition of a rule.
   (h) Miscellaneous. (1) The certificate of the commissioner of  finance
 to  the  effect that a tax has not been paid or that information has not
 been supplied pursuant to  the  provisions  of  this  chapter  shall  be
 presumptive evidence thereof.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   §  11-1414  Returns  to be secret. a. Except in accordance with proper
 judicial order or as otherwise provided by law, it shall be unlawful for
 the commissioner of finance, the chairperson of the taxi  and  limousine
 commission,  the  tax appeals tribunal or any officer or employee of the
 department of finance or  taxi  and  limousine  commission  or  the  tax
 appeals tribunal, to divulge or make known in any manner any information
 contained in or relating to any return provided for by this chapter. The
 officers  charged with the custody of such returns shall not be required
 to produce any of them or evidence of anything contained in them in  any
 action  or proceeding in any court, except on behalf of the commissioner
 of finance in an action or proceeding under the provisions of this chap-
 ter, or on behalf of any party to an  action  or  proceeding  under  the
 provisions  of  this chapter when the returns or facts shown thereby are
 directly involved in such action  or  proceeding,  in  either  of  which
 events  the  court  may  require  the  production  of,  and may admit in
 evidence, so much of said returns or of the facts shown thereby, as  are
 pertinent  to  the  action  or proceeding and no more.   Nothing in this
 section shall be construed to prohibit the delivery to a  transferee  or
 transferor or to the duly authorized representative of either of them of
 a  certified copy of any return filed in connection with the tax imposed
 by this chapter; nor to prohibit the delivery of such a  certified  copy
 of such return or of any information contained in or relating thereto to
 the United States of America or any department thereof, the state of New
 York or any department thereof, the city of Staten Island or any depart-
 ment thereof provided the same is required for official business; nor to
 prohibit  the  inspection  for  official business of such returns by the
 chairperson of the taxi and limousine commission, the corporation  coun-
 sel or other legal representatives of the city or by the district attor-
 ney of Richmond county; nor to prohibit the publication of statistics so
 S. 8474                            852
 
 classified  as  to  prevent  the identification of particular returns or
 items thereof.
   b.  (1) Any officer or employee of the city who willfully violates the
 provisions of subdivision a of this section   shall  be  dismissed  from
 office  and be incapable of holding any public office in this city for a
 period of five years thereafter.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   c. This section  shall be deemed a state statute for purposes of para-
 graph (a) of subdivision two of section eighty-seven of the public offi-
 cers law.
   d. Notwithstanding anything in subdivision a of this  section  to  the
 contrary,  if  a  taxpayer  has  petitioned the tax appeals tribunal for
 administrative review as provided in section one hundred seventy of  the
 charter of the preceding municipality as it existed January first, nine-
 teen  hundred  ninety-four, the commissioner of finance shall be author-
 ized to present to the tribunal any report or return of  such  taxpayer,
 or  any  information contained therein or relating thereto, which may be
 material or relevant to the proceeding  before  the  tribunal.  The  tax
 appeals  tribunal  shall be authorized to publish a copy or a summary of
 any decision rendered pursuant to section one hundred seventy-one of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four.
   § 11-1415 Notices and limitations of time.   a. Any notice  authorized
 or required under the provisions of this chapter may be given by mailing
 the  same  to  the person for whom it is intended in a postpaid envelope
 addressed to such person at the address given in the last  return  filed
 by such person pursuant to the provisions of this chapter, in any appli-
 cation made by such person, or in the records maintained by the taxi and
 limousine  commission,  or,  if  no return has been filed or application
 made or address found in the records of the taxi and  limousine  commis-
 sion,  then  to  such  address as may be obtainable. The mailing of such
 notice shall be presumptive evidence of the receipt of the same  by  the
 person to whom addressed. Any period of time which is determined accord-
 ing  to  the  provisions  of  this chapter by the giving of notice shall
 commence to run from the date of mailing of such notice.
   b. The provisions of the civil practice law and rules or any other law
 relative to limitations of time for the enforcement of  a  civil  remedy
 shall  not  apply to any proceeding or action taken by the city to levy,
 appraise, assess, determine or enforce the  collection  of  any  tax  or
 penalty  provided  by  this  chapter.  However,  except in the case of a
 wilfully false or fraudulent return with intent to  evade  the  tax,  no
 assessment  of additional tax shall be made after the expiration of more
 than three years from the date of the  filing  of  a  return;  provided,
 however,  that where no return has been filed as provided by law the tax
 may be assessed at any time.
   c. Where, before the expiration of the period  prescribed  herein  for
 the assessment of an additional tax, a taxpayer has consented in writing
 that  such period be extended, the amount of such additional tax due may
 be determined at any time within such extended  period.  The  period  so
 extended  may be further extended by subsequent consents in writing made
 before the expiration of the extended period.
   d. If any return, claim,  statement,  notice,  application,  or  other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 of  any  provision  of  this chapter is, after such period or such date,
 S. 8474                            853
 
 delivered by United States mail to the commissioner of finance, the  tax
 appeals  tribunal,  bureau, office, officer or person with which or with
 whom such document is required to be filed, or to which or to whom  such
 payment  is  required to be made, the date of the United States postmark
 stamped on the envelope shall be deemed to be the date of delivery. This
 subdivision shall apply only if  the  postmark  date  falls  within  the
 prescribed  period or on or before the prescribed date for the filing of
 such document, or for making the payment, including any extension grant-
 ed for such filing or payment, and only if such document or payment  was
 deposited  in  the  mail,  postage  prepaid,  properly  addressed to the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer or person with which or with whom the document  is  required  to  be
 filed or to which or to whom such payment is required to be made. If any
 document  is  sent  by  United States registered mail, such registration
 shall be prima facie evidence that such document was  delivered  to  the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer  or  person to which or to whom addressed, and the date of registra-
 tion shall be deemed the postmark date. The commissioner of finance and,
 where relevant, the tax appeals tribunal are authorized  to  provide  by
 regulation  the  extent  to  which such provisions with respect to prima
 facie evidence of delivery and the postmark date shall apply  to  certi-
 fied  mail.  Except  as  provided in subdivision f of this section, this
 subdivision shall apply in the case of postmarks not made by the  United
 States  postal  service only if and to the extent provided by regulation
 of the commissioner of finance  or,  where  relevant,  the  tax  appeals
 tribunal.
   e.  When  the  last  day  prescribed  under authority of this chapter,
 including any extension of time, for  performing  any  act  falls  on  a
 Saturday,  Sunday or legal holiday in the state, the performance of such
 act shall be considered timely if it is performed on the next succeeding
 day which is not a Saturday, Sunday or legal holiday.
   f. (1) Any reference in subdivision d of this section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the secretary of the treasury of the United States
 pursuant to section seventy-five hundred two  of  the  internal  revenue
 code  and  any  reference  in  subdivision d of this section to a United
 States postmark shall be treated as including a reference  to  any  date
 recorded  or  marked  in  the  manner  described in section seventy-five
 hundred two of the  internal  revenue  code  by  a  designated  delivery
 service.  If the commissioner of finance finds that any delivery service
 designated by such secretary is inadequate for the needs  of  the  city,
 the  commissioner  of finance may withdraw such designation for purposes
 of this title. The commissioner of finance may also designate additional
 delivery services meeting the criteria of section  seventy-five  hundred
 two  of  the  internal  revenue  code for purposes of this title, or may
 withdraw any such designation if the commissioner of finance finds  that
 a  delivery  service  so  designated  is inadequate for the needs of the
 city. Any reference in subdivision d  of  this  section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the commissioner of finance and any  reference  in
 subdivision  d  of  this  section  to  a United States postmark shall be
 treated as including a reference to any date recorded or marked  in  the
 manner  described  in  section  seventy-five hundred two of the internal
 revenue code by a delivery service designated  by  the  commissioner  of
 finance,  provided, however, any withdrawal of designation or additional
 designation by the commissioner of finance shall not  be  effective  for
 S. 8474                            854
 
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal  of  designation or additional designation is ratified by the
 president of the tax appeals tribunal.
   (2)  Any  equivalent of registered or certified mail designated by the
 United States secretary of the treasury, or as may be designated by  the
 commissioner  of  finance  pursuant  to  the  same criteria used by such
 secretary for such designations pursuant to section seventy-five hundred
 two of the internal revenue code, shall be included within  the  meaning
 of  registered  or  certified  mail  as  used  in  subdivision d of this
 section. If the commissioner of finance finds  that  any  equivalent  of
 registered or certified mail designated by such secretary or the commis-
 sioner  of  finance is inadequate for the needs of the city, the commis-
 sioner of finance may withdraw such designation  for  purposes  of  this
 title,  provided,  however,  any withdrawal of designation or additional
 designation by the commissioner of finance shall not  be  effective  for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal  of  designation or additional designation is ratified by the
 president of the tax appeals tribunal.
   § 11-1416 Construction and  enforcement.      This  chapter  shall  be
 construed  and  enforced  in  conformity with subdivision (j) of section
 twelve hundred one of the tax law.
   § 11-1417 Disposition of revenues.   All revenues resulting  from  the
 imposition of the tax under this chapter shall be paid into the treasury
 of  the  city and shall be credited to and deposited in the general fund
 of the city, but no part of such revenue may be expended  unless  appro-
 priated in the annual budget of the city.
 
                                CHAPTER 16
                             TAX ON CONTAINERS
   §  11-1601 Definitions. When used in this chapter, the following terms
 shall mean and include:
   1. "Person." An individual, partnership, society, association,  joint-
 stock  company, corporation, estate, receiver, trustee, assignee, refer-
 ee, or any other person acting in a fiduciary or representative  capaci-
 ty,  whether  appointed  by  a  court  or  otherwise and any combination
 thereof.
   2. "Container." Any article, thing or contrivance made in whole or  in
 part  of  rigid  or  semi-rigid  plastic, including, but not limited to,
 barrels, baskets, bottles, boxes, cartons, carrying cases, crates, cups,
 cylinders, drums, jars, jugs, pails, pots, trays, tubs, tubes, tumblers,
 and vessels, intended for  use  in  packing  or  packaging  any  product
 intended for sale:
   (a)  Metal  containers  and  paperboard or fiber containers which have
 been impregnated, lined or coated with plastic or other materials  shall
 be  considered  to  be  classified  as  metal  containers and paperboard
 containers, respectively;
   (b) Paperboard or fiber containers with fastenings,  tops  or  bottoms
 made of plastic shall be classified as paperboard or fiber containers;
   (c)  Plastic  caps  that are easily, readily, usually, and customarily
 separated from the container before disposal  shall  not  be  considered
 part of the container.
   3.  "Recycled  material."  Component materials which have been derived
 from previously used material or from new or old scrap material.
   4. "Taxable  period."  Such  calendar  period  prescribed  for  filing
 returns by this chapter or by the commissioner of finance.
 S. 8474                            855
 
   5.  "Retail  sale"  or  "sale at retail." A sale to any person for any
 purpose other than for resale as such or as a physical component part of
 tangible personal property.
   6.  "Sale."  The  sale  or  furnishing  of  a container by a seller or
 supplier to a retailer.
   7. "Seller or supplier." Any person who sells containers to a  retail-
 er.
   8.  "Retailer." Any person who purchases containers, whether filled or
 unfilled, for the purpose of using them in connection with and  as  part
 of  sales  at  retail  or  who  receives  them as containers of products
 intended for sale at retail.
   9. "City." The city of Staten Island.
   10. "Commissioner of finance." The  commissioner  of  finance  of  the
 city.
   11. "Comptroller." The comptroller of the city.
   §   11-1602  General powers of the  commissioner of finance.  In addi-
 tion to the powers granted to the  commissioner of finance in this chap-
 ter, the commissioner is hereby authorized and empowered:
   1.  To make, adopt and amend rules and regulations appropriate to  the
 carrying chapter and the purposes thereof;
   2.    To  extend, for cause shown, the time of filing any return for a
 period not exceeding thirty days; and for cause shown, to  remit  penal-
 ties  but  not  interest computed at the rate of six per cent per annum;
 and to compromise disputed claims in connection with  the  taxes  hereby
 imposed;
   3.  To request information from the tax commission of the state of New
 York  or  the  treasury  department of the United States relative to any
 person; and to afford information to such tax commission or such  treas-
 ury department relative to any person, any other provision of this chap-
 ter to the contrary notwithstanding;
   4.  To delegate the commissioner's functions  under this section to an
 assistant  commissioner  or  deputy  commissioner  in  the department of
 finance or to any employee or employees of the commissioner of finance;
   5.   To prescribe methods  for  determining  the  containers  sold  or
 supplied or purchased and to determine which are taxable and nontaxable;
   6.   To require sellers and suppliers and retailers within the city to
 keep detailed records with respect to  containers  bought,  sold,  used,
 manufactured  or produced, and stock and production records with respect
 to such containers whether or not subject to the  tax  imposed  by  this
 chapter,  and  to  furnish  any  information  with  respect thereto upon
 request to the  commissioner of finance;
   7.  To assess, determine, revise and readjust the taxes imposed  under
 this chapter.
   §  11-1603  Administration  of  oaths and compelling testimony. a. The
 commissioner of finance or the commissioner's employees or  agents  duly
 designated and authorized by the commissioner shall have power to admin-
 ister  oaths and take affidavits in relation to any matter or proceeding
 in the exercise of their powers  and  duties  under  this  chapter.  The
 commissioner  of  finance  shall  have power to subpoena and require the
 attendance of witnesses and the production of books,  papers  and  docu-
 ments  to secure information pertinent to the performance of the commis-
 sioner's duties hereunder and of the enforcement of this chapter and  to
 examine them in relation thereto, and to issue commissions for the exam-
 ination of witnesses who are out of the state or unable to attend before
 the commissioner or excused from attendance.
 S. 8474                            856
 
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 testimony  of  witnesses  and  the  production and examination of books,
 papers and documents called for by the subpoena of the  commissioner  of
 finance under this chapter.
   c.  Any  person  who  shall  refuse  to testify or to produce books or
 records or who shall testify falsely  in  any  material  matter  pending
 before the commissioner of finance under this chapter shall be guilty of
 a misdemeanor, punishment for which shall be a fine of not more than one
 thousand  dollars  or  imprisonment  for not more than one year, or both
 such fine and imprisonment.
   d. The officers who serve the summons or subpoena of the  commissioner
 of finance and witnesses attending in response thereto shall be entitled
 to the same fees as are allowed to officers and witnesses in civil cases
 in  courts  of record, except as otherwise provided. Such officers shall
 be the city sheriff and the city sheriff's duly  appointed  deputies  or
 any  officers or employees of the commissioner of finance, designated to
 serve such process.
   §  11-1604 Imposition of tax. 1.  On and after  July  first,  nineteen
 hundred  seventy-one,  there is hereby imposed within the city and there
 shall be paid a tax upon every sale of a plastic container at  the  rate
 of two cents for each container sold.
   2.   A credit shall be allowed against the taxes imposed by this chap-
 ter of one cent for each taxable container if manufactured with a  mini-
 mum of thirty percent of recycled material.
   §    11-1605    Presumptions and burden of proof.   For the purpose of
 proper administration of this chapter and to prevent evasion of the  tax
 hereby  imposed, it shall be presumed that all sales of plastic contain-
 ers are taxable, and not entitled to  any  credit  allowed  against  the
 taxes  imposed.    Such presumptions shall prevail until the contrary is
 established and the burden of proving the contrary  shall  be  upon  the
 taxpayer.
   §    11-1606    Payment of the tax.   The tax imposed pursuant to this
 chapter shall be paid by the seller or supplier.  However, where the tax
 has not been paid on a sale by such seller  or  supplier,  the  retailer
 shall  be  liable for tax thereon upon purchasing the container.  Should
 sellers and suppliers having no business situs in  the  city,  who  sell
 containers  to  retailers  within  the  city,  pay the tax, the retailer
 purchasing the containers shall not be liable for the tax.
   § 11-1607  Records to be kept.   Every seller or  supplier  and  every
 retailer  shall keep records of all plastic containers taxed pursuant to
 this chapter and of all purchases and sales thereof and of the taxes due
 and payable on the sale or on the purchase thereof, in such form as  the
 commissioner  of  finance may by regulation require.  Such records shall
 be available for inspection and examination at any time upon  demand  by
 the  commissioner of finance or the commissioner's duly authorized agent
 or  employee  and shall be preserved for a period of three years, except
 that the commissioner of finance may consent to their destruction within
 that period or may require that they be kept longer.
   §  11-1608  Exemptions.  1.  The following shall be  exempt  from  the
 payment of the tax imposed by this chapter:
   (a)  The state of New York, or any of its agencies, instrumentalities,
 public corporations, including a public corporation created pursuant  to
 agreement or compact with another state or Canada, or political subdivi-
 sions where it is the purchaser, user or consumer;
 S. 8474                            857
 
   (b)  The United States of America, and any of its agencies and instru-
 mentalities insofar as it is  immune  from  taxation  where  it  is  the
 purchaser, user or consumer;
   (c)  The  United Nations or other international organizations of which
 the United States of America is a member; and
   (d) Any corporation, or association, or  trust,  or  community  chest,
 fund  or  foundation,  organized and operated exclusively for religious,
 charitable, or educational purposes, or for the prevention of cruelty to
 children or animals, and no part of the net earnings of which inures  to
 the benefit of any private shareholder or individual, and no substantial
 part  of the activities of which is carrying on propaganda, or otherwise
 attempting to influence legislation; provided, however, that nothing  in
 this  paragraph  shall  include an organization operated for the primary
 purpose of carrying on a trade or business for profit,  whether  or  not
 all of its profits are payable to one or more organizations described in
 this paragraph.
   2.    The following containers shall be exempt from the tax imposed by
 this chapter:   a. Containers  sold  or  furnished  containing  products
 intended  for  use  in  manufacturing processes and not for final retail
 sale.
   b.  Containers used as receptacles for food, food products, beverages,
 dietary foods and health supplements, sold for human consumption but not
 including:  (i) candy and confectionery, (ii) fruit drinks which contain
 less than seventy percent of natural fruit  juice,  (iii)  soft  drinks,
 sodas  and  beverages such as are ordinarily dispensed at soda fountains
 or in connection therewith, other than coffee, tea and cocoa,  and  (iv)
 beer, wine or other alcoholic beverages.
   §   11-1609  Returns. 1.  Every seller or supplier shall file with the
 commissioner of finance a return of containers sold and of the taxes due
 and payable thereon for the period from  July  first,  nineteen  hundred
 seventy-one  until  the last day of September, nineteen hundred seventy-
 one and thereafter for each of the four-monthly periods  ending  on  the
 last day of January, May and September of each year.
   2.    Every  retailer  shall  file  with the commissioner of finance a
 return of containers purchased by such retailer from sellers or  suppli-
 ers having no situs within the city and of the taxes due thereon for the
 same periods provided in subdivision one of this section.
   3.  The returns shall be filed within twenty days after the end of the
 periods  covered  thereby.    The  commissioner of finance may permit or
 require returns to be made for other periods and upon such dates as  the
 commissioner  may  specify.    If  the  commissioner of finance deems it
 necessary in order to insure the payment of  the  tax  imposed  by  this
 chapter,  the  commissioner  may  require returns to be made for shorter
 periods than those prescribed pursuant to the provisions of this  subdi-
 vision and upon such dates as he or she may specify.
   4.    The  forms of returns shall be prescribed by the commissioner of
 finance and shall contain such information as the commissioner may  deem
 necessary  for  the  proper administration of this chapter.  The commis-
 sioner of finance may require amended returns to be filed within  twenty
 days  after  notice  and  to  contain  the  information specified in the
 notice.
   5.  If a return required by this chapter is not filed or if  a  return
 when  filed is incorrect or insufficient on its face the commissioner of
 finance shall take the necessary steps to enforce the filing of  such  a
 return or a corrected return.
 S. 8474                            858
 
   §  11-1610  Determination of tax. If a return required by this chapter
 is not filed, or if a return when filed is  incorrect  or  insufficient,
 the amount of tax due shall be determined by the commissioner of finance
 from  such  information  as may be obtainable and, if necessary, the tax
 may  be  estimated  on  the basis of external indices, such as volume of
 sales, inventories,  purchases  of  containers,  or  of  raw  materials,
 production figures, or other factors. Notice of such determination shall
 be  given to the person liable for the collection or payment of the tax.
 Such determination shall finally and irrevocably fix the tax unless  the
 person  against  whom  it  is  assessed, within thirty days after giving
 notice of such determination, shall apply to the commissioner of finance
 for a hearing, or unless the commissioner of finance of his or  her  own
 motion  shall  redetermine the same. After such hearing the commissioner
 of finance shall give notice of his or her determination to  the  person
 against  whom the tax is assessed. The determination of the commissioner
 of finance shall be reviewable for error, illegality or  unconstitution-
 ality  or  any  other  reason  whatsoever  by a proceeding under article
 seventy-eight of the civil practice law and rules if application  there-
 for  is made to the supreme court within four months after the giving of
 the notice of such determination. A proceeding  under  article  seventy-
 eight  of  the  civil  practice  law  and  rules shall not be instituted
 unless: (a) the amount of any tax sought to be reviewed, with  penalties
 and  interest thereon, if any, shall be first deposited with the commis-
 sioner of finance and there shall be  filed  with  the  commissioner  of
 finance  an undertaking, issued by a surety company authorized to trans-
 act business in this state and approved by the superintendent of  insur-
 ance  of this state as to solvency and responsibility, in such amount as
 a justice of the supreme court shall approve to the effect that if  such
 proceeding  be  dismissed  or the tax confirmed, the petitioner will pay
 all costs and charges  which  may  accrue  in  the  prosecution  of  the
 proceeding; or (b) at the option of the applicant such undertaking filed
 with the commissioner of finance may be in a sum sufficient to cover the
 taxes,  penalties and interest thereon stated in such determination plus
 the costs and charges which may accrue against it in the prosecution  of
 the  proceeding,  in  which event the applicant shall not be required to
 deposit such taxes, penalties and interest as a condition  precedent  to
 the application.
   §  11-1611  Refunds.  a.  In  the  manner provided in this section the
 commissioner of finance shall refund or credit,  without  interest,  any
 tax,  penalty  or  interest erroneously, illegally or unconstitutionally
 collected or paid if application to the commissioner of finance for such
 refund shall be made within one year from the payment thereof.  Whenever
 a  refund is made by the commissioner of finance, the commissioner shall
 state his or her reasons therefor in writing.  Such application  may  be
 made  by  the seller or supplier or the retailer or other person who has
 actually paid the tax. The commissioner of finance may, in lieu  of  any
 refund  required  to be made, allow credit therefor on payments due from
 the applicant.
   b. An application for a refund or credit made as herein provided shall
 be deemed an application for revision of any tax,  penalty  or  interest
 complained  of.  If  the  commissioner  of finance, prior to any hearing
 held, initially denies the  application  for  refund,  the  commissioner
 shall give notice of such determination of denial to the applicant. Such
 determination shall be final and irrevocable unless the applicant, with-
 in  thirty  days after the giving of notice of such determination, shall
 apply to the commissioner of  finance  for  a  hearing,  or  unless  the
 S. 8474                            859

 commissioner  of  finance of his or her own motion shall redetermine the
 same. After such hearing the commissioner of finance shall  give  notice
 of  his  or her determination to the applicant, who shall be entitled to
 review  such  determination by a proceeding pursuant to article seventy-
 eight of the civil practice law and rules, provided such  proceeding  is
 instituted  within  four  months  after the giving of the notice of such
 determination, and provided that a final determination of  tax  was  not
 previously  made.  Such  a  proceeding shall not be instituted unless an
 undertaking is filed with the commissioner of finance in such amount and
 with such sureties as a justice of the supreme court  shall  approve  to
 the  effect  that  if such proceeding be dismissed or the tax confirmed,
 the petitioner shall pay all costs and charges which may accrue  in  the
 prosecution of such proceeding.
   c.  A  person  shall  not  be entitled to a revision, refund or credit
 under this section of a tax, interest or penalty which had  been  deter-
 mined  to  be  due pursuant to the provisions of section 11-1610 of this
 chapter where such person has had a hearing  or  an  opportunity  for  a
 hearing,  as provided in said section, or has failed to avail himself or
 herself of the remedies therein provided. No refund or credit  shall  be
 made  of  a  tax,  interest or penalty paid after a determination by the
 commissioner of finance made pursuant to section 11-1609 of this chapter
 unless it be found that such determination  was  erroneous,  illegal  or
 unconstitutional  or  otherwise improper, by the commissioner of finance
 after a hearing or of the commissioner's own motion, or in a  proceeding
 under  article seventy-eight of the civil practice law and rules, pursu-
 ant to the provisions of said section, in which event refund  or  credit
 without  interest shall be made of the tax, interest or penalty found to
 have been overpaid.
   §  11-1612  Reserves.  In cases where the seller or  supplier  or  the
 retailer  has applied for a refund and has instituted a proceeding under
 article seventy-eight of the civil practice law and rules  to  review  a
 determination  adverse  to  him  or  her  on  his or her application for
 refund, the comptroller shall set up appropriate reserves  to  meet  any
 decision adverse to the city.
   §    11-1613   Remedies exclusive.   The remedies provided by sections
 11-1610 and 11-1611 of this chapter  shall  be  the  exclusive  remedies
 available  to any person for the review of tax liability imposed by this
 chapter; and no determination or proposed determination of tax or deter-
 mination on any application for refund shall be enjoined or reviewed  by
 an action for declaratory judgment, an action for money had and received
 or  by any action or proceeding other than a proceeding in the nature of
 a certiorari proceeding under article seventy-eight of the  civil  prac-
 tice  law  and  rules; provided, however, that a taxpayer may proceed by
 declaratory judgment if such taxpayer institutes suit within thirty days
 after a deficiency assessment is made and pays the amount of  the  defi-
 ciency  assessment  to the commissioner of finance prior to the institu-
 tion of such suit and posts a bond for  costs  as  provided  in  section
 11-1610 of this chapter.
   §  11-1614  Proceedings  to  recover  tax.  a.  Whenever any seller or
 supplier or retailer or other person shall fail to pay any tax,  penalty
 or interest imposed by this chapter, the corporation counsel shall, upon
 the  request of the commissioner of finance bring or cause to be brought
 an action to enforce the payment of the same on behalf of  the  city  of
 Staten  Island  in  any  court  of the state of New York or of any other
 state or of the United States. If, however, the commissioner of  finance
 in  his  or  her discretion believes that any such seller or supplier or
 S. 8474                            860
 
 retailer or other person is about to cease business, leave the state  or
 remove or dissipate the assets out of which the tax, penalties or inter-
 est  might be satisfied, and that any such tax, penalty or interest will
 not  be paid when due, the commissioner of finance may declare such tax,
 penalty or interest to be immediately due and payable and  may  issue  a
 warrant immediately.
   b.  As  an additional or alternate remedy, the commissioner of finance
 may issue a warrant, directed to the city sheriff  commanding  the  city
 sheriff  to  levy  upon  and  sell the real and personal property of the
 seller or supplier or retailer or other person liable for the tax, which
 may be found within the city, for the payment  of  the  amount  thereof,
 with  any penalties and interest, and the cost of executing the warrant,
 and to return such warrant to the commissioner of finance and to pay  to
 the commissioner of finance the money collected by virtue thereof within
 sixty  days  after  the  receipt of such warrant. The city sheriff shall
 within five days after the receipt of the warrant file with  the  county
 clerk  a copy thereof, and thereupon such clerk shall enter in the judg-
 ment docket the name of the person mentioned  in  the  warrant  and  the
 amount  of  the  tax,  penalties  and  interest for which the warrant is
 issued and the date when such copy is filed.  Thereupon  the  amount  of
 such  warrant  so  docketed  shall  become  a lien upon the title to and
 interest in real and personal property of the person  against  whom  the
 warrant is issued. The city sheriff shall then proceed upon the warrant,
 in  the  same  manner,  and with like effect, as that provided by law in
 respect to executions issued against property upon judgments of a  court
 of  record,  and  for services in executing the warrant the city sheriff
 shall be entitled to the same fees, which he or she may collect  in  the
 same  manner. In the discretion of the commissioner of finance a warrant
 of like terms, force and effect may be issued and directed to any  offi-
 cer or employee of the department of finance, and in the execution ther-
 eof  such officer or employee shall have all the powers conferred by law
 upon sheriffs, but shall be entitled to no fee or compensation in excess
 of the actual expenses paid in  the  performance  of  such  duty.  If  a
 warrant  is  returned not satisfied in full, the commissioner of finance
 may from time to time issue new warrants and shall also  have  the  same
 remedies  to enforce the amount due thereunder as if the city had recov-
 ered judgment therefor and execution thereon had been returned  unsatis-
 fied.
   c.  Whenever  a  seller or supplier or the retailer shall make a sale,
 transfer, or assignment in bulk of any part of the whole of his  or  her
 fixtures, or of his or her stock of merchandise, or of stock or merchan-
 dise  and of fixtures pertaining to the conduct or operation of business
 of the seller or supplier or the retailer, otherwise than in  the  ordi-
 nary course of trade and regular prosecution of business, the purchaser,
 transferee  or assignee shall at least ten days before taking possession
 of the subject of said sale, transfer or assignment, or paying therefor,
 notify the commissioner of finance by registered mail  of  the  proposed
 sale  and  of the price, terms and conditions thereof whether or not the
 seller, transferor or assignor, has  represented  to,  or  informed  the
 purchaser,  transferee or assignee that it owes any tax pursuant to this
 chapter, and whether or not the purchaser, transferee  or  assignee  has
 knowledge  that  such taxes are owing, and whether any such taxes are in
 fact owing.
   Whenever the purchaser, transferee or  assignee  shall  fail  to  give
 notice  to  the commissioner of finance as required by the opening para-
 graph of this subdivision, or whenever the commissioner of finance shall
 S. 8474                            861
 
 inform the purchaser, transferee or assignee that a possible  claim  for
 such  tax  or  taxes  exists,  any sums of money, property or chooses in
 action, or other  consideration,  which  the  purchaser,  transferee  or
 assignee  is  required  to  transfer  over  to the seller, transferor or
 assignor shall be subject to a first priority right  and  lien  for  any
 such taxes theretofore or thereafter determined to be due from the sell-
 er, transferor or assignor to the city, and the purchaser, transferee or
 assignee  is forbidden to transfer to the seller, transferor or assignor
 any such sums of money, property or chooses in action to the  extent  of
 the  amount  of  the  city's  claim.  For  failure  to  comply  with the
 provisions of this subdivision, the purchaser, transferee  or  assignee,
 in  addition  to  being  subject to the liabilities and remedies imposed
 under the provisions of article six  of  the  uniform  commercial  code,
 shall be personally liable for the payment to the city of any such taxes
 theretofore  or  thereafter  determined  to  be due to the city from the
 seller, transferor or assignor, and such liability may be  assessed  and
 enforced in the same manner as the liability for tax under this chapter.
   d.  The commissioner of finance, if he or she finds that the interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the commissioner of finance may require, may release any  property  from
 the  lien  of any warrant or vacate such warrant for unpaid taxes, addi-
 tions to tax, penalties and interest filed pursuant to subdivision b  of
 this  section,  and  such  release  or  vacating  of  the warrant may be
 recorded in the office of any recording officer in  which  such  warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   §  11-1615  Penalties  and  interest.  a. Any person failing to file a
 return or to pay any tax to the commissioner of finance within the  time
 required  by  this chapter shall be subject to a penalty of five percent
 of the amount of tax due; plus interest at the rate of  one  percent  of
 such  tax  for  each month of delay excepting the first month after such
 return was required to be filed or such tax became due; but the  commis-
 sioner  of  finance if satisfied that the delay was excusable, may remit
 all or any part of such penalty, but not interest at  the  rate  of  six
 percent per year. Such penalties and interest shall be paid and disposed
 of in the same manner as other revenues from this chapter. Unpaid penal-
 ties  and interest may be enforced in the same manner as the tax imposed
 by this chapter.
   b. Any seller or supplier or any retailer or any officer of  a  corpo-
 rate  seller  or  supplier  or  retailer,  failing  to  file a return as
 required by this chapter, or filing or causing to be filed or making  or
 causing  to  be made or given or causing to be given any return, certif-
 icate, affidavit, representation, information,  testimony  or  statement
 required or authorized by this chapter which is willfully false, and any
 seller  or supplier or any retailer or any officer of a corporate seller
 or supplier or retailer failing to keep the records required by subdivi-
 sion six of section 11-1602 of this chapter, shall, in addition  to  the
 penalties under this subdivision or elsewhere prescribed, be guilty of a
 misdemeanor,  punishment  for which shall be a fine of not more than one
 thousand dollars or imprisonment for not more than  one  year,  or  both
 such fine and imprisonment. It shall not be any defense to a prosecution
 under  this  subdivision  that  the failure to file a return or that the
 actions or failures to act mentioned in this  subdivision  was  uninten-
 tional or not willful.
   c. The certificate of the commissioner of finance to the effect that a
 tax  has not been paid, that a return has not been filed, or that infor-
 S. 8474                            862
 
 mation has not been supplied pursuant to the provisions of this chapter,
 shall be presumptive evidence thereof.
   §  11-1616  Return to be secret.  a.  Except in accordance with proper
 judicial  order,  or  as otherwise provided by law, it shall be unlawful
 for the commissioner of finance, any officer or employee of the  depart-
 ment  of  finance,  any  person  engaged  or  retained on an independent
 contract basis or any person who, pursuant to this section is  permitted
 to inspect any return or to whom a copy, an abstract or a portion of any
 return  is furnished, or to whom any information contained in any return
 is furnished, to divulge or make known in  any  manner  any  information
 contained in or relating to any return required under this chapter.  The
 officers  charged with the custody of such returns shall not be required
 to produce any of them or evidence of anything contained in them in  any
 action  or proceeding in any court, except on behalf of the commissioner
 of finance in an action or proceeding under the provisions of this chap-
 ter, or on behalf of any party to any action  or  proceeding  under  the
 provisions  of this chapter, when the returns or facts shown thereby are
 directly involved in such action  or  proceeding,  in  either  of  which
 events  the  court  may  require  the  production  of,  and may admit in
 evidence, so much of said returns or of the facts shown thereby, as  are
 pertinent  to  the  action or proceeding and no more. Nothing under this
 subdivision shall be construed to prohibit the delivery to a taxpayer or
 such taxpayer's duly authorized representative of a  certified  copy  of
 any return filed in connection with such taxpayer's tax; nor to prohibit
 the  delivery of such a certified copy of such return or of any informa-
 tion contained in or relating thereto, the United States of  America  or
 any department thereof, to the state of New York or any department ther-
 eof,  or  to  any  agency  or  department  of the city of Staten Island,
 provided the same is requested for official business;  nor  to  prohibit
 the  inspection for official business of such returns by the corporation
 counsel or other legal representatives of the city or  by  the  district
 attorney  of Richmond county; nor to prohibit the publication of statis-
 tics so classified  as  to  prevent  the  identification  of  particular
 returns  and  the  items thereof.   Returns shall be preserved for three
 years and thereafter until the commissioner of finance permits  them  to
 be destroyed.
   b.  Any violation of subdivision a of this section shall be punishable
 by  a  fine  not  exceeding one thousand dollars, or by imprisonment not
 exceeding one year, or both, in the discretion of the court, and if  the
 offender  be  an  officer  or  employee  of  the city he or she shall be
 dismissed from office and be incapable of holding any public office  for
 a period of five years thereafter.
   §   11-1617   Notices and limitations of time.  a.  Any notice author-
 ized or required under the provisions of this chapter may  be  given  by
 mailing  the  same  to  the person for whom it is intended in a postpaid
 envelope addressed to such person at  the  address  given  in  the  last
 return  filed  by such person pursuant to the provisions of this chapter
 or in any application made by such person or,  if  no  return  has  been
 filed  or  application  made, then to such address as may be obtainable.
 The mailing of such notice shall be presumptive evidence of the  receipt
 of  the  same by the person to whom addressed.  Any period of time which
 is determined according to the provisions of this chapter by the  giving
 of notice shall commence to run from the date of mailing of such notice.
   b.    The  provisions of the civil practice law and rules or any other
 law relative to limitations of time for the enforcement of a civil reme-
 dy shall not apply to any proceeding or action  taken  by  the  city  to
 S. 8474                            863
 
 levy,  appraise,  assess, determine or enforce the collection of any tax
 or penalty provided by this chapter.  However, except in the case  of  a
 willfully  false  or  fraudulent return with intent to evade the tax, no
 assessment  of additional tax shall be made after the expiration of more
 than three years from the date of the  filing  of  a  return;  provided,
 however,  that where no return has been filed as provided by law the tax
 may be assessed at any time.
   c.  Where, before the expiration of the period prescribed  under  this
 section for assessment of an additional tax, a taxpayer has consented in
 writing  that such period be extended, the amount of such additional tax
 due may be determined at any time within  such  extended  period.    The
 period  so  extended  may  be further extended by subsequent consents in
 writing made before the expiration of the extended period.
   §   11-1618   Construction and enforcement.   This  chapter  shall  be
 construed  and enforced in conformity with chapter three hundred ninety-
 nine of the laws of nineteen hundred seventy-one, pursuant to  which  it
 is enacted.
 
                                CHAPTER 17
                   CITY PERSONAL INCOME TAX ON RESIDENTS
 
                               SUBCHAPTER 1
                                  GENERAL

   §  11-1701 Imposition of tax. General.  A tax is hereby imposed on the
 city taxable income of every city resident individual, estate and  trust
 determined  in accordance with the rates set forth in subdivision (a) of
 this section for taxable years beginning before two thousand twenty-sev-
 en, and in accordance with the rates set forth  in  subdivision  (b)  of
 this  section for taxable years beginning after two thousand twenty-six.
 Provided, however, that if, for any taxable  year  beginning  after  two
 thousand  twenty-six,  the  rates  set forth in such subdivision (b) are
 rendered inapplicable and the rates set forth in  such  subdivision  (a)
 are  rendered applicable, then the tax for such taxable year shall be at
 the rates provided under subparagraph (A) of  paragraphs  one,  two  and
 three of such subdivision (a).
   Notwithstanding  the  opening  paragraph  of this section, for taxable
 years beginning after two thousand two and before two  thousand  six,  a
 tax  is hereby imposed on the city taxable income of every city resident
 individual, estate and trust determined in accordance with the rates set
 forth in subdivision (g) of this section  and  in  accordance  with  the
 provisions  of  subdivision (h) of this section. During any taxable year
 beginning after two thousand two and before two thousand six,  in  which
 the  tax  imposed  pursuant  to this section is determined in accordance
 with subdivisions (g) and (h) of this section, the rates  set  forth  in
 subdivisions  (a) and (b) of this section shall be inapplicable, and the
 tax imposed pursuant to section  11-1704.1  of  this  chapter  shall  be
 suspended.
   (a)  Rate  of  tax.  A  tax  imposed pursuant to this section shall be
 determined as follows:
   (1) Resident married individuals filing  joint  returns  and  resident
 surviving  spouses.  The tax under this section for each taxable year on
 the city taxable income of every city resident  married  individual  who
 makes  a  single return jointly with his or her spouse under subdivision
 (b) of section 11-1751 of this chapter and on the city taxable income of
 S. 8474                            864
 
 every city resident surviving spouse shall be determined  in  accordance
 with the following tables:
 
   (A) For taxable years beginning after two thousand sixteen:
 
   If the city taxable income is:   The tax is:
   Not over $21,600                 2.7% of the city taxable income
   Over $21,600 but not             $583 plus 3.3% of excess
   over $45,000                     over $21,600
   Over $45,000 but not             $1,355 plus 3.35% of excess
   over $90,000                     over $45,000
   Over $90,000                     $2,863 plus 3.4% of excess
                                    over $90,000
 
   (B) For taxable years beginning after two thousand fourteen and before
 two thousand seventeen:
 
   If the city taxable income is:   The tax is:
   Not over $21,600                 2.55% of the city taxable income
   Over $21,600 but not             $551 plus 3.1% of excess
   over $45,000                     over $21,600
   Over $45,000 but not             $1,276 plus 3.15% of excess
   over $90,000                     over $45,000
   Over $90,000 but not             $2,694 plus 3.2% of excess
   over $500,000                    over $90,000
   Over $500,000                    $16,803 plus 3.4% of excess
                                    over $500,000
 
   (C) For taxable years beginning after two thousand nine and before two
 thousand fifteen:
 
   If the city taxable income is:   The tax is:
   Not over $21,600                 2.55% of the city taxable income
   Over $21,600 but not             $551 plus 3.1% of excess
   over $45,000                     over $21,600
   Over $45,000 but not             $1,276 plus 3.15% of excess
   over $90,000                     over $45,000
   Over $90,000 but not             $2,694 plus 3.2% of excess
   over $500,000                    over $90,000
   Over $500,000                    $15,814 plus 3.4% of excess
                                    over $500,000
 
   (2)  Resident heads of households. The tax under this section for each
 taxable year on the city taxable income of every city resident head of a
 household shall be determined in accordance with the following tables:
   (A) For taxable years beginning after two thousand sixteen:
 
   If the city taxable income is:   The tax is:
   Not over $14,400                 2.7% of the city taxable income
   Over $14,400 but not             $389 plus 3.3% of excess
   over $30,000                     over $14,400
   Over $30,000 but not             $904 plus 3.35% of excess
   over $60,000                     over $30,000
   Over $60,000                     $1,909 plus 3.4% of excess
                                    over $60,000
 S. 8474                            865
 
   (B) For taxable years beginning after two thousand fourteen and before
 two thousand seventeen:
 
   If the city taxable income is:   The tax is:
   Not over $14,400                 2.55% of the city taxable income
   Over $14,400 but not             $367 plus 3.1% of excess
   over $30,000                     over $14,400
   Over $30,000 but not             $851 plus 3.15% of excess
   over $60,000                     over $30,000
   Over $60,000 but not             $1,796 plus 3.2% of excess
   over $500,000                    over $60,000
   Over $500,000                    $16,869 plus 3.4% of excess
                                    over $500,000
 
   (C) For taxable years beginning after two thousand nine and before two
 thousand fifteen:
 
   If the city taxable income is:   The tax is:
   Not over $14,400                 2.55% of the city taxable income
   Over $14,400 but not             $367 plus 3.1% of excess
   over $30,000                     over $14,400
   Over $30,000 but not             $851 plus 3.15% of excess
   over $60,000                     over $30,000
   Over $60,000 but not             $1,796 plus 3.2% of excess
   over $500,000                    over $60,000
   Over $500,000                    $15,876 plus 3.4% of excess
                                    over $500,000
 
   (3)    Resident  unmarried  individuals,  resident married individuals
 filing separate returns and resident estates and trusts. The  tax  under
 this  section for each taxable year on the city taxable income  of every
 city resident individual who is not a married  individual  who  makes  a
 single  return  jointly  with his or her spouse under subdivision (b) of
 section 11-1751 of this chapter or a city resident head of  a  household
 or  a  city resident surviving spouse, and on the city taxable income of
 every city resident estate and trust shall be determined  in  accordance
 with the following tables:
   (A) For taxable years beginning after two thousand sixteen:
 
   If the city taxable income is:   The tax is:
   Not over $12,000                 2.7% of the city taxable income
   Over $12,000 but not             $324 plus 3.3% of excess
   over $25,000                     over $12,000
   Over $25,000 but not             $753 plus 3.35% of excess
   over $50,000                     over $25,000
   Over $50,000                     $1,591 plus 3.4% of excess
                                    over $50,000
 
   (B) For taxable years beginning after two thousand fourteen and before
 two thousand seventeen:
 
   If the city taxable income is:   The tax is:
   Not over $12,000                 2.55% of the city taxable income
   Over $12,000 but not             $306 plus 3.1% of excess
   over $25,000                     over $12,000
   Over $25,000 but not             $709 plus 3.15% of excess
 S. 8474                            866
 
   over $50,000                     over $25,000
   Over $50,000 but not             $1,497 plus 3.2% of excess
   over $500,000                    over $50,000
   Over $500,000                    $16,891 plus 3.4% of excess
                                    over $500,000
 
   (C) For taxable years beginning after two thousand nine and before two
 thousand fifteen:
 
   If the city taxable income is:   The tax is:
   Not over $12,000                 2.55% of the city taxable income
   Over $12,000 but not             $306 plus 3.1% of excess
   over $25,000                     over $12,000
   Over $25,000 but not             $709 plus 3.15% of excess
   over $50,000                     over $25,000
   Over $50,000 but not             $1,497 plus 3.2% of excess
   over $500,000                    over $50,000
   Over $500,000                    $15,897 plus 3.4% of excess
                                    over $500,000
 
   (b)  Rate  of  tax.  A  tax  imposed pursuant to this section shall be
 determined as follows:
   (1) Resident married individuals filing  joint  returns  and  resident
 surviving  spouses.  The tax under this section for each taxable year on
 the city taxable income of every city resident  married  individual  who
 makes  a  single return jointly with his or her spouse under subdivision
 (b) of section 11-1751 of this chapter and on the city taxable income of
 every city resident surviving spouse shall be determined  in  accordance
 with the following table:
   For taxable years beginning after two thousand twenty-six:

 If the city taxable income is:         The tax is:
 Not over $21,600                       1.18% of the city taxable income
 Over $21,600 but not                   $255 plus 1.435% of excess
 over $45,000                             over $21,600
 Over $45,000 but not                   $591 plus 1.455% of excess
 over $90,000                             over $45,000
 Over $90,000                           $1,245 plus 1.48% of excess
                                          over $90,000
   (2)  Resident heads of households. The tax under this section for each
 taxable year on the city taxable income of every city resident head of a
 household shall be determined in accordance with the following table:
   For taxable years beginning after two thousand twenty-six:
 
 If the city taxable income is:         The tax is:
 Not over $14,400                       1.18% of the city taxable income
 Over $14,400 but not                   $170 plus 1.435% of excess
 over $30,000                             over $14,400
 Over $30,000 but not                   $394 plus 1.455% of excess
 over $60,000                             over $30,000
 Over $60,000                           $830 plus 1.48% of excess
                                          over $60,000
 
   (3)  Resident  unmarried  individuals,  resident  married  individuals
 filing  separate  returns and resident estates and trusts. The tax under
 this section for each taxable year on the city taxable income  of  every
 S. 8474                            867
 
 city  resident  individual  who  is not a married individual who makes a
 single return jointly with his or her spouse under  subdivision  (b)  of
 section  11-1751  of this chapter or a city resident head of a household
 or  a  city resident surviving spouse, and on the city taxable income of
 every city resident estate and trust shall be determined  in  accordance
 with the following table:
   For taxable years beginning after two thousand twenty-six:
 
 If the city taxable income is:         The tax is:
 Not over $12,000                       1.18% of the city taxable income
 Over $12,000 but not                   $142 plus 1.435% of excess
 over $25,000                             over $12,000
 Over $25,000 but not                   $328 plus 1.455% of excess
 over $50,000                             over $25,000
 Over $50,000                           $692 plus 1.48% of excess
                                          over $50,000
 
   (c)  Partners  and  partnerships.  A  partnership as such shall not be
 subject to tax under this chapter. Persons carrying on business as part-
 ners shall be liable for tax under this chapter only in  their  separate
 or  individual  capacities.  As used in this chapter, the term "partner-
 ship" shall include, unless a different meaning is clearly  required,  a
 subchapter  K  limited liability company. The term "subchapter K limited
 liability company" shall mean a limited liability company classified  as
 a partnership for federal income tax purposes. The term "limited liabil-
 ity  company"  means  a  domestic limited liability company or a foreign
 limited liability company, as defined in section one hundred two of  the
 limited  liability  company  law, a limited liability investment company
 formed pursuant to section five hundred seven of the banking law,  or  a
 limited  liability  company formed pursuant to section one hundred two-a
 of the banking law.
   (d) Associations taxable as corporations.  An  association,  trust  or
 other  unincorporated organization which is taxable as a corporation for
 federal income tax purposes shall not be subject to tax under this chap-
 ter.
   (e) Exempt trusts and organizations. A trust or  other  unincorporated
 organization  which  by  reason  of its purposes or activities is exempt
 from federal income tax shall be exempt from  tax  under  this  chapter,
 regardless  of  whether subject to federal and state income tax on unre-
 lated business taxable income.
   (f) Cross references. For definitions of city taxable income of:
   (1) City resident individual, see section 11-1711 of this chapter.
   (2) City resident estate or trust, see section 11-1718 of  this  chap-
 ter.
   (g)  Rate  of  tax. For taxable years beginning after two thousand two
 and before two thousand six, the tax imposed pursuant  to  this  section
 shall be determined as follows:
   (1)  Resident  married  individuals  filing joint returns and resident
 surviving spouses. The tax under this section for each taxable  year  on
 the  city  taxable  income of every city resident married individual who
 makes a single return jointly with his or her spouse  under  subdivision
 (b) of section 11-1751 of this chapter and on the city taxable income of
 every  city  resident surviving spouse shall be determined in accordance
 with the following tables:
 
   (A) For taxable years beginning in two thousand five:
 S. 8474                            868
 
 If the city taxable income is:        The tax is:
 Not over $21,600                      2.907% of the city taxable income
 Over $21,600 but not over $45,000     $628 plus 3.534% of excess over
                                       $21,600
 Over $45,000 but not over $90,000     $1,455 plus 3.591% of excess over
                                       $45,000
 Over $90,000 but not over $150,000    $3,071 plus 3.648% of excess over
                                       $90,000
 Over $150,000 but not over $500,000   $5,260 plus 4.05% of excess over
                                       $150,000
 Over $500,000                         $19,435 plus 4.45% of excess over
                                       $500,000
 
   (B) For taxable years beginning in two thousand four:
 
 If the city taxable income is:        The tax is:
 Not over $21,600                      2.907% of the city taxable income
 Over $21,600 but not over $45,000     $628 plus 3.534% of excess over
                                       $21,600
 Over $45,000 but not over $90,000     $1,455 plus 3.591% of excess over
                                       $45,000
 Over $90,000 but not over $150,000    $3,071 plus 3.648% of excess over
                                       $90,000
 Over $150,000 but not over $500,000   $5,260 plus 4.175% of excess over
                                       $150,000
 Over $500,000                         $19,872 plus 4.45% of excess over
                                       $500,000
 
   (C) For taxable years beginning in two thousand three:
 
 If the city taxable income is:        The tax is:
 Not over $21,600                      2.907% of the city taxable income
 Over $21,600 but not over $45,000     $628 plus 3.534% of excess over
                                       $21,600
 Over $45,000 but not over $90,000     $1,455 plus 3.591% of excess over
                                       $45,000
 Over $90,000 but not over $150,000    $3,071 plus 3.648% of excess over
                                       $90,000
 Over $150,000 but not over $500,000   $5,260 plus 4.25% of excess over
                                       $150,000
 Over $500,000                         $20,135 plus 4.45% of excess over
                                       $500,000
 
   (2)  Resident heads of households. The tax under this section for each
 taxable year on the city taxable income of every city resident head of a
 household shall be determined in accordance with the following tables:
 
   (A) For taxable years beginning in two thousand five:
 
 If the city taxable income is:        The tax is:
 Not over $14,400                      2.907% of the city taxable income
 Over $14,400 but not over $30,000     $419 plus 3.534% of excess over
                                       $14,400
 Over $30,000 but not over $60,000     $970 plus 3.591% of excess over
                                       $30,000
 Over $60,000 but not over $125,000    $2,047 plus 3.648% of excess over
 S. 8474                            869
 
                                       $60,000
 Over $125,000 but not over $500,000   $4,418 plus 4.05% of excess over
                                       $125,000
 Over $500,000                         $19,606 plus 4.45% of excess over
                                       $500,000
 
   (B) For taxable years beginning in two thousand four:
 
 If the city taxable income is:        The tax is:
 Not over $14,400                      2.907% of the city taxable income
 Over $14,400 but not over $30,000     $419 plus 3.534% of excess over
                                       $14,400
 Over $30,000 but not over $60,000     $970 plus 3.591% of excess over
                                       $30,000
 Over $60,000 but not over $125,000    $2,047 plus 3.648% of excess over
                                       $60,000
 Over $125,000 but not over $500,000   $4,418 plus 4.175% of excess over
                                       $125,000
 Over $500,000                         $20,075 plus 4.45% of excess over
                                       $500,000
 
   (C) For taxable years beginning in two thousand three:
 
 If the city taxable income is:        The tax is:
 Not over $14,400                      2.907% of the city taxable income
 Over $14,400 but not over $30,000     $419 plus 3.534% of excess over
                                       $14,400
 Over $30,000 but not over $60,000     $970 plus 3.591% of excess over
                                       $30,000
 Over $60,000 but not over $125,000    $2,047 plus 3.648% of excess over
                                       $60,000
 Over $125,000 but not over $500,000   $4,418 plus 4.25% of excess over
                                       $125,000
 Over $500,000                         $20,356 plus 4.45% of excess over
                                       $500,000
 
   (3)  Resident  unmarried  individuals,  resident  married  individuals
 filing separate returns and resident estates and trusts. The  tax  under
 this  section  for each taxable year on the city taxable income of every
 city resident individual who is not a married  individual  who  makes  a
 single  return  jointly  with his or her spouse under subdivision (b) of
 section 11-1751 of this chapter or a city resident head of household  or
 a  city  resident  surviving  spouse,  and on the city taxable income of
 every city resident estate and trust shall be determined  in  accordance
 with the following tables:
 
   (A) For taxable years beginning in two thousand five:
 
 If the city taxable income is:        The tax is:
 Not over $12,000                      2.907% of the city taxable income
 Over $12,000 but not over $25,000     $349 plus 3.534% of excess over
                                       $12,000
 Over $25,000 but not over $50,000     $808 plus 3.591% of excess over
                                       $25,000
 Over $50,000 but not over $100,000    $1,706 plus 3.648% of excess over
 S. 8474                            870
 
                                       $50,000
 Over $100,000 but not over $500,000   $3,530 plus 4.05% of excess over
                                       $100,000
 Over $500,000                         $19,730 plus 4.45% of excess over
                                       $500,000
 
   (B) For taxable years beginning in two thousand four:
 
 If the city taxable income is:        The tax is:
 Not over $12,000                      2.907% of the city taxable income
 Over $12,000 but not over $25,000     $349 plus 3.534% of excess over
                                       $12,000
 Over $25,000 but not over $50,000     $808 plus 3.591% of excess over
                                       $25,000
 Over $50,000 but not over $100,000    $1,706 plus 3.648% of excess over
                                       $50,000
 Over $100,000 but not over $500,000   $3,530 plus 4.175% of excess over
                                       $100,000
 Over $500,000                         $20,230 plus 4.45% of excess over
                                       $500,000
 
   (C) For taxable years beginning in two thousand three:
 
 If the city taxable income is:        The tax is:
 Not over $12,000                      2.907% of the city taxable income
 Over $12,000 but not over $25,000     $349 plus 3.534% of excess over
                                       $12,000
 Over $25,000 but not over $50,000     $808 plus 3.591% of excess over
                                       $25,000
 Over $50,000 but not over $100,000    $1,706 plus 3.648% of excess over
                                       $50,000
 Over $100,000 but not over $500,000   $3,530 plus 4.25% of excess over
                                       $100,000
 Over $500,000                         $20,530 plus 4.45% of excess over
                                       $500,000
 
   (h) Tax table benefit recapture. For taxable years beginning after two
 thousand  two  and  before  two  thousand six, there is hereby imposed a
 supplemental tax, in addition to the tax imposed under the opening para-
 graph of this section, for the purpose of recapturing the benefit of the
 tax tables contained in subdivision (g) of  this  section.  The  supple-
 mental tax shall be an amount equal to the sum of the tax table benefits
 in  paragraphs  one  and  two  of  this  subdivision multiplied by their
 respective fractions in such paragraphs provided,  however,  that  para-
 graph  one  of this subdivision shall not apply to taxpayers who are not
 subject to the second highest rate of tax.
   (1) Resident  married  individuals  filing  joint  returns,  surviving
 spouses,  resident  heads of households, resident unmarried individuals,
 resident  married  individuals  filing  separate  returns  and  resident
 estates  and trusts. (A) The tax table benefit is the difference between
 (i) the amount of taxable income set forth in the tax table in  subdivi-
 sion  (g)  of this section not subject to the second highest rate of tax
 for the taxable year multiplied by such rate and (ii) the second highest
 dollar denominated tax for such amount of taxable income  set  forth  in
 the  tax table applicable to the taxable year in subdivision (g) of this
 section.
 S. 8474                            871
 
   (B) The fraction is computed as follows: the numerator is  the  lesser
 of  fifty  thousand  dollars  or  the  excess of New York adjusted gross
 income for the taxable year over one hundred fifty thousand dollars  and
 the denominator is fifty thousand dollars.
   (C)  This  paragraph shall only apply to taxable years beginning after
 two thousand two and before two thousand six.
   (2) Resident  married  individuals  filing  joint  returns,  surviving
 spouses,  resident  heads of households, resident unmarried individuals,
 resident  married  individuals  filing  separate  returns  and  resident
 estates  and trusts. (A) The tax table benefit is the difference between
 (i) the amount of taxable income set forth in the tax table in  subdivi-
 sion  (g) of this section not subject to the highest rate of tax for the
 taxable year multiplied by such rate and (ii) the highest dollar denomi-
 nated tax for such amount of taxable income set forth in the  tax  table
 applicable  to  the taxable year in subdivision (g) of this section less
 the sum of the tax table benefits in paragraph one of this subdivision.
   (B) For such taxpayers with adjusted gross income  over  five  hundred
 thousand dollars, the fraction is one. Provided, however, that the total
 tax  prior  to  the  application of any tax credits shall not exceed the
 highest rate of tax set forth in the tax table  in  subdivision  (g)  of
 this section multiplied by the taxpayer's taxable income.
   (C)  This  paragraph shall only apply to taxable years beginning after
 two thousand two and before two thousand six.
   § 11-1703 Separate tax on the ordinary  income  portion  of  lump  sum
 distributions.  (a) Imposition of separate tax. In addition to any other
 tax imposed by this chapter, there is hereby imposed  for  each  taxable
 year  a  separate  tax  on  the  ordinary  income  portion of a lump sum
 distribution of every city resident individual, estate and  trust  which
 has  made  an  election  of  lump  sum treatment under subsection (e) of
 section four hundred two of the internal revenue code. The recipient  of
 a  lump  sum  distribution  shall  be liable for the tax imposed by this
 section. The credits against tax under  this  chapter,  except  for  the
 credit  under  section  11-1773,  shall  not  be allowed against the tax
 imposed by this section.
   (b) Cross reference. For computation of tax, see  section  11-1724  of
 this chapter.
   § 11-1704  Tax  surcharge.  (a)  In  addition  to the taxes imposed by
 sections 11-1701 and 11-1703 of this subchapter, there is hereby imposed
 for each taxable year beginning after nineteen hundred  eighty-nine  but
 before nineteen hundred ninety-nine, a tax surcharge on the city taxable
 income of every city resident individual, estate and trust.
   (b) The tax surcharge imposed pursuant to this section shall be deter-
 mined as follows:
   (1)  Resident  married  individuals  filing joint returns and resident
 surviving spouses. The tax surcharge under  this  section  on  the  city
 taxable  income  of  every  city resident married individual who makes a
 single return jointly with his or her spouse under  subdivision  (b)  of
 section  11-1751 of this chapter and on the city taxable income of every
 city resident surviving spouse shall be determined  in  accordance  with
 the following tables:
 
   (A) For taxable years beginning after nineteen hundred eighty-nine and
 before nineteen hundred ninety-five:
 S. 8474                            872
 
 If the city taxable income is:         The tax surcharge is:
 Not over $15,500                               0
 Over $15,500 but not over $27,000      0.51% of city taxable income in
                                          excess of $15,500
 Over $27,000 but not over $45,000      $59 plus 0.55% of excess over
                                          $27,000
 Over $45,000 but not over $108,000     $158 plus 0.51% of excess over
                                          $45,000
 Over $108,000                          $479 plus 0.51% of excess over
                                          $108,000
 
   (B) For taxable years beginning after nineteen hundred ninety-four but
 before nineteen hundred ninety-nine:
 
 If the city taxable income is:         The tax surcharge is:
 Not over $14,400                              0
 Over $14,400 but not over $27,000      0.51% of city taxable income in
                                          excess of $14,400
 Over $27,000 but not over $45,000      $64 plus 0.55% of excess over
                                          $27,000
 Over $45,000 but not over $108,000     $162 plus 0.51% of excess over
                                          $45,000
 Over $108,000                          $484 plus 0.51% of excess over
                                          $108,000
 
   (2) Resident heads of households. The tax surcharge under this section
 on  the  city  taxable  income  of every city resident head of household
 shall be determined in accordance with the following tables:
   (A) For taxable years beginning after nineteen hundred eighty-nine and
 before nineteen hundred ninety-five:
 
 If the city taxable income is:         The tax surcharge is:
 Not over $8,800                                0
 Over $8,800 but not over $16,500       0.51% of city taxable income in
                                          excess of $8,800
 Over $16,500 but not over $27,500      $39 plus 0.55% of excess over
                                          $16,500
 Over $27,500 but not over $66,000      $100 plus 0.51% of excess over
                                          $27,500
 Over $66,000                           $296 plus 0.51% of excess over
                                          $66,000
 
   (B) For taxable years beginning after nineteen hundred ninety-four but
 before nineteen hundred ninety-nine:
 
 If the city taxable income is:         The tax surcharge is:
 Not over $7,350                              0
 Over $7,350 but not over $9,200        0.42% of city taxable income in
                                          excess of $7,350
 Over $9,200 but not over $17,250       $7 plus 0.51% of excess over
                                          $9,200
 Over $17,250 but not over $28,750      $48 plus 0.55% of excess over
                                          $17,250
 Over $28,750 but not over $69,000      $111 plus 0.51% of excess over
                                          $28,750
 Over $69,000                           $317 plus 0.51% of excess over
 S. 8474                            873
 
                                          $69,000
 
   (3)  Resident  unmarried  individuals,  resident  married  individuals
 filing separate  returns  and  resident  estates  and  trusts.  The  tax
 surcharge  under  this  section on the city taxable income of every city
 resident individual who is not a city resident  married  individual  who
 makes  a  single return jointly with his or her spouse under subdivision
 (b) of section 11-1751 of this chapter or a city resident head of house-
 hold or a city resident surviving spouse, and on the city taxable income
 of every city resident estate and trust shall be determined  in  accord-
 ance with the following tables:
   (A) For taxable years beginning after nineteen hundred eighty-nine and
 before nineteen hundred ninety-five:
 
 If the city taxable income is:         The tax surcharge is:
 Not over $9,000                                0
 Over $9,000 but not over $15,000       0.51% of city taxable income in
                                          excess of $9,000
 Over $15,000 but not over $25,000      $31 plus 0.55% of excess over
                                          $15,000
 Over $25,000 but not over $60,000      $86 plus 0.51% of excess over
                                          $25,000
 Over $60,000                           $264 plus 0.51% of excess over
                                          $60,000
 
   (B) For taxable years beginning after nineteen hundred ninety-four but
 before nineteen hundred ninety-nine:
 
 If the city taxable income is:         The tax surcharge is:
 Not over $8,400                              0
 Over $8,400 but not over $15,000       0.51% of city taxable income in
                                          excess of $8,400
 Over $15,000 but not over $25,000      $33 plus 0.55% of excess over
                                          $15,000
 Over $25,000 but not over $60,000      $88 plus 0.51% of excess over
                                          $25,000
 Over $60,000                           $266 plus 0.51% of excess over
                                          $60,000
 
   (c) The tax surcharge imposed pursuant to this section shall be admin-
 istered,  collected  and distributed by the commissioner of taxation and
 finance in the same manner as the taxes  imposed  pursuant  to  sections
 11-1701  and  11-1703  of  this subchapter, and all of the provisions of
 this chapter, including sections 11-1706, 11-1721 and  11-1773  of  this
 chapter, shall apply to the tax surcharge imposed by this section.
   (d)  (1) Notwithstanding subdivision (b) of this section, with respect
 to taxable years beginning in nineteen  hundred  ninety-three,  nineteen
 hundred  ninety-four,  nineteen hundred ninety-five and nineteen hundred
 ninety-six, the mayor shall, by August first of nineteen  hundred  nine-
 ty-two,  nineteen  hundred ninety-four and nineteen hundred ninety-five,
 and by September fifteenth of nineteen hundred ninety-three, transmit to
 the commissioner of taxation and finance a certification  setting  forth
 the   percentage   of  non-achievement  regarding  the  combined  police
 uniformed staffing level with respect to the fiscal  year  of  the  city
 ending  on  the immediately preceding June thirtieth, provided, however,
 that for the city fiscal year ending in  nineteen  hundred  ninety-three
 S. 8474                            874
 
 the  percentage  of  non-achievement shall be determined by the combined
 police uniformed staffing level existing on August  thirtieth,  nineteen
 hundred  ninety-three,  and  further  provided for all such fiscal years
 that  the percentage of non-achievement shall be calculated according to
 the procedure specified in a memorandum of understanding relating to the
 New York city safe streets-safe city program and  to  the  enactment  of
 this  subdivision  dated February eleventh, nineteen hundred ninety-one,
 as amended, and executed by the governor, the temporary president of the
 senate, the speaker of the assembly, the minority leader of the  senate,
 the  minority  leader  of the assembly, the mayor and the speaker of the
 city council, any  modification  of  such  memorandum  of  understanding
 subsequently  agreed upon by all such signatories in a single subsequent
 memorandum of understanding. If such percentage  of  non-achievement  is
 equal  to or exceeds twenty-five percent with respect to the fiscal year
 of the city of New York ending in nineteen  hundred  ninety-two,  twenty
 percent  with respect to the city fiscal year ending in nineteen hundred
 ninety-three or five percent with  respect  to  the  city  fiscal  years
 ending in nineteen hundred ninety-four and nineteen hundred ninety-five,
 then  the rates of the tax surcharge imposed by this section for taxable
 years beginning in the calendar year beginning  on  January  first  next
 succeeding  such  August  first  or  September  fifteenth  shall  be the
 products of the rates set forth in subdivision (b) of this section and a
 percentage equal to the difference between one hundred percent and  such
 percentage  of  non-achievement,  such  products computed to the nearest
 hundredth of a percent, and the dollar denominated amounts  of  the  tax
 surcharge  set forth in subdivision (b) of this section shall be reduced
 conformably.
   (2) Notwithstanding subdivision (b) of this section, with  respect  to
 the  taxable  year beginning in nineteen hundred ninety-eight, the mayor
 shall, by August first of nineteen hundred ninety-seven, transmit to the
 state commissioner of taxation and finance a certification setting forth
 the percentage of non-achievement regarding the police uniformed  staff-
 ing  level  with  respect  to  the fiscal year ending on the immediately
 preceding June thirtieth, provided, however,  that  such  percentage  of
 non-achievement shall be calculated according to the procedure specified
 in  a  new memorandum of understanding relating to the enactment of this
 paragraph dated no later than  thirty  days  after  such  enactment,  as
 executed  by  the  governor,  the temporary president of the senate, the
 speaker of the assembly, the minority leader of the senate, the minority
 leader of the assembly, the mayor and the speaker of  the  city  council
 and  any  modifications  of  such new memorandum of understanding subse-
 quently agreed upon by all such signatories in a single subsequent memo-
 randum of understanding. If such percentage of  non-achievement  exceeds
 two  percent with respect to the fiscal year of the city ending in nine-
 teen hundred ninety-seven, then the rates of the tax  surcharge  author-
 ized  by  this  section  for the taxable years beginning in the calendar
 year beginning on January first, nineteen hundred ninety-eight shall  be
 the  products  of the rates set forth in subdivision (b) of this section
 and a percentage equal to the difference between one hundred percent and
 the portion of the percentage of non-achievement that is  in  excess  of
 two  percent,  such  products  computed  to  the  nearest hundredth of a
 percent, and the dollar denominated amounts of  the  tax  surcharge  set
 forth in subdivision (b) of this section shall be reduced conformably.
   (3) If the rates of the surcharge imposed by this section are modified
 pursuant  to  paragraph  one  or  paragraph two of this subdivision, the
 S. 8474                            875

 state commissioner of taxation and finance shall promulgate  regulations
 stating the modified rates.
   (e)  Notwithstanding  anything  in  this section or section 11-1798 of
 this chapter to the contrary, of the total revenue,  including  interest
 and  penalties, from the tax surcharge imposed by this section which the
 state comptroller is required to pay,  after  June  thirtieth,  nineteen
 hundred  ninety-two, to the chief fiscal officer of the city for payment
 into the treasury of the city, one hundred ten million  dollars  thereof
 paid  to  the  chief  fiscal  officer during the fiscal year of the city
 commencing July first, nineteen hundred ninety-two, two hundred  million
 dollars  thereof paid to the chief fiscal officer during the fiscal year
 of the city commencing July first, nineteen  hundred  ninety-three,  one
 hundred  sixty-seven  million  dollars  thereof paid to the chief fiscal
 officer during the fiscal year of the city commencing July first,  nine-
 teen  hundred  ninety-four,  and one hundred eighty-five million dollars
 thereof paid to the chief fiscal officer during the fiscal year  of  the
 city commencing July first, nineteen hundred ninety-five, shall be cred-
 ited to and deposited in the criminal justice account established within
 the general fund of the city for the implementation of the safe streets-
 safe  city program. The balance of such revenue shall be credited to the
 general fund of the city and shall be applied exclusively to or  in  aid
 or  support  of  the  city's  provision  of  criminal  justice  and fire
 protection services.
   (f) Notwithstanding anything in this article to the contrary,  of  the
 total  revenue, including interest and penalties, from the tax surcharge
 imposed pursuant to the authority of this section which the state  comp-
 troller  is  required to pay to the chief fiscal officer of the city for
 payment into the treasury of the city, ninety  million  dollars  thereof
 paid  to  such  chief  fiscal officer during the fiscal year of the city
 commencing during calendar year nineteen  hundred  ninety-six,  and  one
 hundred  eighty-five  million  dollars thereof paid to such chief fiscal
 officer during the fiscal year of the city  commencing  during  calendar
 year  nineteen  hundred ninety-seven, shall be credited to and deposited
 in a criminal justice account established by the city within its general
 fund. The balance of such revenue from  such  tax  surcharge  which  the
 state  comptroller  is  required to pay to such chief fiscal officer for
 payment into the treasury of the city for the taxable years beginning in
 the calendar years beginning on January first, nineteen hundred  ninety-
 seven and January first, nineteen hundred ninety-eight shall be credited
 to  the  general fund of the city to be applied exclusively to or in aid
 or support  of  the  city's  provision  of  criminal  justice  and  fire
 protection services; provided however, that, notwithstanding the forego-
 ing,  such  balance  shall  be  applied to implementation of the capital
 program for public schools within the city and  a  supplemental  capital
 rehabilitation  program for such schools, to the extent that such appli-
 cation is necessary for the timely implementation of  such  programs  in
 accordance  with  the  memorandum  of understanding executed pursuant to
 paragraph two of subdivision (d) of this section and  any  modifications
 thereto.
   §  11-1704.1  Additional  tax.  (a) (1) In addition to any other taxes
 imposed by this chapter, there is hereby imposed for each  taxable  year
 beginning  after nineteen hundred ninety but before two thousand twenty-
 seven, an additional tax on the city taxable income of every city  resi-
 dent  individual,  estate  and  trust, to be calculated for each taxable
 year as follows: (i) for each  taxable  year  beginning  after  nineteen
 hundred  ninety  but before nineteen hundred ninety-nine, at the rate of
 S. 8474                            876
 
 fourteen percent of the sum of the taxes  for  each  such  taxable  year
 determined  pursuant  to  section  11-1701  and  section 11-1704 of this
 subchapter; and (ii) for each  taxable  year  beginning  after  nineteen
 hundred  ninety-eight,  at  the  rate of fourteen percent of the tax for
 such taxable year determined pursuant to such section  11-1701  of  this
 subchapter.
   (2)  Notwithstanding paragraph one of this subdivision, for each taxa-
 ble year beginning after two thousand but before two thousand  two,  the
 additional  tax  shall  be calculated as follows:   (i) Resident married
 individuals filing joint returns and  resident  surviving  spouses.  The
 additional  tax  under  this  section  for  each taxable year on the tax
 determined pursuant to section 11-1701 of this subchapter of every  city
 resident  married  individual who makes a single return jointly with his
 or her spouse under subdivision (b) of section 11-1751 of  this  chapter
 and on the tax determined pursuant to section 11-1701 of this subchapter
 of  every city resident surviving spouse shall be determined as follows:
 (A) If the tax determined pursuant to section 11-1701 of this subchapter
 is based on city taxable income equal to or less  than  ninety  thousand
 dollars,  then the additional tax shall be 5.25% of such tax; (B) If the
 tax determined pursuant to section 11-1701 of this subchapter  is  based
 on city taxable income over ninety thousand dollars, then the additional
 tax  shall  be the sum of 5.25% of such tax on city taxable income up to
 and including ninety thousand dollars and 12.25% of  such  tax  on  city
 taxable income in excess of ninety thousand dollars.
   (ii)  Resident  heads  of  households.  The  additional tax under this
 section for each taxable year on the tax determined pursuant to  section
 11-1701  of  this  subchapter of every city resident head of a household
 shall be determined as follows:  (A) If the tax determined  pursuant  to
 section 11-1701 of this subchapter is based on city taxable income equal
 to or less than sixty thousand dollars, then the additional tax shall be
 5.25% of such tax; (B) If the tax determined pursuant to section 11-1701
 of  this  subchapter is based on city taxable income over sixty thousand
 dollars, then the additional tax shall be the sum of 5.25% of  such  tax
 on  city  taxable  income up to and including sixty thousand dollars and
 12.25% of such tax on city taxable income in excess  of  sixty  thousand
 dollars.
   (iii)  Resident  unmarried  individuals,  resident married individuals
 filing separate returns and resident estates and trusts. The  additional
 tax  under  this  section  for  each  taxable year on the tax determined
 pursuant to section 11-1701 of this subchapter of  every  city  resident
 individual  who  is  not  a married individual who makes a single return
 jointly with his or her spouse under subdivision (b) of section  11-1751
 of  this  chapter or a city resident head of a household or a city resi-
 dent surviving spouse, and on the tax  determined  pursuant  to  section
 11-1701 of this subchapter of every city resident estate and trust shall
 be determined as follows:  (A) If the tax determined pursuant to section
 11-1701  of  this subchapter is based on city taxable income equal to or
 less than fifty thousand dollars, then the additional tax shall be 5.25%
 of such tax; (B) If the tax determined pursuant to  section  11-1701  of
 this  subchapter  is  based  on  city taxable income over fifty thousand
 dollars, then the additional tax shall be the sum of 5.25% of  such  tax
 on  city  taxable  income up to and including fifty thousand dollars and
 12.25% of such tax on city taxable income in excess  of  fifty  thousand
 dollars.
   (b)  The  additional  tax  imposed  pursuant  to this section shall be
 administered, collected and distributed by the commissioner of  taxation
 S. 8474                            877
 
 and  finance  in  the same manner as the other taxes imposed pursuant to
 this chapter, and all of  the  provisions  of  this  chapter,  including
 sections 11-1706, 11-1721 and 11-1773, shall apply to the additional tax
 imposed by this section.
   §  11-1705  General provisions and definitions. (a) Accounting periods
 and methods. (1) Accounting periods. A  taxpayer's  taxable  year  under
 this  chapter  shall  be the same as his or her taxable year for federal
 income tax purposes.
   (2) Change of accounting periods. If  a  taxpayer's  taxable  year  is
 changed  for  federal  income  tax purposes, his or her taxable year for
 purposes of this chapter shall be similarly changed. If a  taxable  year
 of  less  than  twelve months results from a change of taxable year, the
 city standard deduction and the city exemptions shall be prorated  under
 regulations of the tax commission.
   (3)  Accounting  methods. A taxpayer's method of accounting under this
 chapter shall be the same as his or her method of accounting for federal
 income tax purposes. In the absence of  any  method  of  accounting  for
 federal income tax purposes, city taxable income shall be computed under
 such  method  as  in  the opinion of the tax commission clearly reflects
 income.
   (4) Change of accounting  methods.  (A)  If  a  taxpayer's  method  of
 accounting is changed for federal income tax purposes, his or her method
 of accounting for purposes of this chapter shall be similarly changed.
   (B)  If  a taxpayer's method of accounting is changed, other than from
 an accrual to an installment method, any additional  tax  which  results
 from  adjustments  determined  to  be  necessary solely by reason of the
 change shall not be greater than if such adjustments were ratably  allo-
 cated  and included for the taxable year of the change and the preceding
 taxable years, not in excess of two, during which the taxpayer used  the
 method of accounting from which the change is made.
   (C) If a taxpayer's method of accounting is changed from an accrual to
 an installment method, any additional tax for the year of such change of
 method  and for any subsequent year which is attributable to the receipt
 of installment payments properly accrued  in  a  prior  year,  shall  be
 reduced by the portion of tax for any prior taxable year attributable to
 the accrual of such installment payments, in accordance with regulations
 of the tax commission.
   (b)  City  resident  and city nonresident defined.   (1) City resident
 individual.  A city resident individual means an individual:
   (A) who is domiciled in this city, unless (i) the  taxpayer  maintains
 no permanent place of abode in this city, maintains a permanent place of
 abode  elsewhere,  and spends in the aggregate not more than thirty days
 of the taxable year in this city, or (ii) (I) within any period of  five
 hundred  forty-eight  consecutive  days  the  taxpayer  is  present in a
 foreign country or countries for at least four hundred fifty  days,  and
 (II)  during the period of five hundred forty-eight consecutive days the
 taxpayer, the taxpayer's spouse, unless such  spouse  is  legally  sepa-
 rated,  and  the  taxpayer's minor children are not present in this city
 for more than ninety days, and (III) during  any  period  of  less  than
 twelve  months,  which  would  be  treated  as a separate taxable period
 pursuant to section  11-1754  of  this  chapter,  and  which  period  is
 contained  within  the  period  of  five hundred forty-eight consecutive
 days, the taxpayer is present in this city for a number  of  days  which
 does  not  exceed  an amount which bears the same ratio to ninety as the
 number of days contained in that period of less than twelve months bears
 to five hundred forty-eight, or
 S. 8474                            878
 
   (B) who maintains a permanent place of abode in this city  and  spends
 in  the aggregate more than one hundred eighty-three days of the taxable
 year in this city, whether or not domiciled in this city for any portion
 of the taxable year, unless such individual is in active service in  the
 armed forces of the United States.
   (2)  City nonresident individual.  A city nonresident individual means
 an individual who is not a city resident.
   (3) City resident estate or trust.  A city resident  estate  or  trust
 means:
   (A)  the estate of a decedent who at his or her death was domiciled in
 this city,
   (B) a trust, or a portion of a trust, consisting  of  property  trans-
 ferred  by  will  of a decedent who at his or her death was domiciled in
 this city, or
   (C) a trust, or portion of a trust, consisting of the property of:
   (i) a person domiciled in this city at  the  time  such  property  was
 transferred  to  the trust, if such trust or portion of a trust was then
 irrevocable, or if it was then revocable and has not subsequently become
 irrevocable; or
   (ii) a person domiciled in this  city  at  the  time  such  trust,  or
 portion  of  a  trust, became irrevocable, if it was revocable when such
 property was transferred to the trust but has subsequently become irrev-
 ocable.
   For the purposes of this paragraph, a trust or portion of a  trust  is
 revocable if it is subject to a power, exercisable immediately or at any
 future  time,  to  revest title in the person whose property constitutes
 such trust or portion of a trust, and a trust  or  portion  of  a  trust
 becomes  irrevocable  when  the possibility that such power may be exer-
 cised has been terminated.
   (D) (i) Provided, however, a resident trust  is  not  subject  to  tax
 under  this  article  if  all of the following conditions are satisfied:
 (I) all the trustees are domiciled outside the city of  New  York;  (II)
 the  entire  corpus of the trusts, including real and tangible property,
 is located outside the city of New York; and (III) all income and  gains
 of  the  trust are derived from or connected with sources outside of the
 city of New York, determined as if the trust were a non-resident trust.
   (ii) For purposes of item (II) of clause  (i)  of  this  subparagraph,
 intangible  property shall be located in this city if one or more of the
 trustees are domiciled in the city of New York.
   (iii) Provided further, that for the purposes of item  (I)  of  clause
 (i)  of  this  subparagraph, a trustee which is a banking corporation as
 defined in subdivision (a) of section 11-640 of this title and which  is
 domiciled  outside the city of New York at the time it becomes a trustee
 of the trust shall be deemed to  continue  to  be  a  trustee  domiciled
 outside  the  city of New York notwithstanding that it thereafter other-
 wise becomes a trustee domiciled in the city of New York  by  virtue  of
 being acquired by, or becoming an office or branch of, a corporate trus-
 tee domiciled within the city of New York.
   For  the  purposes of this subparagraph, a trust or portion of a trust
 is revocable if it is subject to a power, exercisable immediately or  at
 any  future  time,  to revest title in the person whose property consti-
 tutes such trust or portion of a trust, and a  trust  or  portion  of  a
 trust  becomes  irrevocable  when the possibility that such power may be
 exercised has been terminated.
 S. 8474                            879
 
   (4) City nonresident estate or trust.   A city nonresident  estate  or
 trust  means  an  estate or trust which is not a city resident estate or
 trust.
   (5)  Cross  reference.  For effect of a change of resident status, see
 section 11-1754 of this chapter.
   § 11-1706 Credits against tax. (a)  Credit  relating  to  net  capital
 gain.    For taxable years beginning in nineteen hundred eighty-seven, a
 credit against the tax imposed under section 11-1701 of this  subchapter
 shall  be  allowed.  The  amount  of the credit shall be one-half of one
 percent of net capital gain includible in city adjusted gross income for
 the taxable year. The credit  allowed  by  this  subdivision  shall  not
 exceed  the tax imposed by section 11-1701 of this subchapter reduced by
 the credits permitted under section 11-1721 of this chapter and subdivi-
 sion (b) of this section.
   (b) Household credit. (1) For taxable years beginning  after  nineteen
 hundred  eighty-six,  a  credit  against  the  city  personal income tax
 imposed by section 11-1701 of this  subchapter  shall  be  allowed.  The
 credit,  computed  as  described  in  paragraph two of this subdivision,
 shall not exceed the tax imposed by section 11-1701 of this  subchapter,
 reduced by the credit permitted under section 11-1721 of this chapter.
   (2) (A) For any individual who is not married nor the head of a house-
 hold  nor  a  surviving spouse, the amount of the credit shall be deter-
 mined in accordance with the following table:
 
 ------------------------------------------------------------------------
 If household gross                                The credit shall be:
 income is:
                          For taxable years        For taxable years
                          beginning after          beginning after
                          1986 and before               1995
                                1996
 ------------------------------------------------------------------------

 Not over $7,500               $15                      $15
 Over $7,500 but not over
 $10,000                       $10                      $15
 Over $10,000 but not over
 $12,500                       $0                       $10
 
   (B) For any husband and wife, head of household or  surviving  spouse,
 the  amount  of the credit shall be determined by multiplying the number
 of exemptions for which the taxpayer, or in the case of  a  husband  and
 wife,  taxpayers,  is  entitled  to a deduction for the taxable year for
 federal income tax purposes under subsections (b) and (c) of section one
 hundred fifty-one of the internal revenue code by the credit factor  for
 the taxable year as specified in the following table:
 
 ------------------------------------------------------------------------
 If household gross                                The credit factor is:
   income is:
                          For taxable years
                          beginning in
                          1987 1988
                          1989                     For taxable years
                          through                  beginning after
                          1995                         1995
 S. 8474                            880
 
 ------------------------------------------------------------------------
 
 Not over $12,500        $30   $50   $50                    $30
 Over $12,500 but not
 over $15,000            $20   $40   $50                    $30
 Over $15,000 but not
 over $17,500            $10   $20   $25                    $25
 Over $17,500 but not
 over $20,000            $0    $15   $15                    $15
 Over $20,000 but not
 over $22,500            $0    $0    $0                     $10
 
   (3) For purposes of this subdivision:
   (A) "Household gross income" shall mean the aggregate federal adjusted
 gross income of a household, as the term household is defined in subpar-
 agraph (B) of this paragraph, for the taxable year.
   (B)  "Household"  means  a  husband  and  wife, a head of household, a
 surviving spouse, or an individual who is not married nor the head of  a
 household  nor  a surviving spouse nor a taxpayer with respect to whom a
 deduction under subsection (c) of section one hundred fifty-one  of  the
 internal  revenue  code is allowable to another taxpayer for the taxable
 year.
   (C) "Household gross income of a husband and wife" shall be the aggre-
 gate of their federal adjusted gross incomes for the taxable year  irre-
 spective of whether joint or separate city income tax returns are filed.
 Provided,  however,  that  a  husband  or wife who is required to file a
 separate city income tax return shall be permitted one-half  the  credit
 otherwise  allowed  his or her household, except as limited by paragraph
 one of this subdivision.
   (D) "Household gross income" shall be computed in all cases as if each
 member of the household were a resident for the entire taxable year.
   (E) If a taxpayer changes his or her status during his or her  taxable
 year  from resident to nonresident, or from nonresident to resident, the
 household credit shall be prorated according to the number of months  in
 the period of residence. In the case of a husband and wife, if either or
 both  changes  his  or  her  status from resident to nonresident or from
 nonresident to resident and  separate  returns  are  filed,  the  credit
 computed  for  the  entire  year  shall  be divided first as provided in
 subparagraph (C) of this paragraph and then prorated  according  to  the
 number of months in the period of residence.
   (c) State school tax reduction credit.
   (1)  For  taxable  years beginning after nineteen hundred ninety-seven
 and ending before two thousand sixteen, a  state  school  tax  reduction
 credit  shall be allowed as provided in the following tables. The credit
 shall be allowed against the taxes authorized by this article reduced by
 the credits permitted by this article. If the credit exceeds the tax  as
 so  reduced, the taxpayer may receive, and the comptroller, subject to a
 certificate of the commissioner, shall pay as  an  overpayment,  without
 interest,  the  amount of such excess. For purposes of this subdivision,
 no credit shall be granted to an  individual  with  respect  to  whom  a
 deduction  under  subsection (c) of section one hundred fifty-one of the
 internal revenue code is allowable to another taxpayer for  the  taxable
 year.
   (2)  The amount of the credit under this paragraph shall be determined
 based upon the taxpayer's income as  defined  in  subparagraph  (ii)  of
 S. 8474                            881
 
 paragraph (b) of subdivision four of section four hundred twenty-five of
 the  real property tax law. For purposes of this paragraph, any taxpayer
 under subparagraphs (A) and (B) of this paragraph with  income  of  more
 than two hundred fifty thousand dollars shall not receive a credit.
   Beginning in the two thousand ten tax year and each tax year thereaft-
 er  through two thousand fifteen, the "more than two hundred fifty thou-
 sand dollar"  income  limitation  shall  be  adjusted  by  applying  the
 inflation factor set forth herein, and rounding each result to the near-
 est  multiple of one hundred dollars. The department shall establish the
 income limitation to be associated with  each  subsequent  tax  year  by
 applying  the  inflation  factor  set  forth  herein to the figures that
 define the income limitation that were applicable to the  preceding  tax
 year,  as  determined  pursuant  to  this subdivision, and rounding each
 result to the nearest multiple of one  hundred  dollars.  Such  determi-
 nation  shall  be  made  no later than March first, two thousand ten and
 each year thereafter.
   (A) Married individuals filing joint returns and surviving spouses. In
 the case of a husband and wife who make a single return jointly and of a
 surviving spouse:
      For taxable years beginning:       The credit shall be:
                in 2001-2005                    $125
                in 2006                         $230
                in 2007-2008                    $290
                in 2009-2015                    $125
   (B) All others. In the case of an unmarried individual, a  head  of  a
 household or a married individual filing a separate return:
      For taxable years beginning:       The credit shall be:
                in 2001-2005                    $62.50
                in 2006                         $115
                in 2007-2008                    $145
                in 2009-2015                    $62.50
   (4)  Husband  and  wife who make a joint return. If a husband and wife
 make a single return jointly, the credit under this subdivision shall be
 determined under paragraph two of this subdivision, if  either  of  them
 has attained the age of sixty-five on or before the close of the taxable
 year.
   (5) Part-year residents. If a taxpayer changes status during the taxa-
 ble  year from resident to nonresident, or from nonresident to resident,
 the state school tax reduction credit shall be prorated according to the
 number of months in the period of residence.
   (c) Credit for unincorporated business taxes paid. (1) A city resident
 individual, estate or trust whose city adjusted  gross  income  includes
 income,  gain,  loss or deductions from one or more unincorporated busi-
 nesses conducted by such city resident individual, estate or trust  that
 are  subject  to  the  tax  imposed  by chapter five of this title, or a
 distributive share of income, gain, loss and deductions of,  or  guaran-
 teed payments from, one or more partnerships that are subject to the tax
 imposed  by such chapter, shall be allowed a credit as provided in para-
 graph two of this  subdivision  against  the  tax  otherwise  due  under
 sections 11-1701, 11-1703, 11-1704 and 11-1704.1 of this subchapter.
   (2)  (A)  Subject  to  the limitation set forth in subparagraph (B) of
 this paragraph, the credit allowed to a  taxpayer  for  a  taxable  year
 under this subdivision shall be determined as follows:
   (i)  For  taxable  years beginning on or after January first, nineteen
 hundred ninety-seven and before January first, two thousand seven:
 S. 8474                            882
 
   (I) If the city taxable income is forty-two thousand dollars or  less,
 the credit shall be sixty-five percent of the amount determined in para-
 graph three of this subdivision.
   (II)  If  the  city  taxable income is greater than forty-two thousand
 dollars but not greater than one hundred forty-two thousand dollars, the
 amount of the credit shall be a percentage of the amount  determined  in
 paragraph three of this subdivision, such percentage to be determined by
 subtracting  from  sixty-five  percent,  one-tenth of a percentage point
 (.001) for every increment of two hundred dollars,  or  fractional  part
 thereof, of city taxable income in excess of forty-two thousand dollars.
   (III) If the city taxable income is greater than one hundred forty-two
 thousand  dollars,  the  credit  shall  be fifteen percent of the amount
 determined in paragraph three of this subdivision.
   (ii) For taxable years beginning on or after January first, two  thou-
 sand seven:
   (I)  If the city taxable income is forty-two thousand dollars or less,
 the credit shall be one hundred percent  of  the  amount  determined  in
 paragraph three of this subdivision.
   (II)  If  the  city  taxable income is greater than forty-two thousand
 dollars but less than one hundred forty-two thousand dollars, the amount
 of the credit shall be a percentage of the amount  determined  in  para-
 graph  three  of  this  subdivision, such percentage to be determined by
 subtracting  from  one  hundred  percent,  a  percentage  determined  by
 subtracting  forty-two thousand dollars from city taxable income, divid-
 ing the result by one hundred thousand dollars and multiplying by seven-
 ty-seven percent.
   (III) If the city taxable income is  one  hundred  forty-two  thousand
 dollars  or  greater,  the  credit  shall be twenty-three percent of the
 amount determined in paragraph three of this subdivision.
   (B) Notwithstanding anything to the contrary in  subparagraph  (A)  of
 this  paragraph,  the  credit  allowed  to a taxpayer for a taxable year
 under this subdivision shall not exceed the sum of the taxes that  would
 otherwise be imposed by sections 11-1701, 11-1703, 11-1704 and 11-1704.1
 of  this  subchapter  on  such  taxpayer for such taxable year after the
 allowance of any other  credits  allowed  by  this  section  or  section
 11-1721 of this chapter.
   (3)  Subject  to the provisions of subparagraph (C) of this paragraph,
 the amount determined in this paragraph is the sum of:
   (A) for each unincorporated business conducted by  the  taxpayer,  the
 tax  imposed  by chapter five of this title on such unincorporated busi-
 ness for its taxable year ending with the taxable year of  the  taxpayer
 and paid by the unincorporated business; and
   (B)  for each unincorporated business in which the taxpayer is a part-
 ner, the product of:
   (i) the sum of (I) the tax imposed by chapter five of  this  title  on
 such  unincorporated business for its taxable year ending within or with
 the taxable year of the partner and paid by the unincorporated  business
 and (II) the amount of any credit or credits taken by the unincorporated
 business  under  subdivision (j) of section 11-503 of this title for its
 taxable year ending within or with the taxable year of the partner; and
   (ii) a fraction, the numerator of which is the net total of the  part-
 ner's  distributive  share  of income, gain, loss and deductions of, and
 guaranteed payments from, the unincorporated business for  such  taxable
 year, and the denominator of which is the sum, for such taxable year, of
 the  net  total distributive shares of income, gain, loss and deductions
 of, and guaranteed payments to, all partners in the unincorporated busi-
 S. 8474                            883

 ness for whom or which such net total, as separately determined for each
 partner, is greater than zero.
   (C)  For  a taxpayer that changes its status from a city resident to a
 city nonresident or from a city nonresident to a  city  resident  during
 the taxable year:
   (i)  the amount determined in subparagraph (A) of this paragraph shall
 be, with respect  to  each  unincorporated  business  conducted  by  the
 taxpayer, the tax imposed by chapter five of this title on such unincor-
 porated  business  for  its taxable year ending with the taxable year of
 the taxpayer and paid by the unincorporated business,  multiplied  by  a
 fraction,  the  numerator  of which is that portion of the income, gain,
 loss and deductions of  the  unincorporated  business  included  in  the
 taxpayer's  adjusted  gross  income  for the portion of the taxable year
 during which the taxpayer was a city resident, and  the  denominator  of
 which is the total, for such taxable year, of the income, gain, loss and
 deductions of the unincorporated business, and
   (ii)  the amount determined in clause (ii) of subparagraph (B) of this
 paragraph shall be a fraction, the numerator of which is that portion of
 the taxpayer's net total distributive share of income,  gain,  loss  and
 deductions  of,  and that portion of guaranteed payments from, the unin-
 corporated business included  in  the  taxpayer's  city  adjusted  gross
 income for the portion of the taxable year during which the taxpayer was
 a city resident, and the denominator of which is the sum, for such taxa-
 ble year, of the net total distributive shares of income, gain, loss and
 deductions  of, and guaranteed payments to, all partners in the unincor-
 porated business, for whom or which such net total, as separately deter-
 mined for each partner, is greater than zero.
   (4) For purposes of subdivision (c) of section 11-1902 of this  title,
 in determining the amount of tax that a nonresident would be required to
 pay  if  such nonresident were a resident of the city and subject to the
 tax on personal income of residents, the credit allowed by this subdivi-
 sion shall be taken into account.
   (d) Earned income tax credit.  (1) For taxable years  beginning  after
 two  thousand three, a credit against the city personal income tax shall
 be allowed, equal to five percent of the earned  income  credit  allowed
 under section thirty-two of the internal revenue code for the same taxa-
 ble  year,  and,  for taxable years beginning after two thousand twenty-
 one, a credit against the city personal income  tax  shall  be  allowed,
 equal  to  a percentage determined pursuant to subparagraphs (A) through
 (I) of this paragraph, of the earned income credit allowed under section
 thirty-two of the internal revenue code for the same taxable  year.  For
 purposes  of  this  paragraph,  "adjusted  gross  income" means New York
 adjusted gross income as determined pursuant to  article  twenty-two  of
 the tax law. The percentage shall be:
   (A)  thirty  percent,  where  the taxpayer's adjusted gross income for
 such taxable year is less than five thousand dollars;
   (B) thirty percent reduced by the product of two-tenths of a  percent-
 age point (0.002) and the amount of the taxpayer's adjusted gross income
 for  such  taxable  year in excess of four thousand nine hundred ninety-
 nine dollars, where such taxpayer's adjusted gross income for such taxa-
 ble year is equal to or greater than five thousand dollars and less than
 seven thousand five hundred dollars;
   (C) twenty-five percent, where the taxpayer's  adjusted  gross  income
 for  such  taxable  year is equal to or greater than seven thousand five
 hundred dollars and less than fifteen thousand dollars;
 S. 8474                            884
 
   (D) twenty-five percent reduced by the  product  of  two-tenths  of  a
 percentage point (0.002) and the amount of the taxpayer's adjusted gross
 income for such taxable year in excess of fourteen thousand nine hundred
 ninety-nine  dollars,  where  such  taxpayer's adjusted gross income for
 such  taxable  year is equal to or greater than fifteen thousand dollars
 and less than seventeen thousand five hundred dollars;
   (E) twenty percent, where the taxpayer's  adjusted  gross  income  for
 such  taxable  year  is equal to or greater than seventeen thousand five
 hundred dollars and less than twenty thousand dollars;
   (F) twenty percent reduced by the product of two-tenths of a  percent-
 age  point  (0.002)  and  the  amount  of such taxpayer's adjusted gross
 income for such taxable year in excess of nineteen thousand nine hundred
 ninety-nine dollars, where the taxpayer's adjusted gross income for such
 taxable year is equal to or greater than  twenty  thousand  dollars  and
 less than twenty-two thousand five hundred dollars;
   (G)  fifteen  percent,  where the taxpayer's adjusted gross income for
 such taxable year is equal to or greater than twenty-two  thousand  five
 hundred dollars and less than forty thousand dollars;
   (H) fifteen percent reduced by the product of two-tenths of a percent-
 age point (0.002) and the amount of the taxpayer's adjusted gross income
 for  such  taxable  year  in excess of thirty-nine thousand nine hundred
 ninety-nine dollars, where such taxpayer's  adjusted  gross  income  for
 such taxable year is equal to or greater than forty thousand dollars and
 less than forty-two thousand five hundred dollars; and
   (I)  ten  percent  where the taxpayer's adjusted gross income for such
 taxable year is equal to or greater than forty-two thousand five hundred
 dollars.
   (2) In the case of a resident taxpayer, the credit  provided  by  this
 subdivision  shall be allowed against the taxes authorized by this chap-
 ter for the taxable year reduced by the credits permitted by this  chap-
 ter.  If  the  credit  exceeds  the  tax as so reduced, the taxpayer may
 receive, and the state comptroller, subject  to  a  certificate  of  the
 commissioner  of the state department of taxation and finance, shall pay
 as an overpayment, without interest, the amount of such excess.
   (3) If a taxpayer changes his or her status during  the  taxable  year
 from city resident to city nonresident, or from city nonresident to city
 resident,  the credit determined under this subdivision shall be limited
 to the amount determined by multiplying the amount of such credit  by  a
 fraction,  the numerator of which is such taxpayer's city adjusted gross
 income, for the period of residence, and the  denominator  of  which  is
 such  taxpayer's  city  adjusted gross income determined as if he or she
 were a city resident for the entire taxable year.  City  adjusted  gross
 income shall be adjusted as provided in section 11-1754 of this chapter.
 The  credit  as so limited shall be applied as provided in paragraph two
 of this subdivision.
   (4) Subject to the provisions of paragraph three of this  subdivision,
 in  the  case of a husband and wife who file a joint return, but who are
 required to determine their city personal income taxes  separately,  the
 credit  authorized  pursuant  to this subdivision may be applied against
 the tax of either or divided between them as they may elect. In the case
 of a husband and wife who are not required to file a federal return, the
 credit under this subsection shall be allowed  only  if  such  taxpayers
 file a joint city personal income tax return.
   (5)  If the state commissioner of taxation and finance determines that
 the taxpayer is eligible to  receive  the  credit  provided  under  this
 subdivision  but  has  not claimed such credit on his or her return, the
 S. 8474                            885
 
 state commissioner of taxation and finance shall compute and  issue  any
 refund  for the allowable credit amount provided under this subdivision.
 Any refund paid pursuant to this paragraph  shall  be  deemed  to  be  a
 refund  of  an overpayment of tax as provided in section 11-1786 of this
 chapter, provided, however, that no interest shall be paid thereon.
   (e) Credit for certain household and dependent care services necessary
 for gainful employment. (1) For taxable  years  beginning  on  or  after
 January  first, two thousand seven, a taxpayer shall be allowed a credit
 as provided herein equal to the  applicable  percentage  of  the  credit
 allowed  under  subsection (c) of section six hundred six of the tax law
 with respect to qualifying individuals as defined in  paragraph  one  of
 subsection (b) of section twenty-one of the internal revenue code, with-
 out regard to whether the taxpayer in fact claimed the credit under such
 section  twenty-one  for  the  taxable  year,  who are dependents of the
 taxpayer and who have not attained the age of four as of the end of  the
 taxable year. The applicable percentage shall be determined as follows:
   (A)  If household gross income as defined in subparagraph (A) of para-
 graph three of subdivision (b) of this section is  twenty-five  thousand
 dollars  or  less,  the  applicable  percentage  shall  be  seventy-five
 percent.
   (B) If such household gross income is greater than  twenty-five  thou-
 sand  dollars but not greater than thirty thousand dollars, the applica-
 ble percentage shall be seventy-five percent multiplied by one  minus  a
 fraction,  the  numerator  of  which is such household gross income less
 twenty-five thousand dollars and the denominator of which is five  thou-
 sand dollars.
   (C)  If  such  household  gross income is greater than thirty thousand
 dollars, the applicable percentage shall be zero.
   (2) The credit under this subdivision shall  be  allowed  against  the
 taxes  imposed  by this chapter reduced by the credits permitted by this
 chapter. If the credit exceeds the tax as so reduced, the  taxpayer  may
 receive,  and  the  state comptroller, subject to the certificate of the
 state commissioner of taxation and finance, shall pay as an overpayment,
 without interest, the amount of such excess, provided, however,  in  the
 case of a taxpayer who is a part-year resident of New York city any such
 overpayment  under this paragraph shall be limited to the amount of such
 excess multiplied by a fraction,  the  numerator  of  which  is  federal
 adjusted  gross  income  for the period of residence, computed as if the
 taxable year for federal income tax purposes were limited to the  period
 of  residence,  and  the  denominator of which is federal adjusted gross
 income for the taxable year.
   (3) In the case of a husband  and  wife  who  filed  a  joint  federal
 return,  but  who  are  required  to determine their New York city taxes
 separately, the credit allowed pursuant to this subdivision may only  be
 applied  against  the  tax  imposed on the spouse with the lower taxable
 income, computed without regard to such credit,  provided,  however,  if
 the  spouse  with the lower taxable income is a nonresident of the city,
 no credit shall be allowed under this subdivision.  In  the  case  of  a
 husband  and  wife  who  are  not required to file a federal return, the
 credit under this subdivision shall be allowed only  if  such  taxpayers
 file a joint New York city income tax return.
   (f) Credit for general corporation tax paid. (1) A city resident indi-
 vidual,  estate or trust whose city adjusted gross income includes a pro
 rata share of income, loss and deductions described in paragraph one  of
 subsection  (a)  of  section  thirteen hundred sixty-six of the internal
 revenue code, from one or more New York S  corporations  as  defined  in
 S. 8474                            886
 
 subdivision  one-A  of section two hundred eight of the tax law, or from
 one or more QSSSs as defined in subdivision one-B of section two hundred
 eight of the tax law, that are exempt QSSSs by reason of clause  (A)  of
 subparagraph  one  of  paragraph  (k) of subdivision nine of section two
 hundred eight of the tax law, on which a tax is  imposed  by  subchapter
 two  of chapter six of this title, shall be allowed a credit as provided
 in paragraph two of this subdivision against the tax otherwise due under
 sections 11-1701, 11-1703, 11-1704 and 11-1704.1 of this chapter.
   (2) (A) Subject to the limitations set forth in subparagraphs (B)  and
 (C)  of  this  paragraph, the credit allowed to a taxpayer for a taxable
 year under this subdivision shall be determined as follows:
   (i) For taxable years beginning on or after January first,  two  thou-
 sand fourteen and before July first, two thousand nineteen:
   (I)  If  the  city  taxable  income is thirty-five thousand dollars or
 less, the amount of the credit shall  be  one  hundred  percent  of  the
 amount determined in paragraph three of this subdivision.
   (II)  If  the city taxable income is greater than thirty-five thousand
 dollars but less than one hundred thousand dollars, the  amount  of  the
 credit shall be a percentage of the amount determined in paragraph three
 of  this  subdivision,  such  percentage to be determined by subtracting
 from one hundred percent, a percentage determined by  subtracting  thir-
 ty-five  thousand  dollars from city taxable income, dividing the result
 by sixty-five thousand dollars and multiplying by one hundred percent.
   (III) If the city taxable income is one hundred  thousand  dollars  or
 greater, no credit shall be allowed.
   (IV)  Provided  further  that  for  any taxable year of a taxpayer for
 which this credit is effective that  encompasses  days  occurring  after
 June  thirtieth,  two thousand nineteen, the amount of the credit deter-
 mined in item (I) or (II) of this clause shall be multiplied by a  frac-
 tion,  the  numerator  of  which is the number of days in the taxpayer's
 taxable year occurring on or before June thirtieth, two  thousand  nine-
 teen,  and the denominator of which is the number of days in the taxpay-
 er's taxable year.
   (B) Notwithstanding anything to the contrary in  subparagraph  (A)  of
 this  paragraph,  the  credit  allowed  to a taxpayer for a taxable year
 under this subdivision shall not exceed the sum of the taxes that  would
 otherwise be imposed by sections 11-1701, 11-1703, 11-1704 and 11-1704.1
 of  this  subchapter  on  such  taxpayer for such taxable year after the
 allowance of any other credits allowed by subdivisions (a), (b) and  (c)
 of this section, and section 11-1721 of this chapter.
   (C)  Notwithstanding  anything  to the contrary in subparagraph (A) of
 this paragraph, no credit  shall  be  allowed  for  any  amount  of  tax
 imposed,  or  credit  allowed,  by subchapter two of chapter six of this
 title on, or to, a combined group of corporations including a New York S
 corporation or an exempt QSSS, except where the combined group  consists
 exclusively  of  one  or  more  New  York S corporations and one or more
 exempt QSSSs of such corporations as described in paragraph one of  this
 subdivision,  provided that each of the New York S corporations included
 in the group is wholly owned by the  same  interests  and  in  the  same
 proportions as each other New York S corporation included in the group.
   (3)  Subject  to  the provisions of subparagraph (B) of this paragraph
 and subparagraph (C) of paragraph two of this  subdivision,  the  amount
 determined in this paragraph is the sum of the taxpayer's pro rata share
 of the amounts determined in subparagraph (A) of this paragraph for each
 New  York  S  corporation, or exempt QSSS, described in paragraph one of
 this subdivision, a pro rata share of whose income, loss and  deductions
 S. 8474                            887

 described in paragraph one of subsection (a) of section thirteen hundred
 sixty-six  of  the  internal revenue code, is included in the taxpayer's
 city adjusted gross income.
   (A) The amount determined in this subparagraph is the sum of:
   (i)  the  taxes imposed by subchapter two of chapter six of this title
 on such corporation, or a combined group including such corporation, for
 its taxable year ending within or with the taxable year of the  taxpayer
 and paid by such corporation, or combined group; and
   (ii) the amount of any credit or credits taken by such corporation, or
 a  combined group including such corporation, under subdivision eighteen
 of section 11-604 of this title for its taxable year  ending  within  or
 with the taxable year of the taxpayer.
   (B) For purposes of this subdivision, the taxpayer's pro rata share of
 the  amount  in  subparagraph (A) of this paragraph for the taxable year
 shall be the amount determined with respect to the taxpayer:
   (i) by assigning an equal portion of the amount in subparagraph (A) of
 this paragraph to each day of the corporation's taxable  year  on  which
 the corporation has shares outstanding,
   (ii) then by dividing that portion pro rata among the shares outstand-
 ing on that day; provided, however,
   (iii)  if the taxable year of such corporation for purposes of chapter
 six of this title is different from its New York S year or S short  year
 as  defined in subdivision one-A of section two hundred eight of the tax
 law, only those portions that are assigned to days of the  taxable  year
 that are also days of the New York S year or S short year shall be taken
 into  account  in  determining  the  shareholder's pro rata share of the
 amount determined in subparagraph (A) of this paragraph.
   (g) Credit for city pass-through entity tax. (1) A taxpayer who  is  a
 partner  or member of an electing city partnership and a taxpayer share-
 holder of an electing city resident S corporation subject to  tax  under
 article  twenty-four-B  of  the  tax  law  shall be entitled to a credit
 against the tax imposed by such article. For purposes of  this  subdivi-
 sion,  the  terms "electing city partnership," "electing city resident S
 corporation," "city pass-through entity tax," and "direct share of  city
 pass-through entity tax" shall have the same meanings as used in article
 twenty-four-B of the tax law.
   (2) The amount of the credit shall be equal to the partner's, member's
 or shareholder's direct share of the city pass-through entity tax.
   (3) If a taxpayer is a partner, member or shareholder in more than one
 electing  city  partnership  and/or electing city resident S corporation
 that is subject to tax pursuant to article twenty-four-B of the tax law,
 the amount of the credit of such taxpayer shall be equal to the  sum  of
 the amounts of such credits calculated pursuant to paragraph two of this
 subdivision  with  regard  to  each  entity in which such taxpayer has a
 direct ownership interest.
   (4) If the amount of the credit allowable pursuant to this subdivision
 for any taxable year exceeds the tax due for such year pursuant to arti-
 cle twenty-four-B of the tax law, the excess amount shall be treated  as
 an overpayment, to be credited or refunded, without interest.
   (5)  Limitation  on  credit.  No credit shall be allowed to a taxpayer
 under this subdivision unless the electing city partnership or  electing
 city  resident S corporation provided sufficient information to identify
 such taxpayer on its city pass-through entity  tax  return  as  required
 under  paragraph two of subsection (c) of section eight hundred seventy-
 two of the tax law for an electing city partnership or paragraph two  of
 subsection  (d)  of section eight hundred seventy-two of the tax law for
 S. 8474                            888
 
 an electing city resident S corporation. The credit allowed to a taxpay-
 er under this subdivision shall not exceed  the  direct  share  of  city
 pass-through  entity  tax  reported by such electing city partnership or
 electing  city  resident  S corporation attributable to such taxpayer on
 such electing city partnership's or such electing city resident S corpo-
 ration's return filed pursuant to section eight hundred  seventy-two  of
 the tax law.
   §  11-1707  Meaning of terms. (a) General. Any term used in this chap-
 ter shall have the same meaning as when used in a comparable context  in
 the laws of the United States relating to federal income taxes, unless a
 different  meaning is clearly required but such meaning shall be subject
 to the exceptions or modifications prescribed  in  this  chapter  or  by
 statute.  Any reference in this chapter to the laws of the United States
 shall mean the provisions of  the  internal  revenue  code  of  nineteen
 hundred  eighty-six,  unless a reference to the internal revenue code of
 nineteen hundred fifty-four is clearly intended, and amendments thereto,
 and other provisions of the laws of the United States relating to feder-
 al income taxes, as the same may be or become effective at any  time  or
 from  time  to  time for the taxable year, as included and quoted in the
 appendices, including any supplements and  additions  thereto,  to  this
 chapter.    Provided however, for taxable years beginning before January
 first, two thousand twenty-two, any  amendments  made  to  the  internal
 revenue code of nineteen hundred eighty-six after March first, two thou-
 sand  twenty  shall  not  apply to this chapter.   Such quotation of the
 aforesaid laws of the United States is intended to make them a  part  of
 this  chapter  and  to  avoid  constitutional  uncertainties which might
 result if such laws were merely incorporated by reference. The quotation
 of a provision of the internal revenue code or of any other law  of  the
 United  States  in such appendices shall not necessarily mean that it is
 applicable or has relevance to this chapter.
   (b) Marital or other status.  An individual's marital or other  status
 under  section 11-1701 of this chapter and section 11-1714 of this chap-
 ter shall be the same as his or her marital or other status for purposes
 of establishing the applicable federal income tax rates.
   (c)  "City" and "this city" as used in this chapter means the city  of
 Staten  Island;  "tax  commission" as used in this chapter means the tax
 commission of the state of New York; and "state" or "this state" as used
 in this chapter means the state of New York.
 
                               SUBCHAPTER 2
                                 RESIDENTS
 
   §  11-1711  City taxable income of a city resident  individual.    (a)
 General.  The city taxable income of a city resident individual shall be
 his or her city adjusted gross income less his or her city deduction and
 city exemptions, as determined under this chapter.
   (b)  Husband and wife.
   (1)  If the federal taxable income of husband or wife,  both  of  whom
 are  residents,  is  determined on a separate federal return, their city
 taxable incomes shall be separately determined.
   (2)  If the federal taxable income of husband and wife, both  of  whom
 are residents, is determined on a joint federal return, their city taxa-
 ble income shall be determined jointly.
   (3)  If  neither  husband or wife, both of whom are residents, files a
 federal return:
 S. 8474                            889
 
   (A)  their tax shall be determined on their joint city taxable income,
 or
   (B)  separate  taxes  may be determined on their separate city taxable
 incomes if they both so elect.
   (4) If either husband or wife is a resident and the other is a nonres-
 ident, a separate tax shall be determined on the city taxable income  of
 the  resident  spouse  on  a  separate form unless such husband and wife
 determine their federal taxable income jointly and both elect to  deter-
 mine their joint city taxable income as if both were residents.
   §  11-1712   City adjusted gross income of a city resident individual.
 (a)  General.  The city adjusted gross income of a city  resident  indi-
 vidual  means his or her federal adjusted gross income as defined in the
 laws of the United States for the taxable year, with  the  modifications
 specified in this section.
   (b)    Modifications  increasing federal adjusted gross income.  There
 shall be added to federal adjusted gross income:  (1)   Interest  income
 on  obligations  of  any  state other than this state, or of a political
 subdivision of any other such state unless created by compact or  agree-
 ment to which this state is a party, to the extent not properly includi-
 ble in federal adjusted gross income;
   (2)    Interest or dividend income on obligations or securities of any
 authority, commission, or instrumentality of the  United  States,  which
 the  laws  of  the  United States exempt from federal income tax but not
 from state income taxes;
   (3) Income taxes. (A) General. Income taxes imposed by this  state  or
 any  other  taxing jurisdiction, to the extent deductible in determining
 federal adjusted gross income and not credited  against  federal  income
 tax.
   (B) Shareholders of S corporations. In the case of a shareholder of an
 S  corporation,  with  respect  to  taxes imposed upon or payable by the
 corporation, the term "income taxes" in subparagraph (A) of  this  para-
 graph shall also include the tax imposed under article nine-A of the tax
 law,  regardless  of  the  measure  of such tax, but shall not otherwise
 include taxes imposed by this or any other state of the  United  States,
 or any political subdivision of this or any other state, or the District
 of Columbia.
   (4)    Interest  on  indebtedness incurred or continued to purchase or
 carry obligations or securities the interest on which is exempt from tax
 under this chapter, to the  extent  deductible  in  determining  federal
 adjusted gross income.
   (5)    Expenses  paid or incurred during the taxable year for: (i) the
 production or collection of income which is exempt from tax  under  this
 chapter, or (ii) the management, conservation or maintenance of property
 held for the production of such income, and the amortizable bond premium
 for  the  taxable  year on any bond the interest on which is exempt from
 tax under this chapter, to the extent that such  expenses  and  premiums
 are deductible in determining federal adjusted gross income.
   (6)   In the case of a taxpayer who has exercised the election permit-
 ted by subdivision (g) or (h) of this section,  the  amount  or  amounts
 required  by  said  subdivisions  to  be added to federal adjusted gross
 income.
   (7)  In the case of a taxpayer who is a shareholder of  a  corporation
 organized  under  article  fifteen  or authorized to do business in this
 state under article fifteen-A of the business corporation law,  for  the
 taxpayer's taxable years beginning before nineteen hundred eighty-eight,
 the  amount which is deductible by such corporation under paragraph one,
 S. 8474                            890
 
 two or three of subsection (a) of  section  four  hundred  four  of  the
 internal  revenue  code  for  its  taxable  year  ending in or with such
 taxpayer's taxable year for contributions paid on behalf of such taxpay-
 er  minus  the  lesser of fifteen thousand dollars or fifteen percent of
 the earned income derived by such taxpayers from such corporation during
 such taxpayer's taxable year.  In the case of a taxpayer on whose behalf
 contributions are paid under more than one plan to which this  paragraph
 applies or under a plan, contributions to which on his or her behalf are
 subject  to  the  limitations provided in subsection (e) of section four
 hundred four of the internal revenue code, this  paragraph  shall  apply
 with  respect  to  the aggregate of the contributions paid on his or her
 behalf under all such plans.
   (8)  In the case of a taxpayer who is a shareholder of  a  corporation
 organized  under  article  fifteen  or authorized to do business in this
 state under article fifteen-A  of  the  business  corporation  law,  the
 amount  which is required to be paid as a tax by such corporation pursu-
 ant to subsection (a) of section thirty-one hundred eleven of the inter-
 nal revenue code with respect to the wages  of  such  taxpayer  for  the
 calendar year ending in or with such taxpayer's taxable year.
   (10)  The amount required to be added to federal adjusted gross income
 pursuant to subdivision (i) of this section.
   (14)  The amount required to be added to federal adjusted gross income
 pursuant to subdivision (1) of this section.
   (15)  The amount allowed as an exclusion or deduction for the  special
 additional  mortgage  recording  taxes  imposed  by subdivision one-a of
 section two hundred fifty-three of the tax law  in  determining  federal
 adjusted gross income for such taxable year.
   (16)   Unless the credit allowed pursuant to subsection (f) of section
 six hundred six of the tax law is reflected in the  computation  of  the
 gain  or loss so as to result in an increase in such gain or decrease in
 such loss, for federal income tax  purposes,  from  the  sale  or  other
 disposition of the property with respect to which the special additional
 mortgage  recording tax imposed pursuant to subdivision one-a of section
 two hundred fifty-three of such law was paid, the amount of the  special
 additional  mortgage  recording  tax  imposed  by  subdivision  one-a of
 section two hundred fifty-three of such law which was paid and which  is
 reflected  in  the  computation  of  the  basis of the property so as to
 result in a decrease in such gain or increase in such loss  for  federal
 income  tax  purposes from the sale or other disposition of the property
 with respect to which such tax was paid.
   (17) The amount required to be added to federal adjusted gross  income
 pursuant to subdivision (r) of this section.
   (18)  In  the case of a shareholder of an S corporation: (A) where the
 election provided for in subsection (a) of section six hundred sixty  of
 the  tax  law  is  in effect with respect to such corporation, an amount
 equal to his or her pro rata share of the  corporation's reductions  for
 taxes described in paragraphs two and three of subsection (f) of section
 thirteen hundred sixty-six of the internal revenue code, and
   (B)  in the case of a New York S termination year, subparagraph (A) of
 this paragraph shall apply to the amount of reductions for taxes  deter-
 mined under subdivision (s) of this section.
   (19)   In the case of a shareholder of an S corporation: (A) where the
 election provided for in subsection (a) of section six hundred sixty  of
 the tax law has not been made with respect to such corporation, any item
 of loss or deduction of the corporation included in federal gross income
 S. 8474                            891
 
 pursuant  to  section thirteen hundred sixty-six of the internal revenue
 code, and
   (B)  in the case of a New York S termination year, subparagraph (A) of
 this paragraph shall apply to the amounts of loss  or  deduction  deter-
 mined under subdivision (s) of this section.
   (20) S corporation distributions to the extent not included in federal
 gross  income for the taxable year because of the application of section
 thirteen hundred sixty-eight, subsection (e) of section thirteen hundred
 seventy-one or subsection (c) of section thirteen  hundred  seventy-nine
 of  the  internal  revenue  code  which  represent income not previously
 subject to tax under this chapter because the election provided  for  in
 subsection  (a) of section six hundred sixty of the tax law had not been
 made. Any such distribution treated in the manner described in paragraph
 two of subsection (b) of section thirteen  hundred  sixty-eight  of  the
 internal  revenue  code for federal income tax purposes shall be treated
 as ordinary income for purposes of this chapter.
   (21) In relation to the disposition of  stock  or  indebtedness  of  a
 corporation  which  elected  under  subchapter  s  of chapter one of the
 internal revenue code for any taxable year of  such  corporation  begin-
 ning,  in  the case of a corporation taxable under article nine-A of the
 tax law, after  December  thirty-first,  nineteen  hundred  eighty,  the
 amount required to be added to federal adjusted gross income pursuant to
 subdivision (n) of this section.
   (22) The amounts required to be added to federal adjusted gross income
 pursuant to subdivision (q) of this section.
   (23) For taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass  commuting vehicle described in subparagraph (D) of paragraph eight
 of subsection (f) of section one hundred  sixty-eight  of  the  internal
 revenue  code, relating to qualified mass commuting vehicles, any amount
 which the taxpayer claimed as  a  deduction  in  computing  its  federal
 adjusted gross income solely as a result of an election made pursuant to
 the  provisions  of  such paragraph eight as it was in effect for agree-
 ments entered into prior to January first, nineteen hundred eighty-four;
   (24) For taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, any  amount
 which  the  taxpayer would have been required to include in the computa-
 tion of its federal adjusted gross income had it not made  the  election
 permitted  pursuant  to  such  paragraph  eight  as it was in effect for
 agreements entered into prior to January first, nineteen hundred  eight-
 y-four;
   (25) For taxable years beginning after December thirty-first, nineteen
 hundred  eighty-one, except with respect to recovery property subject to
 the provisions of section two hundred eighty-F of the  internal  revenue
 code  and  recovery  property placed in service in this state in taxable
 years beginning after December thirty-first,  nineteen  hundred  eighty-
 four,  the  amount  allowable  as  a deduction under section one hundred
 sixty-eight of the internal revenue code;
   (25) In the case of property placed in service in taxable years begin-
 ning before nineteen hundred ninety-four, for  taxable  years  beginning
 after  December  thirty-first,  nineteen hundred eighty-one, except with
 respect to property subject to the provisions  of  section  two  hundred
 eighty-F  of  the  internal  revenue  code  and  property subject to the
 S. 8474                            892
 
 provisions of section one hundred sixty-eight of  the  internal  revenue
 code which is placed in service in this state in taxable years beginning
 after  December  thirty-first,  nineteen hundred eighty-four, the amount
 allowable  as  a  deduction  determined under section one hundred sixty-
 eight of the internal revenue code.
   (26) The amount of member or employee contributions  to  a  retirement
 system  or  pension  fund  picked up or paid by the employer pursuant to
 subdivision f of section five hundred  seventeen  or  subdivision  d  of
 section  six  hundred thirteen of the retirement and social security law
 or section 13-225.1, 13-327.1, 13-125.1, 13-125.2 or 13-521.1  of  title
 thirteen  of the code of the preceding municipality or subdivision nine-
 teen of section twenty-five hundred seventy-five of the education law.
   (26-a) The amount of member or employee contributions to a  retirement
 system  or pension fund picked up or paid by the employer for members of
 the Manhattan and Bronx surface transportation  authority  pension  plan
 and  treated  as employer contributions in determining income tax treat-
 ment under subdivision (h) of  section  four  hundred  fourteen  of  the
 Internal Revenue Code.
   (27)  Upon  the  disposition  of  recovery property to which paragraph
 twenty-six of subdivision (c) of this section applies,  the  amount,  if
 any, by which the aggregate of the modifications described in such para-
 graph  twenty-six attributable to such property exceeds the aggregate of
 the modifications described in paragraph twenty-five of this subdivision
 attributable to such property; and
   (27) Upon the disposition of property to which paragraph twenty-six of
 subdivision (c) of this section applies, the amount, if  any,  by  which
 the  aggregate  of the modifications described in such paragraph twenty-
 six attributable to such property exceeds the aggregate of the modifica-
 tions described in paragraph twenty-five of this  subdivision  attribut-
 able to such property.
   (29)  When  gain  from  the  sale  or other disposition of property is
 included in federal gross income, the amount of reduction in  the  basis
 of  such  property  attributable  to  credit  for  solar and wind energy
 systems pursuant to paragraph nine of  subsection  (g)  of  section  six
 hundred six of the tax law; but for taxable years beginning before nine-
 teen  hundred  eighty-seven, if such gain affects the determination of a
 net capital gain for federal income tax purposes, forty percent of  such
 amount.
   (31) The amount deducted or deferred from an employee's salary under a
 flexible  benefits  program established pursuant to section twenty-three
 of the general municipal law or section one thousand two  hundred  ten-a
 of the public authorities law.
   (32)  The  amount by which an employee's salary is reduced pursuant to
 the provisions of subdivision b of section 12-126.1 and subdivision b of
 section 12-126.2 of the code of the preceding municipality.
   (33) Real property taxes paid on qualified agricultural  property  and
 deducted  in determining federal adjusted gross income, to the extent of
 the amount  of  the  agricultural  property  tax  credit  allowed  under
 subsection (n) or (i) of section six hundred six of the tax law.
   (34)  The  amount  of  any  deduction  allowed pursuant to section one
 hundred ninety-nine of the internal revenue code.
   (35) The amount of any federal deduction for taxes imposed under arti-
 cle twenty-three of the tax law.
   (36) In the case of a beneficiary of a trust that,  in  any  tax  year
 after  its creation including its first tax year, was not subject to tax
 pursuant to subparagraph (D) of paragraph three of  subdivision  (b)  of
 S. 8474                            893
 
 section 11-1705 of this chapter, except for an incomplete gift non-gran-
 tor trust, as defined by paragraph thirty-seven of this subdivision, the
 amount described in the first sentence of section six hundred sixty-sev-
 en  of  the  internal  revenue  code  for the tax year to the extent not
 already included in federal gross income for the tax year, except  that,
 in computing the amount to be added under this paragraph, such benefici-
 ary shall disregard (i) subsection (c) of section six hundred sixty-five
 of  the  internal  revenue code; (ii) the income earned by such trust in
 any tax year in which the trust was subject to tax under  this  article;
 and  (iii)  the  income  earned by such trust in a taxable year prior to
 when the beneficiary first became a resident of the city or in any taxa-
 ble year starting before January first, two thousand fourteen.    Except
 as  otherwise  provided  in this paragraph, all of the provisions of the
 internal  revenue  code  that  are  relevant  to  computing  the  amount
 described in the first sentence of subsection (a) of section six hundred
 sixty-seven  of  the internal revenue code shall apply to the provisions
 of this paragraph with the same force and effect as if the  language  of
 those  internal  revenue  code  provisions had been incorporated in full
 into this paragraph, except to the extent that  any  such  provision  is
 either inconsistent with or not relevant to this paragraph.
   (37)  In  the case of a taxpayer who transferred property to an incom-
 plete gift  non-grantor  trust,  the  income  of  the  trust,  less  any
 deductions  of  such  trust, to the extent such income and deductions of
 such trust would be taken  into  account  in  computing  the  taxpayer's
 federal  taxable  income if such trust in its entirety were treated as a
 grantor trust for federal tax purposes. For purposes of this  paragraph,
 an "incomplete gift non-grantor trust" means a resident trust that meets
 the  following  conditions:  (i) the trust does not qualify as a grantor
 trust under section six hundred seventy-one through six  hundred  seven-
 ty-nine of the internal revenue code, and (ii) the grantor's transfer of
 assets to the trust is treated as an incomplete gift under section twen-
 ty-five hundred eleven of the internal revenue code, and the regulations
 thereunder.
   (38)  The  amount  contributed to any or all of the following accounts
 within the charitable gifts trust fund set forth in section  ninety-two-
 gg  of  the state finance law, to the extent the amount is claimed as an
 itemized deduction pursuant to section six hundred fifteen  of  the  tax
 law:  the health charitable account established by paragraph a of subdi-
 vision four of section ninety-two-gg of the state finance  law,  or  the
 elementary  and  secondary  education  charitable account established by
 paragraph b of subdivision four of section ninety-two-gg  of  the  state
 finance law.
   (39) The amount of any gain excluded from federal gross income for the
 taxable  year  by subparagraph (A) of paragraph (1) of subsection (a) of
 section one thousand four hundred-Z-two of the internal revenue code.
   (c)   Modifications reducing federal adjusted  gross  income.    There
 shall be subtracted from federal adjusted gross income:
   (1)  Interest  income  on  obligations  of  the  United States and its
 possessions to the extent includible in gross income for federal  income
 tax  purposes; such interest income shall include the amount received as
 dividends from a regulated investment company,  as  defined  in  section
 eight  hundred  fifty-one  of  the internal revenue code, which has been
 designated as the amount of such interest income in a written notice  to
 shareholders  not later than sixty days following the close of its taxa-
 ble year; provided that, at the close of each  quarter  of  the  taxable
 year of such regulated investment company, at least fifty percent of the
 S. 8474                            894
 
 value of its total assets, as defined in subsection (c) of section eight
 hundred  fifty-one of the internal revenue code, consists of obligations
 of the United States and its possessions. The aggregate amount so desig-
 nated by the regulated investment company for its taxable year shall not
 exceed the amount determined by multiplying the total distributions paid
 by such regulated investment company to its shareholders with respect to
 that taxable year, attributable to income earned in that year, including
 any  such  distributions  paid  after  the close of the taxable year, as
 described in section eight hundred fifty-five of  the  internal  revenue
 code,  by  the  ratio  that the interest income received in that taxable
 year on obligations of the United  States  and  its  possessions,  after
 reduction for the deductions and expenses directly or indirectly attrib-
 utable  thereto,  bears to the investment company taxable income of such
 regulated investment company for such taxable year,  determined  without
 regard to subparagraph (D) of paragraph two of subsection (b) of section
 eight hundred fifty-two of the internal revenue code;
   (2)    Interest or dividend income on obligations or securities of any
 authority, commission or instrumentality of the  United  States  to  the
 extent  includible  in  gross income for federal income tax purposes but
 exempt from state income taxes under the laws of the United States;
   (3) (i) Pensions to officers and employees of this state, its subdivi-
 sions and agencies, to the extent includible in gross income for federal
 income tax purposes;
   (ii) Pensions to officers and employees of the United States of Ameri-
 ca, any territory or possession or political subdivision of such  terri-
 tory  or  possession, the District of Columbia, or any agency or instru-
 mentality of such, to the extent includible in gross income for  federal
 income tax purposes;
   (3-a)  Pensions  and  annuities  received  by  an  individual  who has
 attained the age of fifty-nine  and  one-half,  not  otherwise  excluded
 pursuant  to paragraph three of this subdivision, to the extent includi-
 ble in gross income for federal income tax purposes, but not  in  excess
 of  twenty thousand dollars, which are periodic payments attributable to
 personal services performed by such  individual  prior  to  his  or  her
 retirement  from  employment, which arise: (i) from an employer-employee
 relationship or (ii) from contributions to a retirement plan  which  are
 deductible for federal income tax purposes.  However, the term "pensions
 and  annuities" shall also include distributions received by an individ-
 ual who has attained the age of fifty-nine and one-half from an individ-
 ual retirement account or an individual retirement annuity,  as  defined
 in section four hundred eight of the internal revenue code, and distrib-
 utions  received by an individual who has attained the age of fifty-nine
 and one-half from self-employed individual and owner-employee retirement
 plans which qualify under section  four  hundred  one  of  the  internal
 revenue code, whether or not the payments are periodic in nature. Never-
 theless,  the  term  "pensions and annuities" shall not include any lump
 sum distribution, as defined in subparagraph (A) of  paragraph  four  of
 subsection  (e) of section four hundred two of the internal revenue code
 and taxed under section six hundred  three  of  the  tax  law.  Where  a
 husband  and  wife  file  a  joint  city personal income tax return, the
 modification provided for in this paragraph shall be computed as if they
 were filing separate city personal income tax returns. Where  a  payment
 would otherwise come within the meaning of the term "pensions and annui-
 ties"  as  set  forth  in  this paragraph except that such individual is
 deceased, such payment shall, nevertheless, be treated as a  pension  or
 S. 8474                            895
 
 annuity  for  purposes  of this paragraph if such payment is received by
 such individual's beneficiary.
   (3-b)  (i)  Disability income included in federal gross income, to the
 extent that such disability income would have been excluded from federal
 gross income pursuant to the provisions of subsection (d) of section one
 hundred five of the internal revenue code of nineteen hundred fifty-four
 had such provisions continued in effect  for  taxable  years  commencing
 after  December thirty-first, nineteen hundred eighty-three as they were
 in effect immediately prior to the repeal of such  subsection.  Notwith-
 standing  the  provisions  of  this  subparagraph, the sum of disability
 income excluded pursuant to this  paragraph,  and  pension  and  annuity
 income excluded pursuant to paragraph three-a of this subdivision, shall
 not exceed twenty thousand dollars.
   (ii) Notwithstanding subdivision (f) of this section, if a husband and
 wife  determine  their  federal  income  tax  on  a joint return but are
 required to determine their city income taxes separately, the amounts of
 exclusion allowed under subparagraph (i)  of  this  paragraph  shall  be
 determined  in  the  same  joint  manner as such amounts would have been
 determined under the provisions of paragraph five of subsection  (d)  of
 section one hundred five of the internal revenue code as such provisions
 were  in effect immediately prior to the repeal of such subsection,  but
 shall be attributed for city income tax purposes to the spouse who would
 have been required to report any such amount as income  if  the  spouses
 had determined their federal income taxes separately.
   (iii)  Where  a  husband and wife file a joint city income tax return,
 the twenty thousand dollar limitation provided in  subparagraph  (i)  of
 this  paragraph  shall  be  applied as if they were filing separate city
 income tax returns.
   (3-c) Social security benefits  to  the  extent  includible  in  gross
 income for federal income tax purposes pursuant to section eighty-six of
 the internal revenue code.
   (4)    The  portion of any gain, from the sale or other disposition of
 property having a higher adjusted basis for New York  state  income  tax
 purposes  than  for  federal  income tax purposes on the last day of the
 last taxable year for which article sixteen of the tax law imposes  tax,
 that does not exceed such difference in basis.
   (5)    The amount necessary to prevent the taxation under this chapter
 of any annuity or other amount of income  or  gain  which  was  properly
 included  in income or gain and was taxable under article sixteen of the
 tax law to the taxpayer, or to a decedent by reason of whose  death  the
 taxpayer acquired the right to receive the income or gain, or to a trust
 or estate from which the taxpayer received the income or gain.
   (6)    Interest or dividend income on obligations or securities to the
 extent exempt from income tax under the laws of this  state  authorizing
 the  issuance  of such obligations on securities but includible in gross
 income for federal income tax purposes.
   (7)  The amount of any refund or  credit  for  overpayment  of  income
 taxes  imposed by this city, any other taxing jurisdiction, or any taxes
 imposed by article twenty-three of the tax law to  the  extent  properly
 included in gross income for federal income tax purposes.
   (8)    Compensation received for active service in the armed forces of
 the United States on or after October first, nineteen hundred sixty-one,
 and prior to September  first,  nineteen  hundred  sixty-two;  provided,
 however,  that  the amount of such compensation to be deducted shall not
 exceed one hundred dollars for each month of the  taxable  year,  subse-
 quent to September, nineteen hundred sixty-one, during any part of which
 S. 8474                            896
 
 month  the  taxpayer  was  engaged in such service.  For the purposes of
 this paragraph, the words "active service in the  armed  forces  of  the
 United  States"  shall mean active duty, other than for training, in the
 army,  navy, including the marine corps, air force or coast guard of the
 United States as defined in title ten of the United States Code.
   (8-a)  Compensation and bonuses received for  active  service  in  the
 armed  forces of the United States while a prisoner of war or missing in
 action during the hostilities in Vietnam, to the  extent  includible  in
 gross income for federal income tax purposes.
   (9)    Interest  on  indebtedness incurred or continued to purchase or
 carry obligations or securities the interest on which is subject to  tax
 under  this  chapter  but  exempt from federal income tax, to the extent
 that such interest on indebtedness  is  not  deductible  in  determining
 federal adjusted gross income and is attributable to a trade or business
 carried on by the taxpayer.
   (10)    Ordinary  and  necessary  expenses paid or incurred during the
 taxable year for: (i) the production or collection of  income  which  is
 subject to tax under this chapter but exempt from federal income tax, or
 (ii)  the  management,  conservation or maintenance of property held for
 the production of such income, and the amortizable bond premium for  the
 taxable  year  on any bond the interest on which is subject to tax under
 this chapter but exempt from federal income tax, to the extent that such
 expenses and premiums are not deductible in determining federal adjusted
 gross income and are attributable to a trade or business carried  on  by
 the taxpayer.
   (11)  In the case of a taxpayer who has exercised the election permit-
 ted  by  subdivision  (g)  or (h) of this section, the amount or amounts
 required by said subdivisions to be  subtracted  from  federal  adjusted
 gross income.
   (12)  The amount necessary to prevent the taxation of amounts properly
 included  in  New  York  adjusted gross income in prior taxable years in
 accordance with paragraph seven of subdivision (b) of this section.
   (13)  The amount required to be subtracted from federal adjusted gross
 income pursuant to subdivision (i) of this section.
   (14)  The amount that may be subtracted from  federal  adjusted  gross
 income pursuant to subdivision (j) of this section.
   (15)  That portion of wages or salaries paid or incurred for the taxa-
 ble year for which a deduction is not allowed pursuant to the provisions
 of section two hundred eighty-C of the internal revenue code.
   (19)  The  amount  which may be subtracted from federal adjusted gross
 income pursuant to subdivision (r) of this section.
   (20) The amounts which may be subtracted from federal  adjusted  gross
 income pursuant to subdivision (o) of this section.
   (21)  In  relation  to  the  disposition of stock or indebtedness of a
 corporation which elected under subchapter  s  of  chapter  one  of  the
 internal  revenue  code  for any taxable year of such corporation begin-
 ning, in the case of a corporation taxable under article nine-A  of  the
 tax  law,  after  December  thirty-first,  nineteen  hundred eighty, the
 amounts required to be subtracted from  federal  adjusted  gross  income
 pursuant to subdivision (n) of this section.
   (22)  In  the case of a shareholder of an S corporation: (A) where the
 election provided for in subsection (a) of section six hundred sixty  of
 the tax law has not been made with respect to such corporation, any item
 of  income  of the corporation included in federal gross income pursuant
 to section thirteen hundred sixty-six of the internal revenue code, and
 S. 8474                            897
 
   (B) in the case of a New York S termination year, subparagraph (A)  of
 this  paragraph  shall  apply  to the amounts of income determined under
 subdivision (s) of this section.
   (23)  The  amounts which may be subtracted from federal adjusted gross
 income pursuant to subdivision (p) of this section.
   (24) For taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, any  amount
 which is included in the taxpayer's federal adjusted gross income solely
 as a result of an election made pursuant to the provisions of such para-
 graph  eight  as  it  was in effect for agreements entered into prior to
 January first, nineteen hundred eighty-four;
   (25) For taxable years beginning after December thirty-first, nineteen
 hundred eighty-one, except with respect to property which is a qualified
 mass commuting vehicle described in subparagraph (D) of paragraph  eight
 of  subsection  (f)  of  section one hundred sixty-eight of the internal
 revenue code, relating to qualified mass commuting vehicles, any  amount
 which  the  taxpayer  could  have  excluded  from federal adjusted gross
 income had it not made the election provided for in such paragraph eight
 as it was in effect for agreements entered into prior to January  first,
 nineteen hundred eighty-four;
   (26) For taxable years beginning after December thirty-first, nineteen
 hundred  eighty-one, except with respect to recovery property subject to
 the provisions of section two hundred eighty-F of the  internal  revenue
 code  and  recovery  property placed in service in this state in taxable
 years beginning after December thirty-first,  nineteen  hundred  eighty-
 four,  the  amount allowable as the depreciation deduction under section
 one hundred sixty-seven of the internal revenue  code  as  such  section
 would  have  applied  to  property placed in service on December thirty-
 first, nineteen hundred eighty;
   (26) In the case of property placed in service in taxable years begin-
 ning before nineteen hundred ninety-four, for  taxable  years  beginning
 after  December  thirty-first,  nineteen hundred eighty-one, except with
 respect to property subject to the provisions  of  section  two  hundred
 eighty-F  of  the  internal  revenue  code  and  property subject to the
 provisions of section one hundred sixty-eight of  the  internal  revenue
 code which is placed in service in this state in taxable years beginning
 after  December  thirty-first,  nineteen  hundred eighty-four, an amount
 with respect to property which is subject to the provisions  of  section
 one hundred sixty-eight of the internal revenue code equal to the amount
 allowable  as  the  depreciation  deduction  under  section  one hundred
 sixty-seven of the internal revenue code  as  such  section  would  have
 applied to property placed in service on December thirty-first, nineteen
 hundred eighty.
   (28)  Upon  the  disposition  of  recovery property to which paragraph
 twenty-six of this subdivision applies, the amount, if any, by which the
 aggregate of the modifications described  in  paragraph  twenty-five  of
 subdivision  (b)  of  this section attributable to such property exceeds
 the aggregate of the modifications described in paragraph twenty-six  of
 this subdivision attributable to such property.
   (28) Upon the disposition of property to which paragraph twenty-six of
 this  subdivision applies, the amount, if any, by which the aggregate of
 the modifications described in paragraph twenty-five of subdivision  (b)
 of  this  section attributable to such property exceeds the aggregate of
 S. 8474                            898
 
 the modifications described in paragraph twenty-six of this  subdivision
 attributable to such property.
   (29)  Deduction  for  two-earner  married couples. (A) For the taxable
 year beginning in nineteen  hundred  eighty-seven,  in  the  case  of  a
 husband  and  wife  who  each  have qualified earned income and who have
 filed a joint return under subdivision (b) of section  11-1751  of  this
 chapter  for  the  taxable  year,  an amount equal to ten percent of the
 lesser of:
   (i) thirty thousand dollars or
   (ii) the qualified earned income of the spouse with the  lower  quali-
 fied earned income for such taxable year.
   (B)  For  purposes  of  this  paragraph, eligibility for the deduction
 provided for herein and the term qualified earned income shall be deter-
 mined in the manner such eligibility and such  qualified  earned  income
 would  have  been  determined  pursuant to the provisions of section two
 hundred twenty-one of the internal  revenue  code  of  nineteen  hundred
 fifty-four  had  such  provisions  continued in effect for taxable years
 commencing after December thirty-first, nineteen hundred  eighty-six  as
 they  were  in  effect  immediately prior to the repeal of such section.
 Provided, however, the determination of  such  qualified  earned  income
 shall  be  made  with  regard only to the items therein included in city
 adjusted gross income, with such adjusted gross income determined  with-
 out regard to this paragraph, and only with regard to the deductions and
 exclusions  which  are  of  the type properly allowable to or chargeable
 against such qualified earned income in such taxable year.
   (30) The amount received by any person as an  accelerated  payment  or
 payments  of part or all of the death benefit or special surrender value
 under a life insurance policy as a result of any of the diagnoses speci-
 fied in subparagraph (A) or (B) of paragraph one of  subsection  (a)  of
 section  one thousand one hundred thirteen of the insurance law, and the
 amount received by any person as a viatical settlement pursuant  to  the
 provisions  of article seventy-eight of the insurance law, to the extent
 includible in gross income for federal income tax purposes.
   (32) The portion of the fees paid during the taxable year by a taxpay-
 er who is a resident of a continuing care retirement community, issued a
 certificate of authority pursuant to article  forty-six  of  the  public
 health  law,  attributable to the cost of providing long term care bene-
 fits pursuant to a continuing care contract. The portion of the fees  so
 attributable  shall be determined in accordance with regulations promul-
 gated by the superintendent of insurance. The deduction may  not  exceed
 the  limitation that would be applicable to the taxpayer for the taxable
 year, with respect to eligible long term care premiums, determined under
 paragraph ten of subsection (d) of section two hundred thirteen  of  the
 internal revenue code.
   (33)  Distributions, to the extent includible in adjusted gross income
 for federal income tax purposes, made to the taxpayer because of his  or
 her  status as a victim of Nazi persecution, as defined in P.L. 103-286,
 or as a spouse or a descendant in need of such victim.
   (34) Items of income, to the extent includible  in  gross  income  for
 federal income tax purposes, attributable to, derived from or in any way
 related to assets stolen from, hidden from or otherwise lost to a victim
 of  Nazi  persecution, as defined in P.L. 103-286, immediately prior to,
 during and immediately after World War II, including, but not limited to
 interest on the proceeds receivable as insurance under  policies  issued
 to a victim of Nazi persecution, as defined in P.L. 103-286, by European
 insurance companies immediately prior to and during World War II.
 S. 8474                            899
 
   Provided,  however, this subtraction from federal adjusted income does
 not apply to assets acquired with such assets or with the proceeds  from
 the  sale  of  such  assets.  Provided,  further, this paragraph is only
 applicable to a taxpayer who was the  first  recipient  of  such  assets
 after their recovery and who is a victim of Nazi persecution, as defined
 in P.L. 103-286, or a spouse or a descendant of such victim.
   (35) As provided in section thirty-eight of the tax law, any income or
 gain,  to  the extent it is included in federal adjusted gross income of
 an individual who is the sole proprietor of  a  qualified  entity  or  a
 member  of  a limited liability company, a partner in a partnership or a
 shareholder in a New York subchapter S corporation that is  a  qualified
 entity  as  defined  in  section  sixteen-v  of the New York state urban
 development corporation act attributable to the operations of such qual-
 ified entity at its location in or as part of a  New  York  state  inno-
 vation  hot  spot,  as  defined  in  paragraph (a) of subdivision one of
 section sixteen-v of the New York state  urban  development  corporation
 act.
   (36)  (A)  In  the  case  of  a  taxpayer who is a small business or a
 taxpayer who is a member, partner, or shareholder of a limited liability
 company, partnership, or New York S corporation, respectively, that is a
 small business, who or which has business income and/or farm  income  as
 defined  in  the  laws  of the United States, an amount equal to fifteen
 percent of the net items of income, gain, loss and  deduction  attribut-
 able  to  such  business  or  farm  entering into federal adjusted gross
 income, but not less than zero.
   (B) (i) For the purposes of this paragraph, the  term  small  business
 shall mean: (I) a sole proprietor who employs one or more persons during
 the  taxable  year and who has net business income or net farm income of
 greater than zero but less than two hundred fifty thousand dollars;
   (II) a limited liability company, partnership, or New  York  S  corpo-
 ration  that during the taxable year employs one or more persons and has
 net farm income that is greater than zero  but  less  than  two  hundred
 fifty thousand dollars; or
   (III)  a  limited liability company, partnership, or New York S corpo-
 ration that during the taxable year employs one or more persons and  has
 New  York gross business income attributable to a non-farm business that
 is greater than zero but less than one  million  five  hundred  thousand
 dollars.
   (ii)  For purposes of this paragraph, the term New York gross business
 income shall mean: (I) in the case of a limited liability company  or  a
 partnership, New York source gross income as defined in subparagraph (b)
 or  paragraph three of subsection (c) of section six hundred fifty-eight
 of the tax law, and, (II) in the case of a New York S  corporation,  New
 York  receipts  included  in  the  numerator of the apportionment factor
 determined under section two hundred ten-A of the tax law for the  taxa-
 ble year.
   (C)  To  qualify for this modification in relation to a non-farm small
 business that is a limited liability company, partnership, or New York S
 corporation, the taxpayer's income  attributable  to  the  net  business
 income from its ownership interests in non-farm limited liability compa-
 nies,  partnerships,  or  New  York S corporations must be less than two
 hundred fifty thousand dollars.
   (37) Any wages received by an individual as an employee of a  business
 located  within  a  tax-free NY area during the first five years of such
 business's ten year taxable  period  specified  in  subdivision  (a)  of
 section  thirty-nine  of  the  tax law to the extent included in federal
 S. 8474                            900
 
 adjusted gross income and allowed under section thirty-nine of  the  tax
 law.  During  the  second five years of such business's ten year taxable
 period, the first two hundred thousand dollars of such wages in the case
 of a taxpayer filing as a single individual, the first two hundred fifty
 thousand  dollars  of  such  wages in the case of a taxpayer filing as a
 head of household, and three hundred thousand dollars of such  wages  in
 the  case of a taxpayer filing a joint return, to the extent included in
 federal adjusted gross income and allowed under section  thirty-nine  of
 the tax law.
   (38) The amount of any award paid to a volunteer firefighter or volun-
 teer ambulance worker from a length of service defined contribution plan
 or defined benefit plan as provided for in articles eleven-A, eleven-AA,
 eleven-AAA  and  eleven-AAAA of the general municipal law, to the extent
 that such award is includable in gross income  for  federal  income  tax
 purposes;  provided,  however, that such award is not distributed in the
 form of a lump sum distribution, as defined in subparagraph (D) of para-
 graph four of subsection (e) of section four hundred two of the internal
 revenue code and taxed under section six hundred three of the  tax  law;
 and  provided, further, that such award is not distributed to a taxpayer
 who has not attained the age of fifty-nine and one-half years.
   (39) The amount of any gain  added  back  to  federal  adjusted  gross
 income  in  a previous taxable year pursuant to paragraph thirty-nine of
 subdivision (b) of this section that is included in federal gross income
 for the taxable year.
   (d) Modification for city fiduciary adjustment.  There shall be  added
 to or subtracted from federal adjusted gross income, as the case may be,
 the  taxpayer's share, as beneficiary of an estate or trust, of the city
 fiduciary adjustment determined under section 11-1719 of  this  subchap-
 ter.
   (e)  Modifications of partners and shareholders of S corporations. (1)
 Partners and shareholders of S corporations which are  not  New  York  C
 corporations.  The  amounts  of  modifications required to be made under
 this section by a partner or by a shareholder of an S corporation, other
 than an S corporation which is a New York C corporation, which relate to
 partnership or S corporation items of income, gain,  loss  or  deduction
 shall be determined under section 11-1717 of this subchapter and, in the
 case  of  a  partner  of  a  partnership  doing an insurance business as
 members of the New York insurance  exchange  described  in  section  six
 thousand  two  hundred one of the insurance law, under section 11-1717.1
 of this subchapter.
   (2) Shareholders of S corporations which are New York C  corporations.
 In  the  case of a shareholder of an S corporation which is a New York C
 corporation, the modifications under this section which  relate  to  the
 corporation's  items  of  income,  loss  and  deduction shall not apply,
 except for the modifications provided under paragraph nineteen of subdi-
 vision (b) and paragraph twenty-two of subdivision (c) of this section.
   (3) New York S termination year.  In the case of a New York  S  termi-
 nation  year,  the  amounts  of  the  modifications  required under this
 section which relate to the  S  corporation's  items  of  income,  loss,
 deduction  and  reductions for taxes, as described in paragraphs two and
 three of subsection (f) of section thirteen  hundred  sixty-six  of  the
 internal  revenue  code, shall be adjusted in the same manner that the S
 corporation's items are adjusted under subdivision (s) of this section.
   (f)  Husband and wife.  If husband and wife  determine  their  federal
 income  tax  on  a joint return but are required to determine their city
 income taxes separately, they shall determine their city adjusted  gross
 S. 8474                            901
 
 incomes  separately  as if their federal adjusted gross incomes had been
 determined separately.
   (g)    Optional  modifications.  Subject to the conditions provided in
 paragraphs three and four of this subdivision, at the  election  of  the
 taxpayer  there  shall  also  be  subtracted from federal adjusted gross
 income either or both of the items set forth in paragraphs one  and  two
 of  this  subdivision,  except  that  only  one  of  such items shall be
 subtracted with respect to any one item of property, and except  that  a
 subtraction of the item set forth in such paragraph two may not be taken
 with  respect  to  taxable  years  commencing on or after January first,
 nineteen hundred eighty-nine.
   (1)  Depreciation with respect to any property such  as  described  in
 paragraph  three  or four of this subdivision, and subject to the condi-
 tions provided therein, not exceeding  twice  the  depreciation  allowed
 with respect to the same property for federal income tax purposes.  Such
 modification  shall be allowed only upon condition that any depreciation
 or amortization allowed with respect to the same property in determining
 federal adjusted gross income shall be added to federal  adjusted  gross
 income  pursuant  to  paragraph  six of subdivision (b) of this section.
 The total of all deductions allowed pursuant to this  paragraph  in  any
 taxable  year  or  years with respect to any property described in para-
 graph three of this subdivision shall not exceed its cost or other basis
 and, with respect to property described in paragraph four of this subdi-
 vision, which is used in a business carried on both within  and  without
 the  state  shall  not  exceed  its  cost or other basis multiplied by a
 percentage of the excess of the  taxpayer's  business  income  over  its
 business  deductions  allocated  to  this  state for the first year such
 depreciation is deducted.  Such percentage shall be determined by appor-
 tionment and allocation under regulations of the tax commission.
   (2)  Expenditures paid or incurred during the  taxable  year  for  the
 construction,  reconstruction,  erection  or acquisition of any property
 such as described in paragraph three or four of  this  subdivision,  and
 subject  to the conditions provided therein, which is used or to be used
 for purposes of research and development in the experimental or  labora-
 tory  sense.   Such purposes shall not be deemed to include the ordinary
 testing or inspection of materials or products    for  quality  control,
 efficiency  surveys,  management studies, consumer surveys, advertising,
 promotions or research in connection with literary, historical or  simi-
 lar  projects.    Such  modification  shall be allowed only on condition
 that, with respect to property  described  in  paragraph  four  of  this
 subdivision,  which  is  used  in  a business carried on both within and
 without the state the deduction shall not exceed the expenditures multi-
 plied by a percentage of the excess of the  taxpayer's  business  income
 over  its business deductions allocated to this state for the first year
 such expenditures are deducted.  Such percentage shall be determined  by
 apportionment  and  allocation  under regulations of the tax commission,
 and  for  the  taxable  year  and  all  succeeding  taxable  years,  any
 deductions  allowed  for  federal income tax purposes on account of such
 expenditures or on account of depreciation of the same property,  except
 to  the  extent that its basis may be attributable to factors other than
 such expenditures, shall be  added  to  federal  adjusted  gross  income
 pursuant to paragraph six of subdivision (b) of this section, or in case
 a  modification  is allowable pursuant to this paragraph for only a part
 of such expenditures, on condition that a proportionate part of any such
 deductions allowed for federal income tax purposes be added  to  federal
 adjusted  gross income.  With respect to property which is used or to be
 S. 8474                            902
 
 used for research and development only in part, or during only  part  of
 its  useful  life, the modification allowable pursuant to this paragraph
 shall be limited to a proportionate part of  the  expenditures  relating
 thereto.    If  a  modification shall have been allowed pursuant to this
 paragraph for all or part of such expenditures with respect to any prop-
 erty, and such property is used for purposes  other  than  research  and
 development  to  a greater extent than originally reported, the taxpayer
 shall report such use in his or her return for the  first  taxable  year
 during which it occurs, and the tax commission may recompute the tax for
 the  year  or years for which such deduction was allowed, and may assess
 any additional tax resulting from such  recomputation  within  the  time
 fixed by subdivision (c) of section 11-1783 of this chapter.
   (3)  For  purposes  of  this  paragraph,  such  modifications shall be
 allowed only with respect to  tangible  property  which  is  depreciable
 pursuant  to  section  one  hundred  sixty-seven of the internal revenue
 code, having a situs in this state and used in the taxpayer's  trade  or
 business: (A) constructed, reconstructed or erected after December thir-
 ty-first,  nineteen  hundred  sixty-three,  pursuant to a contract which
 was, on or before December thirty-first, nineteen  hundred  sixty-seven,
 and  at  all times thereafter, binding on the taxpayer or, property, the
 physical construction, reconstruction or erection of which began  on  or
 before  December  thirty-first,  nineteen  hundred  sixty-seven or which
 began after such date pursuant to an order placed on or before  December
 thirty-first,  nineteen  hundred sixty-seven, and then only with respect
 to that portion of the basis thereof or the expenditures relating there-
 to which is properly attributable to such  construction,  reconstruction
 or  erection  after December thirty-first, nineteen hundred sixty-three,
 or (B) acquired after December  thirty-first,  nineteen  hundred  sixty-
 three,  pursuant  to a contract which was, on or before December thirty-
 first, nineteen hundred sixty-seven, and at all times thereafter,  bind-
 ing on the taxpayer or pursuant to an order placed on or before December
 thirty-first,  nineteen  hundred  sixty-seven, by purchase as defined in
 subsection (d) of section  one  hundred  seventy-nine  of  the  internal
 revenue  code,  if  the original use of such property commenced with the
 taxpayer, commenced in this state and commenced after  December  thirty-
 first,  nineteen  hundred  sixty-three,  or  (C)  acquired, constructed,
 reconstructed, or erected subsequent to December thirty-first,  nineteen
 hundred  sixty-seven,  if such acquisition, construction, reconstruction
 or erection is pursuant to a plan of the taxpayer which was in existence
 December thirty-first, nineteen hundred sixty-seven and  not  thereafter
 substantially  modified,  and  such  acquisition,  construction,  recon-
 struction or erection would qualify under the rules in  paragraph  four,
 five  or  six  of subdivision (h) of section forty-eight of the internal
 revenue code provided all references in such paragraphs four,  five  and
 six  to  the dates October nine, nineteen hundred sixty-six, and October
 ten, nineteen hundred sixty-six, shall be read as December thirty-first,
 nineteen hundred sixty-seven.  A taxpayer shall be allowed  a  deduction
 under  clause  (A),  (B)  or  (C) of this paragraph only if the tangible
 property shall be  delivered  or  the  construction,  reconstruction  or
 erection shall be completed on or before December thirty-first, nineteen
 hundred  sixty-nine,  except  in  the case of tangible property which is
 acquired, constructed, reconstructed or erected pursuant to  a  contract
 which  was,  on or before December thirty-first, nineteen hundred sixty-
 seven, and at all times thereafter, binding on the taxpayer.    However,
 for  any  taxable  year  beginning  on  or after January first, nineteen
 hundred sixty-eight, a taxpayer shall  not  be  allowed  a  modification
 S. 8474                            903
 
 under  paragraph  one  of  this  subdivision  with  respect  to tangible
 personal property leased to any other person or  corporation,  provided,
 any  contract or agreement to lease or rent or for a license to use such
 property  shall be considered a lease.  With respect to property which a
 taxpayer uses for purposes other than leasing for part of a taxable year
 and leases for a part of a taxable year, a modification under  paragraph
 one  of  this  subdivision shall be allowed in proportion to the part of
 the year such property is used by the taxpayer.
   (4) For purposes  of  this  paragraph,  such  modifications  shall  be
 allowed  only  with  respect  to  tangible property which is depreciable
 pursuant to section one hundred  sixty-seven  of  the  internal  revenue
 code,  having  a situs in this state and used in the taxpayer's trade or
 business.   The modifications provided for  in  paragraph  one  of  this
 subdivision  shall  be  allowed  only  with respect to tangible property
 which is: (A) constructed, reconstructed or erected after December thir-
 ty-first, nineteen hundred sixty-seven, pursuant  to  a  contract  which
 was,  on  or before December thirty-first, nineteen hundred sixty-eight,
 and at all times thereafter, binding on the taxpayer or,  property,  the
 physical  construction,  reconstruction or erection of which began on or
 before December thirty-first,  nineteen  hundred  sixty-eight  or  which
 began  after such date pursuant to an order placed on or before December
 thirty-first, nineteen hundred sixty-eight, and then only  with  respect
 to that portion of the basis thereof or the expenditures relating there-
 to  which  is properly attributable to such construction, reconstruction
 or erection after December thirty-first, nineteen  hundred  sixty-three,
 or (B) acquired after December thirty-first, nineteen hundred sixty-sev-
 en,  pursuant  to  a  contract  which was, on or before December thirty-
 first, nineteen hundred sixty-eight, and at all times thereafter,  bind-
 ing on the taxpayer or pursuant to an order placed on or before December
 thirty-first,  nineteen  hundred  sixty-eight, by purchase as defined in
 section one hundred seventy-nine (d) of the internal  revenue  code,  if
 the original use of such property commenced with the taxpayer, commenced
 in  this  state  and  commenced  after  December  thirty-first, nineteen
 hundred sixty-seven, or (C)  acquired,  constructed,  reconstructed,  or
 erected  subsequent  to  December  thirty-first, nineteen hundred sixty-
 eight, if such acquisition, construction, reconstruction or erection  is
 pursuant to a plan of the taxpayer which was in existence December thir-
 ty-first, nineteen hundred sixty-eight, and not thereafter substantially
 modified, and such acquisition, construction, reconstruction or erection
 would qualify under the rules in paragraph four, five or six of subdivi-
 sion  (h)  of  section forty-eight of the internal revenue code provided
 all references in such paragraphs four, five and six to the dates  Octo-
 ber  nine, nineteen hundred sixty-six, and October ten, nineteen hundred
 sixty-six, shall be read  as  December  thirty-first,  nineteen  hundred
 sixty-eight.   A taxpayer shall be allowed a deduction under clause (A),
 (B) or (C) of the preceding sentence  of  this  paragraph  only  if  the
 tangible property shall be delivered or the construction, reconstruction
 or erection shall be completed on or before December thirty-first, nine-
 teen  hundred  seventy, except in the case of tangible property which is
 acquired, constructed, reconstructed or erected pursuant to  a  contract
 which  was,  on or before December thirty-first, nineteen hundred sixty-
 eight, and at all times thereafter binding on the taxpayer. The  modifi-
 cation  provided  for  in  paragraph  two  of  this subdivision shall be
 allowed only with respect to tangible property:  (A)  the  construction,
 reconstruction  or erection of which is completed after December thirty-
 first, nineteen hundred sixty-seven, and then only with respect to  that
 S. 8474                            904
 
 portion  of the basis thereof or the expenditures relating thereto which
 is  properly  attributable  to  such  construction,  reconstruction   or
 erection  after  December thirty-first, nineteen hundred sixty-three, or
 (B)  acquired after December thirty-first, nineteen hundred sixty-seven,
 by purchase as defined in section one hundred seventy-nine  (d)  of  the
 internal  revenue  code,  if the original use of such property commenced
 with the taxpayer, commenced in this state and commenced after  December
 thirty-first,  nineteen  hundred  sixty-three.    Provided,  however,  a
 modification under paragraph one of this subdivision  shall  be  allowed
 with  respect  to property described in this paragraph only on condition
 that such property shall be principally used  by  the  taxpayer  in  the
 production  of goods by manufacturing; processing; assembling; refining;
 mining; extracting; farming;  agriculture;  horticulture;  floriculture;
 viticulture;  or commercial fishing.  Manufacturing shall mean the proc-
 ess of working raw materials into wares suitable for use or which  gives
 new  shapes,  new  qualities or new combinations to matter which already
 has gone through some artificial process by the use of machinery, tools,
 appliances and other similar equipment. Property used in the  production
 of  goods  shall include machinery, equipment or other tangible property
 which is principally used in the repair and service of other  machinery,
 equipment  or other tangible property used principally in the production
 of goods and shall include all  facilities  used  in  the  manufacturing
 operation, including storage of material to be used in manufacturing and
 of  the  products that are manufactured.  At the option of the taxpayer,
 air and water pollution control facilities which  qualify  for  elective
 deductions  under  subdivision  (h)  of this section may be treated, for
 purposes of this paragraph, as tangible property principally used in the
 production of goods by manufacturing; processing; assembling;  refining;
 mining;  extracting;  farming;  agriculture; horticulture; floriculture;
 viticulture; or commercial fishing, in which event,  a  deduction  shall
 not  be  allowed  under such subdivision (h).   However, for any taxable
 year beginning on or after January first, nineteen hundred  sixty-eight,
 a  taxpayer  shall  not be allowed a modification under paragraph one of
 this subdivision with respect to tangible personal  property  leased  to
 any  other person or corporation, provided, any contract or agreement to
 lease or rent or for a license to use such property shall be  considered
 a  lease.   With  respect to property which a taxpayer uses for purposes
 other than leasing for part of a taxable year and leases for a part of a
 taxable year, a modification under paragraph  one  of  this  subdivision
 shall  be allowed in proportion to the part of the year such property is
 used by the taxpayer.
   (5) If the modifications allowable for any taxable  year  pursuant  to
 this  subdivision  exceed  the  taxpayer's  city  adjusted gross income,
 determined without the allowance of such modifications, the  excess  may
 be  carried  over  to  the  following  taxable  year or years and may be
 subtracted from federal adjusted gross income for such year or years.
   (6) In any taxable year when property is sold  or  otherwise  disposed
 of,  with  respect  to which a modification has been allowed pursuant to
 paragraph one or two of this subdivision, the  basis  of  such  property
 shall  be  adjusted  to reflect the modifications so allowed, and if the
 basis as so adjusted is lower than the adjusted basis of the same  prop-
 erty  for  federal  income tax purposes, there shall be added to federal
 adjusted gross income the amount of the difference between such adjusted
 bases.
   (h)  Optional modification for waste treatment facility  expenditures.
 For  taxable  years  commencing prior to January first, nineteen hundred
 S. 8474                            905
 
 eighty-nine, at the election  of  the  taxpayer,  there  shall  also  be
 subtracted  from  federal  adjusted  gross  income  expenditures paid or
 incurred during the taxable year for the  construction,  reconstruction,
 erection or improvement of industrial waste treatment facilities and air
 pollution control facilities.
   (1)(A)    The  term "industrial waste treatment facilities" shall mean
 facilities for the treatment, neutralization, or stabilization of indus-
 trial waste, as the  term  "industrial  waste"  is  defined  in  section
 17-0105  of the environmental conservation law, from a point immediately
 preceding the point of such treatment, neutralization  or  stabilization
 to  the point of disposal, including the necessary pumping and transmit-
 ting facilities, but excluding such facilities installed for the primary
 purpose of salvaging materials which are  usable  in  the  manufacturing
 process or are marketable.
   (B)  The term "air pollution control facilities" shall mean facilities
 which  remove,  reduce,  or render less noxious air contaminants emitted
 from an air contamination source, as the  terms  "air  contaminant"  and
 "air  contamination  source" are defined in section 19-0107 of the envi-
 ronmental conservation law, from a point immediately preceding the point
 of such removal, reduction or rendering to the  point  of  discharge  of
 air,  meeting  emission  standards  as  established by the air pollution
 control board, but excluding such facilities installed for  the  primary
 purpose  of  salvaging  materials  which are usable in the manufacturing
 process or are marketable and excluding those facilities which rely  for
 their  efficacy  on  dilution, dispersion or assimilation of air contam-
 inants in the ambient air after emission.
   (2)  Such modifications shall be allowed only:
   (A)  with respect to tangible property which is depreciable,  pursuant
 to  section one hundred sixty-seven of the internal revenue code, having
 a situs in this state and used in the taxpayer's trade or business,  the
 construction,  reconstruction,  erection or improvement of which, in the
 case of industrial waste treatment facilities, is initiated on or  after
 January first, nineteen hundred sixty-five, or which, in the case of air
 pollution  control  facilities,  is initiated on or after January first,
 nineteen hundred sixty-six, and
   (B)  on condition that such facilities  have  been  certified  by  the
 commissioner  of  environmental  conservation  or  his or her designated
 representative, in the same manner as provided for in section 17-0707 or
 19-0309 of the environmental conservation law, as applicable, as comply-
 ing with the provisions of  such  environmental  conservation  law,  the
 state  sanitary  code  and  regulations,  permits  or orders promulgated
 pursuant thereto, and
   (C)  on condition that for the taxable year and all succeeding taxable
 years, any deductions allowed for federal income tax purposes  for  such
 expenditures  or  for depreciation or amortization of the same property,
 except to the extent that its basis may be attributable to factors other
 than such expenditures, be added to federal adjusted gross income pursu-
 ant to paragraph five of subdivision (b) of this section, or in  case  a
 modification  is allowable pursuant to this paragraph for only a part of
 such expenditures, on condition that a proportionate amount of any  such
 deductions  allowed  for federal income tax purposes be added to federal
 adjusted gross income, and
   (D)   where the election provided  for  in  subdivision  (g)  of  this
 section has not been exercised in respect to the same property.
   (3)(A)    If  expenditures in respect to an industrial waste treatment
 facility or an air pollution control facility have  been  allowed  as  a
 S. 8474                            906

 modification  as provided herein and if within ten years from the end of
 the taxable year in which such modification was allowed such property or
 any part thereof is used for the primary purpose of salvaging  materials
 which  are  usable  in  the manufacturing process or are marketable, the
 taxpayer shall report such change of use in its  return  for  the  first
 taxable  year  during which it occurs, and the tax commission may recom-
 pute the tax for the year or years for  which  such  modification    was
 allowed,  and may assess any additional tax resulting from such recompu-
 tation within the time fixed by paragraph eight of  subdivision  (c)  of
 section 11-1783 of this chapter.
   (B)   If a modification is allowed as herein provided for expenditures
 paid or incurred during any taxable year on the  basis  of  a  temporary
 certificate of compliance issued pursuant to the environmental conserva-
 tion law, and if the taxpayer fails to obtain a permanent certificate of
 compliance  upon completion of the facilities with respect to which such
 temporary certificate was issued, the taxpayer shall report such failure
 in its report for the taxable year  during  which  such  facilities  are
 completed,  and the tax commission may recompute the tax for the year or
 years for which such modification was allowed, and may assess any  addi-
 tional  tax  resulting  from such recomputation within the time fixed by
 paragraph eight of subdivision (c) of section 11-1783 of this chapter.
   (C) If a modification is allowed as herein provided  for  expenditures
 paid  or incurred during any taxable year in respect to an air pollution
 control facility on the basis of  a  certificate  of  compliance  issued
 pursuant  to  the  environmental conservation law and the certificate is
 revoked pursuant to section 19-0309 of  the  environmental  conservation
 law,  the tax commission may recompute the tax for the year or years for
 which the facility is not or was not in compliance with  the  applicable
 provisions  of  the  environmental  conservation law, the state sanitary
 code or codes, rules, regulations, permits  or  orders  issued  pursuant
 thereto,  and  for  which a modification was allowed, and may assess any
 additional tax resulting from such recomputation within the  time  fixed
 by  paragraph  eight of subdivision (c) of section 11-1783 of this chap-
 ter.
   (4) In any taxable year when property is sold  or  otherwise  disposed
 of,  with  respect  to which a modification has been allowed pursuant to
 this paragraph, such modification shall be disregarded in computing gain
 or loss, and the gain or loss on the sale or other disposition  of  such
 property  shall  be  the  gain  or loss entering into the computation of
 federal adjusted gross income for such taxable year.
   (i) In the case of mines, oil and gas wells and other  natural  depos-
 its,  any  allowance  for  percentage  depletion pursuant to section six
 hundred thirteen or section  six  hundred  thirteen-A  of  the  internal
 revenue code, shall be added to federal adjusted gross income.  However,
 with  respect  to  the  property  as  to  which such addition to federal
 adjusted gross income is required, an allowance for depletion  shall  be
 subtracted  from  federal adjusted gross income in the amount that would
 be deductible under section six hundred  eleven  of  such  code  if  the
 deduction for an allowance for depletion were computed without reference
 to  such section six hundred thirteen or section six hundred thirteen-A.
 With respect to the computation of depletion pursuant to  this  subdivi-
 sion, the basis for such computation shall be the basis for state income
 tax  purposes  provided  for  in  subsection  (i) of section six hundred
 twelve of the tax law.  The portion of any gain from the sale  or  other
 disposition  of  such  property  having a higher adjusted basis for city
 income tax purposes than for federal income tax purposes, that does  not
 S. 8474                            907
 
 exceed  such  difference  in  basis,  shall  be  subtracted from federal
 adjusted gross income.
   (j) Modification for nonpublic school tuition.  (1) General.  An indi-
 vidual  shall  be  entitled to subtract from his or her federal adjusted
 gross income an amount shown in the table set forth  in  this  paragraph
 for his or her city adjusted gross income for the taxable year, computed
 without  the  benefit  of this modification, multiplied by the number of
 his or her dependents, not exceeding three, attending a nonpublic school
 on a full-time basis for at least four months during the regular  school
 year  for  the education of such dependent in grades one through twelve,
 provided such individual is allowed an exemption under  section  11-1716
 of this chapter for such dependent.  Provided, further, that the modifi-
 cation  under  this  paragraph  may be taken only if such individual has
 paid at least fifty dollars for each such dependent in tuition  to  such
 nonpublic  school  for  such  education of such dependent.   No taxpayer
 shall be entitled to the modification provided for in this paragraph  if
 he  or  she  claims  a tuition reimbursement payment pursuant to article
 twelve-A of the education law.
 
           If city adjusted         The amount allowable
           gross income is:         for each dependent is:
           Less than $9,000                $1,000
            9,000 -- 10,999                   850
           11,000 -- 12,999                   700
           13,000 -- 14,999                   550
           15,000 -- 16,999                   400
           17,000 -- 18,999                   250
           19,000 -- 20,999                   150
           21,000 -- 22,999                   125
           23,000 -- 24,999                   100
           25,000 and over                    -0-
 
   (2) Husband and wife.   In determining the  applicable  city  adjusted
 gross  income  of a husband and wife for purposes of the table set forth
 in paragraph one of this subdivision, the city adjusted gross income  of
 a  husband  and wife shall be the aggregate of their city adjusted gross
 incomes for the taxable year, determined  without  the  benefit  of  the
 modification  provided for in this subdivision, and the number of depen-
 dents with respect to which this modification may be claimed shall be no
 more than three in the aggregate.
   (3) Definitions. (A) "Tuition", as used  in  this  subdivision,  shall
 mean  the  amount  actually paid during the taxable year by the taxpayer
 for the enrollment of a dependent during the regular school  year  at  a
 nonpublic school.
   (B)  "Nonpublic  school",  as used in this subdivision, shall mean any
 non-profit elementary or secondary school in  the  state  of  New  York,
 other  than  a  public  school,  which:  (i) is providing instruction in
 accordance with article seventeen and section thirty-two hundred four of
 the education law, (ii) has not been found to be in violation  of  title
 VI of the civil rights act of nineteen hundred sixty-four, 78 Stat. 252,
 42 U.S.C. § 2000(d) and (iii) which is entitled to a tax exemption under
 sections five hundred one (a) and five hundred one (c) (3) of the feder-
 al  internal  revenue  code  of nineteen hundred fifty-four, as amended.
 The commissioner of education shall furnish to  the  tax  commission  by
 February first of each year, a certified list of nonpublic schools which
 comply  with  clause (i) of this subparagraph for the preceding calendar
 S. 8474                            908
 
 year and shall provide such other assistance  with  respect  to  whether
 nonpublic  schools  come  within  clause  (i)  as the tax commission may
 require.
   (C) "Regular school year", as used in this subdivision, shall mean the
 months of the taxable year exclusive of July and August.
   (4)  Additional information.   Any claim for a modification under this
 subdivision shall be accompanied by such information as the tax  commis-
 sion may require.
   (k)  Modification  for  contributions  to a qualified higher education
 fund.  (1) A taxpayer may subtract from  his  or  her  federal  adjusted
 gross  income  amounts  which during the taxable year are contributed by
 him or her to a qualified higher education fund, as defined in paragraph
 three of this subdivision, established by him or  her,  limited  to  the
 product  of seven hundred fifty dollars and the number of eligible bene-
 ficiaries, as defined in subparagraph (C) of  paragraph  three  of  this
 subdivision,  as of the first or last day of the taxable year, whichever
 yields the higher limit.  Provided, however, that a taxpayer whose taxa-
 ble year began on January  first,  nineteen  hundred  seventy-eight  may
 subtract  from his or her federal adjusted gross income for such taxable
 year, amounts contributed by him or her  to a qualified higher education
 fund during the fifteen month period beginning January  first,  nineteen
 hundred  seventy-eight  and  ending  April  fifteenth,  nineteen hundred
 seventy-nine.  Contributions to a qualified higher education  fund  made
 during the period beginning January first, nineteen hundred seventy-nine
 and ending April fifteenth, nineteen hundred seventy-nine and subtracted
 from  a  taxpayer's  federal  adjusted gross income for the taxable year
 beginning January first, nineteen hundred seventy-eight shall be  deemed
 to  have  been  made  during such taxable year.  However, such number of
 eligible beneficiaries shall  not  include  any  individual  who  was  a
 student  at an institution of higher education during the previous taxa-
 ble year.  For purposes of this paragraph, the term "student" shall have
 the same meaning as that ascribed to it by paragraph four of  subsection
 (e)  of  section  one  hundred  fifty-one  of the internal revenue code,
 except that the reference therein to "5 calendar months" shall be deemed
 to be a reference to "3 calendar months."
   (2) A taxpayer who establishes a qualified higher education  fund  may
 subtract  from his or her federal adjusted gross income amounts included
 in gross income for federal income tax purposes by reason of any  income
 realized  by  the  fund  or because of any payment by the fund to, or on
 behalf of, an eligible beneficiary for the purpose specified  in  clause
 (i) of subparagraph (A) of paragraph three of this subdivision.
   (3)    For  purposes of this subdivision, a qualified higher education
 fund is a fund established pursuant  to  a  written  plan  described  in
 subparagraph  (A)  of  this  paragraph,  but  only if the fund meets the
 requirements of subparagraph (B) of this paragraph.
   (A) For purposes of this subdivision a  "plan"  means  a  plan  estab-
 lished:
   (i)  solely for the purpose of defraying costs associated with attend-
 ance subsequent to graduation or separation from secondary school at  an
 institution  of higher education, as defined in subparagraph (F) of this
 paragraph, of one or more eligible beneficiaries, as defined in subpara-
 graph (C) of this paragraph,  such  costs  to  include:  (I)  applicable
 tuition  and  fees, exclusive of fees levied as a penalty for laboratory
 breakage, dormitory damage and similar fees,  (II)  room  and  board  as
 charged  by  the  institution pursuant to a contract entered into by the
 institution and a student or, if no such contract is  entered  into,  an
 S. 8474                            909
 
 amount  not  exceeding one thousand five hundred dollars per year, which
 amount shall include any expenses of transportation,  and  (III)  books,
 supplies and equipment,
   (ii)  which  provides  that no distribution shall be made by the fund,
 except upon termination thereof, other than to, or on behalf of,  eligi-
 ble  beneficiaries  for  the  purpose  specified  in  clause (i) of this
 subparagraph,
   (iii) which provides that upon termination of the fund all  assets  of
 the  fund shall be distributed to the creator of the fund, to his or her
 estate or to a trust established for the purpose of making contributions
 to the fund, and
   (iv) which prohibits contributions to the fund in  excess  of  amounts
 which  may be subtracted from federal adjusted  gross income under para-
 graph one of this subdivision.
   (B) A fund meets the requirements of this subparagraph only if:
   (i) it constitutes a custodial account, the assets of which are   held
 by a bank, as defined in paragraph one of subsection (d) of section four
 hundred one of the internal revenue code, an insurance company qualified
 to do business in this state, or another person who demonstrates, to the
 satisfaction  of  the tax commission, that the manner in which he or she
 will hold the assets will be consistent with the  requirements  of  this
 subdivision, or
   (ii) it is a trust.
   In  the  case  of  a trust referred to in clause (ii) of this subpara-
 graph, the assets may be held by a bank or other person who demonstrates
 to the satisfaction of the tax commission that the manner in which he or
 she will administer the trust will be consistent with  the  requirements
 of  this subdivision.  Such a trust shall not be disqualified under this
 subparagraph merely because a person other than the trustee so  adminis-
 tering  the  trust may be granted, under the trust instrument, the power
 to control the investment of the trust funds either by directing invest-
 ments, including reinvestments, disposals and exchanges,  or  by  disap-
 proving  proposed  investments,  including  reinvestments, disposals and
 exchanges.  Such a trust may use annuity, endowment  or  life  insurance
 contracts  of  a life insurance company exclusively as the funding media
 of the trust, if so provided by regulations of the state    tax  commis-
 sion,  and if the life insurance company supplies annually such informa-
 tion about trust transactions as the tax commission shall by regulations
 prescribe.  For purposes of this subdivision, the term "bank" shall have
 the same meaning ascribed to it by the last sentence of paragraph one of
 subsection (d) of section four hundred one of the internal revenue code.
   (C) For purposes of this subdivision, the term "eligible  beneficiary"
 means a person:
   (i)  having  a  relationship  to  the creator of the fund specified in
 paragraphs one, two, three or six  of  subsection  (a)  of  section  one
 hundred fifty-two of the internal revenue code,
   (ii) who is a dependent of the creator of the fund pursuant to section
 one  hundred  fifty-two  of the internal revenue code, or is a member of
 the armed forces of the United States on active duty, is a volunteer  in
 the  peace  corps, or is a full-time volunteer under the domestic volun-
 teer service act of 1973, and
   (iii) who either: (I) has not attained the age of  twenty-one,  except
 that where his or her twenty-first birthday falls within a  taxable year
 with  respect to which a modification based on contributions to a quali-
 fied higher education fund with respect to which he or she is a  benefi-
 ciary  is  allowed  to  a  taxpayer, for purposes of this subclause such
 S. 8474                            910
 
 beneficiary shall be deemed not to have attained the age  of  twenty-one
 until the day next succeeding the last day of such taxable year, or (II)
 is  a student, as defined in paragraph four of subsection (e) of section
 one  hundred  fifty-one of the internal revenue code or, for a period of
 up to four years, is a member of the armed forces of the  United  States
 on  active  duty,  is  a volunteer in the peace corps, or is a full-time
 volunteer under the domestic volunteer service act of  1973.  Where  the
 determination  of  an individual's status as a student is required for a
 purpose other than determining  the  permissibility  of  a  modification
 under  this  subdivision,  an  individual  shall  be  deemed not to be a
 student as of the last day of any calendar year during which he  or  she
 fails  to satisfy the requirements of subparagraphs (A) and (B) of para-
 graph four of subsection (e) of section one  hundred  fifty-one  of  the
 internal  revenue  code  during each of five calendar months during such
 calendar year.
   (D) A person who meets the requirements of subparagraph  (C)  of  this
 paragraph shall cease to be an eligible beneficiary:
   (i)  if  payments  by the fund to him or her, or on his or her behalf,
 for the purpose specified in clause (i)  of  subparagraph  (A)  of  this
 paragraph do not commence within five years after the date on which such
 person  was  graduated or separated from secondary school, excluding any
 period of up to four years during which an otherwise eligible  benefici-
 ary  was  a  member  of  the armed forces of the United States on active
 duty, a volunteer in the peace corps, or in    service  as  a  full-time
 volunteer under the domestic volunteer service act of 1973, or
   (ii)  after  the  expiration of ten years from the date of such gradu-
 ation or separation, excluding any period of up  to  four  years  during
 which an otherwise eligible beneficiary was a member of the armed forces
 of  the United States on active duty, a volunteer in the peace corps, or
 in service as a full-time volunteer under the domestic volunteer service
 act of 1973, or
   (iii) if within six months after either his or her eighteenth birthday
 or the date on which such fund is established, whichever is later, he or
 she does not file with the tax commission, on a form and in  the  manner
 prescribed by regulation, a notice of consent relating to the tax treat-
 ment  of  payments  from a qualified higher education fund imposed under
 paragraph fourteen of subdivision (b) of this section.
   (E) Where a fund is continued subsequent to its  creator's  death,  an
 individual  shall  not  cease to be an eligible beneficiary by reason of
 failure to fulfill the requirement set forth in clause (ii) of  subpara-
 graph (C) of this paragraph.
   (F)  For purposes of this subdivision, the term "institution of higher
 education" means an educational organization described in clause (ii) of
 subparagraph (A) of paragraph one  of  subsection  (b)  of  section  one
 hundred seventy of the internal revenue code,
   (i) which provides an educational program for which it awards an asso-
 ciate,  baccalaureate  or  higher  degree or provides a program which is
 acceptable for full credit toward such a degree,
   (ii) contributions to or for the use of  which  constitute  charitable
 contributions  within  the meaning of section one hundred seventy (c) of
 the internal revenue code,
   (iii) which is legally  authorized  to  provide  and  does  provide  a
 program of postsecondary education, and
   (iv) which is accredited by a nationally recognized accrediting agency
 or association listed by the United States commissioner of education.
   (4) A qualified higher education fund shall terminate:
 S. 8474                            911
 
   (A)  if  a  contribution  is  made to the fund in excess of the amount
 allowable as a subtraction from  federal  adjusted  gross  income  under
 paragraph one of this subdivision,
   (B)  if a distribution is made by the fund other than to, or on behalf
 of, an eligible beneficiary for the purpose specified in clause  (i)  of
 subparagraph (A) of paragraph three of this subdivision,
   (C) if the plan ceases to have an eligible beneficiary, or
   (D)  in the absence of a testamentary disposition or inter vivos trust
 provision to the contrary, upon the death of the creator of the fund, or
   (E) if the fund is otherwise terminated under the tax law.
   (5) The tax commission may by  regulation  require  the  filing  of  a
 report  annually  by the creator of a qualified higher education fund or
 other person designated by such regulation, such report to set forth the
 amounts contributed to a qualified higher education fund, as well as the
 amount, purpose and beneficiary of  each  disbursement  made  therefrom.
 The  tax  commission may also by regulation require written notification
 annually to each beneficiary of such disbursements made on  his  or  her
 behalf.
   (6)  The  provisions  of  subparagraph  (B)  of paragraph four of this
 subdivision shall not apply in the case of a rollover. A rollover occurs
 where the creator of a qualified higher education fund withdraws all  of
 the assets of such fund and not later than sixty days subsequent to such
 withdrawal  establishes a new qualified higher education fund and depos-
 its therein an amount equal to the value of  the  assets  so  withdrawn.
 Such  deposit  shall not constitute a contribution within the meaning of
 this subdivision. This paragraph shall not apply if at any  time  during
 the one year period ending on the date of such withdrawal from the qual-
 ified  higher  education  fund the creator had made a similar withdrawal
 from another qualified higher education fund, both such funds having  at
 least  one  beneficiary  in  common,  where  such  prior  withdrawal was
 followed by the establishment of a new qualified higher  education  fund
 such  that  a  rollover  was effected pursuant to the provisions of this
 paragraph.
   (l)  Qualified higher education fund.   (1)   Upon  termination  of  a
 qualified  higher  education  fund under subparagraph (A), (B) or (E) of
 paragraph four of subdivision (k) of this section, a  taxpayer  to  whom
 the assets of the fund are required to be distributed pursuant to clause
 (iii)  of subparagraph (A) of paragraph three of subdivision (k) of this
 section shall add to his or her federal adjusted gross  income  for  the
 taxable  year  during which the terminating event occurs an amount equal
 to one hundred ten per centum of an amount which bears the same ratio to
 the value of the assets of such fund immediately prior to termination as
 the total contributions made to such fund by a city resident individual,
 estate or trust bears to the total contributions made to such fund.  For
 purposes of this subdivision the value of the assets of the  fund  imme-
 diately  prior  to  termination  shall include the value of any distrib-
 utions made to or on behalf of an eligible beneficiary who  subsequently
 ceased to be an eligible beneficiary pursuant to clause (iii) of subpar-
 agraph (D) of paragraph three of subdivision (k) of this section.
   (2)    Payments made to or on behalf of an eligible beneficiary from a
 qualified higher education fund for the purpose specified in clause  (i)
 of  subparagraph  (A)  of  paragraph  three  of  subdivision (k) of this
 section shall be added to the federal adjusted gross income of the indi-
 vidual taxpayer to whom or on whose  behalf  the  payment  is  made,  in
 accordance  with  the  following.    For  the first taxable year of such
 taxpayer in which no payment described in this paragraph  is  made  with
 S. 8474                            912
 
 respect  to  him or her and during which such taxpayer is not a student,
 as defined in paragraph four of subsection (e) of  section  one  hundred
 fifty-one  of the internal revenue code, treating the terms "individual"
 and  "taxpayer"  therein as referring to such taxpayer, or, for a period
 of up to four years, a member of the armed forces of the  United  States
 on active duty, a volunteer in the peace corps, or a full-time volunteer
 under  the  domestic  volunteer  service act of 1973, which taxable year
 commences after the last day of the first calendar year in which such  a
 payment  is made, one-fifth of the aggregate of all such payments there-
 tofore made, such aggregate amount pro-rated,  pursuant  to  regulations
 promulgated by the tax commission, according to the portion of the total
 contributions  made  to  the fund prior to the first day of such taxable
 year which constitute amounts contributed by a city resident individual,
 estate or trust, shall be added to the federal adjusted gross income  of
 such  taxpayer for such taxable year and for each of the four succeeding
 taxable years in which no such payment is made and in which such taxpay-
 er is not a student, as defined above, or, for a period of  up  to  four
 years, a member of the armed forces of the United States on active duty,
 a  volunteer  in  the  peace  corps,  or a full-time volunteer under the
 domestic volunteer service act of 1973.  If in a taxable year subsequent
 to a taxable year in which  such  addition  to  federal  adjusted  gross
 income  is required, a payment described in this paragraph is made, one-
 fifth of the amount of such payment, pro-rated, pursuant to  regulations
 promulgated by the tax commission, according to the portion of the total
 contributions  made  to  the fund prior to the first day of such taxable
 year which constitute amounts contributed by a city resident individual,
 estate or trust, shall be added to the federal adjusted gross income  of
 such  taxpayer for each of the five immediately succeeding taxable years
 in which no such payment is made and in which such  taxpayer  is  not  a
 student,  as  defined  above,  or,  for  a period of up to four years, a
 member of the armed forces of the United States on active duty, a volun-
 teer in the peace corps, or a full-time  volunteer  under  the  domestic
 volunteer service act of 1973.
   (n)  Where  gain or loss is recognized for federal income tax purposes
 upon the disposition of stock or indebtedness of a corporation  electing
 under subchapter s of chapter one of the internal revenue code:
   (1)  There  shall be added to federal adjusted gross income the amount
 of increase in basis with respect to such stock or indebtedness pursuant
 to subsection (a) of section thirteen hundred seventy-six of the  inter-
 nal  revenue code as such section was in effect for taxable years begin-
 ning before January first, nineteen hundred  eighty-three  and  subpara-
 graphs  (A)  and  (B)  of  paragraph  one  of  subsection (a) of section
 thirteen hundred sixty-seven of such code, for each taxable year of  the
 corporation  beginning, in the case of a corporation taxable under arti-
 cle nine-A of the tax law, after December thirty-first, nineteen hundred
 eighty, for which the election provided for in subsection (a) of section
 six hundred sixty of the tax law was not in effect, and
   (2) There shall be subtracted from federal adjusted gross income:
   (A) the amount of reduction in basis with respect  to  such  stock  or
 indebtedness  pursuant  to  subsection  (b)  of section thirteen hundred
 seventy-six of the internal revenue code as such section was  in  effect
 for  taxable  years  beginning  before  January  first, nineteen hundred
 eighty-three  and  subparagraphs  (B)  and  (C)  of  paragraph  two   of
 subsection (a) of section thirteen hundred sixty-seven of such code, for
 each  taxable year of the corporation beginning, in the case of a corpo-
 ration taxable under article nine-A of the tax law, after December thir-
 S. 8474                            913
 
 ty-first, nineteen hundred eighty, for which the election  provided  for
 in subsection (a) of section six hundred sixty of the tax law was not in
 effect and
   (B)  the  amount  of  any  modifications  to federal gross income with
 respect to such stock pursuant to paragraph  twenty-one  of  subdivision
 (b) of this section.
   (o)  Modifications  for  new business investment gains and certain new
 business investments.
   1. For purposes of this subdivision, the following  definitions  shall
 apply:
   (A)  "New  business investment gain" means gain from the sale of a new
 business investment issued to the taxpayer before January  first,  nine-
 teen hundred eighty-eight, if:
   (i)  such new business investment is, in the hands of the person sell-
 ing the same, whether or not the taxpayer, a capital asset as defined in
 section twelve hundred twenty-one of the internal revenue code of  nine-
 teen hundred fifty-four, as amended, and
   (ii)  such  new  business  investment  was held by such person for the
 period specified in paragraph two of this subdivision.
   (B) "New business" means a corporation  or  partnership  organized  or
 formed under the laws of any state which:
   (i)  adopts a plan on or after July first, nineteen hundred eighty-one
 and before January first, nineteen hundred eighty-eight,  to  conduct  a
 new  business within the meaning and intent of this section and to issue
 new business investments, as defined in this subdivision, and
   (ii) is, at the date of adoption of such plan,  subject  to  taxation,
 whether  or  not  any amount is owing, under section one hundred eighty-
 three or one hundred eighty-four of article nine  of  the  tax  law,  or
 under  article  nine-A of the tax law or article twenty-three of the tax
 law, or would have been subject to tax  under  article  twenty-three  of
 such  law,  as  such  article  was  in effect on January first, nineteen
 hundred eighty, if such article were still  in  effect,  and  the  first
 taxable  period for which such new business became subject to such taxa-
 tion commenced on or after July first, nineteen hundred  eighty-one  and
 before  January  first,  nineteen  hundred  eighty-eight, and such first
 taxable period includes the date of adoption of such  plan;  if  not  so
 subject  to taxation, the new business must be subject to taxation under
 such sections or articles for the first time within one  year  from  the
 date of adoption of such plan, and
   (iii)  is  conducted, or will be conducted, as evidenced by such plan,
 whereby at least ninety percent of the assets, valued at original  cost,
 are located and employed in this state and eighty percent of the employ-
 ees,  in addition, in the case of a partnership, excluding partners, are
 principally employed in this state during each taxable period,  or  part
 thereof, as required by clause (iv) of this subparagraph, and
   (iv)  within  ninety days after adoption of such plan, or, if a return
 is required, as part of such return, under such  article  nine,  article
 nine-A  or  article  twenty-three  of  the tax law, whichever is sooner,
 shall file a new business certificate with the tax commission  attesting
 to  whether  it  meets,  if  subject to taxation under such articles, or
 intends to meet, if not so subject, all  of  the  conditions  stated  in
 clauses  (i),  (ii)  and  (iii) of this subparagraph within the time set
 forth therein.  Thereafter, during the first four taxable years of  such
 new business, along with, and as part of, any return required under such
 articles,  such  new business shall make and file a new business certif-
 icate for the period covered by such return attesting to whether it  has
 S. 8474                            914
 
 met  the  conditions  specified  in this subparagraph during the taxable
 period covered by such return. If no return is required under such arti-
 cles, such  certificate  shall  be  filed  annually  on  or  before  the
 fifteenth day of March which shall cover the twelve consecutive calendar
 month  period  ending  on the last day of December immediately preceding
 such March fifteenth. If such new business fails to meet such conditions
 specified in this subparagraph, it shall, in addition,  give  notice  of
 this  fact,  within  the  time  prescribed by the tax commission, to the
 holders of its "new business  investments."  The  tax  commission  shall
 prescribe  the  form  and content of such new business certification and
 may require a new business to file such certificate for periods, even if
 no return is filed or required, but for this  section,  covering  up  to
 eight  years  from  the  date  of  adoption  of  such  plan,  as  in its
 discretion, it deems the same necessary  for  the  enforcement  of  this
 section, and
   (v) Special rules:
   (1)  For  any taxable period, in order to constitute a new business, a
 business enterprise must have derived more than  sixty  percent  of  its
 aggregate gross receipts from sources other than royalties, rents, divi-
 dends,  interest,  annuities  and sales or exchanges of stock or securi-
 ties.
   (2) A new business does not include: (i) any  new  business  of  which
 twenty-five  percent or more of the number of shares of stock that enti-
 tle the holders thereof to vote for the election of directors  or  trus-
 tees  is  owned,  directly  or  indirectly, by a taxpayer subject to tax
 under section one hundred eighty-three, one hundred eighty-four,  former
 section one hundred eighty-five or former section one hundred eighty-six
 of article nine of the tax law, or under article nine-A, or thirty-three
 of  the tax law or (ii) any new business substantially similar in opera-
 tion and in ownership, directly or indirectly, to a business entity,  or
 entities, taxable, or previously taxable, under such section, such arti-
 cle,  article  twenty-three  of  the  tax  law  or which would have been
 subject to tax under such article twenty-three, as such article  was  in
 effect  on  January  first,  nineteen  hundred eighty, or the income, or
 losses, of which is, or was, includible under article twenty-two of such
 tax law  whereby the intent and purpose of this section would be evaded.
   (C) "New business investment" means and includes the following invest-
 ments issued before January first, nineteen hundred  eighty-eight  by  a
 new  business pursuant to a plan described in clause (i) of subparagraph
 (B) of this paragraph for money or other property, other than  stock  or
 securities,  on  or  before  the expiration of the third taxable year of
 such new business, excluding any short period immediately preceding such
 taxable year because the new business was not in existence for an entire
 taxable year, or forty-two months from the adoption of such plan, which-
 ever is sooner: (i) original issuance capital stock as  part  of  a  new
 issue,  (ii) other original issuance securities of a new issue of a like
 nature as stocks which are designed as a means of investment and  issued
 for  the  purpose of financing corporate enterprises and providing for a
 distribution of rights in such enterprises, (iii) debt obligations  such
 as  bonds  and  debentures  for    a  term of at least one year, whether
 secured or  unsecured,  and  (iv)  certificates  and  other  instruments
 representing proprietary interests, whether limited or otherwise, in and
 assumption  of  general  liabilities, whether limited or otherwise, of a
 partnership enterprise.
 S. 8474                            915
 
   2. A taxpayer may subtract from his federal adjusted  gross  income  a
 portion  of  an  amount  constituting a new business investment gain, as
 follows:
   If new business                    The modification is equal to the
 investment held for:                 following proportion of the gain
                                      includible in federal
                                      adjusted gross income:
 At least four years, but
   less than five years               twenty-five percent
 At least five years, but
   less than six years                fifty percent
 At least six years                   one hundred percent
   3.  Where,  within  six  months  of  the realization of a new business
 investment gain allowable as the basis of a modification under paragraph
 two of this subdivision, such modification is equal  to  less  than  one
 hundred  percent  of  the  portion  of  the  gain  includible in federal
 adjusted gross income and the taxpayer purchases a new business  invest-
 ment which is then held for a period of at least six months, the taxpay-
 er  may  subtract  from  his  or  her  federal adjusted gross income ten
 percent, but not an amount that will reduce the  portion  of  such  gain
 included in his or her New York income below zero, of the amount of such
 gain where the purchase price of the new business investment is equal to
 or greater than the proceeds of the sale giving rise to such gain. Where
 the purchase price of the new business investment is less than an amount
 equal  to  the  proceeds  of such sale, the modification allowable under
 this paragraph shall be equal to ten percent of an amount equal  to  the
 product of:  (A) the amount of the gain and (B) a fraction the numerator
 of which is the purchase price of the new investment and the denominator
 of which is an amount equal to the proceeds of such sale.  The modifica-
 tion  allowable  under  this paragraph may be utilized, at the option of
 the taxpayer, with respect to the taxable year in which the new business
 investment gain is realized or the year containing the last day  of  the
 six-month retention period described in this paragraph.
   4.  The tax commission may prescribe such rules and regulations as may
 be necessary to carry out the purposes of this subdivision.
   (p) New business investment  deferral.  For  taxable  years  beginning
 before  January  first,  nineteen hundred eighty-eight, at the option of
 the taxpayer, there may be subtracted from federal adjusted gross income
 a reinvested amount of long-term capital gain realized in a taxable year
 from the sale of a capital asset, as such term  is  defined  in  section
 twelve  hundred  twenty-one of the internal revenue code, which is not a
 new business investment. A reinvested amount of long-term  capital  gain
 shall mean an amount which bears the same ratio to the long-term capital
 gain  realized  from the sale of a capital asset which was includible in
 New York adjusted gross income as that  portion  of  the  sale  proceeds
 which  is  reinvested,  within one year from date of sale, in a New York
 new business bears to the total sale proceeds. For the purposes of  this
 subdivision, a New York new business is a business enterprise which: (1)
 has been a taxpayer under article nine-A, twenty-two, or thirty-three of
 the  tax law for no more than three taxable years, including short taxa-
 ble years, (2) over fifty percent of the number of shares of stock  that
 entitle  the  holders  thereof  to vote for the election of directors or
 trustees is not owned, directly or indirectly, by a taxpayer subject  to
 tax  under  section one hundred eighty-three, one hundred eighty-four or
 one hundred eighty-five of article nine of the tax law, or under article
 nine-A, thirty-two or thirty-three of the tax law, (3) is  not  substan-
 S. 8474                            916
 
 tially  similar  in operation or ownership, directly or indirectly, to a
 business entity, or entities taxable, or previously taxable, under  such
 sections,  such  articles,  article twenty-three of the tax law or which
 would have been subject to tax under article twenty-three, as such arti-
 cle  was  in  effect  on  January first, nineteen hundred eighty, or the
 income, or losses, of which is, or was, includible under  article  twen-
 ty-two of the tax law whereby the intent and purpose of this subdivision
 would  be evaded, (4) locates and employs at least ninety percent of its
 assets in the state, (5) employs principally in the state eighty percent
 of its employees, and (6) derives less than forty percent of  its  gross
 income  from dividends, interest, royalties, other than mineral, oil, or
 gas royalties or copyright royalties, annuities and (7) reports at least
 twenty-five hundred dollars in gross income in  any  taxable  year.  The
 reinvested amount must qualify as a capital asset as defined pursuant to
 section  twelve hundred twenty-one of the internal revenue code and must
 be retained by the taxpayer for at least twelve months. The modification
 allowable under this subdivision shall be utilized with respect  to  the
 taxable year in which the twelve month retention period ends.
   (q)  An amount deferred under subdivision (p) of this section shall be
 added to federal adjusted gross income when the reinvestment in the  New
 York new business which qualified a taxpayer for such deferral is sold.
   (r)  In  the  case of a sale or other disposition of property acquired
 from a decedent and valued by the executor of the estate of  such  dece-
 dent for the purposes of the tax under article twenty-six of the tax law
 pursuant  to  paragraph  two  of  subsection (b) of section nine hundred
 fifty-four of the tax law, where such estate was insufficient to require
 the filing of a federal estate tax return, the amount necessary to prop-
 erly reflect the gain or loss from such sale or other disposition  which
 would  have been realized under this chapter, had, in the case of clause
 (i) of this subdivision, a federal estate tax return been filed similar-
 ly valuing such property pursuant to section two thousand thirty-two  of
 the  internal revenue code, or in the case of clause (ii) of this subdi-
 vision, pursuant to section two thousand thirty-two-A of such code.
   (s) New York S termination year. (1) General. In the  case  of  a  New
 York S termination year, the amount of any item of S corporation income,
 loss  and deduction included in the shareholder's federal adjusted gross
 income and any reductions for taxes, as described in paragraphs two  and
 three  of  subsection  (f)  of section thirteen hundred sixty-six of the
 internal revenue code, shall be adjusted in accordance with  the  treat-
 ment provided in paragraph two or three of this subdivision.
   (2)  Pro  rata allocation.  Unless paragraph three of this subdivision
 applies, an equal portion of each S corporation item shall  be  assigned
 to  each  day of the S corporation's taxable year for federal income tax
 purposes.  The portion of each such item thereby assigned to the S short
 year shall be treated as an item of a New York S  corporation,  and  the
 portion  of each such item thereby assigned to the C short year shall be
 treated as an item of an S corporation which is  a  New  York  C  corpo-
 ration.
   (3)  Normal  tax  accounting.   The portion of each S corporation item
 assigned to the S short year and the C short year  shall  be  determined
 using normal tax accounting rules if:
   (A)  there is a sale or exchange of fifty percent or more of the stock
 in such corporation during the New York S termination year or
   (B) the corporation so elects, as  provided  in  subparagraph  (B)  of
 paragraph two of subsection (s) of section six hundred twelve of the tax
 law.
 S. 8474                            917
 
   (t)  Related  members  expense  add back. (1) Definitions. (A) Related
 member. "Related member" means a related person as defined  in  subpara-
 graph  (c)  of paragraph three of subsection (b) of section four hundred
 sixty-five of the internal revenue code,  except  that  "fifty  percent"
 shall be substituted for "ten percent".
   (B)  Effective  rate  of tax. "Effective rate of tax" means, as to any
 city, the maximum statutory rate of tax imposed by the city on or  meas-
 ured  by  a  related member's net income multiplied by the apportionment
 percentage, if any, applicable to the related member under the  laws  of
 said  jurisdiction.  For purposes of this definition, the effective rate
 of tax as to any city is zero where the related member's net income  tax
 liability  in said city is reported on a combined or consolidated return
 including both the taxpayer and the related member  where  the  reported
 transactions  between the taxpayer and the related member are eliminated
 or offset. Also, for purposes of this  definition,  when  computing  the
 effective  rate of tax for a city in which a related member's net income
 is eliminated or offset by  a  credit  or  similar  adjustment  that  is
 dependent  upon the related member either maintaining or managing intan-
 gible property or collecting interest income in that city,  the  maximum
 statutory rate of tax imposed by said city shall be decreased to reflect
 the  statutory  rate of tax that applies to the related member as effec-
 tively reduced by such credit or similar adjustment.
   (C) Royalty payments. Royalty payments are payments directly connected
 to the acquisition, use, maintenance  or  management,  ownership,  sale,
 exchange,  or any other disposition of licenses, trademarks, copyrights,
 trade names, trade dress, service  marks,  mask  works,  trade  secrets,
 patents  and  any other similar types of intangible assets as determined
 by the state commissioner of taxation and finance, and  include  amounts
 allowable  as  interest deductions under section one hundred sixty-three
 of the internal revenue code to the extent such amounts are directly  or
 indirectly  for,  related to or in connection with the acquisition, use,
 maintenance or management, ownership, sale, exchange or  disposition  of
 such intangible assets.
   (D)  Valid  business  purpose. A valid business purpose is one or more
 business purposes, other than the avoidance or  reduction  of  taxation,
 which alone or in combination constitute the primary motivation for some
 business  activity or transaction, which activity or transaction changes
 in a meaningful way, apart from tax effects, the  economic  position  of
 the taxpayer. The economic position of the taxpayer includes an increase
 in  the  market share of the taxpayer, or the entry by the taxpayer into
 new business markets.
   (2) Royalty expense add backs. (A) For the purpose of  computing  city
 adjusted gross income, a taxpayer must add back royalty payments direct-
 ly  or  indirectly  paid, accrued, or incurred in connection with one or
 more direct or indirect transactions with one or  more  related  members
 during  the taxable year to the extent deductible in calculating federal
 taxable income.
   (B) Exceptions. (i) The adjustment required in this subdivision  shall
 not apply to the portion of the royalty payment that the taxpayer estab-
 lishes,  by  clear  and  convincing evidence of the type and in the form
 specified by the commissioner of finance, meets  all  of  the  following
 requirements:  (I) the related member was subject to tax in this city or
 another city within the United States or a foreign nation or some combi-
 nation thereof on a tax base that included  the  royalty  payment  paid,
 accrued  or incurred by the taxpayer; (II) the related member during the
 same taxable year directly or indirectly paid, accrued or incurred  such
 S. 8474                            918

 portion  to  a person that is not a related member; and (III) the trans-
 action giving rise to the royalty payment between the taxpayer  and  the
 related member was undertaken for a valid business purpose.
   (ii)  The  adjustment  required in this subdivision shall not apply if
 the taxpayer establishes, by clear and convincing evidence of  the  type
 and  in the form specified by the commissioner of finance, that: (I) the
 related member was subject to tax on or measured by its  net  income  in
 this  city or another city within the United States, or some combination
 thereof; (II) the tax base for said tax  included  the  royalty  payment
 paid,  accrued  or  incurred  by  the  taxpayer; and (III) the aggregate
 effective rate of tax applied to the related member in  those  jurisdic-
 tions  is  no less than eighty percent of the statutory rate of tax that
 applied to the taxpayer under section 11-1701 of this  chapter  for  the
 taxable year.
   (iii)  The  adjustment required in this subdivision shall not apply if
 the taxpayer establishes, by clear and convincing evidence of  the  type
 and  in the form specified by the commissioner of finance, that: (I) the
 royalty payment was paid, accrued or incurred to a related member organ-
 ized under the laws of a country other than the United States; (II)  the
 related member's income from the transaction was subject to a comprehen-
 sive income tax treaty between such country and the United States; (III)
 the  related member was subject to tax in a foreign nation on a tax base
 that included the royalty payment  paid,  accrued  or  incurred  by  the
 taxpayer;  (IV)  the  related  member's  income from the transaction was
 taxed in such country at an effective rate of tax at least equal to that
 imposed by this city; and (V) the royalty payment was paid,  accrued  or
 incurred pursuant to a transaction that was undertaken for a valid busi-
 ness purpose and using terms that reflect an arm's length relationship.
   (iv)  The  adjustment  required in this subdivision shall not apply if
 the taxpayer and the commissioner of finance agree  in  writing  to  the
 application  or  use  of  alternative  adjustments  or computations. The
 commissioner of finance may, in his or  her  discretion,  agree  to  the
 application or use of alternative adjustments or computations when he or
 she  concludes  that  in the absence of such agreement the income of the
 taxpayer would not be properly reflected.
   (u) Alimony modifications. (1) In the case of  applicable  alimony  or
 separate maintenance payments, the following modifications shall apply:
   (A)  There  shall be subtracted from federal adjusted gross income any
 applicable alimony or separate maintenance payments made by the taxpayer
 during the taxable year.
   (B) There shall be added to federal adjusted gross income any applica-
 ble alimony or separate maintenance payments received  by  the  taxpayer
 during the taxable year.
   (2)  (A)  The  term  "alimony  or separate maintenance payments" means
 payments as defined under section seventy-one of  the  internal  revenue
 code in effect immediately prior to the enactment of Public Law 115-97.
   (B)  The  term  "applicable  alimony or separate maintenance payments"
 means payments made  under  an  alimony  or  separation  instrument,  as
 defined  in  section  seventy-one of the internal revenue code in effect
 immediately prior to the  enactment  of  Public  Law  115-97,  that  was
 executed  after  December  thirty-first,  two thousand eighteen, and any
 divorce or separation instrument executed on or  before  such  date  and
 modified after such date if the modification expressly provides that the
 amendments made by this section apply to such modification.
 S. 8474                            919
 
   (v) Qualified moving expense reimbursement and moving expenses. (1) In
 the case of applicable qualified moving expense reimbursement and moving
 expenses, the following modifications shall apply:
   (A)  There  shall be subtracted from federal adjusted gross income any
 applicable  qualified  moving  expense  reimbursement  received  by  the
 taxpayer during the taxable year.
   (B)  There  shall be subtracted from federal adjusted gross income any
 applicable moving expenses paid by the taxpayer during the taxable year.
   (2) Applicable  qualified  moving  expense  reimbursement  and  moving
 expenses are those deductions as allowed by paragraph (g) of section one
 hundred  thirty-two  and section two hundred seventeen, respectfully, of
 the internal revenue code immediately prior to the enactment  of  Public
 Law 115-97.
   §  11-1713    City  deduction  of  a  resident  individual.   The city
 deduction of a city resident individual shall be his or her city  stand-
 ard  deduction  unless  such resident individual elects to deduct his or
 her city itemized deduction under the conditions set  forth  in  section
 11-1715 of this chapter.
   §  11-1714  City standard deduction of a city resident individual. (a)
 Unmarried individual. For taxable years beginning after nineteen hundred
 ninety-five, the city standard deduction of a city  resident  individual
 who  is  not  married nor the head of a household nor a surviving spouse
 nor an individual who is claimed as a  dependent  by  another  New  York
 state taxpayer shall be seven thousand five hundred dollars; for taxable
 years beginning in nineteen hundred ninety-five, such standard deduction
 shall  be  seven thousand four hundred dollars; for taxable years begin-
 ning in nineteen hundred ninety-four, such standard deduction  shall  be
 six  thousand six hundred dollars; and for taxable years beginning after
 nineteen hundred eighty-nine and before  nineteen  hundred  ninety-four,
 such standard deduction shall be six thousand dollars.
   (b)  Husband and wife filing jointly and surviving spouse. For taxable
 years beginning after nineteen hundred ninety-five,  the  city  standard
 deduction  of a husband and wife whose city taxable income is determined
 jointly or a surviving spouse shall be thirteen  thousand  dollars;  for
 taxable  years  beginning in nineteen hundred ninety-five, such standard
 deduction shall be twelve thousand  three  hundred  fifty  dollars;  for
 taxable  years  beginning in nineteen hundred ninety-four, such standard
 deduction shall be ten thousand eight hundred dollars; and  for  taxable
 years  beginning  after nineteen hundred eighty-nine and before nineteen
 hundred ninety-four, such standard deduction shall be nine thousand five
 hundred dollars.
   (c) Head of household. For  taxable  years  beginning  after  nineteen
 hundred ninety-five, the city standard deduction of an individual who is
 a  head  of  household  shall  be ten thousand five hundred dollars; for
 taxable years beginning in nineteen hundred ninety-five,  such  standard
 deduction  shall be ten thousand dollars; for taxable years beginning in
 nineteen hundred ninety-four, such standard  deduction  shall  be  eight
 thousand  one  hundred  fifty  dollars;  and for taxable years beginning
 after nineteen hundred eighty-nine and before nineteen  hundred  ninety-
 four, such standard deduction shall be seven thousand dollars.
   (d) Married individuals filing separately. For taxable years beginning
 after  nineteen  hundred  ninety-five,  the city standard deduction of a
 married individual filing a separate return shall be six  thousand  five
 hundred  dollars;  for taxable years beginning in nineteen hundred nine-
 ty-five, such standard deduction  shall  be  six  thousand  one  hundred
 seventy-five  dollars;  for  taxable years beginning in nineteen hundred
 S. 8474                            920
 
 ninety-four, such standard deduction shall be five thousand four hundred
 dollars; and for taxable years beginning after nineteen hundred  eighty-
 nine  and  before  nineteen hundred ninety-four, such standard deduction
 shall be four thousand seven hundred fifty dollars.
   (e)  Standard  deduction  of a dependent individual. For taxable years
 beginning  after  nineteen  hundred  ninety-five,  the   city   standard
 deduction  of  a city resident individual whose federal exemption amount
 is zero shall be three thousand dollars; for taxable years beginning  in
 nineteen hundred ninety-five, such standard deduction shall be two thou-
 sand  nine  hundred dollars; and for taxable years beginning after nine-
 teen hundred eighty-nine and before nineteen hundred  ninety-five,  such
 standard deduction shall be two thousand eight hundred dollars.
   (f)  For  taxable years beginning on or after January first, two thou-
 sand thirteen, the amounts of standard  deductions  set  forth  in  this
 section  shall be adjusted in the same manner as the amounts of standard
 deductions set forth in section six hundred fourteen of the tax law.
   § 11-1715  City itemized deduction of a city resident individual.
   (a) General. If federal taxable income of a city  resident  individual
 is  determined  by itemizing deductions or claiming the federal standard
 deduction from his or her federal adjusted gross income,  such  resident
 individual  may  elect  to  deduct his or her city itemized deduction or
 claim his or her city standard deduction.
   The city itemized deduction of a city resident  individual  means  the
 total amount of his or her deductions from federal adjusted gross income
 allowed,  other  than  federal  deductions  for  personal exemptions, as
 provided in the laws of the United States for the taxable year, as  such
 deductions  existed  immediately  prior  to  the enactment of Public Law
 115-97 with the modifications  specified  in  this  section,  except  as
 provided for under subdivision (f) of this section.
   (b)  Husband and wife.
   (1)    A  husband  and wife, both of whom are required to file returns
 under this chapter, shall be allowed city itemized  deductions  only  if
 both elect to take city itemized deductions.
   (2)    The total of the city itemized deductions of a husband and wife
 whose federal taxable income is determined on a joint return, but  whose
 city  taxable incomes are required to be determined separately, shall be
 divided between them as if their federal taxable incomes had been deter-
 mined separately.
   (c)  Modifications reducing federal itemized deductions.    The  total
 amount of deductions from federal adjusted gross income shall be reduced
 by the amount of such federal deductions for:
   (1)  state  and local general sales taxes as defined in subsection (b)
 of section one hundred sixty-four of the internal revenue code,  to  the
 extent  included  in federal itemized deductions or income taxes imposed
 by this city or any other  taxing  jurisdiction,  except  city  earnings
 taxes  on  nonresidents  that are imposed upon and paid by taxpayers for
 taxable years beginning after December  thirty-first,  nineteen  hundred
 seventy  and  before January first, two thousand, to the extent that the
 amount of such tax exceeds the tax computed as if the  rates  were  one-
 fourth  of  one percent of wages subject to tax and three-eighths of one
 percent of net earnings from self-employment subject to tax;
   (2)  interest on indebtedness incurred or  continued  to  purchase  or
 carry obligations or securities the interest on which is exempt from tax
 under this chapter; and
   (3)  ordinary and necessary expenses paid or incurred during the taxa-
 ble year for: (i) the production or collection of income which is exempt
 S. 8474                            921
 
 from  tax  under  this  chapter, or (ii) the management, conservation or
 maintenance of property held for the production of such income, and  the
 amortizable  bond  premium for the taxable year on any bond the interest
 on  which is exempt from tax under this chapter, to the extent that such
 expenses and premiums are  deductible  in  determining  federal  taxable
 income.
   (4) premiums paid for long-term care insurance to the extent that such
 premiums are deductible in determining federal taxable income.
   (6) in the case of a shareholder of an S corporation:
   (A)  where  the election provided for in subsection (a) of section six
 hundred sixty of the tax law has not been made, S corporation  items  of
 deduction included in federal itemized deductions, and
   (B)  in the case of a New York S termination year, the portion of such
 items assigned to the period beginning on the day the election ceases to
 be effective, as determined under subdivision (s) of section 11-1712  of
 this subchapter.
   (d)   Modifications increasing federal itemized deductions.  The total
 amount of  deductions  from  federal  adjusted  gross  income  shall  be
 increased by:
   (1) (Reserved.)
   (2)  interest  on  indebtedness  incurred  or continued to purchase or
 carry obligations or securities the interest on which is subject to  tax
 under  this  chapter  but  exempt from federal income tax, to the extent
 that such interest on indebtedness is not deductible for federal  income
 tax  purposes  and  is not subtracted from federal adjusted gross income
 pursuant to paragraph nine of subdivision (c) of section 11-1712 of this
 subchapter; and
   (3)  ordinary and necessary expenses paid or incurred during the taxa-
 ble year for: (i) the  production  or  collection  of  income  which  is
 subject to tax under this chapter but exempt from federal income tax, or
 (ii)  the  management,  conservation or maintenance of property held for
 the production of such income, and the amortizable bond premium for  the
 taxable  year  on any bond the interest on which is subject to tax under
 this chapter but exempt from federal income tax, to the extent that such
 expenses and premiums are not deductible in determining federal adjusted
 gross income and are not subtracted from federal adjusted  gross  income
 pursuant  to paragraph ten of subdivision (c) of section 11-1712 of this
 subchapter.
   (4) allowable college tuition expenses, as defined in paragraph two of
 subsection (t) of section six hundred six of the tax law, multiplied  by
 the  applicable  percentage. Such applicable percentage shall be twenty-
 five percent for taxable years beginning  in  two  thousand  one,  fifty
 percent  for  taxable  years beginning in two thousand two, seventy-five
 percent for taxable years  beginning  in  two  thousand  three  and  one
 hundred  percent  for  taxable years beginning after two thousand three.
 Provided, however, no deduction shall be allowed under this paragraph to
 a taxpayer who claims  the  credit  provided  under  subsection  (t)  of
 section six hundred six of the tax law.
   (e)  Modification of partners and shareholders of S corporations.  (1)
 Partners and shareholders of S corporations which are  not  New  York  C
 corporations.    The  amounts  of modifications under subdivision (c) or
 under paragraph two or three of subdivision (d) required to be made by a
 partner or by a shareholder of an S corporation, other than an S  corpo-
 ration  which  is  a  New  York  C corporation, with respect to items of
 deduction of a partnership or S corporation shall  be  determined  under
 section 11-1717 of this subchapter.
 S. 8474                            922
 
   (2)  Shareholders of S corporations which are New York C corporations.
 In the case of a shareholder of an S corporation which is a New  York  C
 corporation,  the  modifications  under this section which relate to the
 corporation's items of deduction shall not apply, except for the modifi-
 cation provided under paragraph six of subdivision (c) of this section.
   (3)  New  York S termination year.  In the case of a New York S termi-
 nation year, the  amounts  of  the  modifications  required  under  this
 section  which relate to the S corporation's items of deduction shall be
 adjusted in the same manner that the S corporation's items are  adjusted
 under subdivision (s) of section 11-1712 of this subchapter.
   (f)  Except  as  otherwise  provided  under  subdivision  (g)  of this
 section, the city itemized  deduction  otherwise  allowable  under  this
 section  shall  be  reduced  by  the sum of the amounts determined under
 paragraphs one and two of this subdivision.
   (1) An amount equal to the city itemized deduction otherwise allowable
 under subdivision (a) of this section, multiplied by a percentage,  such
 percentage  to be determined by multiplying, for taxable years beginning
 in nineteen hundred eighty-eight, ten percent,  and  for  taxable  years
 beginning after nineteen hundred eighty-eight, twenty-five percent, by a
 fraction,
   (A)  in  the  case  of  an  unmarried individual or married individual
 filing a separate return, the numerator of which is the lesser of  fifty
 thousand  dollars or the excess of such individual's city adjusted gross
 income over one hundred thousand dollars and the denominator of which is
 fifty thousand dollars;
   (B) in the case of a married individual filing a  joint  return  or  a
 surviving spouse, the numerator of which is the lesser of fifty thousand
 dollars  or  the  excess of such individual's city adjusted gross income
 over two hundred thousand dollars and the denominator of which is  fifty
 thousand dollars;
   (C)  in the case of a head of household, the numerator of which is the
 lesser of fifty thousand dollars or the excess of such individual's city
 adjusted gross income over one hundred fifty thousand  dollars  and  the
 denominator of which is fifty thousand dollars.
   (2)  An  amount  equal to the city itemized deduction of an individual
 otherwise allowable under subdivision (a) of this section, multiplied by
 a percentage, such percentage to be determined by multiplying, for taxa-
 ble years beginning in nineteen hundred eighty-eight, ten  percent,  and
 for  taxable  years beginning after nineteen hundred eighty-eight, twen-
 ty-five percent, by a fraction, the numerator of which is the lesser  of
 fifty  thousand dollars or the excess of such individual's city adjusted
 gross income over four hundred seventy-five  thousand  dollars  and  the
 denominator of which is fifty thousand dollars.
   (g) Notwithstanding subdivision (a) of this section, the city itemized
 deduction for charitable contributions shall be the amount allowed under
 section  one hundred seventy of the internal revenue code, as limited by
 this subdivision. (1) With respect  to  an  individual  whose  New  York
 adjusted  gross  income is over one million dollars but no more than ten
 million dollars, the New York itemized  deduction  shall  be  an  amount
 equal  to fifty percent of any charitable contribution deduction allowed
 under section one hundred seventy of the internal revenue code for taxa-
 ble years beginning after two thousand  nine  and  before  two  thousand
 twenty-five. With respect to an individual whose New York adjusted gross
 income  is  over  one  million  dollars, the New York itemized deduction
 shall be an amount equal to fifty percent of any charitable contribution
 deduction allowed under section one  hundred  seventy  of  the  internal
 S. 8474                            923
 
 revenue  code  for taxable years beginning in two thousand nine or after
 two thousand twenty-four.
   (2) With respect to an individual whose New York adjusted gross income
 is over ten million dollars, the New York itemized deduction shall be an
 amount  equal  to  twenty-five  percent  of  any charitable contribution
 deduction allowed under section one  hundred  seventy  of  the  internal
 revenue  code  for  taxable  years beginning after two thousand nine and
 ending before two thousand twenty-five.
   § 11-1716  City exemptions of a city resident individual. (a)   Gener-
 al.   For taxable years beginning after nineteen hundred eighty-seven, a
 city resident individual shall be allowed a city exemption of one  thou-
 sand  dollars  for  each exemption for which such resident individual is
 entitled to a deduction for the taxable year  under  subsection  (c)  of
 section  one  hundred  fifty-one  of  the internal revenue code; and for
 taxable years beginning in nineteen hundred eighty-seven, a  city  resi-
 dent  individual other than a taxpayer whose federal exemption amount is
 zero shall be allowed a city exemption of nine hundred dollars for  each
 exemption for which he or she is entitled to a deduction for the taxable
 year for federal income tax purposes.
   (b)  Husband  and wife. If the city income taxes of a husband and wife
 are required to be separately determined but their federal income tax is
 determined on a joint return, each of them shall be separately  entitled
 to  the  city  exemptions under subdivision (a) of this section to which
 each would be separately entitled for the taxable year if their  federal
 income taxes had been determined on separate returns.
   §  11-1717  Resident partners and shareholders of S corporations.  (a)
 Partner's and shareholder's modifications. In determining city  adjusted
 gross  income  and  city  taxable income of a city resident partner or a
 city resident shareholder of an S corporation, other than  an  S  corpo-
 ration  which is a New York C corporation, any modification described in
 subdivision (b), (c) or (d) of section 11-1712 of  this  subchapter,  or
 subdivision  (c)  of section 11-1715 of this subchapter or paragraph two
 or three of subdivision (d) of such section, which relates to an item of
 partnership or S corporation income, gain, loss or  deduction  shall  be
 made  in  accordance with the partner's distributive share or the share-
 holder's pro rata share, for federal income tax purposes, of the item to
 which the modification relates. Where a partner's distributive share  or
 a  shareholder's  pro  rata share of any such item is not required to be
 taken into account separately for federal income tax purposes, the part-
 ner's or shareholder's share of such item shall be determined in accord-
 ance with his or her share, for federal income tax purposes, of partner-
 ship or S corporation taxable income or loss generally.  In the case  of
 a  New  York  S  termination year, his or her pro rata share of any such
 item shall be determined under subdivision (s)  of  section  11-1712  of
 this subchapter.
   (b)    Character of items.  Each item of partnership and S corporation
 income, gain, loss, or deduction shall have the  same  character  for  a
 partner  or  shareholder under this subchapter as for federal income tax
 purposes.  Where an item is not characterized  for  federal  income  tax
 purposes,  it shall have the same character for a partner or shareholder
 as if realized directly from the source from which realized by the part-
 nership or S corporation or incurred in the same manner as  incurred  by
 the partnership or S corporation.
   (c)    City  tax avoidance or evasion.  Where a partner's distributive
 share of an item of partnership  income,  gain,  loss  or  deduction  is
 determined  for  federal income tax purposes by special provision in the
 S. 8474                            924
 
 partnership agreement with respect to such item, and where the principal
 purpose of such provision is the avoidance or evasion of tax under  this
 chapter,  the partner's distributive share of such item, and any modifi-
 cation  required  with  respect  thereto,  shall be determined as if the
 partnership agreement made no special provision  with  respect  to  such
 item.
   § 11-1717.1  Residents; special provisions.  Notwithstanding any other
 provisions  of this chapter, the city adjusted gross income and the city
 taxable income of a resident individual  or  partner  of  a  partnership
 doing  an  insurance  business  as  a  member  of the New York insurance
 exchange described in section six thousand two hundred one of the insur-
 ance law, shall not include any item of income, gain, loss or  deduction
 of  such  business,  which  is the individual's distributive or pro rata
 share for federal  income  tax  purposes  or  which  the  individual  is
 required  to  take  into  account  separately  for  federal  income  tax
 purposes.   Provided however,  such  individual's  city  adjusted  gross
 income  shall  include  his or her distributive or pro rata share of the
 allocated entire  net  income  as  determined  by  such  business  under
 sections  fifteen hundred three and fifteen hundred four of the tax law.
 In the event such allocated entire net income is a loss, there shall not
 be subtracted from federal  adjusted  gross  income  in  computing  city
 adjusted gross income such individual's distributive share of such loss.
   §  11-1718    City  taxable income of a city resident estate or trust.
 The city taxable income of a city resident estate  or  trust  means  its
 federal  taxable  income as defined in the laws of the United States for
 the taxable year, with the following modifications:
   (2)  There shall be subtracted the modifications  described  in  para-
 graphs  four  and  five  of  subdivision  (c) of section 11-1712 of this
 subchapter, with respect to gains from the sale or other disposition  of
 property,  to the extent such gains are excluded from federal distribut-
 able net income of the estate or trust.
   (3)  There shall be added or subtracted, as the case may be, the share
 of the estate or trust in the city fiduciary adjustment determined under
 section 11-1719 of this subchapter.
   (4) There shall be added or  subtracted,  as  the  case  may  be,  the
 modifications  described  in  paragraphs  six, ten, seventeen, eighteen,
 nineteen, twenty,  twenty-one,  twenty-two,  twenty-three,  twenty-four,
 twenty-five,  twenty-six,  twenty-seven,  twenty-nine,  thirty-four  and
 thirty-five of subdivision  (b)  and  in  paragraphs  eleven,  thirteen,
 fifteen,  nineteen,  twenty, twenty-one, twenty-two, twenty-three, twen-
 ty-four, twenty-five, twenty-six and twenty-eight of subdivision (c)  of
 section 11-1712 of this subchapter.
   (5)  In  the  case  of a trust, there shall be added the amount of any
 includible gain, reduced by any deductions properly  allocable  thereto,
 upon  which  tax is imposed for the taxable year pursuant to section six
 hundred forty-four of the internal revenue code.
   § 11-1719  Share of a resident estate, trust or  beneficiary  in  city
 fiduciary  adjustment.   (a)   General.   An adjustment shall be made in
 determining city taxable income of a city resident estate or trust under
 section 11-1718 of this subchapter, or city adjusted gross income  of  a
 city  resident  beneficiary of any estate or trust under subdivision (d)
 of section 11-1712 of this subchapter, in the amount  of  the  share  of
 each in the city fiduciary adjustment as determined in this section.
   (b)    Definition.    The  city  fiduciary adjustment shall be the net
 amount of the modifications  described  in  section  11-1712    of  this
 subchapter,  including subdivision (d) if the estate or trust is a bene-
 S. 8474                            925
 
 ficiary of another estate or trust, in subdivision  (c)  and  paragraphs
 two  and three of subdivision (d) of section 11-1715 of this subchapter,
 and in subdivision (e) of this section, which relate to items of income,
 gain,  loss  or deduction of an estate or trust.  The net amount of such
 modifications shall not include:
   (1)  Any modification described in paragraphs one and two of  subdivi-
 sion (b) and paragraphs one, two, four, five, six, and seven of subdivi-
 sion  (c)  of  section  11-1712  of  this subchapter with respect to any
 amount which, pursuant to the terms of the governing instrument, is paid
 or permanently set aside for a charitable  purpose  during  the  taxable
 year, and
   (2)   Any modification described in paragraph four or five of subdivi-
 sion (c) of section 11-1712 of this subchapter, with  respect  to  gains
 from the sale or other disposition of property, to the extent such gains
 are  excluded  from  federal  distributable  net income of the estate or
 trust.
   (c)  Shares of city fiduciary adjustment.
   (1)  The respective shares of an estate or  trust  and  its  benefici-
 aries, including, solely for the purpose of this allocation, nonresident
 beneficiaries,  in  the city fiduciary adjustment shall be in proportion
 to their respective shares of federal distributable net  income  of  the
 estate or trust.
   (2)    If  the estate or trust has no federal distributable net income
 for the taxable year, the share of each beneficiary in the city  fiduci-
 ary  adjustment shall be in proportion to his or her share of the estate
 or trust income for such year, under local law or the governing  instru-
 ment,  which  is  required  to  be  distributed  currently and any other
 amounts of such income distributed in such year.   Any  balance  of  the
 city fiduciary adjustment shall be allocated to the estate or trust.
   (d)    Alternate attribution of modifications.  The tax commission may
 by regulation establish such other method or methods of determining   to
 whom  the items comprising the fiduciary adjustment shall be attributed,
 as may be appropriate and equitable.   Such method may be  used  by  the
 fiduciary  in his or her discretion whenever the allocation of the fidu-
 ciary adjustment pursuant to  subdivision  (c)  of  this  section  would
 result  in  an  inequity  which  is  substantial  both  in amount and in
 relation to the amount of the fiduciary adjustment.
   (e) Additional modifications. (1) For any taxable year beginning after
 December thirty-first, two thousand seventeen, and before January first,
 two thousand twenty-six, to the extent that the estate or trust  claimed
 a deduction for taxes under section one hundred sixty-four of the inter-
 nal revenue code that was limited to ten thousand dollars as provided in
 subparagraph (B) of paragraph six of subdivision (b) of such section one
 hundred  sixty-four  or  was  denied  as a result of subparagraph (A) of
 paragraph six of subdivision (b) of such section one hundred sixty-four,
 there shall be subtracted the taxes paid or accrued in that taxable year
 by an estate or trust that the estate or trust was not  able  to  deduct
 for  federal  income  tax purposes because of such limitation or denial,
 other than state and local sales taxes and  income  taxes  described  in
 paragraph  one of subdivision (c) of section 11-1715 of this subchapter.
 In determining the makeup of  the  ten  thousand  dollars  of  deduction
 claimed  by  the estate or trust under section one hundred sixty-four of
 the internal revenue code, it shall be presumed that  the  ten  thousand
 dollars  of deduction first comprises the state and local sales taxes or
 income taxes the estate or trust accrued  or  paid  during  the  taxable
 year.
 S. 8474                            926
 
   (2)  For  any  taxable year beginning after December thirty-first, two
 thousand seventeen, and before January first, two  thousand  twenty-six,
 there  shall  be  subtracted  the  miscellaneous  itemized deductions as
 described in and limited by section sixty-seven of the internal  revenue
 code,  but  excluding  the  deductions  described  in  subsection (e) of
 section sixty-seven of such  code,  but  determined  without  regard  to
 subsection (g) of such section.
   (3)  For  any  taxable  year,  there  shall be added the amount of any
 deduction allowed pursuant to section one hundred ninety-nine-A  of  the
 internal revenue code.
   § 11-1721 Credits to trust beneficiary receiving accumulation distrib-
 ution.  (a)  General.  A city resident beneficiary of a trust whose city
 adjusted gross income includes all or part of an  accumulation  distrib-
 ution by such trust, as defined in section six hundred sixty-five of the
 internal  revenue  code, including a beneficiary who is required to make
 the modification required by paragraph thirty-six of subdivision (b)  of
 section  11-1712  of  this  subchapter,  shall  be  allowed (1) a credit
 against the tax otherwise due under this chapter for all  or  a  propor-
 tionate  part  of  any tax paid by the trust under this chapter or under
 former title T of chapter forty-six of the code of the preceding munici-
 pality, as it was in effect prior to September first,  nineteen  hundred
 eighty-six,  for  any  preceding  taxable year which would not have been
 payable if the trust had in fact made distributions to its beneficiaries
 at the times and in the amounts specified in section six hundred  sixty-
 six  of  the  internal  revenue code; and (2) a credit against the taxes
 imposed by this chapter for the taxable year for any income tax  imposed
 for  the  taxable year or any prior taxable year by another state of the
 United States, a political  subdivision  thereof,  or  the  District  of
 Columbia,  upon  income  both derived therefrom and subject to tax under
 this chapter, provided that the amount of the credit  shall  not  exceed
 the percentage of the tax otherwise due under this chapter determined by
 dividing  the portion of the income that is both taxable to the trust in
 such other jurisdiction and taxable to the beneficiary under this  chap-
 ter by the total amount of the beneficiary's New York city income.
   (b)  Limitation.  The  credits under this section shall not reduce the
 tax otherwise due from the beneficiary under this chapter to  an  amount
 less than would have been due if the accumulation distribution or his or
 her  part  thereof  were  excluded  from  his or her city adjusted gross
 income.
   § 11-1724  Computation of separate tax on the ordinary income  portion
 of lump sum distributions received by city resident individuals, estates
 and trusts. (a) Amount of separate tax.  The amount of tax imposed under
 section  11-1703  of  this chapter for any taxable year, with respect to
 the ordinary income portion of a lump sum  distribution  received  by  a
 city  resident  individual,  estate  or trust is an amount equal to five
 times the tax which would be imposed by section 11-1701 of this  chapter
 at  the  rate  set  forth  in paragraph three of subdivision (a) or (b),
 whichever may be applicable, if the recipient of such lump sum  distrib-
 ution  were  an  individual referred to in such subdivision and the city
 taxable income were an amount equal to one-fifth of the excess of:
   (1) the total taxable amount of the  lump  sum  distribution  for  the
 taxable year, over
   (2) the minimum distribution allowance.
   (b) Minimum distribution allowance.  For purposes of this section, the
 minimum distribution allowance shall be that which is calculated accord-
 S. 8474                            927
 
 ing  to  subparagraph  (C) of paragraph one of subsection (e) of section
 four hundred two of the internal revenue code.
   (c)  Multiple  distributions  and  distributions of annuity contracts.
 For purposes of this section, the  rules  concerning  multiple  distrib-
 utions  and distributions of annuity contracts as specified by paragraph
 two of subsection (e) of section four hundred two of the internal reven-
 ue code shall be applicable, except that references  to  "paragraph  one
 (A)"  shall  be deemed to be references to this section, and except that
 only lump sum distributions, or portions thereof, and  distributions  of
 annuity  contracts  subject to tax under this chapter shall be included,
 and except that references to the secretary shall be deemed to be refer-
 ences to the tax commission.
   (d) Definitions and special rules. For purposes of this  section,  the
 following  provisions  shall  apply,  to  the  extent  applicable to the
 taxpayer's federal tax on lump sum distributions:  (1)  the  definitions
 and  special  rules  as specified in paragraph four of subsection (e) of
 section four hundred two of the  internal  revenue  code;  and  (2)  the
 special  rules  relating to (A) individuals who have attained the age of
 fifty before January first, nineteen hundred eighty-six and (B)  capital
 gains,  as  specified  in  paragraphs  three,  four,  five  and  six  of
 subsection (h) of section eleven hundred twenty-two of  the  tax  reform
 act  of nineteen hundred eighty-six as enacted by public law 99-514, but
 (i) in the event that paragraph three of such subsection is  applicable,
 clause (ii) of subparagraph (B) of such paragraph shall be applied using
 a  rate of one and seventy-two hundredths percent, and (ii) in the event
 that paragraph five of such subsection is applicable, the  words  "five"
 and  "one-fifth"  in  subdivision  (a)  of this section shall be read as
 "ten" and "one-tenth", respectively, and subdivision (a) of this section
 shall be applied by using the rate of tax specified in  subdivision  (a)
 of section 11-1702 of this chapter as such subdivision was in effect for
 taxable years beginning in nineteen hundred eighty-six.
 
                               SUBCHAPTER 3
                        RETURNS AND PAYMENT OF TAX
 
   §  11-1751  Returns  and  liabilities.   (a) General. On or before the
 fifteenth day of the fourth month following the close of a taxable year,
 an income tax return under this chapter shall be made and  filed  by  or
 for  every  city resident individual, estate or trust required to file a
 New York state personal income tax, including  a  separate  tax  on  the
 ordinary  income portion of lump sum distributions, return for the taxa-
 ble year.
   (b) Husband and wife. (1) If the New York state  personal  income  tax
 liability  of husband and wife is determined on a separate return, their
 city personal income tax liabilities and returns shall be separate.
   (2) If the New York state personal income tax liabilities  of  husband
 and  wife, other than a husband and wife described in paragraph three of
 this subdivision, are determined on a joint return, they  shall  file  a
 joint  city  personal income tax return, and their tax liabilities shall
 be joint and several except as provided in paragraphs four and  five  of
 this  subdivision  and  in subsection (e) of section six hundred eighty-
 five of the tax law.
   (3) If the New York state personal income tax liabilities  of  husband
 and  wife, other than a husband and wife described in paragraph three of
 this subdivision are determined on a joint return,  they  shall  file  a
 joint  city  personal income tax return, and their tax liabilities shall
 S. 8474                            928
 
 be joint and several except as provided in paragraph five of this subdi-
 vision, section 11-1755 of this subchapter and subsection (e) of section
 six hundred eighty-five of the tax law.
   (4)  If  either  husband or wife is a city resident and the other is a
 city nonresident, and their New York state personal income  tax  liabil-
 ities are determined on a joint return:
   (A)  they may elect to file a joint city personal income tax return as
 if both were residents, in which case their  city  personal  income  tax
 liabilities  shall be joint and several except as provided in paragraphs
 four and five of this subdivision and in subsection (e) of  section  six
 hundred eighty-five of the tax law, or
   (B)  they may elect to file a joint city personal income tax return as
 if both were residents, in which case their  city  personal  income  tax
 liabilities  shall  be joint and several except as provided in paragraph
 five of  this  subdivision,  section  11-1755  of  this  subchapter  and
 subsection (e) of section six hundred eighty-five of the tax law, or
   (C)  the  resident  spouse  may elect to file a separate city personal
 income tax return, in which case his or her  city  personal  income  tax
 liability shall be determined as if he or she were filing a separate New
 York state personal income tax return.
   (5) If a joint return has been made under this subdivision for a taxa-
 ble  year and only one spouse is liable for past-due support, or a past-
 due legally enforceable debt, or a city of New York tax warrant judgment
 debt, or an amount of a default in repayment of  a  guaranteed  student,
 state university or city university loan of which the state commissioner
 of  taxation  and  finance  has  been  notified  pursuant to section one
 hundred seventy-one-c, one hundred seventy-one-d, one  hundred  seventy-
 one-e, one hundred seventy-one-f or one hundred seventy-one-1 of the tax
 law,  as the case may be, then an overpayment and interest thereon shall
 be credited  against  such  past-due  support,  or  a  past-due  legally
 enforceable  debt,  or  a city of New York tax warrant judgment debt, or
 such amount of a default in repayment of  a  guaranteed  student,  state
 university  or  city  university  loan, unless the spouse not liable for
 such past-due support, or a past-due legally enforceable debt, or a city
 of New York tax warrant judgment debt, or such amount of  a  default  in
 repayment  of  a guaranteed student, state university or city university
 loan demands, on a declaration made in accordance  with  regulations  or
 instructions  prescribed  by  the  state  commissioner  of  taxation and
 finance, that the portion of the overpayment and  interest  attributable
 to  such spouse not be credited against the past-due support, or a past-
 due legally enforceable debt, or a city of New York tax warrant judgment
 debt, or amount of a default in repayment of a guaranteed student, state
 university or city university loan owed by the other spouse.  Upon  such
 demand,  the  state commissioner of taxation and finance shall determine
 the amount of the overpayment attributable to each spouse in  accordance
 with  regulations  prescribed  by the state commissioner of taxation and
 finance and credit only that portion of  the  overpayment  and  interest
 thereon  attributable  to  the  spouse liable for past-due support, or a
 past-due legally enforceable debt, or a city of  New  York  tax  warrant
 judgment  debt,  or  amount  of  a  default in repayment of a guaranteed
 student, state university or city university loan against such  past-due
 support,  or  a past-due legally enforceable debt, or a city of New York
 tax warrant judgment debt, or such amount of a default in repayment of a
 guaranteed student, state  university  or  city  university  loan.  Such
 demand  may  be  filed  (A) with the return of the spouse not liable for
 past-due support or past-due legally enforceable debt, or a city of  New
 S. 8474                            929
 
 York  tax warrant judgment debt, or default in repayment of a guaranteed
 student, state university, or city  university  loan  or  (B)  with  the
 commissioner  of taxation and finance within ten days after notification
 is  provided  such  spouse  by  the commissioner of taxation and finance
 pursuant to subdivision seven  of  section  one  hundred  seventy-one-c,
 subdivision  six of section one hundred seventy-one-d, subdivision seven
 of section one hundred seventy-one-e, subdivision seven of  section  one
 hundred  seventy-one-f  or subdivision six of section one hundred seven-
 ty-one-1 of the tax law.
   (6) The state commissioner of taxation and finance shall clearly alert
 married taxpayers, on all  appropriate  publications  and  instructions,
 that  their  liability  for  tax  will be joint and several if they file
 joint income tax returns. The state commissioner of taxation and finance
 shall include notice of an individual's right to relief from  joint  and
 several  liability pursuant to section six hundred fifty-four of the tax
 law in the disclosure of rights  statement  required  by  section  three
 thousand  four  of the tax law and in any notice regarding collection of
 tax due with respect to a liability on a joint return.
   (c) Decedents. The return for any deceased individual  shall  be  made
 and filed by his or her executor, administrator, or other person charged
 with  his  or  her  property.   If a final return of a decedent is for a
 fractional part of a year, the due date of  such  return  shall  be  the
 fifteenth  day  of  the  fourth month following the close of the twelve-
 month period which began with the first day of such fractional  part  of
 the year.
   (d)  Individuals  under a disability. The return for an individual who
 is unable to make a return by reason of  minority  or  other  disability
 shall  be made and filed by his or her guardian, committee, fiduciary or
 other person charged with the care of his  or  her  person  or  property
 other than a receiver in possession of only a part of his or her proper-
 ty, or by his or her duly authorized agent.
   (e)  Estates  and  trusts.  The return for an estate or trust shall be
 made and filed by the fiduciary.
   (f) Joint fiduciaries. If two or more fiduciaries are acting  jointly,
 the return may be made by any one of them.
   (h) Tax a debt. Any tax under this chapter, and any increase, interest
 or  penalty  thereon,  shall,  from the time it is due and payable, be a
 personal debt of the person liable to pay the same, to the city  of  New
 York.
   (i) Cross reference. For provisions as to information returns by part-
 nerships,  employers  and  other  persons,  see  section 11-1758 of this
 subchapter.
   § 11-1752 Time and place for filing  returns  and  paying  tax.    (a)
 Except as provided in subdivision (b) of this section, a person required
 to  make and file a return under this chapter shall, without assessment,
 notice or demand, pay any tax due thereon to the commissioner  of  taxa-
 tion  and  finance  on  or before the date fixed for filing such return,
 determined without regard to  any  extension  of  time  for  filing  the
 return.  The  commissioner  shall  prescribe by regulation the place for
 filing any return, statement, or other  document  required  pursuant  to
 this chapter and for payment of any tax.
   (b) The commissioner of taxation and finance may allow individuals who
 have  income  only  from wages, salaries, tips and like remuneration for
 services performed as an employee, interest, dividends and  unemployment
 compensation  to  elect to have the commissioner compute the tax due. To
 provide for expeditious and uniform administration of the  tax  computa-
 S. 8474                            930
 
 tions  which  involve  numerous  variables, the commissioner may further
 qualify, with  regard  to  period  of  residency,  deductions,  credits,
 exemptions,  amount  and character of gross income, and any other appro-
 priate factors relative to calculation of tax, those individuals who may
 elect  to  have  their  taxes  computed  by  the  commissioner. Any such
 election shall be made on the form prescribed by  the  commissioner  for
 this  purpose.  If  a qualified taxpayer elects to have the commissioner
 compute the tax, the amount determined by the commissioner shall be paid
 (i) within ten days from the date of the issuance of a notice and demand
 therefor or (ii) on the date fixed for filing  such  return,  determined
 without regard to any extension of time for filing, whichever is later.
   §  11-1753   Signing of returns and other documents. (a) General.  Any
 return, statement or other document required to be made pursuant to this
 chapter shall be signed in accordance with regulations  or  instructions
 prescribed by the tax commission.  The fact that an individual's name is
 signed  to  a return, statement, or other document, shall be prima facie
 evidence for all purposes that the return, statement or  other  document
 was actually signed by such individual.
   (b) Partnerships.  Any return, statement or other document required of
 a  partnership shall be signed by one or more partners.  The fact that a
 partner's name is signed to a  return,  statement,  or  other  document,
 shall  be  prima  facie  evidence  for all purposes that such partner is
 authorized to sign on behalf of the partnership.
   (c) Certifications.  The making or filing of any return, statement  or
 other  document or copy thereof required to be made or filed pursuant to
 this chapter, including a copy of a federal return, shall  constitute  a
 certification  by  the person making or filing such return, statement or
 other document or copy thereof that the statements contained therein are
 true and that any copy filed is a true copy.
   § 11-1754  Change of resident status during year. (a) General.  If  an
 individual changes his or her status during his or her taxable year from
 city  resident  to  city  nonresident,  or from city nonresident to city
 resident, such individual shall file one return as a  resident  for  the
 portion  of  the  year  during which he or she is a city resident, and a
 return under chapter nineteen of this title, for the portion of the year
 during which he or she is a city nonresident, subject to such exceptions
 as the tax commission may prescribe by regulation.
   (b) City taxable income as city resident.  The city taxable income for
 the portion of the year during which he or she is a city resident  shall
 be determined, except as provided in subdivision (c) of this section, as
 if  his or her taxable year for federal income tax purposes were limited
 to the period of his or her city resident status.
   (c)  Special accruals.
   (1) If an individual changes his or her status from city  resident  to
 city  nonresident,  he  or she shall, regardless of his or her method of
 accounting, accrue for the portion of the taxable  year  prior  to  such
 change  of  status any items of income, gain, loss or deduction accruing
 prior to the change of status, if  not  otherwise  properly  includible,
 whether or not because of an election to report on an installment basis,
 or  allowable for city income tax purposes for such portion of the taxa-
 ble year or for a prior taxable year.  The amounts of such accrued items
 shall be determined  with  the  applicable  modifications  described  in
 sections  11-1712  and  11-1715 of this chapter as if such accrued items
 were includible or allowable for federal income tax purposes.
   (2) If an individual changes his or her status from  city  nonresident
 to  city  resident,  he or she shall, regardless of his or her method of
 S. 8474                            931
 
 accounting, accrue for the portion of the taxable  year  prior  to  such
 change  of  status any items of income, gain, loss or deduction accruing
 prior to the  change  of  status,  other  than  items  derived  from  or
 connected  with New York state sources, if not otherwise properly inclu-
 dible, whether or not because of an election to report on an installment
 basis, or allowable for federal income tax purposes for such portion  of
 the  taxable  year  or  for  a prior taxable year.   The amounts of such
 accrued items shall be  determined  with  the  applicable  modifications
 described  in  sections  11-1712  and 11-1715 of this chapter as if such
 accrued items were  includible  or  allowable  for  federal  income  tax
 purposes.
   (3)  No item of income, gain, loss or deduction which is accrued under
 this subdivision  shall  be  taken  into  account  in  determining  city
 adjusted  gross income or the city itemized deduction for any subsequent
 taxable period.
   (4)  The accruals under this subdivision shall not be required if  the
 individual  files  with  the  tax  commission  a  bond or other security
 acceptable to the tax commission,  conditioned  upon  the  inclusion  of
 amounts  accruable  under this subdivision in city adjusted gross income
 for one or more subsequent taxable years as if the  individual  had  not
 changed his or her resident status.
   (5) The provisions of subdivisions (a), (b) and paragraphs one through
 four of this subdivision shall apply if an individual changes his or her
 status  from a city resident to city nonresident or from a city nonresi-
 dent to a city resident during a taxable year, or at the beginning of  a
 taxable  year,  as  a  result  of a change of domicile or as a result of
 becoming a city resident or city nonresident  based  on  the  definition
 contained  in  subparagraph  (B)  of paragraph one of subdivision (b) of
 section 11-1705 of this chapter.
   (6) Except as provided in this paragraph, where an individual who is a
 member of a partnership or  shareholder  of  an  S  corporation  changes
 status  from city resident to city nonresident, or from city nonresident
 to city resident, the portion of the distributive or pro rata  share  of
 income,  gain  and  loss,  less  deductions attributable thereto, from a
 partnership or S corporation shall be  allocated  to  the  resident  and
 nonresident  periods  of  the  partner or shareholder on a proportionate
 basis throughout the taxable year of the partnership or S corporation.
   In such event, the portion of the distributive or pro rata share allo-
 cated to the period of residency shall be determined based on the number
 of days of residency within the reporting period of the partnership or S
 corporation over the total number of days in the reporting period of the
 partnership or S corporation. Provided, however, that  the  commissioner
 may  require,  or  the  individual may elect, to accrue to the period of
 residence, and the period of nonresidence, the portion of the  distribu-
 tive  or pro rata share of partnership or S corporation income, gain and
 loss, less deductions attributable thereto, accruing during the individ-
 ual's respective resident and  nonresident  periods  in  a  manner  that
 reflects  the date of accrual of said income, gain and loss by the part-
 nership or S corporation.
   (7) Except as provided in this paragraph, where an individual who is a
 beneficiary of an estate or trust changes status from city  resident  to
 city nonresident, or from city nonresident to city resident, the portion
 of  any  estate  or  trust  income  credited,  distributable, payable or
 required to be distributed to such beneficiary shall be allocated to the
 resident and nonresident periods of the beneficiary on  a  proportionate
 basis throughout the taxable year of the estate or trust. In such event,
 S. 8474                            932
 
 the  portion  of  such estate or trust income allocated to the period of
 residency shall be determined based on the number of days  of  residency
 within the reporting period of the estate or trust over the total number
 of days in the reporting period of the estate or trust. Provided, howev-
 er,  that the commissioner may require, or the beneficiary may elect, to
 accrue to the period of residence, and the period of  nonresidence,  the
 portion of such estate or trust income accruing during the beneficiary's
 respective  resident  and  nonresident periods in a manner that reflects
 the date of accrual of said estate or trust  income  by  the  estate  or
 trust.
   (d)  City  minimum  tax.    Where  two returns are required under this
 section, the total of the taxes due thereon shall not be less than would
 be due if the city taxable incomes reportable on the  two  returns  were
 included in one return.
   (e)  Proration.    Where  a return is required under this section, the
 city personal exemptions allowable under section 11-1716 of this chapter
 shall be prorated, under regulations of the tax commission,  to  reflect
 the  portions of the entire taxable year during which the individual was
 a resident.
   (f) Standard deduction.    Where  a  return  is  required  under  this
 section,  the  city standard deduction allowable on such return shall be
 the amount allowed pursuant to the provisions of section 11-1714 of this
 chapter, prorated according to the period covered by the return.
   (g) Trusts.  If the status of a trust changes during its taxable  year
 from city resident to city nonresident, or from city nonresident to city
 resident,  the  fiduciary shall file one return as a city resident trust
 for the portion of the year during which the trust is  a  city  resident
 trust,  and  one  return  under  chapter  nineteen of this title for the
 portion of the year during which the trust is a city nonresident  trust,
 subject  to such exceptions as the tax commission may prescribe by regu-
 lations.  The provisions of subdivisions (b), (c), (d) and (e)  of  this
 section  shall apply for the purposes of this subdivision, except to the
 extent that  any  of  such  provisions  may  be  inconsistent  with  the
 provisions  of section 11-1718 of this chapter, and except that the term
 "individual" shall be read as "trust", the  term  "city  adjusted  gross
 income"  shall  be  read  as  "city taxable income", reference to "gain"
 shall include any modification for  includible  gain  under  subdivision
 five  of  section  11-1718  of  this  chapter,  and the phrase "personal
 exemptions allowable under section 11-1716 of  this  chapter"  shall  be
 read  as  "city exemptions allowable under section 11-1718 of this chap-
 ter."
   (h) Lump sum distributions.   If the  status  of  a  taxpayer  changes
 during  his  or her taxable year from city resident to city nonresident,
 or from city nonresident to city resident, the taxpayer  shall,  regard-
 less  of his method of accounting, accrue for the portion of the taxable
 year prior to such change of status the total taxable amount of  a  lump
 sum distribution accruing prior to the change of status, if the ordinary
 income  portion  thereof  is  not otherwise subject to tax under section
 11-1703 of this chapter for such portion of the taxable year  or  for  a
 prior  taxable year.   No ordinary income portion of a lump sum distrib-
 ution the total taxable amount of which is accrued under  this  subdivi-
 sion  shall  be subject to tax under section 11-1703 of this chapter for
 any subsequent taxable period.  The accrual under this subdivision shall
 not be required if the taxpayer files with the tax commission a bond  or
 other  security  acceptable  to the tax commission, conditioned upon the
 payment of tax under section 11-1703 of this chapter,  with  respect  to
 S. 8474                            933
 
 such  amount  accruable under this subdivision, for a subsequent taxable
 year as if the taxpayer had not changed its resident status.
   (i)  Deduction  for  two-earner  married  couples.  Where  a return is
 required under this section, the amount  of  deduction  under  paragraph
 twenty-nine  of subdivision (c) of section 11-1712 of this chapter shall
 be equal to ten percent of the lesser of:
   (1) thirty thousand dollars, pro rated according to the period covered
 by the return or
   (2) the qualified earned income of the spouse with the lower qualified
 earned income for the period covered by the return.
   § 11-1755 Relief from joint and several  liability  on  joint  return.
 (a)  General.  The  provisions  of  section  six thousand fifteen of the
 internal revenue code applicable to the  liability  of  individuals  who
 file  joint income tax returns shall apply to the same extent as if such
 section of such code were contained in and made part  of  this  section,
 except to the extent that any provision of such section is either incon-
 sistent  with  or not relevant to this chapter and except as modified in
 subdivision (b) of this section, or with such other modifications as may
 be necessary to adapt the language of such provisions to the  provisions
 of this chapter.
   (b) Modifications. Section six thousand fifteen of the internal reven-
 ue code shall be read as modified by this subdivision.
   (1)  "Secretary"  shall be read as "state commissioner of taxation and
 finance".
   (2) "Internal revenue service" shall be read as "department  of  taxa-
 tion and finance".
   (3) "Tax court" shall be read as "division of tax appeals".
   (4)  In  the  heading of subsection (a) and in clause (ii) of subpara-
 graph (A) of paragraph three of  subsection  (c),  the  phrase  "section
 6013(d)(3)"  shall  be  read as "paragraphs two and three of subdivision
 (b) of section 11-1751 of this chapter".
   (5)  In  paragraph  three  of  subsection  (b),  the  phrase  "section
 6662(d)(2)(A)"  shall  be read as "subdivision (p) of section 11-1785 of
 this chapter".
   (6) In subparagraph (B) of paragraph two of subsection (d), the phrase
 "section 1 or 55" shall be read as "section 11-1701 of this chapter".
   (7) In clause (i) of subparagraph (B) of paragraph one  of  subsection
 (e), the phrase "section 6851 or 6861" shall be read as "section 11-1794
 of this chapter" and "section 7485" shall be read as "subdivision (c) of
 section 11-1790 of this chapter".
   (8)  In  paragraph  two  of  subsection (e), the phrase "section 6502"
 shall be read as "section one hundred seventy-four-a of the tax law  and
 section 11-1792 of this chapter".
   (9)  In  subparagraph  (A)  of  paragraph three of subsection (e), the
 phrase "section 6512(b), 7121, or 7122" shall be  read  as  "subdivision
 fifteenth,  eighteenth,  eighteenth-a  or  eighteenth-d  of  section one
 hundred seventy-one of the  tax  law  and  subdivision  (b)  of  section
 11-1789 of this chapter".
   (10)  The  following  provisions  of such section six thousand fifteen
 shall be disregarded: (A) The phrase "notwithstanding the provisions  of
 section  7421(a)"  contained in clause (ii) of subparagraph (B) of para-
 graph one of subsection (e); and (B) subparagraph (C) of paragraph three
 of subsection (e).
   (c) Federal determination. If an individual is relieved of  a  federal
 income  tax liability pursuant to subsection (b) of section six thousand
 fifteen of the internal  revenue  code,  there  shall  be  a  rebuttable
 S. 8474                            934
 
 presumption  that  such  individual shall also be entitled to equivalent
 relief from liability under this section, to the extent that such  indi-
 vidual  has  an  understatement  of  tax under this chapter for the same
 taxable year that is attributable to the same erroneous item or items to
 which the individual's federal income tax liability was attributable.
   §  11-1757  Extensions of time. (a) General. The commissioner of taxa-
 tion and finance may grant a reasonable extension of time for payment of
 tax or estimated tax, or any installment,  or  for  filing  any  return,
 statement,  or other document required pursuant to this chapter, on such
 terms and conditions as it may require. Except for  a  taxpayer  who  is
 outside  the  United  States  or who intends to claim nonresident status
 pursuant to clause (ii) of subparagraph (A) of paragraph one of subdivi-
 sion (b) of section 11-1705 of  this  chapter,  no  such  extension  for
 filing any return, statement or other document, shall exceed six months.
   (b)  Furnishing  of security.  If any extension of time is granted for
 payment of any amount of tax, the tax commission may require the taxpay-
 er to furnish a bond or other security in an amount not exceeding  twice
 the  amount  for  which  the extension of time for payment is granted on
 such terms and conditions as the tax commission may require.
   § 11-1758 Requirements concerning returns, notices, records and state-
 ments. (a) General. The tax commission may prescribe regulations  as  to
 the  keeping of records, the content and form of returns and statements,
 and the filing of copies of federal  income  tax  returns  and  determi-
 nations.  The  tax  commission  may require any person, by regulation or
 notice served upon such person, to make such returns, render such state-
 ments, or keep such records, as the tax commission may  deem  sufficient
 to  show whether or not such person is liable under this chapter for tax
 or for collection of tax.
   (b) Identifying numbers. (1) When required by  regulations  prescribed
 by the tax commission:
   (A)  Inclusion  in returns. Any person required under the authority of
 this chapter to make  a  return,  statement,  or  other  document  shall
 include  in  such  return,  statement or other document such identifying
 number as may be prescribed for securing proper identification  of  such
 person.
   (B)  Furnishing  number  to  other persons. Any person with respect to
 whom a return, statement or other document is required under the author-
 ity of this chapter to be made by another person shall furnish  to  such
 other  person  such identifying number as may be prescribed for securing
 his or her proper identification.
   (C) Furnishing number of another person. Any person required under the
 authority of this chapter to make a return, statement, or other document
 with respect to another person shall request from such other person, and
 shall include in any such return, statement,  or  other  document,  such
 identifying  number as may be prescribed for securing proper identifica-
 tion of such other person.
   (2) Limitation.
   (A) Except as provided in subparagraph (B) of this paragraph, a return
 of any person with respect to his or  her  liability  for  tax,  or  any
 statement  or other document in support thereof, shall not be considered
 for purposes of subparagraphs (B) and  (C)  of  paragraph  one  of  this
 subdivision  as  a  return,  statement or other document with respect to
 another person.
   (B) For purposes of subparagraphs (B) and (C) of paragraph one of this
 subdivision, a return of an estate or trust with respect to its  liabil-
 ity  for  tax,  and  any statement or other document in support thereof,
 S. 8474                            935

 shall be considered as a  return,  statement,  or  other  document  with
 respect to each beneficiary of such estate or trust.
   (3)  Requirement of information. For purposes of this section, the tax
 commission is authorized to require such information as may be necessary
 to assign an identifying number to any person.
   (c) Partnerships and S corporations.
   (1) Partnerships. Every partnership having  a  city  resident  partner
 shall  make  a  return  for  the taxable year setting forth all items of
 income, gain, loss and deduction and such other pertinent information as
 the tax commission may by regulations and instructions  prescribe.  Such
 return shall be filed on or before the fifteenth day of the fourth month
 following  the  close  of each taxable year except that the due date for
 the return of a partnership consisting entirely  of  nonresident  aliens
 shall  be  the date prescribed for the filing of its federal partnership
 return for the taxable year. For purposes of  this  paragraph,  "taxable
 year"  means  a  year  or  a period which would be a taxable year of the
 partnership if it were subject to tax under this chapter.
   (2) S  corporations.  Every  S  corporation  for  which  the  election
 provided  for  in subsection (a) of section six hundred sixty of the tax
 law is in effect shall make a return setting forth all items of  income,
 loss  and  deduction  and  such  other  pertinent information as the tax
 commission may by regulations and instructions  prescribe.  Such  return
 shall be filed on or before the fifteenth day of the third month follow-
 ing the close of each taxable year.
   (d)  Information  at  source.  The  tax commission may prescribe regu-
 lations and instructions requiring returns of information to be made and
 filed on or before February twenty-eighth of each year as to the payment
 or crediting in any calendar year of amounts of six hundred  dollars  or
 more to any taxpayer under this chapter. Such returns may be required of
 any persons, including lessees or mortgagors of real or personal proper-
 ty,  fiduciaries,  employers,  and  all  officers  and employees of this
 state, or of any municipal corporation or political subdivision of  this
 state,  having  the  control,  receipt,  custody, disposal or payment of
 interest, rents, salaries, wages,  premiums,  annuities,  compensations,
 remunerations,  emoluments or other fixed or determinable gains, profits
 or income, except interest coupons payable to bearer. A duplicate of the
 statement as to tax withheld on wages, required to be  furnished  by  an
 employer  to  an  employee,  shall  constitute the return of information
 required to be made under this section with respect to such wages.
   (e) Notice of qualification as receiver, etc. Every receiver,  trustee
 in  bankruptcy, assignee for benefit of creditors, or other like fiduci-
 ary shall give notice of his or her qualification as  such  to  the  tax
 commission, as may be required by regulation.
   (g) Requirements applicable to tax return preparer.
   (1)  Signature  of  tax  return  preparer. Any individual who is a tax
 return preparer and prepares any return or claim for refund, shall  sign
 such  return  or  claim  for  refund  in  accordance with regulations or
 instructions prescribed by the commissioner of taxation and finance.
   (2) Furnishing identifying numbers. Any return  or  claim  for  refund
 which is prepared by a tax return preparer shall include the identifying
 number  of the preparer required by paragraph one of this subdivision to
 sign such return or claim for refund. In addition, where such individual
 preparer is an employee of an employer which is a  tax  return  preparer
 with  respect to such return or claim for refund, or where such preparer
 is a partner in a partnership  which  is  a  tax  return  preparer  with
 respect  to  such  return or claim for refund, then such return or claim
 S. 8474                            936
 
 for refund shall also include the identifying number of such employer or
 partnership. Such identifying numbers shall  be  as  prescribed  by  the
 commissioner of taxation and finance in order to secure the proper iden-
 tification  of  such  individual  preparer, partnership or employer. The
 responsibility for the inclusion of such identifying numbers shall be as
 set forth in paragraph two of subdivision (t) of section 11-1785 of this
 chapter.
   (3) Furnishing copy to taxpayer.  Any  person  who  is  a  tax  return
 preparer  with respect to any return or claim for refund shall furnish a
 completed copy of such return or claim for refund to  the  taxpayer  not
 later  than  the  time  such return or claim for refund is presented for
 such taxpayer's signature.
   (4) Copy or list to be retained by tax return preparer. Any person who
 is a tax return preparer with respect to any return or claim for  refund
 shall  for  a three year retention period described in paragraph nine of
 this subdivision:
   (A) retain a completed copy of such return or  claim  for  refund,  or
 retain,  on  a  list, the name and identification number of the taxpayer
 for whom such return or claim was prepared, and
   (B) make such copy or list available for inspection  upon  request  by
 the commissioner of taxation and finance.
   (5)  Tax  return  preparer  defined. For purposes of this chapter, the
 term "tax return preparer" means any person  who  prepares  for  compen-
 sation,  or  who  employs  or engages one or more persons to prepare for
 compensation any return or  claim  for  refund.  The  preparation  of  a
 substantial  portion of a return or claim for refund shall be treated as
 if it were the preparation of such return or claim for refund. Where  an
 employer  and  one  or  more  employees  of such employer are tax return
 preparers with respect to the same return or claim for refund, or  where
 a  partnership  and  one  or  more  partners in such partnership are tax
 return preparers with respect to the same return or  claim  for  refund,
 for  purposes  of  paragraphs  three  and four of this subdivision, such
 employer or such partnership shall be deemed to be the sole  tax  return
 preparer.  A  person shall not be a "tax return preparer" merely because
 such person:
   (A) furnishes typing, reproducing, or other mechanical assistance,
   (B) prepares a return or claim for refund of the employer,  or  of  an
 officer  or employee of the employer, by whom he or she is regularly and
 continuously employed, or
   (C) prepares as a fiduciary a return  or  claim  for  refund  for  any
 person.
   (6)  Person  defined.  For  purposes  of  this  subdivision,  the term
 "person" includes an  individual,  corporation,  including  a  dissolved
 corporation, or partnership.
   (7)  Return  defined.  For  purposes  of  this  subdivision,  the term
 "return" shall mean any return required under this chapter.
   (8) Claim for refund defined. For purposes of  this  subdivision,  the
 term  "claim  for  refund"  shall  mean  a claim for refund of or credit
 against any tax imposed under this chapter, and shall include any  claim
 for  refund  of  any  credit treated as an overpayment of tax under this
 chapter.
   (9) Retention period defined. For purposes of  this  subdivision,  the
 term "retention period" shall mean:
   (A)  in the case of a tax return, the period ending the later of three
 years after the due date of such return, without regard  to  extensions,
 S. 8474                            937
 
 or  three years after the date such return was presented to the taxpayer
 for such taxpayer's signature, and
   (B)  in  the case of a claim for refund, the period ending three years
 after such claim for refund was  presented  to  the  taxpayer  for  such
 taxpayer's signature.
   (10)  Mandatory  electronic  filing  by  certain tax return preparers.
 (A)(i) If a tax return preparer prepared more than two hundred  original
 returns  during  the calendar year beginning on January first, two thou-
 sand five, and if, in the calendar year beginning on January first,  two
 thousand  six,  such tax return preparer prepares one or more authorized
 returns using tax software, then, for such calendar  year  two  thousand
 six  and  for  each  subsequent calendar year thereafter, all authorized
 returns prepared by such tax return preparer shall  be  filed  electron-
 ically,  in  accordance with instructions prescribed by the commissioner
 of taxation and finance.
   (ii) If a tax return preparer prepared more than one hundred  original
 returns  during  any  calendar year beginning on or after January first,
 two thousand six, and if, in  any  succeeding  calendar  year  such  tax
 return  preparer prepares one or more authorized returns using tax soft-
 ware, then, for such succeeding calendar year and  for  each  subsequent
 calendar  year  thereafter,  all authorized returns prepared by such tax
 return preparer  shall  be  filed  electronically,  in  accordance  with
 instructions prescribed by the commissioner of taxation and finance.
   (B)  For  purposes of this paragraph:  (i) "Electronic" means computer
 technology; provided, however, that the  commissioner  of  taxation  and
 finance  may,  in  instructions,  provide that use of barcode technology
 will also satisfy the mandatory electronic filing requirements  of  this
 section.
   (ii)  "Authorized return" means any return required under this article
 which the commissioner of taxation and  finance  has  authorized  to  be
 filed electronically.
   (iii)  "Original  return"  means  a return required under this article
 that is filed, without regard to extensions, during  the  calendar  year
 for which that return is required to be filed.
   (iv)  "Tax  software" means any computer software program intended for
 tax return preparation purposes.
   § 11-1759 Report of federal changes, corrections or disallowances.  If
 the  amount of a taxpayer's federal taxable income, total taxable amount
 or ordinary income portion of a lump sum distribution or includible gain
 of a trust reported on his federal income tax  return  for  any  taxable
 year,  or  the  amount  of  any claim of right adjustment, is changed or
 corrected by the United States internal revenue service or other  compe-
 tent  authority,  or  as  the result of a renegotiation of a contract or
 subcontract with the United States or the amount an employer is required
 to deduct and withhold from wages for  federal  income  tax  withholding
 purposes  is  changed  or corrected by such service or authority or if a
 taxpayer's claim for credit or refund of federal income  tax  is  disal-
 lowed  in  whole  or in part, the taxpayer or employer shall report such
 change or correction or disallowance within ninety days after the  final
 determination  of  such  change, correction, renegotiation, or disallow-
 ance, or as otherwise required by the commissioner,  and  shall  concede
 the accuracy of such determination or state wherein it is erroneous. The
 allowance of a tentative carryback adjustment based upon a net operating
 loss  carryback  pursuant  to  section  sixty-four hundred eleven of the
 internal revenue code shall be treated  as  a  final  determination  for
 purposes  of this section. Any taxpayer filing an amended federal income
 S. 8474                            938
 
 tax return and any employer filing an amended federal return  of  income
 tax  withheld  shall  also file within ninety days thereafter an amended
 return under this chapter,  and  shall  give  such  information  as  the
 commissioner  may  require. The commissioner may by regulation prescribe
 such exceptions to the requirements of this section as he or  she  deems
 appropriate. For purposes of this section, (i) the term "taxpayer" shall
 include  a  partnership  having  a resident partner or having any income
 derived from New York sources, and a corporation with respect  to  which
 the  taxable  year of such change, correction, disallowance or amendment
 is a year with respect to which the election provided for in  subsection
 (a)  of  section six hundred sixty of the tax law is in effect, and (ii)
 the term "federal income tax return" shall include the returns of income
 required under sections six thousand thirty-one and six  thousand  thir-
 ty-seven  of  the  internal  revenue  code. In the case of such a corpo-
 ration, such report shall also include any change or correction  of  the
 taxes described in paragraphs two and three of subsection (f) of section
 thirteen  hundred  sixty-six  of the internal revenue code. Reports made
 under this section by a partnership or corporation  shall  indicate  the
 portion  of  the change in each item of income, gain, loss or deduction,
 and, in the case of a corporation, of each change in, or disallowance of
 a claim for credit or refund of such tax, allocable to each  partner  or
 shareholder  and  shall  set  forth  such  identifying  information with
 respect to such partner or shareholder  as  may  be  prescribed  by  the
 commissioner.
   §  11-1761    Change of election. Any election expressly authorized by
 this chapter may be changed on such terms  and  conditions  as  the  tax
 commission may prescribe by regulation.
   §  11-1762  Computation  of  tax  where  taxpayer restores substantial
 amount held under claim of right. (a) General. If:
   (1) an item was included in city adjusted gross  income  for  a  prior
 taxable  year,  or  years,  because it appeared that the taxpayer had an
 unrestricted right to such item, and
   (2) for the current taxable year the provisions of paragraph  five  of
 subsection  (a)  of  section  thirteen hundred forty-one of the internal
 revenue code apply to such item, then the tax imposed  by  this  chapter
 for the taxable year shall be an amount equal to
   (3)  the  tax  for  the  taxable  year computed without regard to this
 section, minus
   (4) the decrease in tax under this chapter for the prior taxable year,
 or years, which would result solely from the exclusion of such item,  or
 portion  thereof, from city adjusted gross income for such prior taxable
 year, or years.
   (b) Special rules. If the decrease in tax ascertained under  paragraph
 four  of subdivision (a) of this section exceeds the tax imposed by this
 chapter for the taxable year, such excess shall be considered a  payment
 of  tax on the last day prescribed by law for the payment of tax for the
 taxable year, and shall be refunded or credited in the same manner as if
 it were an overpayment for such taxable year.
 
                               SUBCHAPTER 4
                            WITHHOLDING OF TAX
 
   § 11-1771 Requirement of withholding tax from wages. (a) General.  (1)
 Every employer maintaining an office or transacting business within this
 city or state and making payment on and after  January  first,  nineteen
 hundred  seventy-seven of any wages taxable under this chapter, or under
 S. 8474                            939
 
 section two of chapter eight hundred eighty-two of the laws of  nineteen
 hundred  seventy-five, as amended by chapter eight hundred eighty-six of
 the laws of nineteen hundred seventy-five, shall   deduct  and  withhold
 from such wages for each payroll period a tax computed in such manner as
 to  result,  so  far  as practicable, in withholding from the employee's
 wages during each calendar year an amount  substantially  equivalent  to
 the  tax  reasonably  estimated  to  be  due  under this chapter or such
 section two resulting from the inclusion in the employee's city adjusted
 gross income of his or her wages received  during  such  calendar  year.
 The  method of determining the amount to be withheld shall be prescribed
 by regulations of the tax commission, with due regard to the city  with-
 holding  exemptions of the employee and the sum of any credits allowable
 against his or her tax.  The section shall not apply to payments by  the
 United  States  for  service in the armed forces of the United States so
 long as the right to require deduction and withholding of tax from  such
 payments is prohibited by the laws of the United States.  Service in the
 armed  forces  of  the United States shall have the same meaning as when
 used in a comparable context in the laws of the United  States  relating
 to withholding of city income taxes.
   (2) The tax commission may provide, by regulations, for withholding:
   (A) from remuneration for services performed by an employee for his or
 her employer which does not constitute wages, and
   (B) from remuneration for services performed by an employee for his or
 her  employer  which  does  not constitute wages, and (B) from any other
 type of payment, with respect to which the  tax  commission  finds  that
 withholding  would  be appropriate under the provisions of this chapter,
 if the employer and the employee, or in the case of any  other  type  of
 payment the person making and the person receiving the payment, agree to
 such  withholding.  Such agreement shall be made in such form and manner
 as the tax commission may by regulations provide. For purposes  of  this
 chapter,  remuneration  or  other  payments  with  respect to which such
 agreement is made shall be treated as if they  were  wages  paid  by  an
 employer  to an employee to the extent that such remuneration is paid or
 other payments are made during the period for which the agreement is  in
 effect.
   (3)  The  tax  commission shall provide by regulation for an exemption
 from withholding for: (i) employees under eighteen years  of  age,  (ii)
 employees  under twenty-five years of age who are full-time students and
 (iii) employees over sixty-five years of age,  provided  such  employees
 had  no income tax liability in the prior year and can reasonably antic-
 ipate none in the current year.
   (b) Extension of withholding to certain periodic payments and gambling
 winnings.
   (1) For purposes of this chapter, any payment subject to  withholding,
 within the meaning of paragraph two of this subdivision, shall be treat-
 ed as if it were wages paid by an employer to an employee.
   (2)  Payments subject to withholding. For purposes of paragraph one of
 this subdivision, a payment subject to withholding means:
   (A) Any supplemental unemployment  compensation  benefit  paid  to  an
 individual  to  the extent includible in such individual's city adjusted
 gross income.
   (B) Any member or employee contributions to  a  retirement  system  or
 pension  fund  picked  up  by  the employer pursuant to subdivision f of
 section five hundred seventeen or subdivision d of section  six  hundred
 thirteen  of the retirement and social security law or section 13-225.1,
 13-327.1, 13-125.1, 13-125.2 or 13-521.1 of the code  of  the  preceding
 S. 8474                            940
 
 municipality  or  subdivision  nineteen  of  section twenty-five hundred
 seventy-five of the education law.
   (C)  Any payment of an annuity to an individual to the extent includi-
 ble in such individual's city adjusted gross income, if at the time  the
 payment  is  made  a request that such annuity be subject to withholding
 under this chapter is in effect.
   (D) Any payment of winnings from a wager placed in a lottery conducted
 by the division of the lottery, if the proceeds from such  wager  exceed
 five  thousand dollars and such proceeds are payable pursuant to a prize
 claim made by an individual who was a resident of the city at  the  time
 of the selection of the prize winning lottery ticket.
   (F)  Any amount deducted or deferred from an employee's salary under a
 flexible benefits program established pursuant to  section  twenty-three
 of  the  general municipal law or section one thousand two hundred ten-a
 of the public authorities law.
   (G) Any amount by which an employee's salary is  reduced  pursuant  to
 the provisions of subdivision b of section 12-126.1 and subdivision b of
 section 12-126.2 of the code of the preceding municipality.
   (3) Additional provisions applicable to this subdivision.
   (A)  Request  for  annuity withholding.   A request that an annuity be
 subject to withholding under this chapter shall be made by the payee  in
 writing to the person making the annuity payments.
   Such  a  request  may,  notwithstanding  any  provision  of law to the
 contrary, be terminated by furnishing to the person making the  payments
 a  written  statement of termination.  Such a request for withholding or
 statement of termination shall take effect in such manner as the commis-
 sioner of taxation and finance shall prescribe.
   (B) Withholding on lottery winnings upon change  of  residence.  If  a
 payee  of lottery winnings subject to the provisions of subparagraph (D)
 of paragraph two of this subdivision changes  status  from  resident  to
 nonresident,  withholding  in  accordance  with  such subparagraph shall
 constitute other security acceptable to the commissioner of taxation and
 finance within the meaning of  paragraph  four  of  subdivision  (c)  of
 section  11-1754  of  this  chapter,  unless  such payee elects, in such
 manner as the commissioner of taxation and finance shall  prescribe,  to
 apply  the  provisions  of  paragraph one of such subdivision (c) to the
 proceeds, in which case withholding  under  this  subdivision  shall  no
 longer apply to such proceeds.
   (C)  Proceeds.  For purposes of subparagraphs (D) and (E) of paragraph
 two of this subdivision, proceeds from a wager shall  be  determined  by
 reducing the amount received by the amount of the wager.
   (D)  Taxes  withheld  at maximum rate. The tax withheld on any payment
 subject to withholding under subparagraph (D) or (E) of paragraph two of
 this subdivision shall be withheld at the highest rate of  tax  on  city
 taxable  income,  without any allowance for deductions or exemptions, in
 effect under this chapter for the taxable year in which the  payment  is
 made.
   (E)   Determination   of  residence.  For  purposes  of  applying  the
 provisions of subparagraphs (D) and (E) of paragraph two of this  subdi-
 vision, any payor of proceeds shall determine the residence of the payee
 of  such  proceeds in accordance with regulations or instructions of the
 commissioner of taxation and finance or, in  the  absence  of  any  such
 regulations or instructions, in accordance with the address of the payee
 required  under  the  provisions  of  paragraph six of subsection (q) of
 section thirty-four hundred two of the internal revenue code.
 S. 8474                            941
 
   (b) Extension of withholding to  unemployment  compensation  benefits,
 annuity payments, and lottery winnings.
   (1) For purposes of this chapter:
   (A)  any  supplemental  unemployment  compensation  benefit paid to an
 individual to the extent includible in such individual's  city  adjusted
 gross income,
   (B)  any payment of an annuity to an individual to the extent includi-
 ble in such individual's city adjusted gross income, if at the time  the
 payment  is  made  a request that such annuity be subject to withholding
 under this chapter is in effect, and
   (C) any periodic payment (but only where such payment  is  part  of  a
 series  of  payments  extending over a period greater than one year), of
 lottery winnings by the division of the lottery,  if  at  the  time  the
 payment is made a request that such lottery winnings be subject to with-
 holding  under this chapter is in effect, shall be treated as if it were
 a payment of wages by an employer to an employee for a payroll period.
   (D) any member or employee contributions to  a  retirement  system  or
 pension  fund  picked  up  or  paid  by  the employer for members of the
 Manhattan and Bronx surface transportation authority  pension  plan  and
 treated  as  employer  contributions in determining income tax treatment
 under subdivision (h) of section four hundred fourteen of  the  Internal
 Revenue Code.
   (2)  Request  for withholding. A request that an annuity be subject to
 withholding under this chapter shall be made by the payee in writing  to
 the  person  making  the  annuity  payments,  and a request that lottery
 winnings be subject to withholding under this chapter shall be  made  by
 the  payee  in  writing  to  the  division of the lottery, in the manner
 prescribed by the commissioner of taxation and finance. A  request  that
 an  annuity be subject to withholding may, notwithstanding any provision
 of law to the contrary, be terminated by furnishing to the person making
 the payments a written statement of termination. A request that  lottery
 winnings be subject to withholding under this chapter shall not be revo-
 cable while the payee is a nonresident, and shall constitute other secu-
 rity  acceptable  to  the tax commission within the meaning of paragraph
 four of subdivision (c) of section 11-1754 of this chapter.
   Such a request for withholding or statement of termination shall  take
 effect  in such manner as the commissioner of taxation and finance shall
 provide by regulation.
   (c) Withholding exemptions.  For purposes of this section:
   (1) The number  of  city  withholding  exemptions  which  an  employee
 receiving  wages  taxable  under this chapter may claim shall not exceed
 the number of city exemptions allowed  pursuant  to  the  provisions  of
 section  11-1716  of  this  chapter and such additional city withholding
 exemptions as may be prescribed by regulations or  instructions  of  the
 commissioner of taxation and finance, taking into account the applicable
 standard  deduction  and such other factors as he or she finds appropri-
 ate.
   (2) The amount of each city withholding exemption shall be the  amount
 of  the  city  exemption  allowed  pursuant to the provisions of section
 11-1716 of this chapter.
   (3) Withholding exemption certificate. An employee shall  be  required
 to  file with his or her employer a withholding exemption certificate in
 accordance with regulations or instructions prescribed  by  the  commis-
 sioner of taxation and finance.
   § 11-1772  Information statement for employee. Every employer required
 to  deduct  and  withhold  tax  under  this chapter from the wages of an
 S. 8474                            942
 
 employee, or who would have been required so to deduct and withhold  tax
 if  the  employee  had  claimed  no more than one withholding exemption,
 shall furnish to each such employee in respect of the wages paid by such
 employer to such employee during the calendar year on or before February
 fifteenth of the succeeding year, or, if his or her employment is termi-
 nated  before  the  close of such calendar year, within thirty days from
 the date on which the last payment of  the  wages  is  made,  a  written
 statement  as  prescribed  by  the  tax commission showing the amount of
 wages paid by the employer to the  employee,  the  amount  deducted  and
 withheld  as tax, and such other information as the tax commission shall
 prescribe.
   § 11-1773  Credit for tax withheld. Wages upon which tax  is  required
 to  be withheld shall be taxable under this chapter as if no withholding
 were required, but any amount of  tax  actually  deducted  and  withheld
 under  this  chapter  in  any calendar year shall be deemed to have been
 paid to the tax commission on behalf of the person from  whom  withheld,
 and  such  person  shall be credited with having paid that amount of tax
 for the taxable year beginning in such calendar year.
   For a taxable year of less than twelve months,  the  credit  shall  be
 made under regulations of the tax commission.
   § 11-1774  Employer's return and payment of withheld taxes. (a) Gener-
 al.  Every employer required to deduct and withhold tax under this chap-
 ter  shall  file a withholding return and pay over to the tax commission
 or to a depository designated  by  the  tax  commission,  the  taxes  so
 required to be deducted and withheld, as hereafter prescribed.
   (1)  If, after having made a payroll, an employer has been required to
 deduct and withhold, but has  not  paid  over,  a  cumulative  aggregate
 amount  of  seven hundred dollars or more of tax during a calendar quar-
 ter, such employer shall file a return and  pay  over  the  tax.  If  an
 employer  was  required  to  remit a cumulative aggregate amount of less
 than fifteen thousand dollars in withholding  tax  during  the  calendar
 year  which  precedes  the previous calendar year, the tax shall be paid
 over on or before the fifth business day following the  date  of  making
 such a payroll. If an employer was required to remit a cumulative aggre-
 gate amount more than or equal to fifteen  thousand dollars in withhold-
 ing  tax  during  the calendar year which precedes the previous calendar
 year, the tax shall be paid over on or before  the  third  business  day
 following  the  date of making such a payroll. In the case of an "educa-
 tional organization" as defined in paragraph two of  subsection  (a)  of
 section  nine  of  the tax law or a "health care provider" as defined in
 paragraph four of subsection (a) of section nine of the tax law, the tax
 shall be paid over on or before the fifth  business  day  following  the
 date of making such a payroll.
   (2)  If,  at  the  close of any calendar quarter, an employer has been
 required to deduct and withhold, but has not  paid  over,  a  cumulative
 aggregate  amount  of less than seven hundred dollars of tax during such
 calendar quarter, such employer shall pay over the tax with the quarter-
 ly combined  withholding,  wage  reporting  and  unemployment  insurance
 return  required  to be filed for such quarter by paragraph four of this
 subdivision, on or before the last date prescribed by such paragraph for
 filing such return.
   (3) If an employer makes more than one payroll  per  week,  then  such
 employer  shall  determine  the  applicability of the rules described in
 paragraphs one and two of this subdivision measured by the last  payroll
 made  within  the  week by such employer; provided, however, that in any
 week in which the end of a quarter occurs between the making of payrolls
 S. 8474                            943
 
 by an employer, any tax required  to  be  deducted  and  withheld  in  a
 payroll  or payrolls made during such week prior to or on the end of the
 quarter shall be paid over. If an employer was required to remit a cumu-
 lative  aggregate  amount of less than fifteen thousand dollars in with-
 holding tax during the calendar year  preceding  the  previous  calendar
 year,  the  tax  shall  be paid over on or before the fifth business day
 following the date of making the last payroll in  such  quarter.  If  an
 employer  was  required to remit a cumulative aggregate amount more than
 or equal to fifteen thousand  dollars  in  withholding  tax  during  the
 calendar  year  preceding  the  previous calendar year, the tax shall be
 paid over on or before the third business  day  following  the  date  of
 making  the last payroll in such quarter. In the case of an "educational
 organization" as defined in paragraph two of subsection (a)  of  section
 nine  of the tax law or a "health care provider" as defined in paragraph
 four of subsection (a) of section nine of the tax law, the tax shall  be
 paid  over  on  or  before  the fifth business day following the date of
 making such a payroll.  For purposes of this paragraph, the term  "week"
 shall mean the period Sunday through Saturday.
   (4)(A)  All employers described in paragraph one of subdivision (a) of
 section 11-1771 of this subchapter, including those whose wages paid are
 not sufficient to require the withholding of tax from the wages  of  any
 of their employees, all employers required to provide the wage reporting
 information  for  the  employees described in subdivision one of section
 one hundred seventy-one-a of the tax law, and all employers  liable  for
 unemployment  insurance  contributions  or  for payments in lieu of such
 contributions pursuant to article eighteen of the labor law, shall  file
 a quarterly combined withholding, wage reporting and unemployment insur-
 ance  return  with  the department of taxation and finance detailing the
 preceding calendar quarter's withholding tax  transactions,  such  quar-
 ter's  wage reporting information, such quarter's unemployment insurance
 contributions, and such other related information as the commissioner of
 taxation and finance or the commissioner of labor,  as  applicable,  may
 prescribe. In addition, the return covering the last calendar quarter of
 each  year shall also include withholding reconciliation information for
 such calendar year. Such returns shall be filed no later than  the  last
 day  of  the  month  following  the  last  day of each calendar quarter;
 provided, however, that an  employer  may  provide  the  wage  reporting
 information  covering  the  last  calendar quarter of each year, and the
 withholding reconciliation information  for  such  year  no  later  than
 February twenty-eighth of the succeeding year.
   (B)  An  employer shall, at the time prescribed by subparagraph (A) of
 this paragraph for filing  each  quarterly  combined  withholding,  wage
 reporting  and  unemployment  insurance  return,  pay  over, in a single
 remittance, the unemployment insurance contributions and aggregate with-
 holding taxes required to be paid over with such return.
   Notwithstanding any provision of law to the contrary,  an  overpayment
 of  unemployment  insurance  contributions  or  of aggregate withholding
 taxes made by an employer with the quarterly combined withholding,  wage
 reporting  and  unemployment insurance return for a calendar quarter may
 be only credited by such employer against such employer's liability  for
 unemployment  insurance  contributions  or  aggregate withholding taxes,
 respectively.
   (5) The tax commission may, if it believes such action  necessary  for
 the protection of the revenues, require any employer to make such return
 and pay to it the tax deducted and withheld at any time, or from time to
 time.
 S. 8474                            944
 
   (6)  "Aggregate  amount"  as  used in paragraphs one, two and three of
 this subdivision means the aggregate of the  aggregate  amounts  of  New
 York  state  personal  income tax, city personal income tax on residents
 and city earnings tax on nonresidents  authorized  to  be  deducted  and
 withheld.
   (b)  Deposit in trust for tax commission.  Whenever any employer fails
 to collect, truthfully account for, pay over the tax, or make returns of
 the tax as required in this section, the  tax  commission  may  serve  a
 notice requiring such employer to collect the taxes which become collec-
 tible  after  service  of  such  notice, to deposit such taxes in a bank
 approved by the tax commission, in a separate account, in trust for  and
 payable  to  the  tax  commission, and to keep the amount of such tax in
 such account until payment over to the  tax  commission.    Such  notice
 shall  remain  in effect until a notice of cancellation is served by the
 tax commission.
   § 11-1775   Employer's liability for withheld  taxes.  Every  employer
 required  to  deduct  and withhold tax under this chapter is hereby made
 liable for such tax.   For purposes of assessment  and  collection,  any
 amount  required to be withheld and paid over to the tax commission, and
 any additions to tax, penalties and interest with respect thereto, shall
 be considered the tax of the employer.    Any  amount  of  tax  actually
 deducted  and  withheld under this chapter shall be held to be a special
 fund in trust for the tax commission.  No employee shall have any  right
 of  action against his or her employer in respect to any moneys deducted
 and withheld from his or her wages and paid over to the  tax  commission
 in compliance or in intended compliance with this chapter.
   §  11-1776    Employer's  failure to withhold. If an employer fails to
 deduct and withhold tax as required,  and  thereafter  the  tax  against
 which  such  tax  may  be  credited  is  paid, the tax so required to be
 deducted and withheld shall not be collected from the employer, but  the
 employer  shall not be relieved from liability for any penalties, inter-
 est, or additions to the tax otherwise applicable  in  respect  of  such
 failure to deduct and withhold.
   §  11-1777    Designation of third parties to perform acts required of
 employers. In case a fiduciary, agent, or other person has the  control,
 receipt,  custody,  or  disposal of, or pays the wages of an employee or
 group of employees, employed by one or more employers, the  tax  commis-
 sion,  under  regulations  promulgated by it, is authorized to designate
 such fiduciary, agent, or other person  to  perform  such  acts  as  are
 required  of  employers under this chapter and as the tax commission may
 specify. Except as may be otherwise prescribed by  the  tax  commission,
 all  provisions of law, including penalties, applicable in respect of an
 employer shall be applicable to a fiduciary, agent, or other  person  so
 designated  but, except as so provided, the employer for whom such fidu-
 ciary,  agent,  or  other  person  acts  shall  remain  subject  to  the
 provisions of law, including penalties, applicable in respect of employ-
 ers.
   §  11-1778  Liability  of third parties paying or providing for wages.
 (a) Direct payment by third party. If a lender, surety or other  person,
 who  is  not an employer with respect to an employee or group of employ-
 ees, pays wages directly to such an  employee  or  group  of  employees,
 employed  by  one  or  more  employers, or to an agent on behalf of such
 employee or employees, such lender, surety  or  other  person  shall  be
 liable  for  the amount of taxes, together with interest, required to be
 deducted and withheld from such wages by the employer.
 S. 8474                            945
 
   (b) Funds supplied to employer by third parties. If a  lender,  surety
 or  other person supplies funds to or for the account of an employer for
 the specific purpose of paying wages of the employees of such  employer,
 with actual notice or knowledge that such employer does not intend to or
 will not be able to make timely payment or deposit of the amounts of tax
 required  by  this  chapter to be deducted and withheld by such employer
 from such wages, such lender, surety or other person shall be liable for
 the amount of the taxes, together with interest, which are not paid over
 to the tax commission by such  employer  with  respect  to  such  wages.
 However,  the  liability of such lender, surety or other person shall be
 limited to an amount equal to  twenty-five  percent  of  the  amount  so
 supplied to or for the account of such employer for such purpose.
   (c) Effect of payment. Any amounts paid to the tax commission pursuant
 to this section shall be credited against the liability of the employer.
                               SUBCHAPTER 5
                       PROCEDURE AND ADMINISTRATION
   § 11-1781  Notice of deficiency. (a) General. If upon examination of a
 taxpayer's  return under this chapter the tax commission determines that
 there is a deficiency of income tax, it may mail a notice of  deficiency
 to  the  taxpayer.    If  a  taxpayer fails to file an income tax return
 required under this chapter, the tax commission is authorized  to  esti-
 mate the taxpayer's city taxable income and tax thereon, from any infor-
 mation  in  its  possession,  and  to mail a notice of deficiency to the
 taxpayer.  A notice of deficiency shall be mailed by certified or regis-
 tered mail to the taxpayer at his or her last known address in or out of
 this state.  If a husband and wife are jointly liable for tax, a  notice
 of  deficiency  may  be  a  single  joint notice, except that if the tax
 commission has been notified by either spouse that  separate  residences
 have  been  established,  then,  in  lieu  of the single joint notice, a
 duplicate original of the joint notice shall be mailed to each spouse at
 his or her last known address in or out of this state.  If the  taxpayer
 is  deceased  or under a legal disability, a notice of deficiency may be
 mailed to his or her last known address in or out of this state,  unless
 the  tax  commission has received notice of the existence of a fiduciary
 relationship with respect to the taxpayer.
   (b) Notice of deficiency as assessment. After  ninety  days  from  the
 mailing of a notice of deficiency, such notice shall be an assessment of
 the  amount of tax specified in such notice, together with the interest,
 additions to tax and penalties stated in such notice,  except  only  for
 any  such  tax or other amounts as to which the taxpayer has within such
 ninety day period filed with the tax commission a petition under section
 11-1789 of this subchapter. If the notice of deficiency is addressed  to
 a  person outside of the United States, such period shall be one hundred
 fifty days instead of ninety days.
   (c) Restrictions on assessment and levy. No assessment of a deficiency
 in tax and no levy or proceeding in court for its  collection  shall  be
 made,  begun  or  prosecuted,  except  as  otherwise provided in section
 11-1794 of this subchapter, until a notice of deficiency has been mailed
 to the taxpayer, nor until the expiration of the time for filing a peti-
 tion contesting such notice, nor, if a  petition  with  respect  to  the
 taxable  year has been filed with the tax commission, until the decision
 of the tax commission has become final.  For exception in  the  case  of
 judicial  review  of the decision of the tax commission, see subdivision
 (c) of section 11-1790 of this subchapter.
   (d) Exceptions  for  mathematical  errors.  If  a  mathematical  error
 appears on a return, including an overstatement of the credit for income
 S. 8474                            946
 
 tax  withheld  at  the source, or of the amount paid as estimated income
 tax, the tax commission shall notify the taxpayer that an amount of  tax
 in excess of that shown upon the return is due, and that such excess has
 been assessed.  Such notice shall not be considered as a notice of defi-
 ciency  for  the  purposes  of  this section, subdivision (f) of section
 11-1787 of this subchapter, limiting credits or refunds  after  petition
 to  the  tax  commission,  or subdivision (b) of section 11-1789 of this
 subchapter, authorizing the filing of a petition with the tax commission
 based on a notice of deficiency, nor shall such assessment or collection
 be prohibited by the provisions of subdivision (c) of this section.
   (e) Exceptions where federal changes, corrections or disallowances are
 not reported. (1) If the taxpayer  or  employer  fails  to  comply  with
 section 11-1759 of this chapter, instead of the mode and time of assess-
 ment provided for in subdivision (b) of this section, the tax commission
 may  assess  a  deficiency based upon such federal change, correction or
 disallowance by mailing to the taxpayer a notice of additional  tax  due
 specifying  the  amount of the deficiency, and such deficiency, together
 with the interest, additions to tax and penalties stated in such notice,
 shall be deemed assessed on the date such notice is mailed unless within
 thirty days after the mailing of such notice a  report  of  the  federal
 change,  correction  or  disallowance  or  an amended return, where such
 return was required by section 11-1759 of this chapter, is filed  accom-
 panied  by  a  statement  showing wherein such federal determination and
 such notice of additional tax due are erroneous.
   (2) Such notice shall not be considered as a notice of deficiency  for
 the purposes of this section, subdivision (f) of section 11-1787 of this
 subchapter,  limiting  credits  or  refunds  after  petition  to the tax
 commission, or subdivision (b) of section 11-1789  of  this  subchapter,
 authorizing  the filing of a petition with the tax commission based on a
 notice of deficiency, nor shall such assessment or the collection there-
 of be prohibited by the provisions of subdivision (c) of this section.
   (3) If a husband and wife are jointly liable  for  tax,  a  notice  of
 additional  tax due may be a single joint notice, except that if the tax
 commission has been notified by either spouse that  separate  residences
 have  been  established,  then, in lieu of the joint notice, a duplicate
 original of the joint notice shall be mailed to each spouse  at  his  or
 her  last  known  address  in  or out of this state.  If the taxpayer is
 deceased or under a legal disability, a notice of additional tax due may
 be mailed to his or her last known address in  or  out  of  this  state,
 unless  the  tax  commission  has  received notice of the existence of a
 fiduciary relationship with respect to the taxpayer.
   (f) Waiver of restrictions. The taxpayer shall at any time, whether or
 not a notice of deficiency has been issued, have the right to waive  the
 restrictions  on  assessment  and collection of the whole or any part of
 the deficiency by a signed notice in writing filed with the tax  commis-
 sion.
   (g)  Deficiency  defined.  For  purposes of this chapter, a deficiency
 means the amount of the tax imposed by this chapter, less (i) the amount
 shown as the tax upon the taxpayer's return, whether the return was made
 or the tax computed by such taxpayer or by the tax commission, and  less
 (ii)  the  amounts previously assessed, or collected without assessment,
 as a deficiency and plus (iii) the amount  of  any  rebates.    For  the
 purpose  of this definition, the tax imposed by this chapter and the tax
 shown on the return shall both be determined without regard to  payments
 on  account  of  estimated  tax or the credit for withholding tax; and a
 rebate means so much of an abatement, credit, refund or other repayment,
 S. 8474                            947
 
 whether or not erroneous, made on the ground that the  amounts  entering
 into  the  definition  of  a deficiency showed a balance in favor of the
 taxpayer.
   §  11-1782  Assessment. (a) Assessment date. The amount of tax which a
 return shows to be due, or the amount of tax which a return  would  have
 shown  to  be  due  but  for a mathematical error, shall be deemed to be
 assessed on the date of filing of  the  return,  including  any  amended
 return  showing  an  increase  of  tax. In the case of a return properly
 filed without computation of tax, the tax computed by the tax commission
 shall be deemed to be assessed on the date on which payment is due.   If
 a  notice  of  deficiency  has been mailed, the amount of the deficiency
 shall be deemed to be assessed on the date specified in subdivision  (b)
 of  section 11-1781 of this subchapter if no petition to the tax commis-
 sion is filed, or if a petition is filed, then  upon  the  date  when  a
 decision of the tax commission establishing the amount of the deficiency
 becomes final.  If an amended return or report filed pursuant to section
 11-1759  of  this  chapter  concedes the accuracy of a federal change or
 correction, any deficiency in tax under this chapter resulting therefrom
 shall be deemed to be assessed on the date  of  filing  such  report  or
 amended  return,  and  such  assessment  shall be timely notwithstanding
 section 11-1783 of this subchapter.  If a notice of additional tax  due,
 as  prescribed in subdivision (e) of section 11-1781 of this subchapter,
 has been mailed, the amount of the deficiency  shall  be  deemed  to  be
 assessed  on the date specified in such subdivision unless within thirty
 days after the mailing of such notice a report of the federal change  or
 correction  or  an  amended  return,  where  such return was required by
 section 11-1759 of this chapter, is filed  accompanied  by  a  statement
 showing wherein such federal determination and such notice of additional
 tax due are erroneous.  Any amount paid as a tax or in respect of a tax,
 other  than  amounts  withheld at the source or paid as estimated income
 tax, shall be deemed to be assessed upon the date of receipt of payment,
 notwithstanding any other provisions.
   (b) Other assessment powers. If the mode or time for the assessment of
 any tax under this chapter, including interest,  additions  to  tax  and
 assessable  penalties, is not otherwise provided for, the tax commission
 may establish the same by regulations.
   (c) Estimated income tax. No unpaid amount of estimated tax  shall  be
 assessed.
   (d)  Omission  of income, item of tax preference, total taxable amount
 or ordinary income portion of a lump sum distribution on return. The tax
 may be assessed at any time within six years after the return was  filed
 if:    (1)  an individual omits from his city adjusted gross income, the
 sum of his items of tax preference, or the total taxable amount or ordi-
 nary income portion of a lump sum distribution an amount properly inclu-
 dible therein which is in excess of twenty-five percent of the amount of
 city adjusted gross income, the sum of the items of  tax  preference  or
 the  total  taxable  amount  or  ordinary  income  portion of a lump sum
 distribution stated in the return, or (2) an estate or trust omits  from
 its  city adjusted gross income, the sum of its items of tax preference,
 or the total taxable amount or ordinary income portion  of  a  lump  sum
 distribution an amount properly includible therein which is in excess of
 twenty-five  percent of the amount stated in the return of city adjusted
 gross income, or the sum of the items of tax preference,  or  the  total
 taxable  amount  or  ordinary income portion of a lump sum distribution,
 respectively. For purposes of this paragraph, city adjusted gross income
 S. 8474                            948
 
 means New York adjusted gross income as determined under paragraph  four
 of subsection (e) of section six hundred one of the tax law.
   For purposes of this subdivision there shall not be taken into account
 any amount which is omitted in the return if such amount is disclosed in
 the  return,  or  in  a  statement  attached  to the return, in a manner
 adequate to apprise the commissioner of the nature  and  amount  of  the
 item  of  income,  tax  preference, the total taxable amount or ordinary
 income portion of a lump sum distribution.
   (e) Cross reference. For assessment in case of jeopardy,  see  section
 11-1794 of this subchapter.
   §  11-1783 Limitations on assessment. (a) General. Except as otherwise
 provided in this section, any tax under this chapter shall  be  assessed
 within  three  years  after  the  return  was filed, whether or not such
 return was filed on or after the date prescribed.
   (b) Time return deemed filed.
   (1) Early return. For purposes of this section a return of income tax,
 except withholding tax, filed before the last day prescribed by  law  or
 by regulations promulgated pursuant to law for the filing thereof, shall
 be deemed to be filed on such last day.
   (2)  Return  of  withholding  tax.  For purposes of this section, if a
 return of withholding tax for any period ending with or within a  calen-
 dar  year  is  filed  before  April fifteenth of the succeeding calendar
 year, such return shall be deemed to be filed on April fifteenth of such
 succeeding calendar year.
   (c) Exceptions.
   (1) Assessment at any time. The tax may be assessed at any time if:
   (A) no return is filed,
   (B) a false or fraudulent return is filed with intent to evade tax, or
   (C) the taxpayer or employer fails to comply with section  11-1759  of
 this chapter.
   (2)  Extension  by agreement. Where, before the expiration of the time
 prescribed in this section for the  assessment  of  tax,  both  the  tax
 commission  and the taxpayer have consented in writing to its assessment
 after such time, the tax may be assessed at any time prior to the  expi-
 ration  of  the  period  agreed  upon.  The period so agreed upon may be
 extended by subsequent agreements in writing made before the  expiration
 of the period previously agreed upon.
   (3)  Report  of  federal changes, corrections or disallowances. If the
 taxpayer or employer complies with section 11-1759 of this chapter,  the
 assessment,  if  not  deemed  to  have  been made upon the filing of the
 report or amended return, may be made at any time within two years after
 such report or amended return was filed. The amount of  such  assessment
 of tax shall not exceed the amount of the increase in city tax attribut-
 able  to such federal change or correction. The provisions of this para-
 graph shall not affect the time within which or the amount for which  an
 assessment may otherwise be made.
   (4)  Deficiency  attributable  to  net  operating loss carryback. If a
 deficiency is attributable to the application to the taxpayer of  a  net
 operating  loss  carryback,  it may be assessed at any time that a defi-
 ciency for the taxable year of the loss may be assessed.
   (5) Recovery of erroneous refund. An erroneous refund shall be consid-
 ered an underpayment of tax on the date made, and  an  assessment  of  a
 deficiency  arising  out  of an erroneous refund may be made at any time
 within two years from the making of the refund, except that the  assess-
 ment  may  be made within five years from the making of the refund if it
 S. 8474                            949
 
 appears that any part of the refund was induced by fraud or misrepresen-
 tation of a material fact.
   (6) Request for prompt assessment. If a return is required for a dece-
 dent or for a decedent's estate during the period of administration, the
 tax  shall  be  assessed  within  eighteen  months after written request
 therefor, made after the return is filed, by the executor, administrator
 or other person representing the estate of such decedent, but  not  more
 than  three  years  after  the  return  was  filed,  except as otherwise
 provided in this subdivision and subdivision (d) of this section.
   (7) Report  on  use  of  certain  property.  Under  the  circumstances
 described in paragraph two of subdivision (g) of section 11-1712 of this
 chapter,  the tax may be assessed within three years after the filing of
 a return reporting that property has been used for purposes  other  than
 research and development to a greater extent than originally reported.
   (8)  Report concerning waste treatment facility, air pollution control
 facility  or  eligible  business  facility.  Under   the   circumstances
 described  in  paragraph  three of subdivision (h) of section 11-1712 of
 this chapter, the tax may be assessed within three years after filing of
 the return containing the information required by such paragraph, or, if
 a certificate of compliance in  respect  to  an  air  pollution  control
 facility  shall  be revoked, within three years after the tax commission
 shall receive notice of such revocation from the taxpayer or as required
 by section 19-0309 of  the  environmental  conservation  law,  whichever
 notice is received earlier.
   (9)  Except  as otherwise provided in paragraph three of this subdivi-
 sion, or as otherwise provided in this section where a longer period  of
 time  may apply, if a taxpayer files an amended return, an assessment of
 tax, if not deemed to have been made upon  the  filing  of  the  amended
 return,  including recovery of a previously paid refund, attributable to
 a change or correction on the amended return from a prior return may  be
 made at any time within one year after such amended return is filed.
   (d)  Omission  of  income,  total  taxable  amount  or ordinary income
 portion of a lump sum distribution on return. The tax may be assessed at
 any time within six years after the return was filed if:
   (1) an individual omits from his city adjusted gross income the  total
 taxable  amount or ordinary income portion of a lump sum distribution an
 amount properly includible therein which is  in  excess  of  twenty-five
 percent of the amount of city adjusted gross income or the total taxable
 amount  or  ordinary income portion of a lump sum distribution stated in
 the return, or
   (2) an estate or trust omits from its city adjusted gross  income,  or
 the  total  taxable  amount  or  ordinary  income  portion of a lump sum
 distribution an amount properly includible therein which is in excess of
 twenty-five percent of the amount stated in the return of city  adjusted
 gross  income, or the total taxable amount or ordinary income portion of
 a lump sum distribution, respectively. For purposes of  this  paragraph,
 city  adjusted  gross  income  means  New  York adjusted gross income as
 determined under paragraph four of subsection (e) of section six hundred
 one of the tax law.
   For purposes of this subdivision there shall not be taken into account
 any amount which is omitted in the return if such amount is disclosed in
 the return, or in a statement  attached  to  the  return,  in  a  manner
 adequate  to  apprise  the  commissioner of the nature and amount of the
 item of income, the total taxable amount or ordinary income portion of a
 lump sum distribution.
 S. 8474                            950
 
   (e) Suspension of running of period of limitation. The running of  the
 period  of  limitations  on  assessment  or  collection  of tax or other
 amount, or of a transferee's liability, shall, after the  mailing  of  a
 notice  of  deficiency, be suspended for the period during which the tax
 commission  is  prohibited  under  subdivision (c) of section 11-1781 of
 this subchapter from making the assessment or from collecting by levy.
   § 11-1784  Interest on underpayment.  (a) General. If  any  amount  of
 income  tax  is  not  paid on or before the last date prescribed in this
 chapter for payment, interest on such amount at  the  underpayment  rate
 set  by  the  commissioner  of  taxation and finance pursuant to section
 11-1797 of this subchapter, or if no rate is set, at the rate  of  seven
 and  one-half  percent  per annum shall be paid for the period from such
 last date to the date paid, whether or not any  extension  of  time  for
 payment  was  granted. Interest under this subdivision shall not be paid
 if the amount thereof is less than one dollar. If the time for filing of
 a return of tax withheld by an employer is extended, the employer  shall
 pay  interest  for the period for which the extension is granted and may
 not charge such interest to the employee.
   (b) Exception as to estimated tax. This section shall not apply to any
 failure to pay estimated tax.
   (c) Exception for mathematical error. No interest shall be imposed  on
 any underpayment of tax due solely to mathematical error if the taxpayer
 files a return within the time prescribed in this chapter, including any
 extension  of  time,  and  pays  the amount of underpayment within three
 months after the due date of such return, as it may be extended.
   (d)  Suspension  of  interest  on  deficiencies.  If   a   waiver   of
 restrictions on assessment of a deficiency has been filed by the taxpay-
 er,  and  if notice and demand by the tax commission for payment of such
 deficiency is not made within thirty days after the filing of such waiv-
 er, interest shall not be imposed on  such  deficiency  for  the  period
 beginning  immediately after such thirtieth day and ending with the date
 of notice and demand.
   (e) Tax reduced by carryback. If the amount of  tax  for  any  taxable
 year  is  reduced by reason of a carryback of a net operating loss, such
 reduction in tax shall not affect the computation of interest under this
 section for the period ending with the filing date for the taxable  year
 in which the net operating loss arises. Such filing date shall be deter-
 mined without regard to extensions of time to file.
   (f) Interest treated as tax. Interest under this section shall be paid
 upon  notice and demand and shall be assessed, collected and paid in the
 same manner as income tax. Any reference in  this  chapter  to  the  tax
 imposed  by  this  chapter  shall  be  deemed  also to refer to interest
 imposed by this section on such tax.
   (g) Interest on penalties or  additions  to  tax.  Interest  shall  be
 imposed under subdivision (a) of this section in respect of any assessa-
 ble  penalty or addition to tax only if such assessable penalty or addi-
 tion to tax is not paid within twenty-one calendar days from the date of
 the notice and demand therefor under subdivision (b) of section  11-1792
 of  this  subchapter,  ten  business  days  if the amount for which such
 notice and demand  is  made  equals  or  exceeds  one  hundred  thousand
 dollars,  and in such case interest shall be imposed only for the period
 from such date of the notice and demand to the date of payment.
   (h) Payment within specified period after notice and demand. If notice
 and demand is made for payment of any amount under  subdivision  (b)  of
 section  11-1792  of  this subchapter, and if such amount is paid within
 twenty-one calendar days, ten business days if the amount for which such
 S. 8474                            951
 
 notice and demand  is  made  equals  or  exceeds  one  hundred  thousand
 dollars,  after  the date of such notice and demand, interest under this
 section on the amount so paid shall not be imposed for the period  after
 the date of such notice and demand.
   (i) Limitation on assessment and collection. Interest prescribed under
 this section may be assessed and collected, at any time during the peri-
 od  within  which the tax or other amount to which such interest relates
 may be assessed and collected, respectively.
   (j) Interest on erroneous refund. Any portion of tax or  other  amount
 which  has  been  erroneously  refunded, and which is recoverable by the
 commissioner of taxation and finance, shall bear interest at the  under-
 payment  rate  set  by  such commissioner pursuant to section 11-1797 of
 this subchapter, or if no rate is set, at the rate of seven and one-half
 percent per annum from the date of the payment of the refund,  but  only
 if  it  appears  that  any  part of the refund was induced by fraud or a
 misrepresentation of a material fact.
   (k) Satisfaction by credits. If any portion of a tax is  satisfied  by
 credit  of  an overpayment, then no interest shall be imposed under this
 section on the portion of the tax so satisfied  for  any  period  during
 which,  if the credit had not been made, interest would have been allow-
 able with respect to such overpayment.
   § 11-1785  Additions to tax and civil penalties. (a) (1)   Failure  to
 file  tax return. (A) In case of failure to file a tax return under this
 chapter on or before the prescribed date, determined with regard to  any
 extension  of  time  for filing, unless it is shown that such failure is
 due to reasonable cause and not due to willful neglect, there  shall  be
 added  to  the  amount  required  to be shown as tax on such return five
 percent of the amount of such tax if the failure is for  not  more  than
 one  month, with an additional five percent for each additional month or
 fraction thereof during which  such  failure  continues,  not  exceeding
 twenty-five percent in the aggregate.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to  any extension of time for filing, unless it is shown that such fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion to tax hereunder shall not be less than the lesser of  one  hundred
 dollars or one hundred percent of the amount required to be shown as tax
 on such return.
   (C)  For  purposes of this paragraph, the amount of tax required to be
 shown on the return shall be reduced by the amount of any  part  of  the
 tax  which  is  paid on or before the date prescribed for payment of the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2)  Failure to pay tax shown on return. In case of failure to pay the
 amounts shown as tax on any return required to be filed under this chap-
 ter on or before the prescribed date,  determined  with  regard  to  any
 extension  of  time for payment, unless it is shown that such failure is
 due to reasonable cause and not due to willful neglect, there  shall  be
 added  to the amount shown as tax on such return one-half of one percent
 of the amount of such tax if the failure is not for more than one month,
 with an additional one-half of one percent for each additional month  or
 fraction  thereof  during  which  such  failure continues, not exceeding
 twenty-five percent in the aggregate.  For the purpose of computing  the
 addition  for  any month, the amount of tax shown on the return shall be
 reduced by the amount of any part of the tax which is paid on or  before
 the  beginning of such month and by the amount of any credit against the
 S. 8474                            952
 
 tax which may be claimed upon the return.  If the amount of tax required
 to be shown on a return is less than the amount shown  as  tax  on  such
 return,  this  paragraph  shall  be  applied  by substituting such lower
 amount.
   (3)  Failure  to  pay  tax  required to be shown on return. In case of
 failure to pay any amount in respect of any tax required to be shown  on
 a  return required to be filed under this chapter which is not so shown,
 including an assessment made pursuant  to  subdivision  (a)  of  section
 11-1782  of this subchapter, within twenty-one calendar days of the date
 of a notice and demand therefor, ten business days  if  the  amount  for
 which such notice and demand is made equals or exceeds one hundred thou-
 sand  dollars, unless it is shown that such failure is due to reasonable
 cause and not due to willful neglect, there shall be added to the amount
 of tax stated in such notice and demand one-half of one percent of  such
 tax  if  the  failure is not for more than one month, with an additional
 one-half of one percent for each additional month  or  fraction  thereof
 during  which  such failure continues, not exceeding twenty-five percent
 in the aggregate. For the purpose of  computing  the  addition  for  any
 month,  the  amount  of  tax  stated  in  the notice and demand shall be
 reduced by the amount of any part of the tax which is  paid  before  the
 beginning of such month.
   (4)    Limitations  on additions. (A)  With respect to any return, the
 amount of the addition under paragraph one of this subdivision shall  be
 reduced by the amount of the addition under paragraph two of this subdi-
 vision  for any month to which an addition applies under both paragraphs
 one and two of this subdivision. In any case described  in  subparagraph
 (B)  of  such paragraph one of this subdivision, the amount of the addi-
 tion under such paragraph one shall not  be  reduced  below  the  amount
 provided in such subparagraph.
   (B)    With  respect to any return, the maximum amount of the addition
 permitted under paragraph three of this subdivision shall be reduced  by
 the  amount  of  the  addition  under paragraph one of this subdivision,
 determined without regard to subparagraph (B) of such  paragraph,  which
 is  attributable  to the tax for which the notice and demand is made and
 which is not paid within ten days of such notice and demand.
   (b) Deficiency due to negligence. (1) If any part of a  deficiency  is
 due  to  negligence or intentional disregard of this chapter or rules or
 regulations established pursuant to such chapter, but without intent  to
 defraud, there shall be added to the tax an amount equal to five percent
 of the deficiency.
   (2)  There shall be added to the tax, in addition to the amount deter-
 mined under paragraph one of this subdivision, an amount equal to  fifty
 percent of the interest payable under section 11-1784 of this subchapter
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to the negligence or intentional  disre-
 gard referred to in such paragraph, for the period beginning on the last
 date  prescribed  by  law  for  payment of such underpayment, determined
 without regard to any extension, and ending on the date of  the  assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
   (3)  If  any payment is shown on a return made by a payor with respect
 to dividends, patronage dividends and interest under subsection  (a)  of
 section  six  thousand forty-two, subsection (a) of section six thousand
 forty-four or subsection (a) of section six thousand forty-nine  of  the
 internal  revenue code, respectively, and the payee fails to include any
 portion of such payment in city adjusted gross income, any portion of an
 underpayment attributable to such failure shall be treated, for purposes
 S. 8474                            953
 
 of this subdivision, as due to negligence in the absence  of  clear  and
 convincing  evidence  to the contrary.   If any penalty is imposed under
 this subdivision by reason of this paragraph, the amount of the  penalty
 imposed  by  paragraph  one of this subdivision shall be five percent of
 the portion of the underpayment which is  attributable  to  the  failure
 described in this paragraph.
   (c)  Failure  by individual to pay estimated income tax.  (1) Addition
 to the tax. Except as otherwise provided in this subdivision and  subdi-
 vision (d) of this section, in the case of any underpayment of estimated
 tax by an individual, there shall be added to the tax under this chapter
 for  the  taxable year an amount determined by applying the underpayment
 rate established under section 11-1797 of this subchapter, or if no rate
 is set, at the rate of seven and one-half  percent  per  annum,  to  the
 amount  of  the  underpayment  for  the period of the underpayment. Such
 period shall run from the due date for the required installment  to  the
 earlier  of the fifteenth day of the fourth month following the close of
 the taxable year or, with respect to any portion  of  the  underpayment,
 the date on which such portion is paid. For purposes of determining such
 date,  a  payment  of  estimated  tax  shall  be credited against unpaid
 required installments in  the  order  in  which  such  installments  are
 required  to be paid. There shall be four required installments for each
 taxable year, due on  April  fifteenth,  June  fifteenth  and  September
 fifteenth of such taxable year and on January fifteenth of the following
 taxable year.
   (2)  Amount  of  underpayment.   For purposes of paragraph one of this
 subdivision, the amount of the underpayment shall be the excess  of  the
 required installment over the amount, if any, of the installment paid on
 or before the due date for the installment.
   (3)  Required installment. (A) Except as provided in paragraph four of
 this subdivision, the amount of any required installment shall be  twen-
 ty-five percent of the required annual payment.
   (B) The required annual payment is the lesser of
   (i)  ninety  percent  of  the  tax shown on the return for the taxable
 year, or, if no return is filed, ninety percent  of  the  tax  for  such
 year, or
   (ii)  one  hundred percent of the tax shown on the return of the indi-
 vidual for the preceding taxable year. Provided, however, that  the  tax
 shown  on  such return for taxable years beginning in two thousand eight
 shall be calculated as if paragraph three of subdivision (f) of  section
 11-1715 of this chapter was in effect for taxable years beginning in two
 thousand eight. Provided, however, that the tax shown on such return for
 taxable  years  beginning in two thousand nine shall be calculated as if
 paragraph two of subdivision (g) of section 11-1715 of this chapter  was
 in effect for taxable years beginning in two thousand nine.
   Clause  (ii)  of  this  subparagraph  shall not apply if the preceding
 taxable year was not a taxable year of twelve months or if the  individ-
 ual did not file a return for such preceding taxable year.
   (C) Limitation on use of preceding year's tax.
   (i)  General. If the city adjusted gross income shown on the return of
 the individual for the preceding taxable year exceeds one hundred  fifty
 thousand  dollars,  clause  (ii)  of  subparagraph (B) of this paragraph
 shall be applied by substituting "one  hundred  ten  percent"  for  "one
 hundred percent".
   (ii)  Separate  returns.  In  the  case of a husband and wife who file
 separate returns pursuant to subdivision (b) of section 11-1751 of  this
 chapter  for the taxable year for which the amount of the installment is
 S. 8474                            954
 
 being determined, clause (i) of this subparagraph shall  be  applied  by
 substituting  "seventy-five  thousand  dollars"  for  "one hundred fifty
 thousand dollars".
   (4)  Annualized  income installment.   (A) In general.  In the case of
 any required installment, if the individual establishes that the annual-
 ized income installment determined under subparagraph (B) of this  para-
 graph  is  less than the amount determined under paragraph three of this
 subdivision, the annualized income installment  shall  be  the  required
 installment.  Any reduction in a required installment resulting from the
 application  of  this subparagraph shall be recaptured by increasing the
 amount of the next required installment determined under paragraph three
 of this subdivision by the amount of such reduction, and  by  increasing
 successive required installments as necessary to effect full recapture.
   (B)  Determination  of  annualized income installment.  In the case of
 any required installment,  the  annualized  income  installment  is  the
 excess,  if  any, of an amount equal to the applicable percentage of the
 tax for the taxable year computed by placing on an annualized basis  the
 taxable income for months in the taxable year ending before the due date
 for  the  installment,  over  the aggregate amount of any prior required
 installments for the taxable year.  The applicable percentage of the tax
 shall be twenty-two and one-half  percent  in  the  case  of  the  first
 installment,  forty-five  percent in the case of the second installment,
 sixty-seven and one-half percent in the case of  the  third  installment
 and  ninety  percent in the case of the fourth installment, and shall be
 computed without regard to any increase in the rates applicable  to  the
 taxable year unless such increase was enacted at least thirty days prior
 to the due date of the installment.
   (5)  Definitions  and special rules.   (A)  Definition of the term tax
 and application of credits against tax.  For purposes of  this  subdivi-
 sion  and  subdivision (d) of this section, the term "tax" means the tax
 imposed under this chapter minus the credits against tax  allowed  under
 this  chapter, other than the credit under section 11-1773 of this chap-
 ter, relating to tax withheld  on  wages.    The  credit  allowed  under
 section  11-1773  of this chapter for the taxable year shall be deemed a
 payment of estimated tax, and an equal part  of  such  amount  shall  be
 deemed  paid  on each installment due date for such taxable year, unless
 the taxpayer establishes the dates on which all  amounts  were  actually
 withheld, in which case the amounts so withheld shall be deemed payments
 of  estimated tax on the dates on which such amounts were actually with-
 held.
   (B) Special rule where return filed on or before January thirty-first.
  If, on or before January thirty-first of the  following  taxable  year,
 the  taxpayer  files  a return for the taxable year and pays in full the
 amount computed on the return as payable, then no addition to tax  shall
 be  imposed  under paragraph one of this subdivision with respect to any
 underpayment of the fourth required installment for the taxable year.
   (C) Special rules for farmers and  fishermen.  For  purposes  of  this
 subdivision,  if  an individual is a farmer or fisherman for any taxable
 year there shall be only one required installment for the taxable  year,
 due  on  January  fifteenth  of  the following taxable year in an amount
 equal to the required annual payment determined under paragraph three of
 this subdivision by substituting sixty-six and  two-thirds  percent  for
 ninety percent and without regard to subparagraph (C) of paragraph three
 of this subdivision. Subparagraph (B) of this paragraph shall be applied
 by substituting March first for January thirty-first and by treating the
 required  installment  under  this  subparagraph  as the fourth required
 S. 8474                            955
 
 installment. An individual is a farmer or fisherman for any taxable year
 if the individual's  federal  gross  income  from  farming  or  fishing,
 including oyster farming, for the taxable year is at least two-thirds of
 the  total federal gross income from all sources for the taxable year or
 if such individual's federal  gross  income  from  farming  or  fishing,
 including  oyster farming, shown on the return of the individual for the
 preceding taxable year is at least two-thirds of the total federal gross
 income from all sources shown on such return.
   (D) Fiscal years.   In applying this subdivision  to  a  taxable  year
 beginning  on  any date other than January first, there shall be substi-
 tuted, for the months specified in this subdivision,  the  months  which
 correspond thereto.
   (E)  Short taxable year.  This subdivision shall be applied to taxable
 years  of  less  than  twelve  months  in  accordance  with  regulations
 prescribed by the tax commission.
   (F)  Joint  estimated tax of husband and wife.  A husband and wife may
 make the required annual payment determined  under  paragraph  three  of
 this subdivision as if they were one taxpayer, in which case the liabil-
 ity  under  paragraph  one of this subdivision with respect to the esti-
 mated tax shall be joint and several.  No such joint payment may be made
 if husband and wife are separated under a decree of divorce or  separate
 maintenance,  or  if  they  have  different  taxable years.   If a joint
 payment is made but husband and wife determine their  taxes  under  this
 chapter  separately,  the  estimated tax for such year may be treated as
 the estimated tax of either husband or wife, or may be  divided  between
 them, as they may elect.
   (6)  Trusts  and  certain estates. (A) General. This subdivision shall
 apply to any trust or estate except as provided in subparagraphs (B) and
 (C) of this paragraph.
   (B) Exception for estates and certain trusts. This  subdivision  shall
 not  apply  with  respect to any taxable year ending before the date two
 years after the date of the decedent's death to (i) the estate  of  such
 decedent  or (ii) any trust all of which was treated, under subpart E of
 part I of subchapter J of chapter one of the internal revenue  code,  as
 owned  by the decedent and to which the residue of the decedent's estate
 will pass under his will, or, if no will is admitted to  probate,  which
 is  the trust primarily responsible for paying debts, taxes and expenses
 of administration.
   (C) Special rule for annualizations. In the  case  of  any  estate  or
 trust,  subparagraph  (B) of paragraph four of this subdivision shall be
 applied by substituting "ending before the date one month before the due
 date for the installment" for  "ending  before  the  due  date  for  the
 installment".
   (D) In the case of a trust, the trustee may elect to treat any portion
 of a payment of estimated tax made by such trust for any taxable year of
 the  trust  as a payment made by a beneficiary of such trust. Any amount
 so treated shall be treated as paid or credited to  the  beneficiary  on
 the last day of such taxable year, and for purposes of this subdivision,
 the amount so treated shall not be treated as a payment of estimated tax
 made  by  the  trust, but shall be treated as a payment of estimated tax
 made by such beneficiary on the January fifteenth following the  end  of
 the trust's taxable year.
   (E) An election under subparagraph (D) of this paragraph shall be made
 on or before the sixty-fifth day after the close of the taxable year and
 in  such  manner  as  the  commissioner  of  taxation  and  finance  may
 prescribe.
 S. 8474                            956
 
   (F) Extension to last year of estate. In the case of  a  taxable  year
 reasonably expected to be the last taxable year of an estate, any refer-
 ence  in  subparagraph (D) of this paragraph to a trust shall be treated
 as including a reference to an estate, and the fiduciary of  the  estate
 shall be treated as the trustee.
   (d)  Exceptions to addition to tax for failure to pay estimated income
 tax.
   (1) Where tax is small amount.  No addition to tax  shall  be  imposed
 under  subdivision  (c)  of this section for any taxable year if the tax
 shown on the return for such taxable year, or, if no  return  is  filed,
 the  tax,  reduced by the credit allowable under section 11-1773 of this
 chapter, is less than one hundred dollars.
   (2) Where no tax liability for preceding taxable year.  No addition to
 tax shall be imposed under subdivision (c) of this section for any taxa-
 ble year if the preceding taxable year was  a  taxable  year  of  twelve
 months,  the  individual  did  not have any liability for tax under this
 chapter for the preceding taxable  year  and  throughout  the  preceding
 taxable year the individual was a resident of this city or a nonresident
 who had city adjusted gross income.
   (3)  Installment  due  on or after individual's death.  No addition to
 tax shall be imposed under subdivision (c) of this section with  respect
 to any installment due on or after the individual's death.
   (4)  Waiver  in  certain cases.   (A) In general.   No addition to tax
 shall be imposed under subdivision (c) of this section with  respect  to
 any  underpayment  to  the  extent the tax commission determines that by
 reason of casualty, disaster or other unusual circumstances the  imposi-
 tion  of  such  addition  to  tax  would  be  against  equity  and  good
 conscience.
   (B) Newly retired or disabled individuals.  No addition to  tax  shall
 be  imposed  under  subdivision  (c) of this section with respect to any
 underpayment if the tax commission determines that in the  taxable  year
 for  which estimated payments were required to be made or in the taxable
 year preceding such taxable  year  the  taxpayer  retired  after  having
 attained  age  sixty-two  or became disabled, and that such underpayment
 was due to reasonable cause and not to willful neglect.
   (e) Deficiency due to fraud.  (1) If any part of a deficiency  is  due
 to  fraud,  there  shall  be  added  to the tax an amount equal to fifty
 percent of the deficiency.
   (2) There shall be added to the tax, in addition to the amount  deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under section 11-1784 of this subchapter
 with respect to the portion of the underpayment described in such  para-
 graph  one  which  is attributable to fraud, for the period beginning on
 the last day prescribed by law for payment of such underpayment,  deter-
 mined  without  regard  to  any extension, and ending on the date of the
 assessment of the tax, or, if earlier, the date of the  payment  of  the
 tax.
   (3) The addition to tax under this subdivision shall be in lieu of any
 other addition to tax imposed by subdivision (a) or (b) of this section.
   (4)  In the case of a joint return under section 11-1751 of this chap-
 ter, this subdivision shall not apply with  respect  to  the  tax  of  a
 spouse  unless some part of the underpayment is due to the fraud of such
 spouse.
   (f)   Non-willful failure to pay withholding  tax.  If  any  employer,
 without intent to evade or defeat any tax imposed by this chapter or the
 payment  thereof,  shall fail to make a return and pay a tax withheld by
 S. 8474                            957
 
 him or her at the time required by or under the  provisions  of  section
 11-1774  of this chapter, such employer shall be liable for such tax and
 shall pay the same together with interest thereon and  the  addition  to
 tax  provided in subdivision (a)  of this section, and such interest and
 addition to tax shall not be charged to or collected from  the  employee
 by  the  employer.    The  tax commission shall have the same rights and
 powers for the collection of such tax,  interest  and  addition  to  tax
 against  such  employer  as  are  now prescribed by this chapter for the
 collection of tax against an individual taxpayer.
   (g)  Willful failure to collect and pay over tax. Any person  required
 to collect, truthfully account for, and pay over the tax imposed by this
 chapter  who  willfully  fails to collect such tax or truthfully account
 for and pay over such tax or willfully attempts in any manner  to  evade
 or  defeat  the  tax or the payment thereof, shall, in addition to other
 penalties provided by law, be liable to a penalty  equal  to  the  total
 amount  of  the  tax  evaded, or not collected, or not accounted for and
 paid over.  No addition to tax under subdivision  (b)  or  (e)  of  this
 section  shall  be  imposed  for  any  offense to which this subdivision
 applies.  The tax commission shall have the power, in its discretion, to
 waive, reduce or compromise any penalty under this subdivision.
   (h) Failure to file certain information returns. (1) Except as  other-
 wise  provided  in  this  paragraph,  in  case of each failure to file a
 statement of a payment to another person, required  under  authority  of
 subdivision (d) of section 11-1758 of this chapter, relating to informa-
 tion  at  source,  including  the duplicate statement of tax withheld on
 wages, on the date prescribed therefor, determined with  regard  to  any
 extension  of  time  for filing, unless it is shown that such failure is
 due to reasonable cause and not to willful neglect,  there  shall,  upon
 notice  and  demand by the tax commission and in the same manner as tax,
 be paid by the person so failing to file the  statement,  a  penalty  of
 fifty  dollars  for  each  statement  not so filed, but the total amount
 imposed on the delinquent person for all such failures during any calen-
 dar year shall not exceed ten thousand dollars.
   (2) If any partnership or S corporation required to file a  return  or
 report under subdivision (c) of section 11-1758 of this chapter or under
 section  11-1759 of this chapter for any taxable year fails to file such
 return or report at the time prescribed therefor, determined with regard
 to any extension of time for filing, or files a return or  report  which
 fails  to  show  the  information required under such subdivision (c) or
 section 11-1759 of this chapter, unless it is shown that such failure is
 due to reasonable cause and not due to  willful  neglect,  there  shall,
 upon  notice  and  demand  by the commissioner and in the same manner as
 tax, be paid by the partnership or S  corporation  a  penalty  for  each
 month, or fraction thereof, during which such failure continues, but not
 to  exceed  five months. The amount of such penalty for any month is the
 product of fifty dollars, multiplied by the number of  partners  in  the
 partnership  or shareholders in the S corporation during any part of the
 taxable year who were subject to tax under this chapter during any  part
 of such taxable year.
   (i)    Additional penalty. Any person who with fraudulent intent shall
 fail to pay, or to deduct or withhold and pay,  any  tax,  or  to  make,
 render,  sign or certify any return, or to supply any information within
 the time required by or under this chapter, shall be liable  to  penalty
 of  not more than one thousand dollars, in addition to any other amounts
 required under this chapter, to be imposed, assessed  and  collected  by
 the  tax  commission.    The tax commission shall have the power, in its
 S. 8474                            958
 
 discretion, to waive, reduce or compromise any penalty under this subdi-
 vision.
   (j)  Fraudulent statement or failure to furnish statement to employee.
 In  addition  to  any  criminal  penalties  provided  by law, any person
 required under the provisions of section  11-1772  of  this  chapter  to
 furnish  a  statement to an employee, who willfully furnishes a false or
 fraudulent statement, or who willfully fails to furnish a  statement  in
 the  manner,  at  the  time,  and showing the information required under
 section 11-1772 of this chapter, or regulations  prescribed  thereunder,
 shall  for  each such failure be subject to a penalty under this chapter
 of fifty dollars.
   (k)   Failure to supply identifying numbers.  If  any  person  who  is
 required  by  regulations  prescribed  under  subdivision (b) of section
 11-1758 of this chapter:
   (1)  to include his or her identifying number in  any  return,  state-
 ment, or other document;
   (2)  to furnish his or her identifying number to another person; or
   (3)  to  include  in any return, statement or other document made with
 respect to another person the identifying number of such  other  person,
 fails  to  comply  with  such requirement at the time prescribed by such
 regulations, such person shall, unless it is shown that such failure  is
 due to reasonable cause and not due to willful neglect, pay a penalty of
 five  dollars  for  each such failure described in paragraph one of this
 subdivision and fifty dollars for each such failure described  in  para-
 graph two of this subdivision, and this paragraph, except that the total
 amount  imposed on such person for all such failures during any calendar
 year shall not exceed ten thousand dollars; except that for  failure  to
 include his or her own identification number in any return, statement or
 other  document,  such  penalty  shall not be imposed unless such person
 shall have failed to supply his or her identification number to the  tax
 commission within thirty days after demand therefor.
   (1)  Additions  treated  as  tax.  The  additions to tax and penalties
 provided by this section shall be paid upon notice and demand and  shall
 be  assessed,  collected  and  paid in the same manner as taxes, and any
 reference in this chapter to income tax or tax imposed by this  chapter,
 shall  be  deemed  also  to  refer to the additions to tax and penalties
 provided by this section.  For  purposes  of  section  11-1781  of  this
 subchapter, this subdivision shall not apply to:
   (1)  any  addition to tax under subdivision (a) of this section except
 as to that portion attributable to a deficiency;
   (2) any addition to tax under subdivision (c) of this section;
   (3) any penalty under subdivision (h) of this section  and  any  addi-
 tional penalty under subdivision (i) of this section; and
   (4)  any  penalties under subdivisions (j), (k), (q), (r), (s) and (t)
 of this section.
   (m)  Determination of deficiency. For purposes of subdivisions (b) and
 (e)  of this section, the amount shown as the tax by the  taxpayer  upon
 his  or her return shall be taken into account in determining the amount
 of the deficiency only if such return was filed on or  before  the  last
 day  prescribed for the filing of such return, determined with regard to
 any extension of time for such filing.
   (n)  Person defined. For purposes of subdivisions (g), (i),  (o),  (q)
 and (r)  of this section, the term person includes an individual, corpo-
 ration,  partnership  or  limited  liability  company  or  an officer or
 employee of any corporation, including a  dissolved  corporation,  or  a
 member  or employee of any partnership, or a member, manager or employee
 S. 8474                            959
 
 of a limited liability company, who as such officer,  employee,  manager
 or  member  is  under  a duty to perform the act in respect of which the
 violation occurs.
   (o)    Failure  to  make  deposits of taxes. In case of failure by any
 person required by this chapter, or by regulations of the tax commission
 under this chapter, to deposit  on  the  date  prescribed  therefor  any
 amount  of tax imposed by this chapter in a depository authorized pursu-
 ant to subdivision (a) of section 11-1792 of this subchapter to  receive
 such deposits, unless it is shown that such failure is due to reasonable
 cause  and  not  due  to willful neglect, there shall be imposed on such
 person a penalty of five percent of the amount of the underpayment.  For
 purposes of this subdivision the term "underpayment" means the excess of
 the amount of the tax required to be so deposited over  the  amount,  if
 any, thereof, deposited on or before the date prescribed therefor.
   (p) Substantial understatement of liability. If there is a substantial
 understatement  of income tax for any taxable year, there shall be added
 to the tax an amount equal to ten percent of the amount of any underpay-
 ment attributable to such understatement. For purposes of this  subdivi-
 sion,  there is a substantial understatement of income tax for any taxa-
 ble year if the amount  of  the  understatement  for  the  taxable  year
 exceeds  the  greater  of ten percent of the tax required to be shown on
 the return for the taxable year, or two thousand dollars.  For  purposes
 of  this  subdivision, the term "understatement" means the excess of the
 amount of the tax required to be shown on the  return  for  the  taxable
 year,  over  the  amount of the tax imposed which is shown on the return
 reduced by any rebate, within the meaning of subdivision (g) of  section
 11-1781  of  this subchapter. The amount of such understatement shall be
 reduced by that portion of the understatement which is  attributable  to
 the  tax  treatment  of  any  item  by  the  taxpayer if there is or was
 substantial authority for such treatment, or any item  with  respect  to
 which  the  relevant  facts  affecting  the  item's  tax  treatment  are
 adequately disclosed in the return or in a  statement  attached  to  the
 return.  The tax commission may waive all or any part of the addition to
 tax provided by this subdivision on a showing by the taxpayer that there
 was reasonable cause for the understatement, or part thereof,  and  that
 the taxpayer acted in good faith.
   (q)  Frivolous  tax returns.  If any individual files what purports to
 be a return of any tax imposed  by  this  chapter  but  which  does  not
 contain information on which the substantial correctness of the self-as-
 sessment  may  be judged, or contains information that on its face indi-
 cates that the self-assessment  is  substantially  incorrect;  and  such
 conduct  is  due  to  a position which is frivolous, or an intent, which
 appears on the purported return, to delay or impede  the  administration
 of  this chapter, then such individual shall pay a penalty not exceeding
 five hundred dollars.  This penalty shall be in addition  to  any  other
 penalty provided by law.
   (r)  Aiding or assisting in the giving of fraudulent returns, reports,
 statements or other documents.  (1) Any person who, with the intent that
 tax be evaded, shall, for a fee or other compensation or as an  incident
 to  the  performance  of  other  services for which such person receives
 compensation, aid or assist in, or procure, counsel, or advise the prep-
 aration or presentation under, or in connection with any matter  arising
 under  this  chapter  of  any  return, report, declaration, statement or
 other document which is fraudulent or false as to any  material  matter,
 or  supply  any  false  or  fraudulent  information, whether or not such
 falsity of fraud is with the knowledge or consent of the person  author-
 S. 8474                            960
 
 ized  or required to present such return, report, declaration, statement
 or other document  shall  pay  a  penalty  not  exceeding  one  thousand
 dollars.
   (2)  For  purposes  of  paragraph  one  of  this subdivision, the term
 "procures" includes ordering, or otherwise causing, a subordinate to  do
 an  act, and knowing of, and not attempting to prevent, participation by
 a subordinate in an act.  The term "subordinate" means any other person,
 whether or not a director, officer, employee, or agent of  the  taxpayer
 involved, over whose activities the person has direction, supervision or
 control.
   (3)  For  purposes  of  paragraph  one  of  this subdivision, a person
 furnishing typing, reproducing,  or  other  mechanical  assistance  with
 respect  to  a document shall not be treated as having aided or assisted
 in the preparation of such document by reason of such assistance.
   (4) The penalty imposed by this subdivision shall be  in  addition  to
 any other penalty provided by law.
   (s) False information with respect to withholding.  In addition to any
 criminal  penalty  provided  by law, if any individual makes a statement
 under section 11-1771 of this chapter which results in a decrease in the
 amounts deducted and withheld under this chapter, and  as  of  the  time
 such  statement  was made, there was no reasonable basis for such state-
 ment, such individual shall pay a penalty of five  hundred  dollars  for
 such  statement.    The  tax  commission shall waive the penalty imposed
 under this subdivision if the taxes imposed with respect to the individ-
 ual under this chapter for the taxable year are equal to  or  less  than
 the  sum  of the credits against such taxes allowed by this chapter, and
 the payments of estimated tax which are considered payments  on  account
 of such taxes.
   (t) Failure of tax return preparer to conform to certain requirements.
 (1)  Failure to sign return or claim for refund. Any individual who is a
 tax return preparer with respect to any return or claim for refund,  who
 is  required  pursuant  to  paragraph  one of subdivision (g) of section
 11-1758 of this chapter to sign such return or claim for refund, and who
 fails to comply with such requirement with respect  to  such  return  or
 claim  for  refund,  shall  be subject to a penalty of fifty dollars for
 each such failure, unless it is  shown  that  such  failure  is  due  to
 reasonable  cause  and  not due to willful neglect.  The maximum penalty
 imposed under this paragraph on any person with respect  to  returns  or
 claims  for refund filed during any calendar year shall not exceed twen-
 ty-five thousand dollars.
   (2) Failure to furnish identifying number. If any  identifying  number
 required  to  be  included on any return or claim for refund pursuant to
 paragraph two of subdivision (g) of section 11-1758 of this  chapter  is
 not  so included, the person who is the tax return preparer with respect
 to such return or claim for refund shall be  subject  to  a  penalty  of
 fifty  dollars with respect to such return or claim for refund unless it
 is shown that such failure is due to reasonable cause  and  not  willful
 neglect.    For purposes of this paragraph, where an employer and one or
 more employees of such employer are tax return preparers with respect to
 the same return or claim for refund or where a partnership  and  one  or
 more  partners in such partnership are tax return preparers with respect
 to the same return or claim for refund, such employer or  such  partner-
 ship  shall be deemed to be the sole tax return preparer with respect to
 such return or claim for refund.  The maximum penalty imposed under this
 paragraph on any person with respect to returns  or  claims  for  refund
 S. 8474                            961
 
 filed  during  any  calendar  year shall not exceed twenty-five thousand
 dollars.
   (3)  Failure  to  furnish  copy  to  taxpayer. Any person who is a tax
 return preparer with respect to any return or claim for refund,  who  is
 required  under paragraph three of subdivision (g) of section 11-1758 of
 this chapter to furnish a copy of such return or claim for refund to the
 taxpayer, and who fails to comply with such provision  with  respect  to
 such  return  or claim for refund shall be subject to a penalty of fifty
 dollars for each such failure, unless it is shown that such  failure  is
 due  to  reasonable  cause  and not due to willful neglect.  The maximum
 penalty imposed under this paragraph  on  any  person  with  respect  to
 returns  or  claims  for refund filed during any calendar year shall not
 exceed twenty-five thousand dollars.
   (4) Failure to retain copy or list. Any person who  is  a  tax  return
 preparer with respect to any return or claim for refund, who is required
 under paragraph four of subdivision (g) of section 11-1758 of this chap-
 ter  to:  (i) retain a copy of such return or claim for refund or retain
 on a list the name and taxpayer identifying number of the  taxpayer  for
 whom  such  return  or  claim for refund was prepared and (ii) make such
 copy or list available for inspection upon request by  the  commissioner
 of  taxation  and  finance,  and  who fails to comply with the retention
 requirement or who complies with the retention requirement but fails  to
 comply  with  such  request  by  the commissioner, shall be subject to a
 penalty of fifty dollars for each such failure, unless it is shown  that
 such  failure is due to reasonable cause and not due to willful neglect.
 The maximum penalty imposed under this  paragraph  on  any  person  with
 respect  to  any  calendar  year  shall  not exceed twenty-five thousand
 dollars.
   (5) Failure to electronically  file.  If  a  tax  return  preparer  is
 required  to  file  returns  electronically pursuant to paragraph ten of
 subdivision (g) of section 11-1758 of this chapter,  and  such  preparer
 fails  to  file  one  or  more of such returns electronically, then such
 preparer shall be subject to a penalty of fifty dollars  for  each  such
 failure  to  electronically  file a return, unless it is shown that such
 failure is due to reasonable cause and not due to willful  neglect.  For
 purposes  of  this paragraph, reasonable cause shall include, but not be
 limited to, a taxpayer's election not to electronically file his or  her
 return.
   §  11-1786 Overpayment.   (a) General. The state commissioner of taxa-
 tion and finance, within the applicable period of limitations, may cred-
 it an overpayment of income tax and interest on such overpayment against
 any liability in respect of any tax imposed by this chapter or by  chap-
 ter nineteen of this title on the person who made the overpayment or any
 other  tax  imposed  on such person pursuant to the authority of the tax
 law or any other law if such tax is administered by  the  state  commis-
 sioner  of taxation and finance, against any liability in respect of any
 tax imposed on such person by the tax law and, as provided  in  sections
 one hundred seventy-one-c, one hundred seventy-one-d, one hundred seven-
 ty-one-e, one hundred seventy-one-f and one hundred seventy-one-l of the
 tax  law, against past-due support, against a past-due legally enforcea-
 ble debt, against a city of New  York  tax  warrant  judgment  debt  and
 against  the  amount  of a default in repayment of a guaranteed student,
 state university or city university loan. The balance shall be  refunded
 by  the state comptroller out of the proceeds of the tax retained by him
 or her for such general purpose. Any refund under this section shall  be
 made  only  upon  the  filing  of a return and upon a certificate of the
 S. 8474                            962
 
 state commissioner of taxation and finance approved by the  state  comp-
 troller. The state comptroller, as a condition precedent to the approval
 of  such  a  certificate, may examine into the facts as disclosed by the
 return  of the person who made the overpayment and other information and
 data available in the files of the state commissioner  of  taxation  and
 finance.
   (b)    Excessive  withholding. If the amount allowable as a credit for
 tax withheld from the taxpayer exceeds his or her tax to which the cred-
 it relates, the excess shall be considered an overpayment.
   (c)  Overpayment by employer. If there has been an overpayment of  tax
 required to be deducted and withheld under section 11-1771 of this chap-
 ter,  refund  shall  be made to the employer only to the extent that the
 amount of the overpayment was not deducted and withheld by the employer.
   (d)  Overpayment by a deceased person. Notwithstanding  section  thir-
 teen hundred ten of the surrogate's court procedure act, any overpayment
 by  a  decedent not in excess of one thousand dollars may be refunded to
 the decedent's surviving spouse unless the return for the  decedent  was
 filed by his or her executor or administrator.
   (e)    Credits against estimated tax. The commissioner of taxation and
 finance may prescribe regulations providing for  the  crediting  against
 the  estimated  income tax for any taxable year of the amount determined
 to be an overpayment of the income tax for a preceding taxable year.  If
 any overpayment of income tax is so claimed as a  credit  against  esti-
 mated  tax for the succeeding taxable year, such amount shall be consid-
 ered as a payment of the income tax for the succeeding taxable year, and
 no claim for credit or refund of such overpayment shall be  allowed  for
 the  taxable  year for which the overpayment arises, except upon request
 to the commissioner of taxation and finance on or before  the  last  day
 prescribed for the filing of the return for the succeeding taxable year,
 determined  with  regard to any extension of time granted. If good cause
 is shown for reversing the credit,  the  commissioner  of  taxation  and
 finance  may, in his or her discretion, credit the overpayment against a
 liability or refund the  overpayment  without  interest.  Provided,  the
 person  who  made  the overpayment will not be relieved of liability for
 any penalty imposed for a consequent underpayment of estimated  tax  for
 the  succeeding  taxable year. The decision of the commissioner of taxa-
 tion and finance to grant or deny the request is final and  not  subject
 to further administrative or judicial review.
   (f)    Rule where no tax liability. If there is no tax liability for a
 period in respect of which an amount is paid as income tax, such  amount
 shall be considered an overpayment.
   (g)   Assessment and collection after limitation period. If any amount
 of income tax is assessed or collected after the expiration of the peri-
 od of limitations properly applicable  thereto,  such  amount  shall  be
 considered an overpayment.
   (h)    Cross  reference.  For provision barring application of article
 fifty-two of the civil practice law  and  rules  to  any  amount  to  be
 refunded or credited to a taxpayer, see section seven of the tax law.
   §  11-1787    Limitations on credit or refund. (a)  General. Claim for
 credit or refund of an overpayment of income tax shall be filed  by  the
 taxpayer  within  three  years from the time the return was filed or two
 years from the time the tax was paid, whichever of such periods  expires
 the later, or if no return was filed, within two years from the time the
 tax  was paid.   If the claim is filed within the three year period, the
 amount of the credit or refund shall not exceed the portion of  the  tax
 paid  within  the  three  years  immediately preceding the filing of the
 S. 8474                            963
 
 claim plus the period of any extension of time for  filing  the  return.
 If  the  claim  is  not filed within the three year period, but is filed
 within the two year period, the amount of the credit or refund shall not
 exceed  the  portion  of  the  tax paid during the two years immediately
 preceding the filing of the claim.  Except as otherwise provided in this
 section, if no claim is filed, the amount of a credit  or  refund  shall
 not exceed the amount which would be allowable if a claim had been filed
 on the date the credit or refund is allowed.
   (b)    Extension  of  time  by  agreement.  If  an agreement under the
 provisions of paragraph two of subdivision (c)  of  section  11-1783  of
 this  subchapter,  extending the period for assessment of income tax, is
 made within the period prescribed in subdivision (a)   of  this  section
 for  the filing of a claim for credit or refund, the period for filing a
 claim for credit or refund, or for making credit or refund if  no  claim
 is  filed,  shall not expire prior to six months after the expiration of
 the period within which an assessment may be made pursuant to the agree-
 ment or any extension thereof.   The amount of  such  credit  or  refund
 shall  not exceed the portion of the tax paid after the execution of the
 agreement and before the filing of the claim or the making of the credit
 or refund, as the case may be, plus the portion of the tax  paid  within
 the  period  which  would  be  applicable  under subdivision (a) of this
 section if a claim  had  been  filed  on  the  date  the  agreement  was
 executed.
   (c)    Notice  of  federal change or correction. A claim for credit or
 refund of any overpayment of tax attributable to  a  federal  change  or
 correction  required  to be reported pursuant to section 11-1759 of this
 chapter shall be filed by the taxpayer within two years  from  the  time
 the  notice  of  such  change  or  correction or such amended return was
 required to be filed with the commissioner of taxation and finance.   If
 the report or amended return required by section 11-1759 of this chapter
 is not filed within the ninety day period therein specified, no interest
 shall  be  payable  on any claim for credit or refund of the overpayment
 attributable to the federal change or correction.   The amount  of  such
 credit  or  refund  shall  not exceed the amount of the reduction in tax
 attributable to such federal change, correction or items amended on  the
 taxpayer's  amended  federal  income tax return.  This subdivision shall
 not affect the time within which or the amount for  which  a  claim  for
 credit or refund may be filed apart from this subdivision.
   (d)  Overpayment attributable to net operating loss carryback. A claim
 for  credit or refund of so much of an overpayment as is attributable to
 the application to the taxpayer of a net operating loss carryback  shall
 be  filed within three years from the time the return was due, including
 extensions thereof, for the taxable year of  the  loss,  or  within  the
 period  prescribed in subdivision (b) of this section in respect of such
 taxable year, or within the period prescribed in subdivision (c) of this
 section, where applicable, in respect of the taxable year to  which  the
 net operating loss is carried back, whichever expires the latest.
   (e)    Failure  to  file  claim within prescribed period. No credit or
 refund shall be allowed or made, except as provided in  subdivision  (f)
 of  this  section or subdivision (d) of section 11-1790 of this subchap-
 ter, after the expiration of the applicable period of limitation  speci-
 fied  in  this  chapter, unless a claim for credit or refund is filed by
 the taxpayer within such period.  Any later credit shall be void and any
 later refund erroneous.  No period of limitations specified in any other
 law shall apply to the recovery by a taxpayer of moneys paid in  respect
 of taxes under this chapter.
 S. 8474                            964

   (f)    Effect of petition to tax commission. If a notice of deficiency
 for a taxable year has been mailed to the taxpayer under section 11-1781
 of this subchapter and if the taxpayer files a timely petition with  the
 tax  commission  under section 11-1789 of this subchapter, it may deter-
 mine that the taxpayer has made an overpayment for such year, whether or
 not  it also determines a deficiency for such a year.  No separate claim
 for credit or refund for such year shall be  filed,  and  no  credit  or
 refund for such year shall be allowed or made, except:
   (1)  as to overpayments determined by a decision of the tax commission
 which has become final; and
   (2)  as  to  any  amount  collected in excess of an amount computed in
 accordance with the decision of the  tax  commission  which  has  become
 final; and
   (3) as to any amount collected after the period of limitation upon the
 making of levy for collection has expired; and
   (4)  as  to  any  amount claimed as a result of a change or correction
 described in subdivision (c)  of this section.
   (g) Limit on amount of credit or refund.  The  amount  of  overpayment
 determined  under subdivision (f)  of this section shall, when the deci-
 sion of the tax commission has become final, be credited or refunded  in
 accordance  with  subdivision  (a) of section 11-1786 of this subchapter
 and shall not exceed the amount of tax which the tax  commission  deter-
 mines as part of its decision was paid:
   (1) after the mailing of the notice of deficiency, or
   (2) within the period which would be applicable under subdivision (a),
 (b) or (c)  of this section, if on the date of the mailing of the notice
 of  deficiency a claim had been filed, whether or not filed, stating the
 grounds upon which the tax commission finds that there  is  an  overpay-
 ment.
   (h)    Early  return.  For  purposes of this section, any return filed
 before the last day prescribed for the filing thereof shall  be  consid-
 ered  as filed on such last day, determined without regard to any exten-
 sion of time granted the taxpayer.
   (i)  Prepaid income tax. For purposes of this section, any tax paid by
 the taxpayer before the last day prescribed for its payment, any  income
 tax  withheld from the taxpayer during any calendar year, and any amount
 paid by the taxpayer as estimated income tax for a taxable year shall be
 deemed to have been paid by him or her  on  the  fifteenth  day  of  the
 fourth month following the close of his or her taxable year with respect
 to which such amount constitutes a credit or payment.
   (j)    Return and payment of withholding tax. Notwithstanding subdivi-
 sion (h)  of this section, for purposes of this section with respect  to
 any withholding tax:
   (1)   if a return for any period ending with or within a calendar year
 is filed before April fifteenth of the succeeding  calendar  year,  such
 return  shall  be considered filed on April fifteenth of such succeeding
 calendar year; and
   (2) if a tax with respect  to  remuneration  paid  during  any  period
 ending  with or within a calendar year is paid before April fifteenth of
 the succeeding calendar year, such tax shall be considered paid on April
 fifteenth of such succeeding calendar year.
   (k) Running of periods  of  limitation  suspended  while  taxpayer  is
 unable to manage financial affairs due to disability. (1) In the case of
 an individual taxpayer, the running of the periods specified in subdivi-
 sions  (a),  (b),  and (c) of this section shall be suspended during any
 period of such individual's life that  such  individual  is  financially
 S. 8474                            965
 
 disabled. For purposes of this subdivision, an individual taxpayer is an
 individual who is subject to the tax imposed under this chapter.
   (2)  For  purposes of paragraph one of this subdivision, an individual
 taxpayer is financially disabled if such individual is unable to  manage
 his or her financial affairs by reason of a medically determinable phys-
 ical  or  mental  impairment of that individual which can be expected to
 result in death or which has lasted or can be expected  to  last  for  a
 continuous  period  of  not less than twelve months. An individual shall
 not be considered to have such impairment unless proof of the  existence
 thereof  is  furnished  in  such  form and manner as the commissioner of
 taxation and finance may require.
   (3) An individual taxpayer shall not be treated as  financially  disa-
 bled during any period that such individual's spouse or any other person
 is authorized to act on behalf of such individual in financial matters.
   (l)    Cross  reference.  For  provision barring refund of overpayment
 credited against tax of  a  succeeding  year,  see  subdivision  (e)  of
 section 11-1786 of this subchapter.
   §  11-1788  Interest  on overpayment. (a) General. Notwithstanding the
 provisions of section sixteen of the state finance law,  interest  shall
 be  allowed  and  paid  as  follows  at  the overpayment rate set by the
 commissioner of taxation and finance pursuant to section 11-1797 of this
 subchapter, or if no rate is set, at the rate of six percent  per  annum
 upon any overpayment in respect of the tax imposed by this chapter:
   (1)  from  the  date  of  the overpayment to the due date of an amount
 against which a credit is taken;
   (2) from the date of the overpayment to a date, to  be  determined  by
 the commissioner of taxation and finance, preceding the date of a refund
 check  by not more than thirty days, whether or not such refund check is
 accepted by the taxpayer after tender of such check to the taxpayer. The
 acceptance of such check shall be without prejudice to any right of  the
 taxpayer to claim any additional overpayment and interest thereon.
   (3)  Late  and  amended  returns  and  claims  for  credit  or refund.
 Notwithstanding paragraph one or two of this subdivision, in the case of
 an overpayment claimed on a return of tax which is filed after the  last
 date prescribed for filing such return, determined with regard to exten-
 sions,  or claimed on an amended return of tax or claimed on a claim for
 credit or refund, no interest shall be  allowed  or  paid  for  any  day
 before the date on which such return or claim is filed.
   (4)  Interest  on certain refunds. To the extent provided for in regu-
 lations promulgated by the commissioner of taxation and finance,  if  an
 item  of  income,  gain,  loss,  deduction or credit is changed from the
 taxable year or period in which it is reported to the  taxable  year  or
 period  in which it belongs and the change results in an underpayment in
 a taxable year or period and an overpayment in some other  taxable  year
 or  period,  the  provisions of paragraph three of this subdivision with
 respect to an overpayment shall not be applicable to the extent that the
 limitation in such paragraph on the right to interest would result in  a
 taxpayer not being allowed interest for a length of time with respect to
 an  overpayment  while  being  required to pay interest on an equivalent
 amount of the related underpayment. However, this paragraph shall not be
 construed as limiting or mitigating the effect of any statute of limita-
 tions or any other provision of law relating to the  authority  of  such
 commissioner  to  issue  a  notice of deficiency or to allow a credit or
 refund on an overpayment.
   (5) Amounts of less than one dollar. No interest shall be  allowed  or
 paid if the amount thereof is less than one dollar.
 S. 8474                            966
 
   (b)  Advance  payment of tax, payment of estimated tax, and credit for
 income tax withholding. The provisions of subdivisions (h)  and  (i)  of
 section 11-1787 of this subchapter applicable in determining the date of
 payment  of tax for purposes of determining the period of limitations on
 credit or refund, shall be applicable in determining the date of payment
 for purposes of this section.
   (c) Income tax refund within forty-five days of claim for overpayment.
 If  any  overpayment  of  tax  imposed  by  this  chapter is credited or
 refunded within forty-five days  after  the  last  date  prescribed,  or
 permitted  by  extension  of  time, for filing the return of such tax on
 which such overpayment was claimed or within forty-five days after  such
 return was filed, whichever is later, or within forty-five days after an
 amended  return was filed claiming such overpayment or within forty-five
 days after a claim for credit or refund was filed on which such overpay-
 ment was claimed, within six months after a demand is filed pursuant  to
 paragraph  six of subsection (b) of section six hundred fifty-one of the
 tax law, no interest shall be allowed under this  section  on  any  such
 overpayment.  For  purposes  of  this subdivision, any amended return or
 claim for credit or refund filed before  the  last  day  prescribed,  or
 permitted  by extension of time, for the filing of the return of tax for
 such year shall be considered as filed on such last day.
   (d) Refund of income tax caused by carryback.  For  purposes  of  this
 section,  if any overpayment of tax imposed by this chapter results from
 a carryback of a net operating loss, such overpayment  shall  be  deemed
 not  to  have been made prior to the filing date for the taxable year in
 which such net operating loss arises. Such filing date shall  be  deter-
 mined  without  regard  to  extensions  of time to file. For purposes of
 subdivision (c) of this section any overpayment described  herein  shall
 be  treated  as  an  overpayment  for the loss year and such subdivision
 shall be applied with respect to such overpayment by treating the return
 for the loss year as not filed before  claim  for  such  overpayment  is
 filed.  The  term  "loss year" means the taxable year in which such loss
 arises.
   (e) No interest until return in processible form.
   (1) For purposes of subdivisions (a) and (c) of this section, a return
 shall not be treated as filed until it is filed in processible form.
   (2) For purposes of paragraph one of this subdivision, a return is  in
 a processible form if:
   (A) such return is filed on a permitted form, and
   (B) such return contains:
   (i)  the  taxpayer's  name,  address,  and  identifying number and the
 required signatures, and
   (ii) sufficient required information, whether  on  the  return  or  on
 required  attachments,  to  permit  the mathematical verification of tax
 liability shown on the return.
   (f) Overpayment credited against past-due support, or against a  past-
 due legally enforceable debt, or a city of New York tax warrant judgment
 debt,  or defaulted guaranteed student, state university or city univer-
 sity loans. If interest is payable pursuant  to  this  section  on  that
 portion of an overpayment of tax imposed by this chapter which is certi-
 fied  by  the  state  commissioner  of taxation and finance to the state
 comptroller as the amount to be credited against  past-due  support,  or
 against  a  past-due legally enforceable debt, or a city of New York tax
 warrant judgment debt, or the amount of a  default  in  repayment  of  a
 guaranteed  student,  state  university  or city university loan, as the
 case may be, pursuant to the provisions of sections one  hundred  seven-
 S. 8474                            967
 
 ty-one-c,  one  hundred  seventy-one-d,  one  hundred seventy-one-e, one
 hundred seventy-one-f and one hundred seventy-one-l of the tax law, such
 portion of such an overpayment shall cease to bear interest on the  date
 of such certification.
   (g)  Cross-reference.  For  provision  with  respect to interest after
 failure to file notice of federal change under section 11-1759  of  this
 chapter, see subdivision (c) of section 11-1787 of this subchapter.
   §  11-1789    Petition  to  tax commission. (a) General. The form of a
 petition to the tax commission, and further proceedings before  the  tax
 commission  in  any case initiated by the filing of a petition, shall be
 governed by such rules as the tax commission shall prescribe.  No  peti-
 tion shall be denied in whole or in part without opportunity for a hear-
 ing  on  reasonable prior notice. Such hearing shall be conducted by one
 or more members of the tax commission, or by a  hearing  officer  desig-
 nated  by  the  tax  commission  to  take evidence and report to the tax
 commission.   The tax commissioners shall, acting  as  a  body,  jointly
 decide the case as quickly as practicable.  Notice of the decision shall
 be  mailed  promptly  to the taxpayer by certified or registered mail at
 his or her last known address, and such notice shall set forth  the  tax
 commission's  findings  of  fact and a brief statement of the grounds of
 decision in each case decided in whole  or  in  part  adversely  to  the
 taxpayer.
   (b)  Petition for redetermination of a deficiency. Within ninety days,
 or one hundred fifty days if the notice is addressed to a person outside
 of  the  United  States,  after  the mailing of the notice of deficiency
 authorized by section 11-1781 of this subchapter, the taxpayer may  file
 a  petition  with  the tax commission for a redetermination of the defi-
 ciency.  Such petition may also assert a claim for refund for  the  same
 taxable  year or years, subject to the limitations of subdivision (g) of
 section 11-1787 of this subchapter.
   (c)  Petition for refund. A taxpayer may file a petition with the  tax
 commission for the amounts asserted in a claim for refund if:
   (1)  the  taxpayer  has  filed  a timely claim for refund with the tax
 commission,
   (2) the taxpayer has not previously filed with the  tax  commission  a
 timely  petition  under  subdivision  (b)   of this section for the same
 taxable year unless the petition under this  subdivision  relates  to  a
 separate claim for credit or refund properly filed under subdivision (f)
 of section 11-1787 of this subchapter, and
   (3)  either: (A) six months have expired since the claim was filed, or
 (B) the tax commission has mailed to  the  taxpayer,  by  registered  or
 certified  mail,  a  notice of disallowance of such claim in whole or in
 part.
   No petition under this subdivision shall be filed more than two  years
 after  the  date of mailing of a notice of disallowance, unless prior to
 the expiration of such two year period it has been extended  by  written
 agreement  between  the  taxpayer and the tax commission.  If a taxpayer
 files a written waiver of the requirement that he or  she  be  mailed  a
 notice  of disallowance, the two year period prescribed by this subdivi-
 sion for filing a petition for refund shall begin on the date such waiv-
 er is filed.
   (d)  Assertion of deficiency after filing petition.
   (1)  Petition for redetermination of deficiency. If a  taxpayer  files
 with the tax commission, a petition for redetermination of a deficiency,
 the  tax  commission  shall have power to determine a greater deficiency
 than asserted in the notice of deficiency  and  to  determine  if  there
 S. 8474                            968
 
 should  be  assessed  any addition to tax or penalty provided in section
 11-1785 of this subchapter, if claim therefor is asserted at  or  before
 the hearing under rules of the tax commission.
   (2)    Petition for refund. If the taxpayer files with the tax commis-
 sion a petition for credit or refund for a taxable year, the tax commis-
 sion may:
   (A)  determine a deficiency for such year as to any  amount  of  defi-
 ciency  asserted at or before the hearing under rules of the tax commis-
 sion, and within the period in which an assessment would be timely under
 section 11-1783 of this subchapter, or
   (B)    deny so much of the amount for which credit or refund is sought
 in the petition, as is offset by other issues  pertaining  to  the  same
 taxable  year which are asserted at or before the hearing under rules of
 the tax commission.
   (3)  Opportunity to respond. A taxpayer shall be  given  a  reasonable
 opportunity  to  respond  to  any matters asserted by the tax commission
 under this subdivision.
   (4)  Restriction on further notices of  deficiency.  If  the  taxpayer
 files  a  petition with the tax commission under this section, no notice
 of deficiency under section 11-1781 of this subchapter may thereafter be
 issued by the tax commission for the same taxable year, except  in  case
 of  fraud  or  with  respect  to  a  change or correction required to be
 reported under section 11-1759 of this chapter.
   (e) Burden of proof. In any case before the tax commission under  this
 chapter, the burden of proof shall be upon the petitioner except for the
 following  issues, as to which the burden of proof shall be upon the tax
 commission:
   (1)  whether the petitioner has been guilty of fraud  with  intent  to
 evade tax;
   (2)  whether the petitioner is liable as the transferee of property of
 a taxpayer, but not to show that the taxpayer was liable for the tax;
   (3)  whether the petitioner is liable for any increase in a deficiency
 where  such  increase is asserted initially after a notice of deficiency
 was mailed and a petition under this section filed, unless such increase
 in deficiency is the result of a change or  correction  required  to  be
 reported  under  section 11-1759 of this chapter, and of which change or
 correction the tax commission had no notice at the time  it  mailed  the
 notice of deficiency; and
   (4)  whether  any person is liable for a penalty under subdivision (q)
 or (r) of section 11-1785 of this subchapter.
   (f)  Evidence of related federal determination. Evidence of a  federal
 determination relating to issues raised in a case before the tax commis-
 sion  under this section shall be admissible, under rules established by
 the tax commission.
   (g)  Jurisdiction over other years. The tax commission shall  consider
 such  facts  with relation to the taxes for other years as may be neces-
 sary correctly to determine the tax for the  taxable  year,  but  in  so
 doing shall have no jurisdiction to determine whether or not the tax for
 any other year has been overpaid or underpaid.
   § 11-1790  Review of tax commission decision. (a)  General. A decision
 of  the  tax  commission  shall  be  subject  to  judicial review at the
 instance of any taxpayer effected thereby in the manner provided by  law
 for  the review of a final decision or action of administrative agencies
 of the state.  An application by a taxpayer for such review must be made
 within four months after notice of the decision is sent by certified  or
 registered mail to the taxpayer.
 S. 8474                            969

   (b)    Judicial  review exclusive remedy of taxpayer.  The review of a
 decision of the tax commission provided by this  section  shall  be  the
 exclusive  remedy  available  to  any taxpayer for the judicial determi-
 nation of the liability of the taxpayer for the taxes  imposed  by  this
 chapter.
   (c)    Assessment  pending  review; review bond.   Irrespective of any
 restrictions on the assessment and collection of deficiencies,  the  tax
 commission  may  assess  a deficiency after the expiration of the period
 specified in subdivision (a) of this section,  notwithstanding  that  an
 application  for  judicial review in respect of such deficiency has been
 duly made by the taxpayer, unless the taxpayer, at or  before  the  time
 his or her application for review is made, has  paid the deficiency, has
 deposited  with  the tax commission the amount of the deficiency, or has
 filed with the tax commission a bond, which may be a jeopardy bond under
 subdivision (h) of section 11-1794 of this subchapter, in the amount  of
 the  portion of the deficiency, including interest and other amounts, in
 respect of which the application for review is made and  all  costs  and
 charges  which  may  accrue against him or her in the prosecution of the
 proceeding, including costs of all appeals, and with surety approved  by
 a  justice  of  the  supreme court of the state of New York, conditioned
 upon the  payment  of  the  deficiency,  including  interest  and  other
 amounts,  as  finally  determined  and such costs and charges.   If as a
 result of a waiver of the restrictions on the assessment and  collection
 of  a deficiency any part of the amount determined by the tax commission
 is paid after the filing of the review bond, such  bond  shall,  at  the
 request of the taxpayer, be proportionately reduced.
   (d)    Credit,  refund  or abatement after review.  If the amount of a
 deficiency determined by the tax commission is disallowed in whole or in
 part by the court of review, the amount so disallowed shall be  credited
 or  refunded  to the taxpayer, without the making of claim therefor, or,
 if payment has not been made, shall be abated.
   (e)  Date of finality of tax commission decision.  A decision  of  the
 tax  commission  shall  become  final  upon the expiration of the period
 specified in subdivision (a) of this section for making  an  application
 for  review, if no such application has been duly made within such time,
 or if such application has been duly made, upon expiration of  the  time
 for  all  further  judicial  review,  or  upon  the rendering by the tax
 commission of a decision in accordance with the mandate of the court  on
 review,  provided, however, for the purpose of making an application for
 review, the decision of the tax commission shall be deemed final on  the
 date  the  notice of decision is sent by certified or registered mail to
 the taxpayer.
   § 11-1791  Mailing rules;  holidays; miscellaneous. (a)  Timely  mail-
 ing.    (1)  If any return, claim, statement, notice, petition, or other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 of any provision of this chapter is, after such  period  or  such  date,
 delivered  by  United States mail to the tax commission, bureau, office,
 officer or person with which or with whom such document is  required  to
 be  filed,  or  to which or to whom such payment is required to be made,
 the date of the United States postmark stamped on the envelope shall  be
 deemed  to be the date of delivery. This subdivision shall apply only if
 the postmark date falls within the prescribed period or on or before the
 prescribed date for the filing of  such  document,  or  for  making  the
 payment, including any extension granted for such filing or payment, and
 only  if  such  document  or  payment was deposited in the mail, postage
 S. 8474                            970
 
 prepaid, properly addressed to the tax commission, bureau, office, offi-
 cer or person with which or with whom the document  is  required  to  be
 filed or to which or to whom such payment is required to be made. If any
 document  or  payment  is  sent  by  United States registered mail, such
 registration shall be prima facie evidence that such document or payment
 was delivered to the tax commission, bureau, office, officer  or  person
 to  which  or  to  whom addressed. To the extent that the tax commission
 shall prescribe by regulation, certified mail may be  used  in  lieu  of
 registered  mail under this section. This subdivision shall apply in the
 case of postmarks not made by the United States post office only if  and
 to the extent provided by regulations of the tax commission.
   (2)(A)  Any  reference  in  paragraph  one  of this subdivision to the
 United States mail shall be treated as  including  a  reference  to  any
 delivery  service  designated  by  the  secretary of the treasury of the
 United States pursuant to section seventy-five hundred two of the Inter-
 nal Revenue Code and any reference in paragraph one of this  subdivision
 to  a postmark by the United States mail shall be treated as including a
 reference to any date recorded or marked  in  the  manner  described  in
 section  seventy-five  hundred  two  of  the  Internal Revenue Code by a
 designated delivery service. If the commissioner of taxation and finance
 finds that any delivery service designated by such secretary  is  inade-
 quate  for  the  needs of the state, such commissioner may withdraw such
 designation for purposes of this article.  Such  commissioner  may  also
 designate  additional  delivery services meeting the criteria of section
 seventy-five hundred two of the Internal Revenue Code  for  purposes  of
 this  article, or may withdraw any such designation if such commissioner
 finds that a delivery service so designated is inadequate for the  needs
 of  the state. Any reference in paragraph one of this subdivision to the
 United States mail shall be treated as  including  a  reference  to  any
 delivery  service  designated  by such commissioner and any reference in
 paragraph one of this subdivision to a postmark  by  the  United  States
 mail  shall  be treated as including a reference to any date recorded or
 marked in the manner described in section seventy-five  hundred  two  of
 the  Internal  Revenue  Code  by  a  delivery  service designated by the
 commissioner.
   (B) Any equivalent of registered or certified mail designated  by  the
 United  States secretary of the treasury, or as may be designated by the
 commissioner of taxation and finance pursuant to the same criteria  used
 by  the  secretary for such designation pursuant to section seventy-five
 hundred two of the Internal Revenue Code, shall be included  within  the
 meaning of registered or certified mail as used in paragraph one of this
 subdivision.  If  such  commissioner finds that any equivalent of regis-
 tered or certified mail designated by such secretary or such commission-
 er is inadequate for the needs of the state, such commissioner may with-
 draw such designation for purposes of this article.
   (b)  Last known address. For purposes of this  chapter,  a  taxpayer's
 last  known  address shall be the address given in the last return filed
 by such taxpayer, unless subsequent to the filing  of  such  return  the
 taxpayer shall have notified the tax commission of a change of address.
   (c)    Last day a Saturday, Sunday or legal holiday. When the last day
 prescribed under authority of this chapter, including any  extension  of
 time, for performing any act falls on Saturday, Sunday, or a legal holi-
 day  in  the  state  of  New  York, the performance of such act shall be
 considered timely if it is performed on the next succeeding day which is
 not a Saturday, Sunday or a legal holiday.
 S. 8474                            971
 
   (d) Certificate; unfiled return.  For purposes of  this  chapter,  the
 certificate  of the tax commission to the effect that a tax has not been
 paid, that a return has not been filed, or that information has not been
 supplied, as required by or under the provisions of this chapter,  shall
 be  prima  facie  evidence  that  such  tax has not been paid, that such
 return has not been  filed,  or  that  such  information  has  not  been
 supplied.
   (e)  Attorney  general; jurisdiction.  The attorney general shall have
 concurrent jurisdiction with any district attorney in the prosecution of
 any offenses arising under article thirty-seven  of  the  tax  law  with
 respect to the tax imposed under this chapter.
   § 11-1792  Collection, levy and liens. (a)  Collection procedures. The
 taxes  imposed by this chapter shall be collected by the tax commission,
 and it may establish the mode or time for the collection of  any  amount
 due  it  under this chapter if not otherwise specified.  The tax commis-
 sion shall, upon request, give a receipt for  any  sum  collected  under
 this chapter.  The tax commission may authorize banks or trust companies
 which  are  depositaries or financial agents of the state to receive and
 give a receipt for any tax imposed under this chapter in such manner, at
 such times,  and  under  such  conditions  as  the  tax  commission  may
 prescribe;  and the tax commission shall prescribe the manner, times and
 conditions under which the receipt of such tax by such banks  and  trust
 companies is to be treated as payment of such tax to the tax commission.
   (b)  Notice  and  demand  for tax. The tax commission shall as soon as
 practicable give notice to each person liable for  any  amount  of  tax,
 addition  to  tax,  penalty  or  interest,  which  has been assessed but
 remains unpaid, stating the amount and demanding payment thereof.   Such
 notice  shall be left at the dwelling or usual place of business of such
 person or shall be sent by mail to such  person's  last  known  address.
 Except  where  the  tax  commission  determines that collection would be
 jeopardized by delay, if any tax is assessed prior  to  the  last  date,
 including  any  date  fixed by extension, prescribed for payment of such
 tax, payment of such tax shall not be demanded until after such date.
   (c) Issuance of warrant after notice and demand. If any person  liable
 under  this chapter for the payment of any tax, addition to tax, penalty
 or interest neglects or refuses to pay the same within twenty-one calen-
 dar days after notice and demand therefor is given to such person  under
 subdivision  (b)  of  this  section, ten business days if the amount for
 which such notice and demand is made equals or exceeds one hundred thou-
 sand dollars, the commissioner of taxation and finance  may  within  six
 years  after  the  date  of  such  assessment issue a warrant under such
 commissioner's official seal directed to the sheriff of  any  county  of
 the  state,  or to any officer or employee of the department of taxation
 and finance, commanding him or her to levy upon and sell  such  person's
 real  and personal property for the payment of the amount assessed, with
 the cost of executing the warrant, and to return such  warrant  to  such
 commissioner and pay to him or her the money collected by virtue thereof
 within sixty days after the receipt of the warrant. If such commissioner
 finds  that  the  collection  of the tax or other amount is in jeopardy,
 notice and demand for immediate payment of such tax may be made by  such
 commissioner and upon failure or refusal to pay such tax or other amount
 such  commissioner  may issue a warrant without regard to the twenty-one
 day period, or ten-day period if applicable, provided in  this  subdivi-
 sion.
   (d)    Copy of warrant to be filed and lien to be created. Any sheriff
 or officer or employee who receives a warrant under subdivision  (c)  of
 S. 8474                            972
 
 this  section  shall  within  five  days thereafter file a copy with the
 clerk of the appropriate county.  The clerk shall thereupon enter in the
 judgment docket, in the column for judgment debtors,  the  name  of  the
 taxpayer mentioned in the warrant, and in appropriate columns the tax or
 other  amounts  for  which  the warrant is issued and the date when such
 copy is filed; and such amount shall thereupon be a lien upon the  title
 to  and  interest  in real, personal and other property of the taxpayer.
 Such lien shall not apply to personal property unless  such  warrant  is
 filed in the department of state.
   (e)    Judgment.   When a warrant has been filed with the county clerk
 the tax commission shall, in the right of the city, be  deemed  to  have
 obtained judgment against the taxpayer for the tax or other amounts.
   (f)    Execution.   The sheriff or officer or employee shall thereupon
 proceed upon the warrant in all respects, with like effect, and  in  the
 same  manner  prescribed  by law in respect to executions issued against
 property upon judgments of a court of record, and  a  sheriff  shall  be
 entitled  to  the  same  fees  for  his or her services in executing the
 warrant, to be collected in the same manner.  An officer or employee  of
 the  department  of  taxation  and  finance may proceed in any county or
 counties of this state and  shall  have  all  the  powers  of  execution
 conferred  by  law  upon  sheriffs,  but  shall be entitled to no fee or
 compensation in excess of actual expenses paid in  connection  with  the
 execution of the warrant.
   (g)   Taxpayer not a resident.  Where a notice and demand under subdi-
 vision (b)  of this section shall have been given to a taxpayer  who  is
 not then a resident, and it appears to the tax commission that it is not
 practicable to find in this state property of the taxpayer sufficient to
 pay the entire balance of tax or other amount owing by such taxpayer who
 is  not  then  a  resident,  the  tax commission may, in accordance with
 subdivision (c)  of this section, issue a warrant directed to an officer
 or employee of the department of taxation and finance, a copy  of  which
 warrant  shall be mailed by certified or registered mail to the taxpayer
 at his or her last known address,  subject  to  the  rules  for  mailing
 provided  in subdivision (a) of section 11-1781 of this subchapter. Such
 warrant shall command the officer or employee to proceed in Albany coun-
 ty, and he or she shall, within five days after receipt of the  warrant,
 file  the warrant and obtain a judgment in accordance with this section.
 Thereupon the tax commission may authorize the institution of any action
 or proceeding to collect or enforce the judgment in any place and by any
 procedure that a civil judgment of the supreme court of the state of New
 York could be collected or enforced.  The tax commission  may  also,  in
 its  discretion,  designate  agents or retain counsel for the purpose of
 collecting, outside the state of New York, any unpaid  taxes,  additions
 to  tax, penalties or interest which have been assessed under this chap-
 ter against taxpayers who are not residents of this state, may  fix  the
 compensation  of  such agents and counsel to be paid out of money appro-
 priated or otherwise lawfully available for  payment  thereof,  and  may
 require of them bonds or other security for the faithful performance  of
 their  duties,  in  such  form  and in such amount as the tax commission
 shall deem proper and sufficient.
   (h)  Action by state for recovery of taxes. Action may be  brought  by
 the  attorney  general at the instance of the tax commission in the name
 of the city or both to recover the amount of any unpaid taxes, additions
 to tax, penalties or interest which have been assessed under this  chap-
 ter within six years prior to the date the action is commenced.
 S. 8474                            973
 
   (i)  Release of lien.  The tax commission, if it finds that the inter-
 ests  of  the city will not thereby be jeopardized, and upon such condi-
 tions as it may require, may release any property from the lien  of  any
 warrant for unpaid taxes, additions to tax, penalties and interest filed
 pursuant to this section, and such release may be recorded in the office
 of any recording officer in which such warrant has been filed.
   §    11-1793 Transferees. (a)   General.   The liability, at law or in
 equity, of a transferee of property of a taxpayer for any tax, additions
 to tax, penalty or interest due under this chapter, shall  be  assessed,
 paid,  and  collected  in  the  same  manner  and  subject  to  the same
 provisions and limitations as in the  case  of  the  tax  to  which  the
 liability  relates, except that the period of limitations for assessment
 against the transferee shall be extended by one year for each successive
 transfer, in  order,  from  the  original  taxpayer  to  the  transferee
 involved,  but  not by more than three years in the aggregate.  The term
 transferee includes donee, heir, legatee, devisee and distributee.
   (b)  Exceptions.
   (1)  If before the expiration of the period of limitations for assess-
 ment of liability of the transferee, a claim has been filed by  the  tax
 commission  in  any  court  against  the  original  taxpayer or the last
 preceding transferee based upon the liability of the original  taxpayer,
 then  the period of limitation for assessment of liability of the trans-
 feree shall in no event expire prior to one year after  such  claim  has
 been finally allowed, disallowed or otherwise disposed of.
   (2)    If, before the expiration of the time prescribed in subdivision
 (a) or the immediately preceding paragraph of this subdivision  for  the
 assessment  of the liability, the tax commission and the transferee have
 both consented in writing to its assessment after such time, the liabil-
 ity may be assessed at any time prior to the expiration  of  the  period
 agreed  upon.    The period so agreed upon may be extended by subsequent
 agreements in writing made before the expiration of the period previous-
 ly agreed upon.  For the purpose of determining the period of limitation
 on credit or refund to the transferee of overpayments  of  tax  made  by
 such  transferee  or  overpayments  of  tax made by the transferor as to
 which the transferee is legally  entitled  to  credit  or  refund,  such
 agreement  and  any  extension  thereof shall be deemed an agreement and
 extension thereof referred to in subdivision (b) of section  11-1787  of
 this  subchapter.   If the agreement is executed after the expiration of
 the period of limitation for assessment against the  original  taxpayer,
 then  in  applying  the  limitations  under  subdivision  (b) of section
 11-1787 of this subchapter on the amount of the credit  or  refund,  the
 periods specified in subdivision (a) of section 11-1787 of this subchap-
 ter shall be increased by the period from the date of such expiration to
 the date of the agreement.
   (c)    Deceased  transferor.  If any person is deceased, the period of
 limitation for assessment against such person shall be the  period  that
 would be in effect if he or she had lived.
   (d)    Evidence.  Notwithstanding the provisions of subdivision (e) of
 section 11-1797 of this subchapter the  tax  commission  shall  use  its
 powers  to make available to the transferee evidence necessary to enable
 the transferee to determine the liability of the original  taxpayer  and
 of any preceding transferees, but without undue hardship to the original
 taxpayer  or  preceding  transferee.    See  subdivision  (e) of section
 11-1789 of this subchapter for rule as to burden of proof.
   § 11-1794  Jeopardy assessment. (a) Authority for making. If  the  tax
 commission  believes  that  the assessment or collection of a deficiency
 S. 8474                            974

 will be jeopardized by delay, it shall, notwithstanding  the  provisions
 of  sections  11-1781 and 11-1796 of this subchapter, immediately assess
 such deficiency, together with all interest, penalties and additions  to
 tax  provided for by law, and notice and demand shall be made by the tax
 commission for the payment thereof.
   (b)  Notice of deficiency. If the jeopardy assessment is  made  before
 any  notice  in  respect  of  the  tax  to which the jeopardy assessment
 relates has been mailed under section 11-1781 of this  subchapter,  then
 the  tax  commission shall mail a notice under such section within sixty
 days after the making of the assessment.
   (c)  Amount assessable before decision of tax commission. The jeopardy
 assessment may be made in respect of a deficiency greater or  less  than
 that  of  which  notice is mailed to the taxpayer and whether or not the
 taxpayer has theretofore filed a petition with the tax commission.   The
 tax  commission  may,  at  any time before rendering its decision, abate
 such assessment, or any unpaid portion thereof, to the  extent  that  it
 believes  the  assessment to be excessive in amount.  The tax commission
 may in its decision redetermine the entire amount of the deficiency  and
 of all amounts assessed at the same time in connection therewith.
   (d)    Amount  assessable  after  decision  of  tax commission. If the
 jeopardy assessment is made after the decision of the tax commission  is
 rendered,  such assessment may be made only in respect of the deficiency
 determined by the tax commission in its decision.
   (e)  Expiration of right to assess.  A jeopardy assessment may not  be
 made  after the decision of the tax commission has become final or after
 the taxpayer has made an application for review of the decision  of  the
 tax commission.
   (f)  Collection of unpaid amounts. When a petition has been filed with
 the  tax  commission and when the amount which should have been assessed
 has been determined by a decision of the tax commission which has become
 final, then any unpaid portion, the collection of which has been  stayed
 by  bond,  shall  be collected as part of the tax upon notice and demand
 from the tax commission, and any remaining  portion  of  the  assessment
 shall  be  abated.    If the amount already collected exceeds the amount
 determined as the amount which should have been  assessed,  such  excess
 shall  be  credited  or  refunded to the taxpayer as provided in section
 11-1786 of this subchapter without the filing of claim therefor.  If the
 amount determined as the amount  which  should  have  been  assessed  is
 greater  than the amount actually assessed, then the difference shall be
 assessed and shall be collected as part  of  the  tax  upon  notice  and
 demand from the tax commission.
   (g)    Abatement  if  jeopardy  does not exist. The tax commission may
 abate the jeopardy assessment if it finds that jeopardy does not  exist.
 Such abatement may not be made after a decision of the tax commission in
 respect  of the deficiency has been rendered or, if no petition is filed
 with the tax commission, after the expiration of the period  for  filing
 such  petition.    The period of limitation on the making of assessments
 and levy or a proceeding for collection, in respect of  any  deficiency,
 shall be determined as if the jeopardy assessment so abated had not been
 made,  except  that  the  running  of  such period shall in any event be
 suspended for the period from the date of such jeopardy assessment until
 the expiration of the tenth day after the day  on  which  such  jeopardy
 assessment is abated.
   (h)    Bond  to  stay  collection.  The collection of the whole or any
 amount of any jeopardy assessment may be stayed by filing with  the  tax
 commission, within such time as may be fixed by regulation, a bond in an
 S. 8474                            975
 
 amount  equal to the amount as to which the stay is desired, conditioned
 upon the payment of the amount,  together  with  interest  thereon,  the
 collection  of  which is stayed at the time at which, but for the making
 of  the  jeopardy assessment, such amount would be due.  Upon the filing
 of the bond the collection of so much  of  the  amount  assessed  as  is
 covered  by the bond shall be stayed.  The taxpayer shall have the right
 to waive such stay at any time in respect of the whole or  any  part  of
 the  amount  covered  by the bond, and if as a result of such waiver any
 part of the amount covered by the bond is paid, then the bond  shall  at
 the request of the taxpayer, be proportionately reduced.  If any portion
 of the jeopardy assessment is abated, or if a notice of deficiency under
 section 11-1781 of this subchapter is mailed to the taxpayer in a lesser
 amount,  the  bond shall, at the request of the taxpayer, be proportion-
 ately reduced.
   (i)   Petition to tax commission. If the  bond  is  given  before  the
 taxpayer  has  filed  his  or her petition under section 11-1789 of this
 subchapter, the bond shall contain a further condition that if  a  peti-
 tion  is  not filed within the period provided in such section, then the
 amount, the collection of which is stayed by the bond, will be  paid  on
 notice  and  demand  at  any  time  after the expiration of such period,
 together with interest thereon from the date of the jeopardy notice  and
 demand  to  the  date  of notice and demand under this subdivision.  The
 bond shall be conditioned upon the payment of so much  of  such  assess-
 ment,  collection  of which is stayed by the bond, as is not abated by a
 decision of the tax commission which has  become  final.    If  the  tax
 commission  determines  that  the  amount  assessed  is greater than the
 amount which should have been assessed, then  the  bond  shall,  at  the
 request of the taxpayer, be proportionately reduced when the decision of
 the tax commission is rendered.
   (j)   Stay of sale of seized property pending tax commission decision.
 Where a jeopardy  assessment  is  made,  the  property  seized  for  the
 collection of the tax shall not be sold:
   (1)  if  subdivision (b)   of this section is applicable, prior to the
 issuance of the notice of deficiency and  the  expiration  of  the  time
 provided  in  section  11-1789  of this subchapter for filing a petition
 with the tax commission, and
   (2)  if a petition is filed with the tax commission, whether before or
 after the making of such jeopardy assessment, prior to the expiration of
 the period during which  the  assessment  of  the  deficiency  would  be
 prohibited if subdivision (a)  of this section were not applicable.
   Such  property may be sold if the taxpayer consents to the sale, or if
 the tax commission determines that  the  expenses  of  conservation  and
 maintenance  will greatly reduce the net proceeds, or if the property is
 perishable.
   (k)  Interest. For the purpose of subdivision (a) of  section  11-1784
 of this subchapter, the last date prescribed for payment shall be deter-
 mined  without  regard to any notice and demand for payment issued under
 this section prior to  the  last  date  otherwise  prescribed  for  such
 payment.
   (l)    Early  termination of taxable year. If the tax commission finds
 that a taxpayer designs quickly to depart from this state or  to  remove
 his  or  her property therefrom, or to conceal himself or herself or his
 or her property therein, or to do any other act tending to prejudice  or
 to  render  wholly or partly ineffectual proceedings to collect the city
 personal income tax for the current or the preceding taxable year unless
 such proceedings be brought without  delay,  the  tax  commission  shall
 S. 8474                            976

 declare the taxable period for such taxpayer immediately terminated, and
 shall  cause  notice  of  such  finding  and declaration to be given the
 taxpayer, together with a demand for immediate payment of  the  tax  for
 the taxable period so declared terminated and of the tax for the preced-
 ing taxable year or so much of such tax as is unpaid, whether or not the
 time  otherwise  allowed by law for filing return and paying the tax has
 expired; and such taxes shall thereupon become immediately due and paya-
 ble.  In any proceeding brought to enforce payment of taxes made due and
 payable by virtue of the provisions of this subdivision, the finding  of
 the tax commission made as herein provided, whether made after notice to
 the  taxpayer  or not, shall be for all purposes presumptive evidence of
 jeopardy.
   (m)  Reopening of taxable period. Notwithstanding the  termination  of
 the taxable period of the taxpayer by the tax commission, as provided in
 subdivision  (1)  of  this  section,  the tax commission may reopen such
 taxable period each time the taxpayer is found by the tax commission  to
 have  received income, within the current taxable year, since the termi-
 nation of such period.   A taxable  period  so  terminated  by  the  tax
 commission  may  be reopened by the taxpayer if he or she files with the
 tax commission a true and accurate return of taxable income and  credits
 allowed  under  this chapter for such taxable period, together with such
 other information as the tax commission may by regulations prescribe.
   (n)   Furnishing of bond where taxable  year  is  closed  by  the  tax
 commission.  Payment  of  taxes shall not be enforced by any proceedings
 under the provisions of subdivision (1)  of this section  prior  to  the
 expiration  of  the  time otherwise allowed for paying such taxes if the
 taxpayer furnishes, under regulations prescribed by the tax  commission,
 a  bond  to  insure  the  timely  making of returns with respect to, and
 payment of, such taxes or any  city  personal  income  taxes  for  prior
 years.
   §  11-1795   Criminal penalties; cross-reference.  For criminal penal-
 ties, see article thirty-seven of the tax law.
   § 11-1796 Income taxes of members  of  armed  forces  and  victims  of
 certain  terrorist  attacks. (a) Time to be disregarded.  In the case of
 an individual serving in the armed forces of the United States, or serv-
 ing in support of such armed forces, in an area designated by the presi-
 dent of the United States by executive order as a "combat zone"  at  any
 time during the period designated by the president by executive order as
 the  period of combatant activities in such zone, or hospitalized inside
 or outside the state as a result of injury  received  while  serving  in
 such  an area during such time, the period of service in such area, plus
 the period of continuous hospitalization inside  or  outside  the  state
 attributable to such injury, and the next one hundred eighty days there-
 after,  shall  be  disregarded  in  determining,  under this chapter, in
 respect of the city personal income tax liability, including any  inter-
 est, penalty, or addition to the tax, of such individual:
   (1)  Whether  any  of the following acts was performed within the time
 prescribed therefor:
   (A) filing any return of income tax, except withholding tax;
   (B) payment of any income tax, except withholding tax, or any install-
 ment thereof or of any other liability in respect thereof;
   (C) filing a petition with the tax commission for credit or refund  or
 for  redetermination  of  a  deficiency,  or application for review of a
 decision rendered by the tax commission;
   (D) allowance of a credit or refund of city personal income tax;
   (E) filing a claim for credit or refund of city personal income tax;
 S. 8474                            977
 
   (F) assessment of city personal income tax;
   (G)  giving or making any notice or demand for the payment of any city
 personal income tax, or with respect to any liability  to  the  city  in
 respect of such income tax;
   (H)  collection,  by  the  tax commission, by levy or otherwise of the
 amount of any liability in respect of such income tax;
   (I) bringing suit by the city, the state, or  any  officer,  on  their
 behalf, in respect of any liability in respect of such income tax; and
   (J)  any  other act required or permitted under this chapter or speci-
 fied in regulations prescribed under this section by the tax commission.
   (2) The amount of any credit or refund.
   (b) Special rule for overpayments. (1) Subdivision (a) of this section
 shall not apply for purposes of determining the amount  of  interest  on
 any overpayment of tax.
   (2) If an individual is entitled to the benefits of subdivision (a) of
 this  section  with  respect to any return, amended return, or claim for
 credit or refund, and such return, amended return  or  claim  is  timely
 filed,  determined  after the application of such subdivision, paragraph
 three of subdivision (a) and subdivision (c) of section 11-1788 of  this
 subchapter of this title shall not apply.
   (c)  Action  taken  before  ascertainment  of  right  to benefits. The
 assessment or collection of the tax imposed by this chapter  or  of  any
 liability  in  respect of such tax, or any action or proceeding by or on
 behalf of the city in connection therewith, may be made,  taken,  begun,
 or  prosecuted  in accordance with law, without regard to the provisions
 of subdivision (a)  of this section, unless prior  to  such  assessment,
 collection,  action,  or  proceeding  it  is ascertained that the person
 concerned is entitled to the  benefits  of  subdivision  (a)    of  this
 section.
   (d) Members of armed forces dying in action. In the case of any person
 who  dies while in active service as a member of the armed forces of the
 United States, if such death occurred while serving  in  a  combat  zone
 during  a  period  of combatant activities in such zone, as described in
 subdivision (a)  of this section, or as a result of wounds,  disease  or
 injury  incurred while so serving, the tax imposed by this chapter shall
 not apply with respect to the taxable year in which falls  the  date  of
 his or her death, or with respect to any prior taxable year ending on or
 after  the first day so served in a combat zone, and no returns shall be
 required in behalf of such person or his or her estate  for  such  year;
 and  the  tax  for  any such taxable year which is unpaid at the date of
 death, including interest, additions to tax and penalties, if any, shall
 not be assessed and, if assessed, the assessment shall be abated and, if
 collected, shall be refunded to the legal representative of such  estate
 if  one  has been appointed and has qualified, or, if no legal represen-
 tative has been appointed or has qualified, to the surviving spouse.
   (e) Treatment of individuals performing Desert  Shield  services.  (1)
 Any individual who performed Desert Shield services shall be entitled to
 the  benefits  of  subdivisions  (a) and (b) of this section in the same
 manner as if such services were services referred to in subdivision  (a)
 of this section.
   (2)  For  purposes  of  this  subdivision,  the  term  "Desert  Shield
 services" means any services in the armed forces of the United States or
 in support of such armed forces if
   (A) such services are performed in the area designated by  the  presi-
 dent of the United States as the "Persian Gulf Desert Shield area", and
 S. 8474                            978
 
   (B)  such services are performed during the period beginning on August
 second, nineteen hundred ninety, and ending on the  date  on  which  any
 portion of the area referred to in subparagraph (A) of this paragraph is
 designated  by  the  president  as a combat zone pursuant to section one
 hundred twelve of the internal revenue code.
   (f)  Relief  for  personnel  under  hostile fire. For purposes of this
 section, members of the armed forces of the United  States  who  perform
 military  service in an area outside an area designated by the president
 of the United States by  executive  order  as  a  "combat  zone",  which
 service  is in direct support of military operations in such zone and is
 performed under conditions which qualify such members for  hostile  fire
 pay,  as authorized under subdivision (a) of section nine of the federal
 uniformed services pay  act  of  nineteen  hundred  sixty-three,  shall,
 during  the  period of such qualifying service, be deemed to have served
 in such combat zone.
   (g) Application to spouse. The provisions of  subdivisions  (a),  (b),
 (c),  (e) and (f) of this section shall apply to the spouse of any indi-
 vidual entitled to the benefits of  subdivision  (a)  of  this  section;
 provided, however, that such subdivisions shall not apply for any spouse
 for any taxable year beginning more than two years after the date desig-
 nated  under  section one hundred twelve of the internal revenue code as
 the date of termination of combatant activities in a combat zone.
   (h) Individuals dying as a result of certain attacks. (1) General.  In
 the  case of a specified terrorist victim, any tax imposed by this chap-
 ter shall not apply:   (A) with respect to the  taxable  year  in  which
 falls  the date of death; and (B) with respect to any prior taxable year
 in the period beginning with the last taxable  year  ending  before  the
 taxable  year  in  which  the  wounds or injury referred to in paragraph
 three of this subdivision were incurred.
   (2) Taxation of certain benefits. Paragraph one  of  this  subdivision
 shall  not  apply to the amount of any tax imposed by this chapter which
 would be computed by only taking into account the items of income, gain,
 or other amounts determined by the United States secretary of the treas-
 ury to be taxable pursuant to paragraph  three  of  subdivision  (d)  of
 section six hundred ninety-two of the internal revenue code.
   (3)  Specified terrorist victim. For purposes of this subdivision, the
 term "specified terrorist victim" means  any  decedent  who  dies  as  a
 result of wounds or injury incurred as a result of the terrorist attacks
 against  the  United  States  on  September  eleventh, two thousand one,
 provided, however, such term shall not include any individual identified
 by the attorney general of the United States to have been a  participant
 or  conspirator  in any such attack or a representative of such an indi-
 vidual.
   § 11-1797 General powers of  tax  commission.  (a)  General.  The  tax
 commission  shall administer and enforce the tax imposed by this chapter
 and it is authorized to make such rules and regulations, and to  require
 such  facts  and information to be reported, as it may deem necessary to
 enforce the provisions of this chapter.
   (b) Examination of books and witnesses. (1) The tax commission for the
 purpose of ascertaining the  correctness  of  any  return,  or  for  the
 purpose  of  making  an  estimate of taxable income of any person, shall
 have power to examine or to cause to have  examined,  by  any  agent  or
 representative  designated  by  it  for that purpose, any books, papers,
 records or memoranda bearing upon the matters required to be included in
 the return, and may require the attendance of the person  rendering  the
 return  or  any officer or employee of such person, or the attendance of
 S. 8474                            979
 
 any other person having knowledge in the premises, and may take testimo-
 ny and require proof material for its information, with power to  admin-
 ister oaths to such person or persons.
   (2) The tax commission may take any action under paragraph one of this
 subdivision to inquire into the commission of any offense connected with
 the  administration  or  enforcement of this chapter, provided, however,
 that notwithstanding the provisions of section 11-1774 of  this  chapter
 no  such action shall be taken after a referral by the department or the
 tax commission to the attorney general, a district attorney or any other
 prosecutorial agency is in effect.
   (c) Abatement authority. The tax commission, of its  own  motion,  may
 abate  any small unpaid balance of an assessment of city personal income
 tax, or any liability in respect thereof, if the tax  commission  deter-
 mines  under  uniform rules prescribed by it that the administration and
 collection costs involved would not warrant  collection  of  the  amount
 due.  It  may  also  abate, of its own motion, the unpaid portion of the
 assessment of any tax or any liability  in  respect  thereof,  which  is
 excessive  in  amount, or is assessed after the expiration of the period
 of limitation properly applicable thereto, or is erroneously or illegal-
 ly assessed.  No claim for abatement under  this  subdivision  shall  be
 filed by a taxpayer.
   (d)  Special  refund  authority. Where no questions of fact or law are
 involved and it appears from the records of the tax commission that  any
 moneys have been erroneously or illegally collected from any taxpayer or
 other  person,  or paid by such taxpayer or other person under a mistake
 of facts, pursuant to the provisions of this chapter, the tax commission
 at any time, without regard to any period of limitations, shall have the
 power, upon making a record of its reasons therefor in writing, to cause
 such moneys so paid and being  erroneously  and  illegally  held  to  be
 refunded and to issue therefor its certificate to the comptroller.
   (e)  Secrecy  requirement  and  penalties for violation. (1) Except in
 accordance with proper judicial order or as otherwise provided  by  law,
 it  shall  be unlawful for the tax commission, any tax commissioner, any
 officer or employee of the  department  of  taxation  and  finance,  any
 person engaged or retained by such department on an independent contract
 basis,  any  depositary to which any return may be delivered as provided
 in subdivision (h) or (i) of this section, any officer  or  employee  of
 such depositary, or any person who, pursuant to this section, is permit-
 ted  to inspect any report or return or to whom a copy, an abstract or a
 portion of any report or return is furnished, or to whom any information
 contained in any report or return is furnished, to divulge or make known
 in any manner the amount of income  or  any  particulars  set  forth  or
 disclosed in any report or return required under this chapter.
   (2)  The officers charged with the custody of such reports and returns
 shall not be required to produce any of them  or  evidence  of  anything
 contained  in  them  in any action or proceeding in any court, except on
 behalf of the tax commission  in  an  action  or  proceeding  under  the
 provisions  of  this  chapter,  the  tax  law  or in any other action or
 proceeding involving the collection of a tax due under this  chapter  or
 such  tax  law to which the city, state or the tax commission is a party
 or a claimant, or on behalf of any party to  any  action  or  proceeding
 under  the provisions of this chapter when the reports, returns or facts
 shown thereby are directly involved in such action or proceeding, in any
 of which events the court may require the production of, and  may  admit
 in  evidence,  so  much  of  said reports, returns or of the facts shown
 thereby, as are pertinent to the action or proceeding and no  more.  The
 S. 8474                            980
 
 tax  commission  may,  nevertheless,  publish a copy or a summary of any
 decision rendered after the hearing required under  section  11-1789  of
 this subchapter.
   (3)  Nothing in this section shall be construed to prohibit the deliv-
 ery by the state commissioner of taxation  and  finance  to  the  county
 clerk of a county within the city of New York of a mailing list of indi-
 viduals to whom income tax forms are mailed by the state commissioner of
 taxation  and  finance  for  the  sole  purpose  of  compiling a list of
 prospective jurors as provided in article sixteen of the judiciary  law.
 Provided, however, such delivery shall only be made pursuant to an order
 of  the chief administrator of the courts, appointed pursuant to section
 two hundred ten of such law. No such order may  be  issued  unless  such
 chief  administrator  is  satisfied  that such mailing list is needed to
 compile a proper list of prospective jurors for  the  county  for  which
 such  order  is sought and that, in view of the responsibilities imposed
 by the various laws of the state  on  the  department  of  taxation  and
 finance,  it is reasonable to require the state commissioner of taxation
 and finance to furnish such list. Such order  shall  provide  that  such
 list  shall be used for the sole purpose of compiling a list of prospec-
 tive jurors and that such county clerk shall take all necessary steps to
 insure that the list is kept confidential and that there is no unauthor-
 ized use or disclosure  of  such  list.  Furthermore,  nothing  in  this
 section shall be construed to prohibit the delivery to a taxpayer or his
 or  her duly authorized representative of a certified copy of any return
 or report filed in connection with his or her tax  or  to  prohibit  the
 publication of statistics so classified as to prevent the identification
 of  particular  reports  or  returns  and  the  items  thereof,  or  the
 inspection by the attorney general or other legal representatives of the
 state or city of the report or return of any taxpayer  who  shall  bring
 action  to set aside or review the tax based thereon, or against whom an
 action or proceeding under this chapter  has  been  recommended  by  the
 commissioner  of  taxation  and  finance, the corporation counsel or the
 attorney general or has  been  instituted,  or  the  inspection  of  the
 reports  or  returns  required  under this chapter by the comptroller or
 duly designated officer or employee of the state department of audit and
 control, for purposes of the audit of a refund of  any  tax  paid  by  a
 taxpayer  under  this chapter, or the furnishing to the state department
 of social services of the amount of an overpayment of tax  and  interest
 thereon  certified  to  the  comptroller to be credited against past-due
 support pursuant to section one hundred seventy-one-c of the tax law and
 of the name and social security number of the  taxpayer  who  made  such
 overpayment  or  the  furnishing  to the New York state higher education
 services corporation of the amount of an overpayment of tax and interest
 thereon certified to the comptroller to be credited against  the  amount
 of  a  default  in  repayment  of  a guaranteed student loan pursuant to
 section one hundred seventy-one-d of the tax law and  of  the  name  and
 social  security number of the taxpayer who made such overpayment or the
 furnishing to the state university of New York or the city university of
 New York or the attorney general on behalf of such state or city univer-
 sity the amount of an overpayment of tax and interest thereon  certified
 to  the  comptroller  to  be credited against the amount of a default in
 repayment of a state university loan or city university loan pursuant to
 section one hundred seventy-one-e of the tax law and  of  the  name  and
 social security number of the taxpayer who made such overpayment, or the
 disclosing  to  a state agency, pursuant to section one hundred seventy-
 one-f of the tax law, of the amount of an overpayment and interest ther-
 S. 8474                            981
 
 eon certified to the comptroller  to  be  credited  against  a  past-due
 legally  enforceable debt owed to such agency and of the name and social
 security number of the  taxpayer  who  made  such  overpayment,  or  the
 disclosing  to  the  commissioner  of  finance  of the city of New York,
 pursuant to section one hundred seventy-one-1 of the  tax  law,  of  the
 amount  of  an  overpayment  and interest thereon certified to the comp-
 troller to be credited against a city of New York tax  warrant  judgment
 debt and of the name and social security number of the taxpayer who made
 such overpayment. Reports and returns shall be preserved for three years
 and  thereafter  until  the  state  commissioner of taxation and finance
 orders them to be destroyed.
   (3-a) Notwithstanding the provisions of paragraph one of this subdivi-
 sion, the state commissioner of taxation and finance or the commissioner
 of finance may disclose to a taxpayer or a taxpayer's related member, as
 defined in subdivision (t) of section 11-1712 of this chapter,  informa-
 tion relating to any royalty paid, incurred or received by such taxpayer
 or  related member to or from the other, including the treatment of such
 payments by the taxpayer or the related member in any report  or  return
 transmitted to the state commissioner of taxation and finance under this
 chapter  or  the  New  York state tax law or the commissioner of finance
 under this title.
   (4) (A) Any officer or employee of the state, who  willfully  violates
 the provisions of this subdivision shall be dismissed from office and be
 incapable  of  holding  any  public office in this state for a period of
 five years thereafter.
   (B) Cross-reference: For criminal penalties, see article  thirty-seven
 of the tax law.
   (f)  Cooperation  with  the  United States and other states.  Notwith-
 standing the provisions of subdivision (e)  of  this  section,  the  tax
 commission may permit the secretary of the treasury of the United States
 or his or her delegates, or the proper tax officer of any state imposing
 an  income tax upon the incomes of individuals, or the authorized repre-
 sentative of either such officer, to inspect any return filed under this
 chapter, or may furnish to such officer or his or her authorized  repre-
 sentative  an  abstract  of  any  such  return or supply him or her with
 information  concerning  an  item  contained  in  any  such  return,  or
 disclosed  by any investigation of tax liability under this chapter, but
 such permission shall be granted or such information furnished  to  such
 officer  or  his  or  her  representative only if the laws of the United
 States or of such other state, as the case may be,  grant  substantially
 similar  privileges  to  the commission or officer of this state charged
 with the administration of the tax imposed  by  this  chapter  and  such
 information  is  to  be used for tax purposes only; and provided further
 the commissioner of taxation and finance may furnish to the commissioner
 of internal revenue or his or her authorized representative such returns
 filed under this chapter and other tax information, as  he  or  she  may
 consider  proper,  for  use  in  court  actions or proceedings under the
 internal revenue code,  whether  civil  or  criminal,  where  a  written
 request  therefor  has  been  made  to  the commissioner of taxation and
 finance by the secretary of the treasury of the United States or his  or
 her delegates, provided the laws of the United States grant substantial-
 ly  similar powers to the secretary of the treasury of the United States
 or his or her delegates. Where the commissioner of taxation and  finance
 has  so  authorized use of returns and other information in such actions
 or proceedings, officers and employees of the department of taxation and
 S. 8474                            982
 
 finance may testify in such actions or proceedings in  respect  to  such
 returns or other information.
   (g)  Cooperation  with  the cities of the state of New York.  Notwith-
 standing the provisions of subdivision (e)  of  this  section,  the  tax
 commission  may  permit the proper city officer of any city of the state
 of New York imposing a personal income tax upon  the  incomes  of  resi-
 dents,  or  an unincorporated business income tax, or an earnings tax on
 nonresidents, or the authorized representative of any such  officer,  to
 inspect  any  return  filed  under  this chapter, or may furnish to such
 officer or his or her authorized representative an abstract of any  such
 return  or  supply  him  or  her  with  information  concerning  an item
 contained in any such return, or disclosed by any investigation  of  tax
 liability  under  this  chapter, but such permission shall be granted or
 such information furnished to such officer or his or her  representative
 only  if  the local laws of such city grant substantially similar privi-
 leges to the commission or officer of this state charged with the admin-
 istration of the tax imposed by this chapter and such information is  to
 be  used for tax purposes only; and provided further the commissioner of
 taxation and finance may furnish to  such  city  officer  or  the  legal
 representative  of  such  city such returns filed under this chapter and
 other tax information, as he or she may  consider  proper,  for  use  in
 court  actions  or  proceedings  under  such local law, whether civil or
 criminal, where a written request therefor has been made to the  commis-
 sioner  of taxation and finance by such city officer or his or her dele-
 gate, provided the local law of such city grants  substantially  similar
 powers  to  such city officer or his or her delegate.  Where the commis-
 sioner of taxation and finance has so  authorized  use  of  returns  and
 other information in such actions or proceedings, officers and employees
 of the department of taxation and finance may testify in such actions or
 proceedings in respect to such returns or other information.
   (h) Withholding returns. Notwithstanding the provisions of subdivision
 (e)  of  this  section the tax commission in its discretion, when making
 deposits, pursuant to section 11-1798 of this subchapter, of taxes with-
 held by employers, may deliver to the depositary the withholding returns
 filed by such employers as provided in section 11-1774 of this  chapter,
 for  the  purpose  of  insuring  that  all  money  so deposited shall be
 correctly credited to taxpayers' accounts.
   (i) Filing returns and making payments to depository banks.   Notwith-
 standing  the  provisions  of  subdivision  (e) of this section, the tax
 commission, in its discretion, may require or permit any or all individ-
 uals, estates or trusts liable for any tax imposed by this  chapter,  to
 make payments on account of estimated tax and payment of any tax, penal-
 ty or interest imposed by this chapter to banks, banking houses or trust
 companies  designated  by  the  tax  commission  and to file reports and
 returns with such banks, banking houses or trust companies as agents  of
 the  tax  commission,  in  lieu  of  making  any such payment to the tax
 commission. However, the tax commission shall designate only such banks,
 banking houses or trust companies as are or shall be designated  by  the
 comptroller as depositories pursuant to section 11-1798 of this subchap-
 ter.
   (j)  (1) Authority to set interest rates. The commissioner of taxation
 and finance shall set the overpayment and underpayment rates of interest
 to be paid pursuant to sections 11-1784, 11-1785  and  11-1788  of  this
 subchapter,  but  if no such rates of interest are set, such overpayment
 rate shall be deemed to be set at six percent per annum and  the  under-
 payment  rate shall be deemed to be set at seven and one-half per annum.
 S. 8474                            983

 Such rates shall be the rates prescribed by paragraphs two and  four  of
 this  subdivision, but shall not be less than seven and one-half percent
 per annum. Any such rates set by such commissioner shall apply to taxes,
 or  any  portion  thereof,  which remain or become due or overpaid on or
 after the date on which such rates become effective and shall apply only
 with respect to interest computed or computable for periods or  portions
 of  periods  occurring  in  the  period  during  which such rates are in
 effect.
   (1) Authority to set interest rates. The commissioner of taxation  and
 finance  shall set the overpayment and underpayment rates of interest to
 be paid pursuant to  sections  11-1784,  11-1785  and  11-1788  of  this
 subchapter,  but  if no such rates of interest are set, such rates shall
 be deemed to be set at six percent per annum. Such rates  shall  be  the
 rates prescribed by paragraphs two and four of this subdivision, but the
 underpayment rate shall not be less than six percent per annum. Any such
 rates  set  by  such  commissioner  shall apply to taxes, or any portion
 thereof, which remain or become due or overpaid on or after the date  on
 which  such  rates become effective and shall apply only with respect to
 interest computed or computable  for  periods  or  portions  of  periods
 occurring in the period during which such rates are in effect.
   (2)  Rates  of interest. (A) Overpayment rate. The overpayment rate of
 interest set under this subdivision shall be the sum of (i) the  federal
 short-term  rate  as provided under paragraph three of this subdivision,
 plus (ii) two percentage points.
   (B) Underpayment rate. The underpayment rate  of  interest  set  under
 this  subdivision shall be the sum of (i) the federal short-term rate as
 provided under paragraph three of this subdivision, plus (ii)  five  and
 one-half percentage points.
   (3) Federal short-term rate. For the purposes of this subdivision:
   (A)  The  federal  short-term  rate for any month shall be the federal
 short-term rate determined by the United States secretary of the  treas-
 ury  during  such  month  in  accordance  with subsection (d) of section
 twelve hundred seventy-four of the internal  revenue  code  for  use  in
 connection  with  section  six  thousand  six  hundred twenty-one of the
 internal revenue code. Any such rate shall be  rounded  to  the  nearest
 full  percent,  or,  if a multiple of one-half of one percent, such rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i) In general. Except as provided in clauses (ii) and (iii)  of  this
 subparagraph,  the  federal  short-term rate for the first month in each
 calendar quarter shall apply during the first calendar quarter beginning
 after such month.
   (ii) Special rule for individual estimated  tax.  In  determining  the
 addition  to  tax  under  subdivision  (c)  of  section  11-1785 of this
 subchapter for failure to pay estimated tax for any  taxable  year,  the
 federal  short-term  rate which applies during the third month following
 the taxable year shall also apply during the first fifteen days  of  the
 fourth month following such taxable year.
   (iii) Special rule for the month of September, nineteen hundred eight-
 y-nine.  The  federal  short-term  rate for the month of April, nineteen
 hundred eighty-nine shall apply with respect  to  setting  the  rate  of
 interest for the month of September, nineteen hundred eighty-nine.
   (4)  Notwithstanding  the provisions of paragraph two of this subdivi-
 sion to the contrary, in the case of interest  payable  by  an  employer
 with  respect  to  income taxes required to be withheld and paid over by
 him or her pursuant to the provisions of subchapter four of this chapter
 S. 8474                            984
 
 and with respect to interest payable to an employer pursuant to subdivi-
 sion (c) of section 11-1786 of this subchapter, the  rates  of  interest
 prescribed  by  this  section  shall be the overpayment and underpayment
 rates  of  interest  prescribed  in  paragraph  two of subsection (e) of
 section one thousand ninety-six of the tax law.
   (5) In computing the amount of any interest required to be paid  under
 this  article  by  the  commissioner  of  taxation and finance or by the
 taxpayer, or any other amount determined by reference to such amount  of
 interest,  such  interest and such amount shall be compounded daily. The
 provisions of this paragraph shall not apply for purposes  of  computing
 the amount of any addition to tax for failure to pay estimated tax under
 subdivision (c) of section 11-1785 of this subchapter.
   (6)  Publication  of  interest rates. The commissioner of taxation and
 finance shall cause to be published in  the  section  for  miscellaneous
 notices in the state register, and give other appropriate general notice
 of,  the  interest  rates to be set under this subdivision no later than
 twenty days preceding the first day of the calendar quarter during which
 such interest rates apply. The setting and publication of such  interest
 rates  shall  not be included within paragraph (a) of subdivision two of
 section one hundred two of the state administrative procedure act relat-
 ing to the definition of a rule.
   (7) Cross-reference. For provisions  relating  to  the  power  of  the
 commissioner of taxation and finance to abate small amounts of interest,
 see subdivision (c) of this section.
   (k)  Disclosure of collection activities with respect to joint return.
 Notwithstanding the provisions of subdivision (e) of  this  section,  if
 any deficiency of tax with respect to a joint return is assessed and the
 individuals filing such return are no longer married or no longer reside
 in  the  same household, upon request in writing by either of such indi-
 viduals, the commissioner of taxation  and  finance  shall  disclose  in
 writing  to  the individual making the request whether such commissioner
 has attempted to collect such deficiency from such other individual, the
 general nature of such collection activities, and the amount collected.
   The opening paragraph of this subdivision shall not apply to any defi-
 ciency which may not be collected by reason of expiration of time within
 which to issue a warrant under subdivision (c)  of  section  11-1792  of
 this  subchapter  or  within  which to collect such tax by execution and
 levy or by court proceeding.
   (l) Disclosure of certain information where more than  one  person  is
 subject  to  penalty. If the commissioner of taxation and finance deter-
 mines that a person is liable for a penalty  under  subdivision  (g)  of
 section  11-1785  of  this  subchapter with respect to any failure, upon
 request in writing of such person, such commissioner shall  disclose  in
 writing  to  such  person  (1)  the  name  of any other person whom such
 commissioner has determined to be liable for such penalty  with  respect
 to  such  failure,  and  (2)  whether such commissioner has attempted to
 collect such penalty from such other person, the general nature of  such
 collection activities, and the amount collected.
   (m)  (1)  Notwithstanding  the  provisions  of subdivision (e) of this
 section, upon written request from the chairperson of the  committee  on
 ways and means of the United States House of Representatives, the chair-
 person  of  the committee on finance of the United States Senate, or the
 chairperson of the joint committee on  taxation  of  the  United  States
 Congress,  the  commissioner  of taxation and finance shall furnish such
 committee with any current or  prior  year  returns  specified  in  such
 request  that  were  filed  under  this  article by the president of the
 S. 8474                            985
 
 United States, vice-president of the United States, member of the United
 States Congress representing New York state, or any person who served in
 or was employed by the executive branch of the government of the  United
 States  on the executive staff of the president, in the executive office
 of the president, or in an acting or confirmed capacity  in  a  position
 subject  to  confirmation  by  the United States senate; or, in New York
 state: a statewide elected official, as  defined  in  paragraph  (a)  of
 subdivision one of section seventy-three-a of the public officers law; a
 state  officer  or employee, as defined in subparagraph (i) of paragraph
 (c) of subdivision one of  such  section  seventy-three-a;  a  political
 party  chairperson,  as  defined  in paragraph (h) of subdivision one of
 such section seventy-three-a; a local elected official,  as  defined  in
 subdivisions  one  and  two  of section eight hundred ten of the general
 municipal law; a person appointed, pursuant to  law,  to  serve  due  to
 vacancy  or  otherwise  in  the position of a local elected official, as
 defined in subdivisions one and two of section eight hundred ten of  the
 general  municipal law; a member of the state legislature; or a judge or
 justice of the unified court system; provided  however  that,  prior  to
 furnishing  any  return,  the  commissioner  shall  redact any copy of a
 federal return, or portion thereof, attached to, or any information on a
 federal return that is reflected on, such return, and any social securi-
 ty numbers, account numbers and residential address information.
   (2) No returns shall be furnished pursuant to this subdivision  unless
 the  chairperson  of  the requesting committee certifies in writing that
 such returns have been requested related to, and in  furtherance  of,  a
 legitimate  task of the Congress, that the requesting committee has made
 a written request to the United States secretary  of  the  treasury  for
 related  federal  reports  or  returns  or report or return information,
 pursuant to 26 U.S.C.  Section  6103(f),  and  that  if  such  requested
 returns  are  inspected by and/or submitted to another committee, to the
 United States House of Representatives, or to the United States  Senate,
 then  such inspection and/or submission shall occur in a manner consist-
 ent with federal law as informed  by  the  requirements  and  procedures
 established in 26 U.S.C. Section 6103(f).
   §  11-1798  Deposit and disposition of revenues. All revenue collected
 by the state commissioner of taxation and finance from the taxes imposed
 pursuant to this chapter or chapter nineteen  of  this  title  shall  be
 deposited  daily  with  such  responsible banks, banking houses or trust
 companies, as may be designated by the state comptroller, to the  credit
 of  the  comptroller, in trust for the city. Such deposits shall be kept
 in trust and separate and apart from all other moneys in the  possession
 of the comptroller. The state comptroller shall require adequate securi-
 ty  from  all  such  depositories of such revenue collected by the state
 commissioner of taxation and finance. The state comptroller shall retain
 in his or her hands such amounts as the  commissioner  of  taxation  and
 finance  may  determine  to  be  necessary for refunds in respect to the
 taxes imposed by this chapter and such chapter nineteen and for  reason-
 able costs of the state commissioner of taxation and finance in adminis-
 tering,  collecting  and distributing such taxes, out of which the comp-
 troller shall pay any refunds of such taxes to which taxpayers shall  be
 entitled under this chapter and such chapter nineteen and except further
 that  he or she shall pay to a non-obligated spouse that amount of over-
 payment of tax imposed pursuant to the authority of  article  thirty  of
 the  tax  law  or  former  article two-E of the general city law and the
 interest on such amount which has been credited pursuant to section  one
 hundred  seventy-one-c,  one hundred seventy-one-d, one hundred seventy-
 S. 8474                            986
 
 one-e, one hundred seventy-one-f or one hundred seventy-one-l of the tax
 law and which is certified to him or her by the commissioner of taxation
 and finance as the amount due  such  non-obligated  spouse  pursuant  to
 paragraph  six of subsection (b) of section six hundred fifty-one of the
 tax law, and he or she shall deduct a like amount  which  he  shall  pay
 into  the treasury to the credit of the general fund from amounts subse-
 quently payable to the department of social services, the state  univer-
 sity  of New York, the city university of New York, the higher education
 services corporation, or to the revenue  arrearage  account  or  special
 offset   fiduciary   account   pursuant   to   section  ninety-one-a  or
 ninety-one-c of the state finance law, as the case may be, whichever had
 been credited the amount originally withheld from such overpayment  and,
 with respect to amounts originally withheld from such overpayment pursu-
 ant  to section one hundred seventy-one-l of the tax law and paid to the
 city of New York, the comptroller shall collect a like amount  from  the
 city  of  New  York.  The state comptroller, after reserving such refund
 fund and such costs shall, on or before the fifteenth day of each month,
 pay to the chief fiscal officer of the city the balance  of  such  taxes
 collected, to be paid into the treasury of the city to the credit of the
 general  fund except that he or she shall pay to the state department of
 social services that amount of overpayments of the taxes imposed  pursu-
 ant  to  this chapter or chapter nineteen of this title and the interest
 on such amount which is certified to him or her by the state commission-
 er of taxation and finance as the amount to be credited against past-due
 support pursuant to subdivision six of section one hundred seventy-one-c
 of the tax law and except that he or she shall pay to the New York state
 higher education services corporation that amount of overpayments of the
 taxes imposed pursuant to this chapter or chapter nineteen of this title
 and the interest on such amount which is certified to him or her by  the
 state  commissioner of taxation and finance as the amount to be credited
 against the amount of defaults in repayment of guaranteed student  loans
 pursuant to subdivision five of section one hundred seventy-one-d of the
 tax  law  and except that he or she shall pay to the state university of
 New York or the city university of New York, respectively,  that  amount
 of overpayments of the taxes imposed pursuant to this chapter or chapter
 nineteen  of  this title and the interest on such amount which is certi-
 fied to him or her by the state commissioner of taxation and finance  as
 the amount to be credited against the amount of defaults in repayment of
 state university or city university loans pursuant to subdivision six of
 section  one  hundred  seventy-one-e  of the tax law, and except further
 that, notwithstanding any other provision of law, he or she shall credit
 to the revenue arrearage account, pursuant to  section  ninety-one-a  of
 the  state finance law, that amount of overpayments of the taxes imposed
 pursuant to this chapter or chapter  nineteen  of  this  title  and  the
 interest  on  such  amount which is certified to him or her by the state
 commissioner of taxation and  finance  as  the  amount  to  be  credited
 against  a  past-due  legally  enforceable  debt  owed to a state agency
 pursuant to paragraph (a) of subdivision  six  of  section  one  hundred
 seventy-one-f  of the tax law, provided, however, he or she shall credit
 to  the  special  offset  fiduciary   account,   pursuant   to   section
 ninety-one-c  of  the state finance law, any such amount creditable as a
 liability as set forth in paragraph (b) of subdivision  six  of  section
 one  hundred seventy-one-f of the tax law, and except further that he or
 she shall pay to the city of New York that amount of overpayments of tax
 imposed pursuant to this chapter or chapter nineteen of this  title  and
 the  interest  on  such  amount  which is certified to him or her by the
 S. 8474                            987
 
 state commissioner of taxation and finance as the amount to be  credited
 against  city  of New York tax warrant judgment debt pursuant to section
 one hundred seventy-one-l of the tax law. The amount deducted for admin-
 istering,  collecting  and  distributing  such taxes during such monthly
 period shall be paid by the state comptroller into the general  fund  of
 the state treasury to the credit of the state purposes fund therein. The
 first  payment  to  such chief fiscal officer shall be made on or before
 March fifteenth,  nineteen  hundred  seventy-six,  which  payment  shall
 represent  the  balance  of  revenue after provision for refund and such
 reasonable costs, with respect to taxes collected  from  January  first,
 nineteen  hundred  seventy-six  through  February twenty-ninth, nineteen
 hundred seventy-six. Subsequent payments shall  be  made  on  or  before
 April  fifteenth,  nineteen  hundred  seventy-six  and  on or before the
 fifteenth day of each succeeding month thereafter, and  shall  represent
 the  balance  of  revenue  with respect to taxes collected the preceding
 calendar month. The amounts so payable shall be certified to  the  state
 comptroller  by the state commissioner of taxation and finance or his or
 her delegate, either of whom shall not be held liable for any inaccuracy
 in such certificate. Where the amount so paid over to such chief  fiscal
 officer  is  more or less than the amount then due such city, the amount
 of overpayment or underpayment shall be certified  to  the  state  comp-
 troller  by the state commissioner of taxation and finance or his or her
 delegate, either of whom shall not be held liable for any inaccuracy  in
 such  certificate. The amount of overpayment or underpayment shall be so
 certified to the state comptroller as soon after the  discovery  of  the
 overpayment  or  underpayment  as  reasonably  possible  and  subsequent
 payments by the state comptroller to such chief fiscal officer shall  be
 adjusted  by  subtracting the amount of any such overpayment from, or by
 adding the amount of any such underpayment to such number of  subsequent
 payments  and  distributions  as  the  state  comptroller  and the state
 commissioner of taxation and finance shall consider reasonable  in  view
 of the amount of the overpayment or underpayment and all other facts and
 circumstances.
   §  11-1800    Enforcement with other taxes. (a) If there is assessed a
 tax under this chapter and there is also assessed a tax or taxes against
 the same taxpayer pursuant to article twenty-two of the tax law or under
 chapter nineteen of this title and if the tax  commission  takes  action
 under  such  article  twenty-two  or  under  such  chapter nineteen with
 respect to the enforcement and collection of the tax or  taxes  assessed
 under  such  articles  or  chapter,  the  tax commission shall, wherever
 possible, accompany such action with  a  similar  action  under  similar
 enforcement and collection provisions of this chapter.
   (b)  Any  moneys  collected  as a result of such joint action shall be
 deemed to have been collected in proportion to the amounts due,  includ-
 ing  tax,  penalties, interest and additions to tax, under article twen-
 ty-two of the tax law and this city income tax.
   (c) Whenever the tax commission takes any action  with  respect  to  a
 deficiency  of  income  tax  under  article twenty-two of the tax law or
 under chapter nineteen of this title, other than the action set forth in
 subdivision (a) of this section, it may in its discretion accompany such
 action with a similar action under such city income tax.
   § 11-1801  Administration, collection and review. (a) Except as other-
 wise provided in this chapter, any tax imposed by this chapter shall  be
 administered  and  collected by the tax commission in the same manner as
 the tax imposed by article twenty-two of the tax law is administered and
 collected by such commission.   Whenever there is  joint  collection  of
 S. 8474                            988
 
 state  and  city  personal  income  taxes,  it shall be deemed that such
 collections shall represent proportionately  the  applicable  state  and
 city  personal  income taxes in determining the amount to be remitted to
 the city.
   (b)  The  tax commission, in its discretion, may require or permit any
 or all persons liable for any  tax  imposed  by  this  chapter  to  make
 payments  on account of estimated tax and payment of any tax, penalty or
 interest to such banks, banking houses or trust companies designated  by
 the  tax  commission and to file returns with such banks, banking houses
 or trust companies, as agent of the tax commission, in lieu of paying  a
 tax  imposed  by  this chapter directly to the tax commission.  However,
 the tax commission shall designate only such banks,  banking  houses  or
 trust  companies which are designated by the comptroller as depositories
 of the state.
   (c) Notwithstanding any other provisions  of  this  chapter,  the  tax
 commission may require:
   (1) the filing of any or all of the following:
   (A) a combined return which, in addition to the return provided for in
 section  11-1751  of  this  chapter, may also include any or both of the
 returns required to be filed by a resident individual of New York  state
 pursuant  to  the provisions of section six hundred fifty-one of the tax
 law and which may be required to be filed by such individual pursuant to
 chapter nineteen of this title and
   (B) a combined employer's return which, in addition to the  employer's
 return provided for by this chapter, may also include any or both of the
 employer's returns required to be filed by the same employer pursuant to
 the  provisions  of  section  six  hundred  seventy-four of such law and
 required to be filed by such employer pursuant to such chapter  nineteen
 of this title and
   (2) where a combined return or employer's return is required, and with
 respect  to  the  payment  of estimated tax, the tax commission may also
 require the payment to it of a single amount which shall equal the total
 of the amounts which would have  been  required  to  be  paid  with  the
 returns or employer's returns or in payment of estimated tax pursuant to
 the  provisions of article twenty-two of the tax law, and the provisions
 of this chapter as if no  combined  return  or  employer's  return  were
 required.
   §  11-1802  Construction. This chapter shall be construed and enforced
 in conformity with article thirty of the tax law, as added to  such  law
 by  chapter  eight  hundred  eighty-one  of the laws of nineteen hundred
 seventy-five, pursuant to which article it is enacted.
 
                                CHAPTER 19
                       EARNINGS TAX ON NONRESIDENTS
                               SUBCHAPTER 1
                                  GENERAL
 
   § 11-1901 Meaning of terms. As used in  this  chapter,  the  following
 terms shall mean and include:
   (a)  "Commissioner"  means  the  commissioner  of  finance of the city
 except that with respect to taxes imposed for any taxable year beginning
 on or after January first, nineteen hundred seventy-six, such term shall
 mean state tax commission.
   (b) "Payroll period" and "employer" mean the same  as  payroll  period
 and  employer  as  defined in subsections (b) and (d) of section thirty-
 four hundred one of the internal revenue code, and "employee" shall also
 S. 8474                            989
 
 include all those included  as  employees  in  subsection  (c)  of  such
 section of such code.
   (c) "Commissioner of finance" means the commissioner of finance of the
 city.
   (d) "This state" means the state of New York.
   (e)  "Wages" means wages as defined in subsection (a) of section thir-
 ty-four hundred one of the internal revenue code, except that (1)  wages
 shall  not  include payments for active service as a member of the armed
 forces of the United States and shall not include,  in  the  case  of  a
 nonresident  individual  or  partner of a partnership doing an insurance
 business as a member of the New York  insurance  exchange  described  in
 section  six  thousand two hundred one of the insurance law, any item of
 income, gain, loss or deduction of such business which is such  individ-
 ual's  distributive or pro rata share for federal income tax purposes or
 which such individual is required to take into  account  separately  for
 federal  income tax purposes, and (2) wages shall include (i) the amount
 of member or employee contributions to a retirement  system  or  pension
 fund picked up by the employer pursuant to subdivision f of section five
 hundred  seventeen  or  subdivision d of section six hundred thirteen of
 the retirement and social security law or  section  13-225.1,  13-327.1,
 13-125.1,  13-125.2  or  13-521.1  of  title thirteen of the code of the
 preceding municipality or subdivision nineteen  of  section  twenty-five
 hundred  seventy-five  of the education law, (ii) the amount deducted or
 deferred from an employee's salary under  a  flexible  benefits  program
 established  pursuant  to  section twenty-three of the general municipal
 law or section twelve hundred ten-a of the public authorities law, (iii)
 the amount by which an employee's salary  is  reduced  pursuant  to  the
 provisions  of  subdivision  b  of section 12-126.1 and subdivision b of
 section 12-126.2 of title twelve of the code of  the  preceding  munici-
 pality,  and  (iv)  the  amount of member or employee contributions to a
 retirement system or pension fund picked up or paid by the employer  for
 members  of  the  Manhattan  and  Bronx surface transportation authority
 pension plan and treated as employer contributions in determining income
 tax treatment under subdivision (h) of section four hundred fourteen  of
 the Internal Revenue Code.
   (f) "Net earnings from self-employment" means the same as net earnings
 from  self-employment  as  defined in subsection (a) of section fourteen
 hundred two of the internal revenue code, except that the deduction  for
 wages  and  salaries  paid or incurred for the taxable year which is not
 allowed pursuant to section two hundred eighty-c of such code  shall  be
 allowed,  and except that an estate or trust shall be deemed to have net
 earnings from self-employment determined in the same  manner  as  if  it
 were  an individual subject to the tax on self-employment income imposed
 by section fourteen hundred one of the internal revenue code  diminished
 by:    (1)  the  amount  of  any  deduction allowed by subsection (c) of
 section six hundred forty-two of the internal revenue code and  (2)  the
 deductions  allowed  by  sections  six hundred fifty-one and six hundred
 sixty-one of such code to the extent that they  represent  distributions
 or  payments to a resident of the city.  However, "trade or business" as
 used in subsection (a) of section fourteen  hundred  two  of  such  code
 shall mean the same as trade or business as defined in subsection (c) of
 section  fourteen hundred two of such code, except that paragraphs four,
 five and six of such subsection shall not apply in determining net earn-
 ings from self-employment taxable under this chapter. Provided, however,
 in the case of a nonresident individual  or  partner  of  a  partnership
 doing  an  insurance  business  described  in  section  six thousand two
 S. 8474                            990
 
 hundred one of the insurance law, any item  of  income,  gain,  loss  or
 deduction of such business which is the individual's distributive or pro
 rata  share  for  federal income tax purposes or which the individual is
 required to take into account separately for federal income tax purposes
 shall not be considered to be "net earnings from self-employment".
   (g)  "Taxable  year"  means  the  taxpayer's  taxable year for federal
 income tax purposes.
   (h) Resident individual. A resident individual means an individual:
   (1) who is domiciled in the city, unless (A) he or  she  maintains  no
 permanent  place  of  abode  in the city, maintains a permanent place of
 abode elsewhere, and spends in the aggregate not more than  thirty  days
 of  the  taxable  year in the city, or (B) (i) within any period of five
 hundred forty-eight consecutive days he or she is present in  a  foreign
 country  or  countries  for  at  least four hundred fifty days, and (ii)
 during such period of five hundred forty-eight consecutive  days  he  or
 she  is  not  present in the city for more than ninety days and does not
 maintain a permanent place of abode in the city  at  which  his  or  her
 spouse,  unless  such spouse is legally separated, or minor children are
 present for more than ninety days, and (iii) during any period  of  less
 than  twelve  months which would be treated as a separate taxable period
 pursuant to section  11-1919  of  this  chapter,  and  which  period  is
 contained  within  such  period  of five hundred forty-eight consecutive
 days, he or she is present in the city for a number of days  which  does
 not  exceed an amount which bears the same ratio to ninety as the number
 of days contained in such period of less than  twelve  months  bears  to
 five hundred forty-eight, or
   (2)  who  is not domiciled in the city but maintains a permanent place
 of abode in the city and spends in the aggregate more than  one  hundred
 eighty-three  days of the taxable year in the city, unless such individ-
 ual is in active service in the armed forces of the United States.
   (i) Nonresident individual. A nonresident individual means an individ-
 ual who is not a resident.
   (j) Resident estate or trust. A resident estate or trust means:
   (1) the estate of a decedent who at his or her death was domiciled  in
 the city,
   (2)  a  trust,  or a portion of a trust, consisting of property trans-
 ferred by will of a decedent who at his or her death  was  domiciled  in
 the city, or
   (3) a trust, or portion of a trust, consisting of the property of:
   (A)  a  person  domiciled  in  the  city at the time such property was
 transferred to the trust, if such trust or portion of a trust  was  then
 irrevocable, or if it was then revocable and has not subsequently become
 irrevocable; or
   (B)  a person domiciled in the city at the time such trust, or portion
 of a trust, became irrevocable, if it was revocable when  such  property
 was transferred to the trust but has subsequently become irrevocable.
   For the purposes of this subdivision, a trust or portion of a trust is
 revocable if it is subject to a power, exercisable immediately or at any
 future  time,  to  revest title in the person whose property constitutes
 such trust or portion of a trust, and a trust  or  portion  of  a  trust
 becomes  irrevocable  when  the possibility that such power may be exer-
 cised has been terminated.
   (k) Nonresident estate or trust. A nonresident estate or  trust  means
 an estate or trust which is not a resident.
   (l)  Unless a different meaning is clearly required, any terms used in
 this chapter shall have the same meaning as when used  in  a  comparable
 S. 8474                            991
 
 context  in  the laws of the United States relating to federal taxes but
 such meaning  shall  be  subject  to  the  exceptions  or  modifications
 prescribed in or pursuant to article two-E of the general city law or by
 the  laws  of  this state. Any reference in this chapter to the internal
 revenue code, the internal revenue code of nineteen  hundred  eighty-six
 or  to  the  laws  of the United States shall mean the provisions of the
 internal revenue code of nineteen hundred eighty-six, unless a reference
 to the internal revenue code of nineteen hundred fifty-four  is  clearly
 intended,  and  amendments  thereto, and other provisions of the laws of
 the United States relating to federal taxes, as the same are included in
 the appendix and supplement to the appendix to this chapter. The  quota-
 tion  of  such laws of the United States is intended to make them a part
 of this chapter and to avoid constitutional  uncertainties  which  might
 result  if  such laws were merely incorporated by reference.  The quota-
 tion of a provision of the federal internal revenue code or of any other
 law of the United States shall not necessarily mean that it is  applica-
 ble to or has relevance to this chapter.
   (m)  With  respect  to  any taxable year beginning in nineteen hundred
 seventy, until and including the thirty-first day of December,  nineteen
 hundred seventy-one, "administrator" shall be read as "state tax commis-
 sion";  "administrative agencies of the city" shall be read as "adminis-
 trative agencies of the state"; "depositories or financial agents of the
 city" shall be read as "depositories or financial agents of the  state";
 "officers  or  employees of the department of finance of the city" shall
 be read as "officers or employees of the state  department  of  taxation
 and finance"; in sections 11-1934, 11-1936, 11-1939, and 11-1942 of this
 chapter  "city"  shall be read as "state"; "corporation counsel or other
 appropriate officer of the city" or "corporation counsel  of  the  city"
 shall  be  read as "state attorney general"; and the words "it" or "its"
 shall apply instead of the pronouns used where the reference is  to  tax
 commission. Provided, however, with respect to declarations of estimated
 tax and payments of such tax and the withholding tax requirements, until
 and  including the thirty-first day of December, nineteen hundred seven-
 ty-one, any such terms shall be so read with respect to any taxable year
 or other period beginning in nineteen hundred seventy-one.
   (n) The term "partnership" shall include, unless a  different  meaning
 is  clearly required, a subchapter K limited liability company. The term
 "subchapter K limited liability company" shall mean a limited  liability
 company classified as a partnership for federal income tax purposes. The
 term  "limited  liability  company"  means  a domestic limited liability
 company or a foreign limited liability company, as  defined  in  section
 one  hundred two of the limited liability company law, a limited liabil-
 ity investment company formed pursuant to section five hundred seven  of
 the banking law, or a limited liability trust company formed pursuant to
 section one hundred two-a of the banking law.
   § 11-1902 Persons subject to tax.  (a) Imposition of tax. (1) A tax is
 hereby  imposed  for  each  taxable  year ending on or after July first,
 nineteen hundred sixty-six and on or before December thirty-first, nine-
 teen hundred seventy and for each taxable year beginning after  December
 thirty-first,  nineteen hundred ninety-nine, on the wages earned and net
 earnings from self-employment, within the  city,  of  every  nonresident
 individual,  estate  and  trust which shall comprise:   (i) A tax at the
 rate of one-fourth of one percent on all wages.
   (ii) A tax at the rate of three-eighths of  one  percent  on  all  net
 earnings from self-employment.
 S. 8474                            992
 
   (2)  For  each taxable year beginning on or after January first, nine-
 teen hundred seventy-one and ending on or before December  thirty-first,
 nineteen  hundred  ninety-nine,  a  tax  is  hereby imposed on the wages
 earned, and net earnings from self-employment, within the city, of every
 nonresident  individual,  estate  and trust which shall comprise:  (i) A
 tax at the rate of forty-five hundredths of one percent on all wages.
   (ii) A tax at the rate of sixty-five hundredths of one percent on  all
 net earnings from self-employment.
   (3)  For  each  taxable year beginning in nineteen hundred seventy and
 ending in nineteen hundred seventy-one, two  tentative  taxes  shall  be
 computed, the first as provided in paragraph one of this subdivision and
 the second as provided in paragraph two of this subdivision, and the tax
 for each such year shall be the sum of that proportion of each tentative
 tax  which the number of days in nineteen hundred seventy and the number
 of days in nineteen hundred  seventy-one,  respectively,  bears  to  the
 number of days in the entire taxable year.
   (4)  For  each  taxable year beginning in nineteen hundred ninety-nine
 and ending in two thousand, two tentative taxes shall be  computed,  the
 first as provided in paragraph two of this subdivision and the second as
 provided in paragraph one of this subdivision, and the tax for each such
 year shall be the sum of that proportion of each tentative tax which the
 number of days in nineteen hundred ninety-nine and the number of days in
 two  thousand,  respectively,  bears to the number of days in the entire
 taxable year.
   (b) Exclusion. (1) In computing the amount of wages and  net  earnings
 from  self-employment  taxable  under  subdivision  (a) of this section,
 there shall be allowed an exclusion against the total of wages  and  net
 earnings from self-employment in accordance with the following table:
 
 Total of wages and net earnings
      from self-employment      Exclusion allowable
 Not over $10,000                          $3,000
 Over $10,000 but not over $20,000         $2,000
 Over $20,000 but not over $30,000         $1,000
 Over $30,000                              None
 
   (2)  The  exclusion  allowable shall be applied pro rata against wages
 and net earnings from self-employment.
   (3) For taxable periods of less than one year, the exclusion allowable
 shall be prorated pursuant to regulations of the commissioner.
   (c) Limitation. In no event shall a taxpayer be  subject  to  the  tax
 under  this  chapter  in  an  amount greater than such taxpayer would be
 required to pay if such taxpayer were a resident of the city and subject
 to a tax on personal income of residents of the city adopted by the city
 pursuant to authority granted by the general city law or the tax law.
   § 11-1903 Taxable years to which tax imposed by this chapter  applies;
 tax  for  taxable  years beginning prior to and ending after July first,
 nineteen hundred sixty-six. (a) General. The tax imposed by this chapter
 is imposed for each taxable year beginning with taxable years ending  on
 or after July first, nineteen hundred sixty-six.
   (b)  Alternate methods for determining tax for taxable years ending on
 or after July first, nineteen hundred sixty-six.   (1) The tax  for  any
 taxable  year  ending on or after July first, nineteen hundred sixty-six
 and on or before June thirtieth, nineteen hundred sixty-seven, shall  be
 the  same part of the tax which would have been imposed had this chapter
 been in effect for the entire taxable year as the number of  months,  or
 S. 8474                            993
 
 major  portions thereof, of the taxable year occurring after July first,
 nineteen hundred sixty-six is of the number of months, or major portions
 thereof, in the taxable year.
   (2)(i) In lieu of the method of computation of tax prescribed in para-
 graph  one  of  this  subdivision,  if  the  taxpayer maintains adequate
 records for any taxable year ending on or  after  July  first,  nineteen
 hundred  sixty-six  and  on  or  before June thirtieth, nineteen hundred
 sixty-seven, the tax for such taxable  year,  at  the  election  of  the
 taxpayer,  may  be computed on the basis of the wages which the taxpayer
 would have reported had he or she filed a federal income tax return  for
 a  taxable  year  beginning  July first, nineteen hundred sixty-six, and
 ending with the close of such taxable year  ending  on  or  before  June
 thirtieth, nineteen hundred sixty-seven, and the net earnings from self-
 employment which the taxpayer would have reported for federal income tax
 purposes  had he or she filed a self-employment tax return for a taxable
 year beginning July first, nineteen hundred sixty-six  and  ending  with
 the close of such taxable year ending on or before June thirtieth, nine-
 teen hundred sixty-seven.
   (ii)  For  purposes  of this paragraph, the exclusions allowable under
 section 11-1902 of this subchapter shall be reduced by a  fraction,  the
 numerator  of  which is the number of months, or major portions thereof,
 of the taxable  year  occurring  before  July  first,  nineteen  hundred
 sixty-six,  and  the  denominator  of  which is the number of months, or
 major portions thereof, in the taxable year. Except as provided in  this
 paragraph,  the  tax for such period ending on or before June thirtieth,
 nineteen hundred sixty-seven, shall be computed in accordance  with  the
 other provisions of this chapter.
   §  11-1904   Allocation to the city. (a) General. If net earnings from
 self-employment are derived from services performed,  or  from  sources,
 within and without the city, there shall be allocated to the city a fair
 and equitable portion of such earnings.
   (b) Allocation of net earnings from self-employment.
   (1)  Place of business. If a taxpayer has no regular place of business
 outside the city all of his or her  net  earnings  from  self-employment
 shall be allocated to the city.
   (2)  Allocation  by taxpayer's books. The portion of net earnings from
 self-employment allocable to the city may be determined from  the  books
 and  records  of  a taxpayer's trade or business, if the methods used in
 keeping such books and the accuracy thereof are approved by the  commis-
 sioner as fairly and equitably reflecting net earnings from self-employ-
 ment within the city.
   (3)  Allocation  by formula. If paragraph two of this subdivision does
 not apply to the taxpayer, the portion of net earnings from self-employ-
 ment allocable to the city shall be determined by  multiplying  (A)  net
 earnings  from  self-employment  within and without the city, by (B) the
 average of the following three percentages:
   (i) Property percentage.  The percentage computed by dividing (A)  the
 average  of the value, at the beginning  and end of the taxable year, of
 real and tangible personal  property connected with  net  earnings  from
 self-employment  and  located within the city, by (B) the average of the
 value, at the beginning and end of the taxable year,  of  all  real  and
 tangible personal property connected with the net earnings from self-em-
 ployment  and  located  both  within  and  without  the city.   For this
 purpose, real property shall include  real  property  whether  owned  or
 rented.
 S. 8474                            994
 
   (ii)  Payroll percentage.  The percentage computed by dividing (A) the
 total wages, salaries and other personal service  compensation  paid  or
 incurred during the taxable year to employees in connection with the net
 earnings  from  self-employment derived from a trade or business carried
 on  within  the  city, by (B) the total of all wages, salaries and other
 personal service compensation paid or incurred during the  taxable  year
 to  employees  in  connection with the net earnings from self-employment
 derived from a trade or business carried on both within and without  the
 city.
   (iii)  Gross  income percentage.   The percentage computed by dividing
 (A) the gross sales or charges for services performed by or  through  an
 agency  located  within the city, by (B) the total of all gross sales or
 charges for services performed within and without the city.   The  sales
 or  charges  to be allocated to the city shall include all sales negoti-
 ated or consummated, and charges for services performed, by an employee,
 agent, agency or independent contractor chiefly situated  at,  connected
 by  contract or otherwise with, or sent out from, offices or other agen-
 cies of the trade or business from which  a  taxpayer  is  deriving  net
 earnings from self-employment, situated within the city.
   (c)  Other  allocation methods. The portion of net earnings from self-
 employment allocable to the city shall be determined in accordance  with
 rules  and  regulations  of  the  commissioner if it shall appear to the
 commissioner that the net earnings from self-employment are  not  fairly
 and  equitably reflected under the provisions of subdivision (b) of this
 section.
   (d) Special rules for real estate.  Income  and  deductions  from  the
 rental  of  real  property  and gain and loss from the sale, exchange or
 other disposition of real property, shall not be subject  to  allocation
 under subdivision (b) or (c) of this section, but shall be considered as
 entirely derived from or connected with the place in which such property
 is located.
   §  11-1905   Accounting periods and methods. (a) Accounting periods. A
 taxpayer's taxable year under this chapter shall be the same as  his  or
 her taxable year for federal income tax purposes.
   (b)  Change  of  accounting  periods.  If a taxpayer's taxable year is
 changed for federal income tax purposes, his or  her  taxable  year  for
 purposes of this chapter shall be similarly changed.  If a taxable peri-
 od of less than twelve months results from a change of taxable year, the
 exclusion  allowable  under  section 11-1902 of this subchapter shall be
 prorated under regulations of the commissioner.
   (c) Accounting methods. A taxpayer's method of accounting  under  this
 chapter shall be the same as his or her method of accounting for federal
 income  tax  purposes.    In the absence of any method of accounting for
 federal income tax purposes, net earnings  from  self-employment  within
 the  city  shall  be computed under such method as in the opinion of the
 commissioner clearly reflects net earnings from  self-employment  within
 the city.
   (d)  Change  of  accounting  methods.  (1)  If  a taxpayer's method of
 accounting is changed for federal income tax purposes, his or her method
 of accounting for purposes of this chapter shall be similarly changed.
   (2) If a taxpayer's method of accounting is changed, other  than  from
 an  accrual  to  an installment method, any additional tax which results
 from adjustments determined to be necessary  solely  by  reason  of  the
 change  shall not be greater than if such adjustments were ratably allo-
 cated and included for the taxable year of the change and the  preceding
 taxable  years,  beginning after July first, nineteen hundred sixty-six,
 S. 8474                            995

 not in excess of two, during which  the  taxpayer  used  the  method  of
 accounting from which the change is made.
   (3) If a taxpayer's method of accounting is changed from an accrual to
 an installment method, any additional tax for the year of such change of
 method  and for any subsequent year which is attributable to the receipt
 of installment payments properly accrued  in  a  prior  year,  shall  be
 reduced by the portion of tax for any prior taxable year attributable to
 the accrual of such installment payments, in accordance with regulations
 of the commissioner.
   §  11-1908 Withholding of tax on wages.  On or after the first payroll
 period beginning  August  twenty-seventh,  nineteen  hundred  sixty-six,
 every employer maintaining an office or transacting business within this
 state  and  making payment of any wages taxable under this chapter shall
 deduct and withhold from such  wages  for  each  payroll  period  a  tax
 computed  in  such  manner as to result, so far as practicable, in with-
 holding from the employee's wages during each calendar  year  an  amount
 substantially  equivalent to the tax reasonably estimated to be due from
 the employee under this chapter. The method of determining the amount to
 be withheld shall be prescribed by regulations of the commissioner.
   § 11-1909 Withholding of tax on wages for taxable  periods  commencing
 on  or after January first, nineteen hundred seventy-six. The provisions
 contained in sections 11-1908, 11-1910, 11-1911,  11-1912,  11-1913  and
 11-1914  of this subchapter shall not be applicable to taxes imposed for
 taxable periods commencing on or after January first,  nineteen  hundred
 seventy-six   provided  however,  with  respect  to  such  periods,  the
 provisions contained in part V of article  twenty-two  of  the  tax  law
 shall  be  applicable  with  the  same  force  and  effect  as  if those
 provisions had been incorporated in full in this section except that the
 term "aggregate amount" contained in paragraphs one, two  and  three  of
 subsection  (a) of section six hundred seventy-four of the tax law shall
 mean the aggregate amounts of New York state personal income  tax,  city
 earnings  tax  on nonresidents and city personal income tax on residents
 authorized pursuant to article thirty of the  tax  law  required  to  be
 deducted and withheld and provided, however, that the provisions of such
 paragraphs  shall not be applicable to employer's returns required to be
 filed with respect to taxes required to be deducted and withheld  during
 the  calendar  year nineteen hundred seventy-six, but such returns shall
 be required to be filed with the tax commission at the times and in  the
 manner  provided  for  in  subdivision  (a)  of  section 11-1912 of this
 subchapter, except the term "commission" in such  subdivision  shall  be
 read  as  "tax  commission." This section shall not apply to payments by
 the United States for service in the armed forces of the  United  States
 so  long  as  the right to require deduction and withholding of tax from
 such payments is prohibited by the laws of the United States. Service in
 the armed forces of the United States shall have  the  same  meaning  as
 when  used  in  a  comparable  context  in the laws of the United States
 relating to withholding of city income taxes.
   § 11-1910  Information statement for employee. Every employer required
 to deduct and withhold tax under this  chapter  from  the  wages  of  an
 employee,  shall  furnish  to each such employee in respect of the wages
 paid by such employer to such employee during the calendar  year  on  or
 before  February  fifteenth  of  the  succeeding year, or, if his or her
 employment is terminated before the close of such calendar year,  within
 thirty  days  from  the  date  on which the last payment of the wages is
 made, a written statement as prescribed by the commissioner showing  the
 total  amount  of wages paid by the employer to the employee, the amount
 S. 8474                            996
 
 of wages paid  for  services  performed  within  the  city,  the  amount
 deducted  and withheld as tax, and such other information as the commis-
 sioner may prescribe. The    written    statement  required  under  this
 section may be furnished to such employee in an electronic format.
   § 11-1911 Credit for tax withheld. Wages upon which tax is required to
 be  withheld  shall  be  taxable under this chapter as if no withholding
 were required, but any amount of  tax  actually  deducted  and  withheld
 under  this  chapter  in  any calendar year shall be deemed to have been
 paid on behalf of the employee from whom  withheld,  and  such  employee
 shall  be  credited with having paid that amount of tax in such calendar
 year. For a taxable year of less than twelve months, the credit shall be
 made under regulations of the commissioner.
   § 11-1912  Employer's return and payment of withheld taxes. (a) Gener-
 al. On or after the first payroll period  beginning  August  twenty-sev-
 enth,  nineteen hundred sixty-six, every employer required to deduct and
 withhold tax under this chapter shall, for each calendar  month,  on  or
 before the fifteenth day of the month following the close of such calen-
 dar  month  file  a withholding return as prescribed by the commissioner
 and pay over to the commissioner or to the depository designated by  the
 commissioner,  the taxes so required to be deducted and withheld, except
 that for the month of December in any year the returns  shall  be  filed
 and  the  taxes paid on or before January thirty-first of the succeeding
 year.  Where the aggregate amount required to be deducted  and  withheld
 by  any  employer under this chapter and under chapter seventeen of this
 title is less than twenty-five dollars  in  a  calendar  month  and  the
 aggregate  of such taxes for the semi-annual period ending on June thir-
 tieth and December thirty-first can reasonably be expected  to  be  less
 than  one  hundred  fifty  dollars, the commissioner may, by regulation,
 permit an employer to file a return on or before July  thirty-first  for
 the semi-annual period ending on June thirtieth and on or before January
 thirty-first for the semi-annual period ending on December thirty-first.
 The  commissioner  may,  if he or she believes such action necessary for
 the protection of the revenues, require any employer to  make  a  return
 and pay to him or her the tax deducted and withheld at any time, or from
 time  to  time.    Where  the amount of wages paid by an employer is not
 sufficient under this chapter and under chapter seventeen of this  title
 to  require  the  withholding of tax from the wages of any of his or her
 employees, the commissioner may, by regulation, permit such employer  to
 file an annual return on or before February twenty-eighth of the follow-
 ing calendar year.
   (b)  Combined  returns. The commissioner may by regulation provide for
 the filing of one return which shall include the return required  to  be
 filed  under  this section, together with the employer's return required
 to be filed under chapter seventeen of this title.
   (c) Deposit in trust for city. Whenever any employer fails to collect,
 truthfully account for, pay over the tax, or make returns of the tax  as
 required  in this section, the commissioner may serve a notice requiring
 such employer to  collect  the  taxes  which  become  collectible  after
 service  of such notice, to deposit such taxes in a bank approved by the
 commissioner, in a separate account, in trust for the city  and  payable
 to  the commissioner, and to keep the amount of such tax in such account
 until payment over to the commissioner.   Such notice  shall  remain  in
 effect until a notice of cancellation is served by the commissioner.
   §  11-1913    Employer's  liability for withheld taxes. Every employer
 required to deduct and withhold the tax under  this  chapter  is  hereby
 made  liable  for such tax.   For purposes of assessment and collection,
 S. 8474                            997
 
 any amount required to be withheld and paid over  to  the  commissioner,
 and  any  additions  to tax, penalties and interest with respect thereto
 shall be considered the tax of the employer.  Any amount of tax actually
 deducted  and  withheld under this chapter shall be held to be a special
 fund in trust for the city.  No employee shall have any right of  action
 against  his or her employer in respect to any monies deducted and with-
 held from his or her wages and paid over to the commissioner in  compli-
 ance or in intended compliance with this chapter.
   §  11-1914    Employer's  failure to withhold. If an employer fails to
 deduct and withhold the tax, as required, and thereafter the tax against
 which such tax may be credited is  paid,  the  tax  so  required  to  be
 deducted  and withheld shall not be collected from the employer, but the
 employer shall not be relieved from liability for any penalties,  inter-
 est  or  additions  to  the  tax otherwise applicable in respect of such
 failure to deduct and withhold.
   § 11-1915   Combined returns, employer's  returns  and  payments.  The
 state tax commission may require:
   (1)  The filing of any or all of the following:
   (A)  A combined return which in addition to the return provided for in
 this  chapter  may also include returns required to be filed under a law
 authorized by article thirty of the tax law and under article twenty-two
 of the tax law.
   (B)  A combined employer's return which in addition to the  employer's
 return  provided for by this chapter may also include employer's returns
 required to be filed under a law authorized by article thirty of the tax
 law and under article twenty-two of the tax law.
   (2)  Where a combined return or employer's  return  is  required,  and
 with  respect  to the payment of estimated tax, the state tax commission
 may also require payment of a single amount which shall be the total  of
 the  amounts,  total  taxes  less any credits or refunds, required to be
 paid with the returns or employer's returns or in payment  of  estimated
 tax  pursuant  to  the  provisions  of this chapter, a law authorized by
 article thirty of the tax law and pursuant to the provisions of  article
 twenty-two of the tax law.
 
                               SUBCHAPTER 2
                        RETURNS AND PAYMENT OF TAX
 
   §  11-1916  Returns  and payment of tax. (a) General. On or before the
 fifteenth day of the fourth month following the  close  of  the  taxable
 year,  every  person subject to the tax shall make and file a return and
 any balance of the tax shown due on the face of  such  return  shall  be
 paid  therewith.    The commissioner may, by regulation, provide for the
 filing of returns and payment of the tax at such other times  as  he  or
 she  deems  necessary  for  the proper enforcement of this chapter.  The
 commissioner may also provide by regulation that  any  return  otherwise
 required  to  be  made  and  filed under this chapter by any nonresident
 individual need not be made and filed  if  such  nonresident  individual
 had,  during  the  taxable year to which the return would relate, no net
 earnings from self-employment within the city.  Any regulation  allowing
 such  waiver  of  return  may  provide for additional limitations on and
 conditions and prerequisites to the privilege of not filing a return.
   (b) Decedents. The return for any deceased individual  shall  be  made
 and filed by his or her executor, administrator, or other person charged
 with  his  or  her  property.   If a final return of a decedent is for a
 fractional part of a year, the due date of  such  return  shall  be  the
 S. 8474                            998
 
 fifteenth  day  of  the  fourth month following the close of the twelve-
 month period which began with the first day of such fractional  part  of
 the year.
   (c)  Individuals  under a disability. The return for an individual who
 is unable to make a return by reason of  minority  or  other  disability
 shall  be made and filed by his or her guardian, committee, fiduciary or
 other person charged with the care of his or  her  person  or  property,
 other than a receiver in possession of only a part of his or her proper-
 ty, or by his or her duly authorized agent.
   (d) Estates and trust. The return for an estate or trust shall be made
 and filed by the fiduciary.
   (e)  Joint fiduciaries. If two or more fiduciaries are acting jointly,
 the return may be made by any one of them.
   (f) Cross reference. For provisions as to information returns by part-
 nerships, employers and other  persons,  see  section  11-1921  of  this
 subchapter.
   §  11-1917  Time and place for filing returns and paying tax. A person
 required to make and file a return under  this  chapter  shall,  without
 assessment, notice or demand, pay any tax due thereon to the commission-
 er  on or before the date fixed for filing such return, determined with-
 out regard to any extension of time for filing the return.  The  commis-
 sioner  shall  prescribe  by regulation the place for filing any return,
 statement, or other document required pursuant to this chapter  and  for
 payment of any tax.
   §  11-1918    Signing of returns and other documents. (a) General. Any
 return, statement or other document required to be made pursuant to this
 chapter shall be signed in accordance with regulations  or  instructions
 prescribed  by  the commissioner.  The fact that an individual's name is
 signed to a return, statement, or other document, shall be  prima  facie
 evidence  for  all purposes that the return, statement or other document
 was actually signed by such individual.
   (b) Partnerships. Any return, statement or other document required  of
 a  partnership shall be signed by one or more partners.  The fact that a
 partner's name is signed to a  return,  statement,  or  other  document,
 shall  be  prima  facie  evidence  for all purposes that such partner is
 authorized to sign on behalf of the partnership.
   (c) Certifications. The making or filing of any return,  statement  or
 other  document or copy thereof required to be made or filed pursuant to
 this chapter, including a copy of a federal return, shall  constitute  a
 certification  by  the person making or filing such return, statement or
 other document or copy thereof that the statements contained therein are
 true and that any copy filed is a true copy.
   § 11-1919 Change of residence status during year. (a) General.  If  an
 individual changes his or her status during his or her taxable year from
 resident  to  nonresident,  or  from  nonresident to resident, he or she
 shall file a return as a nonresident for the portion of the year  during
 which  he  or  she  is  a nonresident if he or she is subject to the tax
 imposed by this chapter or, if not subject to such tax,  an  information
 return  for the portion of the year during which he or she is a nonresi-
 dent, subject to such exceptions as the commissioner  may  prescribe  by
 regulation.    Such  information return shall be due at the same time as
 the return required by chapter seventeen of this title for  the  portion
 of the year during which such individual is a resident.
   (b)  City  taxable  wages  and  net  earnings from self-employment for
 portion of year individual is a nonresident. The city taxable wages  and
 net  earnings  from  self-employment  for the portion of the year during
 S. 8474                            999
 
 which he or she is a nonresident shall be determined, except as provided
 in subdivision (c) of this section, under this chapter as if his or  her
 taxable  year for federal income tax purposes were limited to the period
 of his or her nonresident status.
   (c)  Special  accruals. (1) If an individual changes his or her status
 from resident to nonresident, he or she shall,  regardless of his or her
 method of accounting, accrue for the portion of the taxable  year  prior
 to  such  change  of status any items of income, gain, loss or deduction
 accruing prior to the change of status, if not otherwise properly inclu-
 dible, whether or not because of an election to report on an installment
 basis, or allowable for city earnings tax purposes for such  portion  of
 the  taxable year for a prior taxable year.  The amounts of such accrued
 items shall be determined as if such accrued items  were  includible  or
 allowable for federal self-employment tax purposes.
   (2)  If  an  individual  changes his or her status from nonresident to
 resident, he or she shall, regardless of his or her method  of  account-
 ing,  accrue for the portion of the taxable year prior to such change of
 status any items of income, gain, loss or deduction  accruing  prior  to
 the  change  of status, if not otherwise properly includible, whether or
 not because of an election to report on an installment basis, or  allow-
 able  for  federal  self-employment tax purposes for such portion of the
 taxable year or for prior taxable year.   The amounts  of  such  accrued
 items  shall  be  determined  if  such  accrued items were includible or
 allowable for federal self-employment tax purposes.
   (3) No item of income, gain, loss or deduction which is accrued  under
 this  subdivision  shall  be  taken  into  account  in  determining city
 adjusted wages earned, or net earnings from self-employment, within  the
 city, for any subsequent taxable period.
   (4)  Where  an  individual  changes his or her status from resident to
 nonresident, the accruals under this subdivision shall not  be  required
 if  the  individual files with the commissioner a bond or other security
 acceptable to  the  commissioner,  conditioned  upon  the  inclusion  of
 amounts  accruable  under this subdivision in city adjusted gross income
 under chapter seventeen of this title for one or more subsequent taxable
 years as if the individual has not changed his or her  resident  status.
 In  such  event,  the  tax  under  this  chapter shall not apply to such
 amounts.
   (d) Prorations. Where an individual changes his or her  status  during
 his or her taxable year from resident to nonresident or from nonresident
 to  resident,  the  exclusion allowable under subdivision (b) of section
 11-1902 of this chapter shall be  prorated,  under  regulations  of  the
 commissioner,  to reflect the portions of the entire taxable year during
 which the individual was a resident and a nonresident.
   § 11-1920 Extension of time. (a) General. The commissioner may grant a
 reasonable extension of time for payment of tax or estimated tax, or any
 installment, or for filing any  return,  statement,  or  other  document
 required pursuant to this chapter, on such terms and conditions as he or
 she may require.  Except for a taxpayer who is outside the United States
 or  who  intends  to  claim nonresident status pursuant to subparagraphs
 (i), (ii) and (iii) of paragraph  one  of  subdivision  (h)  of  section
 11-1901 of this chapter, no such extension for filing any return, state-
 ment or other document, shall exceed six months.
   (b)  Furnishing  of  security. If any extension of time is granted for
 payment of any amount of tax, the commissioner may require the  taxpayer
 to furnish a bond or other security in an amount not exceeding twice the
 S. 8474                           1000
 
 amount  for  which the extension of time for payment is granted, on such
 terms and conditions as the commissioner may require.
   § 11-1921 Requirements concerning returns, notices, records and state-
 ments. (a) General. The commissioner may prescribe regulations as to the
 keeping  of records, the content and form of returns and statements, and
 the filing of copies of federal income tax returns  and  determinations.
 The  commissioner may require any person, by regulation or notice served
 upon such person, to make such returns, render such statements, or  keep
 such records, as the commissioner may deem sufficient to show whether or
 not  such  person is liable under this chapter for tax or for collection
 of tax.
   (b) Partnerships. Every partnership doing business  in  the  city  and
 having no partners who are residents shall make a return for the taxable
 year  setting  forth  all  items of income, gain, loss and deduction and
 such other pertinent information as the commissioner may by  regulations
 and instructions prescribe.  Such return shall be filed on or before the
 fifteenth  day  of  the fourth month following the close of each taxable
 year.  For purposes of this subdivision, "taxable year"  means  year  or
 period  which  would  be  a  taxable  year of the partnership if it were
 subject to tax under this chapter.
   (c) Information at source. The commissioner may prescribe  regulations
 and  instructions  requiring returns of information to be made and filed
 on or before February twenty-eighth of each year as to  the  payment  or
 crediting in any calendar year of amounts of six hundred dollars or more
 to  any taxpayer under this chapter. Such returns may be required of any
 person, including lessees or mortgagors of real  or  personal  property,
 fiduciaries, employers, and all officers and employees of this state, or
 any municipal corporation or political subdivision of this state, having
 the  control,  receipt, custody, disposal or payment of interest, rents,
 salaries,  wages,  premiums,  annuities,  compensations,  remunerations,
 emoluments  or  other  fixed  or  determinable gains, profits or income,
 except interest coupons payable to bearer.  A duplicate of the statement
 as to tax withheld on wages, required to be furnished by an employer  to
 an  employee,  shall constitute the return of information required to be
 made under this section with respect to such wages.
   (d) Notice of qualification as receiver, etc. Every receiver,  trustee
 in  bankruptcy, assignee for benefit of creditors, or other like fiduci-
 ary shall give notice of   his or her  qualifications  as  such  to  the
 commissioner, as may be required by regulation.
   §  11-1922  Report  of  change  in  federal  or New York state taxable
 income. If the amount of a taxpayer's federal or New York state  taxable
 income  or  self-employment income reported on his or her federal or New
 York state tax return for any taxable year is changed  or  corrected  by
 the United States internal revenue service or the New York state commis-
 sioner  of  taxation and finance or other competent authority, or as the
 result of a renegotiation of a contract or subcontract with  the  United
 States or New York state or if a taxpayer, pursuant to subsection (d) of
 section  six thousand two hundred thirteen of the internal revenue code,
 executes a notice of waiver of the restrictions provided  in  subsection
 (a)  of  said  section  or if a taxpayer, pursuant to subdivision (f) of
 section six hundred eighty-one of the tax law executes a notice of waiv-
 er of the restrictions provided in subdivision (c) of said  section,  or
 if any tax on self-employment income in addition to that shown on his or
 her  return  is  assessed,  the  taxpayer  shall  report  such change or
 correction in federal or New York state taxable income or such execution
 of such  notice  of  waiver  or  such  assessment  and  the  changes  or
 S. 8474                           1001
 
 corrections  of  his  or her federal or New York state taxable income or
 self-employment income on which it is based, within  ninety  days  after
 the final determination of such change, correction, or renegotiation, or
 such execution of such notice of waiver or the making of such assessment
 as otherwise required by the commissioner, and shall concede the accura-
 cy of such determination or state wherein it is erroneous.  Any taxpayer
 filing  an  amended  federal or New York state income or self-employment
 income tax return shall also  file  within  ninety  days  thereafter  an
 amended  return  under  this chapter, and shall give such information as
 the commissioner may  require.    The  commissioner  may  by  regulation
 prescribe  such  exceptions to the requirements of this section as he or
 she deems appropriate.   For purposes of  this  section,  (i)  the  term
 "taxpayer"  shall  include  a partnership having any income derived from
 city sources, and (ii)  the  term  "federal  income  tax  return"  shall
 include  the returns of income required under section six thousand thir-
 ty-one of the internal revenue code. Reports made under this section  by
 a  partnership  shall indicate the portion of the change in each item of
 income, gain, loss or deduction allocable to each partner and shall  set
 forth  such  identifying information with respect to such partner as may
 be prescribed by the commissioner.
 
                               SUBCHAPTER 3
                       PROCEDURE AND ADMINISTRATION

   § 11-1923  Notice of deficiency. (a) General. If upon examination of a
 taxpayer's return under this chapter the  commissioner  determines  that
 there  is a deficiency of tax, he or she may mail a notice of deficiency
 to the taxpayer.  If a taxpayer fails to file a  return  required  under
 this  chapter, the commissioner is authorized to estimate the taxpayer's
 wages and net earnings from self-employment  or  the  wages  from  which
 taxes are required to be deducted and withheld and the tax thereon, from
 any  information  in the commissioner's possession, and to mail a notice
 of deficiency to the taxpayer.  A notice of deficiency shall  be  mailed
 by  certified or registered mail to the taxpayer at such taxpayer's last
 known address in or out of the city.   If the taxpayer  is  deceased  or
 under a legal disability, a notice of deficiency may be mailed to his or
 her  last  known  address in or out of the city, unless the commissioner
 has received notice of the existence of a  fiduciary  relationship  with
 respect to the taxpayer.
   (b) Notice of deficiency as assessment. The notice of deficiency shall
 be an assessment of the amount of tax specified in such notice, together
 with the interest, additions to tax and penalties stated in such notice.
   (c)  Restrictions  on  collection  and  levy. No notice and demand for
 payment of an assessment of a deficiency in tax  made  by  a  notice  of
 deficiency  and  no levy or proceeding in court for its collection shall
 be made, begun or prosecuted, except as otherwise  provided  in  section
 11-1937  of this subchapter, until the expiration of the time for filing
 a petition contesting such notice, nor, if a petition  with  respect  to
 the  taxable  year has been filed with the commissioner, until the deci-
 sion of the commissioner has become final.   After a petition  has  been
 filed  the  restriction  provided herein shall not apply to such part of
 the deficiency as is not contested by the petition.   For  exception  in
 the  case  of  judicial  review of the decision of the commissioner, see
 subdivision (c) of section 11-1932 of this subchapter.
   (d) Exceptions  for  mathematical  errors.  If  a  mathematical  error
 appears  on  a  return, including an overstatement of the credit for tax
 S. 8474                           1002
 
 withheld at the source or of the  amount  paid  as  estimated  tax,  the
 commissioner  shall  notify the taxpayer that an amount of tax in excess
 of that shown upon the return is due, and  that  such  excess  has  been
 assessed.  Such notice shall not be considered as a notice of deficiency
 for  the purposes of this section, subdivision (f) of section 11-1929 of
 this subchapter, limiting credits  or  refunds  after  petition  to  the
 commissioner,  or subdivision (b) of section 11-1931 of this subchapter,
 authorizing the filing of a petition with the commissioner  based  on  a
 notice of deficiency, nor shall collection of such assessment be prohib-
 ited by the provisions of subdivision (c) of this section.
   (e) Exception where change in federal or New York state taxable income
 is not reported (1) If the taxpayer fails to comply with section 11-1922
 of  this  chapter in not reporting a change or correction increasing his
 or her federal or New  York  state  taxable  income  or  self-employment
 income  as  reported  on  such  taxpayer's federal or New York state tax
 return or in not reporting a change or correction which  is  treated  in
 the same manner as if it were a deficiency for federal or New York state
 tax  purposes or in not filing an amended return or in not reporting the
 execution of a notice of waiver  or  an  assessment  described  in  such
 section,  instead  of  the  mode  and  time of assessment and collection
 provided for in subdivision (b) of this section,  the  commissioner  may
 assess  a deficiency based upon such changed or corrected federal or New
 York state taxable income or self-employment income by  mailing  to  the
 taxpayer  a  notice  of  additional tax due specifying the amount of the
 deficiency, and such deficiency, together with the  interest,  additions
 to tax and penalties stated in such notice, shall be deemed assessed and
 subject  to  collection  procedures  on  the  date such notice is mailed
 unless within thirty days after the mailing of such notice a  report  of
 the federal or New York state change or correction or an amended return,
 where  such  return  was  required by section 11-1922 of this chapter is
 filed accompanied by a statement showing wherein  such  federal  or  New
 York  state determination of such notice of additional tax due are erro-
 neous.
   (2) Such notice shall not be considered as a notice of deficiency  for
 the purposes of this section, subdivision (f) of section 11-1929 of this
 subchapter,  limiting  credits  or refunds after petition to the commis-
 sioner, or subdivision  (b)  of  section  11-1931  of  this  subchapter,
 authorizing  the  filing  of a petition with the commissioner based on a
 notice of deficiency, nor shall the collection  of  such  assessment  be
 prohibited by the provisions of subdivision (c)  of this section.
   If  the  taxpayer is deceased or under a legal disability, a notice of
 additional tax due may be mailed to his or her last known address in  or
 out  of  the  city,  unless  the commissioner has received notice of the
 existence of a fiduciary relationship with respect to the taxpayer.
   (f) Waiver of restrictions. The taxpayer shall at any  time  have  the
 right  to  waive the mailing of a notice of deficiency or restriction on
 collection of the whole or any part of the deficiency,  or  both,  by  a
 signed notice in writing filed with the commissioner.
   (g)  Deficiency  defined.  For  purposes of this chapter, a deficiency
 means the amount of the tax imposed by this chapter, less (1) the amount
 shown as the tax upon the taxpayer's return, whether the return was made
 or the tax computed by the taxpayer or by the  commissioner,  and  less,
 (2) the amounts previously assessed, or collected without assessment, as
 a  deficiency and plus (3) the amount of any rebates. For the purpose of
 this definition, the tax imposed by this chapter and the  tax  shown  on
 the  return  shall  both  be  determined  without  regard to payments on
 S. 8474                           1003
 
 account of estimated tax or the credit for withholding tax; and a rebate
 means so much of an abatement, refund or other repayment, whether or not
 erroneous, made on the ground that the amounts entering into  the  defi-
 nition of a deficiency showed a balance in favor of the taxpayer.
   §  11-1924 Assessment. (a) Assessment date.  The amount of tax which a
 return shows to be due, or the amount of tax which a return  would  have
 shown  to  be  due  but  for a mathematical error, shall be deemed to be
 assessed on the date of filing of  the  return,  including  any  amended
 return  showing  an  increase of tax.   In the case of a return properly
 filed without computation of tax, the tax computed by  the  commissioner
 shall  be deemed to be assessed on the date on which payment is due.  If
 a notice of deficiency has been mailed, the  amount  of  the  deficiency
 shall be deemed to be assessed on the date on which it is mailed.  If an
 amended return or report filed pursuant to section 11-1922 of this chap-
 ter   concedes  the  accuracy of a federal or New York state adjustment,
 change or correction, any deficiency in tax under this chapter resulting
 therefrom shall be deemed to be assessed on  the  date  of  filing  such
 report  or  amended return, and such assessment shall be timely notwith-
 standing section 11-1925 of this subchapter.  If a notice of  additional
 tax  due,  as  prescribed  in subdivision (e) of section 11-1923 of this
 subchapter, has been mailed, the  amount  of  the  deficiency  shall  be
 deemed  to  be assessed on the date specified in such subdivision unless
 within thirty days after the mailing of such  notice  a  report  of  the
 federal  or  New  York  state change or correction or an amended return,
 where such return was required by section 11-1922 of  this  chapter,  is
 filed  accompanied  by  a  statement showing wherein such federal or New
 York state determination and such notice of additional tax due are erro-
 neous.  Any amount paid as a tax or in respect  of  a  tax,  other  than
 amounts withheld at the source or paid as estimated income tax, shall be
 deemed to be assessed upon the date of receipt of payment, notwithstand-
 ing any other provisions.
   (b)  Other  assessment powers.  If the mode or time for the assessment
 of any tax under this chapter, including interest, additions to tax  and
 assessable  penalties,  is  not otherwise provided for, the commissioner
 may establish the same by regulations.
   (d) Supplemental assessment.  The commissioner may, at any time within
 the period prescribed for assessment, make  a  supplemental  assessment,
 subject  to  the  provisions of section 11-1923 of this subchapter where
 applicable, whenever it is ascertained that any assessment is  imperfect
 or incomplete in any material respect.
   (e)  Cross reference.  For assessment in case of jeopardy, see section
 11-1937 of this subchapter.
   § 11-1925 Limitations on assessment. (a) General. Except as  otherwise
 provided  in  this section, any tax under this chapter shall be assessed
 within three years after the return  was  filed,  whether  or  not  such
 return was filed on or after the date prescribed.
   (b) Exceptions. (1) Assessment at any time. The tax may be assessed at
 any time if:
   (A) no return is filed,
   (B) a false or fraudulent return is filed with intent to evade tax, or
   (C)  the taxpayer fails to comply with section 11-1922 of this chapter
 in not reporting a change or correction increasing his or her federal or
 New York state taxable income or self-employment income as  reported  on
 the taxpayer's federal or New York state tax return, or the execution of
 a  notice  of waiver and the changes or corrections on which it is based
 or in not reporting an assessment or a change  or  correction  which  is
 S. 8474                           1004

 treated in the same manner as if it were a deficiency for federal or New
 York state income tax purposes, or in not filing an amended return.
   (2)  Extension  by agreement. Where, before the expiration of the time
 prescribed in this section for the assessment of tax, both  the  commis-
 sioner  and  the  taxpayer  have  consented in writing to its assessment
 after such time, the tax may be assessed at any time prior to the  expi-
 ration  of  the  period  agreed upon.   The period so agreed upon may be
 extended by subsequent agreements in writing made before the  expiration
 of the period previously agreed upon.
   (3)  Report  of changed or corrected federal or New York state income.
 If the taxpayer shall, pursuant to  section  11-1922  of  this  chapter,
 report  a  change or correction or file an amended return increasing the
 taxpayer's federal or New York state taxable  income  or  earnings  from
 self-employment  or report an assessment or a change or correction which
 is treated in the same manner as if it were a deficiency for federal  or
 New  York  state  income  tax purposes, the assessment, if not deemed to
 have been made upon the filing of the report or amended return,  may  be
 made  at  any  time within two years after such report or amended return
 was filed.  The amount of such assessment of tax shall  not  exceed  the
 amount  of  the  increase  in  city tax on earnings attributable to such
 federal or New York state change or correction.  The provisions of  this
 paragraph shall not affect the time within which or the amount for which
 an assessment may otherwise be made.
   (4) Recovery of erroneous refund. An erroneous refund shall be consid-
 ered  an  underpayment  of  tax on the date made, and an assessment of a
 deficiency arising out of an erroneous refund may be made  at  any  time
 within  two years from the making of the refund, except that the assess-
 ment may be made within five years from the making of the refund  if  it
 appears that any part of the refund was induced by fraud or misrepresen-
 tation of a material fact.
   (5) Request for prompt assessment. If a return is required for a dece-
 dent  or  for the decedent's estate during the period of administration,
 the tax shall be assessed within eighteen months after  written  request
 therefor, made after the return is filed, by the executor, administrator
 or  other  person representing the estate of such decedent, but not more
 than three years  after  the  return  was  filed,  except  as  otherwise
 provided in this subdivision and subdivision (c) of this section.
   (c)  Omission of income on return. The tax may be assessed at any time
 within six years after the return was filed if a taxpayer omits  from  a
 return an amount properly includible therein which is in excess of twen-
 ty-five  per  centum  of  the  amount of the gross income derived by the
 taxpayer from any trade or business.
   For purposes of this subdivision there shall not be taken into account
 any amount which is omitted in the return if such amount is disclosed in
 the return, or in a statement  attached  to  the  return,  in  a  manner
 adequate  to  apprise  the commissioner of the nature and amount of such
 item.
   (d)  Suspension of running of period of limitation. The running of the
 period of limitations on or collection of tax or other amount, or  of  a
 transferee's  liability,  shall,  after the mailing of a notice of defi-
 ciency, be suspended for the period during  which  the  commissioner  is
 prohibited  under  subdivision (c) of section 11-1923 of this subchapter
 collecting by levy or proceeding in court.
   § 11-1926 Interest on underpayment. (a) General. If any amount of  tax
 is  not  paid  on or before the last date prescribed in this chapter for
 payment, interest on such amount at the appropriate rates prescribed for
 S. 8474                           1005
 
 underpayments of tax under chapter seventeen of this title shall be paid
 for the period from such last date to the date paid, whether or not  any
 extension of time for payment was granted.  Interest under this subdivi-
 sion  shall  not  be paid if the amount thereof is less than one dollar.
 If the time for filing a return  of  tax  withheld  by  an  employer  is
 extended,  the  employer shall pay interest for the period for which the
 extension is granted and may not charge such interest to the employee.
   (c)  Exception for mathematical error. No interest shall be imposed on
 any underpayment of tax due solely to mathematical error if the taxpayer
 files a return within the time prescribed in this chapter, including any
 extension of time, and pays the  amount  of  underpayment  within  three
 months after the due date of such return, as it may be extended.
   (d)  No  interest on interest. No interest under this chapter shall be
 imposed on any interest provided by this chapter.
   (e)  Suspension  of  interest  on  deficiencies.  If   a   waiver   of
 restrictions  on  collection  of  an assessment of a deficiency has been
 filed by the taxpayer, and if notice and demand by the commissioner  for
 payment of such assessed deficiency is not made within thirty days after
 the  filing  of such waiver, interest shall not be imposed on such defi-
 ciency for the period beginning immediately after such thirtieth day and
 ending with the date of notice and demand.
   (f)  Interest treated as tax. Interest under  this  section  shall  be
 paid upon notice and demand and shall be assessed, collected and paid in
 the  same  manner  as  tax.    Any  reference in this chapter to the tax
 imposed by this chapter shall  be  deemed  also  to  refer  to  interest
 imposed by this section on such tax.
   (g)    Interest  on  penalties  or additions to tax. Interest shall be
 imposed under subdivision (a)  of this section in respect of any assess-
 able penalty or addition to tax only if such assessable penalty or addi-
 tion to tax is not paid within ten days from the date of the notice  and
 demand  therefor  under  subdivision  (b)  of  section  11-1934  of this
 subchapter, and in such case interest shall  be  imposed  only  for  the
 period from such date of the notice and demand to the date of payment.
   (h)    Payment prior to notice of deficiency. If, prior to the mailing
 to the taxpayer of a notice  of  deficiency  under  subdivision  (b)  of
 section  11-1923  of  this  subchapter,  the  commissioner  mails to the
 taxpayer a notice of proposed increase of tax  and  within  thirty  days
 after  the date of the notice of proposed increase the taxpayer pays all
 amounts shown on the notice to be due to the commissioner,  no  interest
 under this section on the amount so paid shall be imposed for the period
 after the date of such notice of proposed increase.
   (i)    Payment  within  ninety  days  after notice of deficiency. If a
 notice of deficiency under section 11-1923 of this subchapter is  mailed
 to  the  taxpayer, and the total amount specified in such notice is paid
 on or before the ninetieth day after the date of mailing, interest under
 this section shall not be imposed for the period after the date  of  the
 notice.
   (j)    Payment  within ten days after notice and demand. If notice and
 demand is made for payment  of  any  amount  under  subdivision  (b)  of
 section  11-1934  of  this subchapter, and if such amount is paid within
 ten days after the date of such notice and demand, interest  under  this
 section  on the amount so paid shall not be imposed for the period after
 the date of such notice and demand.
   (k)   Limitation on assessment  and  collection.  Interest  prescribed
 under  this section may be assessed and collected at any time during the
 S. 8474                           1006
 
 period within which the tax or  other  amount  to  which  such  interest
 relates may be assessed and collected, respectively.
   (l)  Interest  on erroneous refund. Any portion of tax or other amount
 which has been erroneously refunded, and which  is  recoverable  by  the
 commissioner,  shall  bear  interest  at  the rate of six per centum per
 annum from the date of the payment of the refund, but only if it appears
 that any part of the refund was induced by fraud or a  misrepresentation
 of a material fact.
   (m)  Satisfaction  by credits. If any portion of a tax is satisfied by
 credit of an overpayment, then no interest shall be imposed  under  this
 section  on  the  portion  of the tax so satisfied for any period during
 which, if the credit had not been made, interest would have been  allow-
 able with respect to such overpayment.
   §  11-1927  Additions  to tax and civil penalties. (a) Failure to file
 tax return. In case of failure to file a tax return under  this  chapter
 on  or  before the prescribed date, determined with regard to any exten-
 sion of time for filing, unless it is shown that such failure is due  to
 reasonable cause and not due to willful neglect, there shall be added to
 the  amount  required  to be shown as tax on such return five percent of
 the amount of such tax if the failure is for not more  than  one  month,
 with  an  additional  five percent for each additional month or fraction
 thereof during which such failure continues, not  exceeding  twenty-five
 percent  in the aggregate.  For this purpose, the amount of tax required
 to be shown on the return shall be reduced by the amount of any part  of
 the  tax  which  is paid on or before the date prescribed for payment of
 the tax and by the amount of any credit against the  tax  which  may  be
 claimed upon the return.
   (b)  Deficiency  due to negligence. If any part of a deficiency is due
 to negligence or intentional disregard of this chapter or rules or regu-
 lations hereunder, but without intent to defraud, there shall  be  added
 to the tax an amount equal to five percent of the deficiency.
   (c)  Failure  to file declaration or underpayment of estimated tax. If
 any taxpayer fails to file a declaration of estimated tax  or  fails  to
 pay  all  or  any  part of an installment of estimated tax, the taxpayer
 shall be deemed to have made an underpayment of estimated  tax.    There
 shall  be added to the tax for the taxable year an amount at the rate of
 six per centum upon the amount of the underpayment for the period of the
 underpayment but not beyond  the  fifteenth  day  of  the  fourth  month
 following  the  close  of the taxable year.   The amount of underpayment
 shall be the excess of the amount of  the  installment  which  would  be
 required  to  be paid if the estimated tax were equal to seventy percent
 of the tax attributable to net earnings from self  employment  shown  on
 the  tax  return for the taxable year, or if no return was filed, of the
 tax so attributable for such year, over  the  amount,  if  any,  of  the
 installment  paid on or before the last day prescribed for such payment.
 No underpayment shall be deemed to exist with respect to  a  declaration
 or installment otherwise due on or after the taxpayer's death.
   (d) Exception to addition for underpayment of estimated tax. The addi-
 tion  to  tax under subdivision (c)  of this section with respect to any
 underpayment of any installment shall not be imposed if the total amount
 of all payments of estimated  tax  made  on  or  before  the  last  date
 prescribed  for the payment of such installment equals or exceeds which-
 ever of the following is the lesser:
   (1) The amount which would have been required to be paid on or  before
 such  date  if  the estimated tax were whichever of the following is the
 lesser:
 S. 8474                           1007
 
   (A) The tax attributable to net earnings from self-employment shown on
 the return of the individual for the preceding taxable year, if a return
 showing a liability for tax was filed by the individual for the  preced-
 ing  taxable  year  and such preceding year was a taxable year of twelve
 months, or
   (B)  An amount equal to seventy percent of the tax so attributable for
 the taxable year computed by placing on an annualized basis the  taxable
 net  earnings  from  self-employment  for the months in the taxable year
 ending before the month in which the installment is required to be paid.
 For purposes of this subparagraph, the taxable net earnings  from  self-
 employment shall be placed on an annualized basis by:
   (i)  multiplying  by twelve, or, in the case of a taxable year of less
 than twelve months, the number of months in the taxable year, the  taxa-
 ble net earnings from self-employment for the months in the taxable year
 ending  before  the  month   in  which the installment is required to be
 paid,
   (ii) dividing the resulting amount by the  number  of  months  in  the
 taxable  year  ending  before  the  month in which such installment date
 falls, and
   (iii) deducting from such amount the proper proportion of  the  exclu-
 sion  allowable  for  the  taxable  year  by  subdivision (b) of section
 11-1902 of this chapter; or
   (2) An amount equal to ninety percent of  the  tax  computed,  at  the
 rates applicable to the taxable year, on the basis of the actual taxable
 net  earnings  from  self-employment  for the months in the taxable year
 ending before the month in which the installment is required to be paid.
   (e) Deficiency due to fraud. If any part of a  deficiency  is  due  to
 fraud,  there shall be added to the tax an amount equal to fifty percent
 of the deficiency.  This amount shall be in lieu of any  other  addition
 to tax imposed by subdivision (a) or (b)  of this section.
   (f) Non-willful failure to pay withholding tax. If any employer, with-
 out  intent  to  evade  or defeat any tax imposed by this chapter or the
 payment thereof, shall fail to make a return and pay a tax  withheld  by
 him  or  her  at  the  time  required  by or under provisions of section
 11-1912 of this chapter, such employer shall be liable for such tax  and
 shall  pay  the  same together with interest thereon and the addition to
 tax provided in subdivision (a)  of this section, and such interest  and
 addition  to  tax shall not be charged to or collected from the employee
 by the employer.  The commissioner shall have the same rights and powers
 for the collection of such tax, interest and  addition  to  tax  against
 such  employer  as are now prescribed by this chapter for the collection
 of tax against an individual taxpayer.
   (g) Willful failure to collect and pay over tax. Any  person  required
 to collect, truthfully account for, and pay over the tax imposed by this
 chapter  who  willfully  fails to collect such tax or truthfully account
 for and pay over such tax or willfully attempts in any manner  to  evade
 or  defeat  the  tax or the payment thereof, shall, in addition to other
 penalties provided by law, be liable to a penalty  equal  to  the  total
 amount  of  the  tax  evaded, or not collected, or not accounted for and
 paid over.  No addition to tax under subdivision (b) or  (e)    of  this
 section  shall  be  imposed  for  any  offense to which this subdivision
 applies.
   (h) Failure to file certain information returns. In case of each fail-
 ure to file a statement of a payment to another person,  required  under
 authority  of subdivision (c) of section 11-1921 of this chapter, relat-
 ing to information at source, including the duplicate statement  of  tax
 S. 8474                           1008
 
 withheld  on  wages,  on  the  date prescribed therefor, determined with
 regard to any extension of time for filing, unless it is shown that such
 failure is due to reasonable cause and not willful neglect, there shall,
 upon  notice  and  demand  by the commissioner and in the same manner as
 tax, be paid by the person so failing to file the statement,  a  penalty
 of  one  dollar  for  each  statement not so filed, but the total amount
 imposed on the delinquent person for all such failures during any calen-
 dar year shall not exceed one thousand dollars.
   (i) Additional penalty. Any person who with  fraudulent  intent  shall
 fail  to  pay,  or  to  deduct or withhold and pay, any tax, or to make,
 render, sign or certify any return or declaration of estimated  tax,  or
 to  supply  any  information  within  the time required by or under this
 chapter, shall be liable to a penalty of  not  more  than  one  thousand
 dollars,  in  addition to any other amounts required under this chapter,
 to be imposed, assessed and collected by the commissioner.  The  commis-
 sioner  shall have the power, in his or her discretion, to waive, reduce
 or compromise any penalty under this subdivision.
   (j) Additions treated as tax.  The  additions  to  tax  and  penalties
 provided  by this section shall be paid upon notice and demand and shall
 be assessed, collected and paid in the same manner  as  taxes,  and  any
 reference  in  this chapter to tax or tax imposed by this chapter, shall
 be deemed also to refer to the additions to tax and  penalties  provided
 by  this  section.   For purposes of section 11-1923 of this subchapter,
 this subdivision shall not apply to:
   (1) any addition to tax under subdivision (a) of this  section  except
 as to that portion attributable to a deficiency;
   (2) any addition to tax under subdivision (c) of this section; and
   (3) any additional penalty under subdivision (i) of this section.
   (k)  Determination of deficiency. For purposes of subdivisions (b) and
 (e) of this section, the amount shown as the tax by  the  taxpayer  upon
 his  or her return shall be taken into account in determining the amount
 of the deficiency only if such return was filed on or  before  the  last
 day  prescribed for the filing of such return, determined with regard to
 any extension of time for such filing.
   (l) Person defined. For purposes of subdivisions (g) and (i)  of  this
 section,  the term "person" includes an individual, corporation or part-
 nership or an officer  or  employee  of  any  corporation,  including  a
 dissolved  corporation,  or a member or employee of any partnership, who
 as such officer, employee, or member is under a duty to perform the  act
 in respect of which the violation occurs.
   §  11-1928  Overpayment.  (a)  General.  The  commissioner, within the
 applicable period of limitations, may credit an overpayment of  tax  and
 interest on such overpayment against any liability in respect of any tax
 imposed  by this chapter or by another chapter or chapters of this title
 on the person who  made  the  overpayment,  and  the  balance  shall  be
 refunded.    Any  refund  under this section shall be made only upon the
 filing of a return.
   (b) Excessive withholding. If the amount allowable as a credit for tax
 withheld from the taxpayer exceeds his or her tax to  which  the  credit
 relates, the excess shall be considered an overpayment.
   (c)  Overpayment  by employer. If there has been an overpayment of tax
 required to be deducted and withheld under section 11-1908 of this chap-
 ter, refund shall be made to the employer only to the  extent  that  the
 amount of the overpayment was not deducted and withheld by the employer.
   (d)  Credits  against  estimated  tax.  The commissioner may prescribe
 regulations providing for the crediting against the  estimated  tax  for
 S. 8474                           1009
 
 any  taxable  year  of the amount determined to be an overpayment of the
 tax for a preceding taxable year.   If any  overpayment  of  tax  is  so
 claimed  as  a  credit  against estimated tax for the succeeding taxable
 year,  such  amount  shall be considered as a payment of the tax for the
 succeeding taxable year, whether or not  claimed  as  a  credit  in  the
 declaration  of   estimated tax for such succeeding taxable year, and no
 claim for credit or refund of such overpayment shall be allowed for  the
 taxable year for which the overpayment arises.
   (e)  Rule  where  no tax liability. If there is no tax liability for a
 period in respect of which an amount is paid as tax, such  amount  shall
 be considered an overpayment.
   (f)  Assessment  and collection after limitation period. If any amount
 of tax is assessed or collected after the expiration of  the  period  of
 limitations properly applicable thereto, such amount shall be considered
 an overpayment.
   (g)  Notwithstanding  any provision of law in article fifty-two of the
 civil practice law and rules to the contrary,  the  procedures  for  the
 enforcement  of  money  judgments  shall  not apply to the department of
 finance, or to any officer or employee of the department of finance,  as
 a garnishee, with respect to any amount of money to be refunded or cred-
 ited to a taxpayer under this chapter.
   §  11-1929    Limitations  on credit or refund. (a) General. Claim for
 credit or refund of an overpayment of tax shall be filed by the taxpayer
 within three years from the time the return was filed or two years  from
 the  time the tax was paid, whichever of such periods expires the later,
 or if no return was filed, within two years from the time  the  tax  was
 paid.  If the claim is filed within the three year period, the amount of
 the credit or refund shall not exceed the portion of the tax paid within
 the  three  years immediately preceding the filing of the claim plus the
 period of any extension of time for filing the return.  If the claim  is
 not filed within the three year period, but is filed within the two year
 period,  the amount of the credit or refund shall not exceed the portion
 of the tax paid during the two years immediately preceding the filing of
 the claim.  Except as otherwise provided in this section, if no claim is
 filed, the amount of a credit or refund  shall  not  exceed  the  amount
 which would be allowable if a claim had been filed on the date the cred-
 it or refund is allowed.
   (b)  Extension  of  time  by  agreement.  If  an  agreement  under the
 provisions of paragraph two of subdivision (b)  of  section  11-1925  of
 this  subchapter,  extending  the  period for assessment of tax, is made
 within the period prescribed in subdivision (a)  of this section for the
 filing of a claim for credit or refund, the period for  filing  a  claim
 for  credit  or  refund,  or  for making credit or refund if no claim is
 filed, shall not expire prior to six months after the expiration of  the
 period  within which an assessment may be made pursuant to the agreement
 or any extension thereof.  The amount of such credit or refund shall not
 exceed the portion of the tax paid after the execution of the  agreement
 and  before  the  filing  of  the  claim  or the making of the credit or
 refund, as the case may be, plus the portion of the tax paid within  the
 period  which  would be applicable under subdivision (a) of this section
 if a claim had been filed on the date the agreement was executed.
   (c) Notice of change or  correction  of  federal  or  New  York  state
 income.  If a taxpayer is required by section 11-1922 of this chapter to
 report a change or correction in  federal  or  New  York  state  taxable
 income  or  self-employment income reported on his or her federal or New
 York state tax return, or  to  report  an  assessment  or  a  change  or
 S. 8474                           1010

 correction which is treated in the same manner as if it were an overpay-
 ment  for  federal  or New York state income tax purposes, or to file an
 amended return with the commissioner, claim for credit or refund of  any
 resulting  overpayment  of tax shall be filed by the taxpayer within two
 years from the time the notice of such  change  or  correction  or  such
 amended  return  was required to be filed with the commissioner.  If the
 report or amended return required by section 11-1922 of this chapter  is
 not  filed  within  the ninety day period therein specified, interest on
 any resulting refund or credit shall cease to accrue after such  nineti-
 eth  day.    The  amount  of  such credit or refund shall not exceed the
 amount of the reduction in tax attributable to such federal or New  York
 state  change,  correction  or  items  amended on the taxpayer's amended
 federal or New York state income  tax  or  self-employment  tax  return.
 This  subdivision  shall  not affect the time within which or the amount
 for which a claim for credit or refund may  be  filed  apart  from  this
 subdivision.
   (d)  Failure  to  file  claim  within  prescribed period. No credit or
 refund shall be allowed or made, except as provided in  subdivision  (e)
 of this section or subdivision (d) of section 11-1932 of this subchapter
 after the expiration of the applicable period of limitation specified in
 this chapter unless a claim for credit or refund is filed by the taxpay-
 er  within  such  period.   Any later credit shall be void and any later
 refund erroneous.  No period of limitations specified in any  other  law
 shall  apply  to the recovery by a taxpayer of moneys paid in respect of
 taxes under this chapter.
   (e) Effect of petition to commissioner. If a notice of deficiency  for
 a  taxable year has been mailed to the taxpayer under section 11-1923 of
 this subchapter and if the taxpayer files a  timely  petition  with  the
 commissioner  under section 11-1931 of this subchapter, the commissioner
 may determine that the taxpayer has made an overpayment for  such  year,
 whether  or  not  the commissioner also determines a deficiency for such
 year.  No separate claim for credit or refund for  such  year  shall  be
 filed,  and  no credit or refund for such year shall be allowed or made,
 except:
   (1) as to overpayments determined by a decision  of  the  commissioner
 which has become final;
   (2)  as  to  any  amount  collected in excess of an amount computed in
 accordance with the decision of the commissioner which has become final;
   (3) as to any amount collected after the period of limitation upon the
 making of levy for collection has expired; and
   (4) as to any amount claimed as a result of  a  change  or  correction
 described in subdivision (c)  of this section.
   (f)  Limit  on  amount  of credit or refund. The amount of overpayment
 determined under subdivision (e)  of this section shall, when the  deci-
 sion  of  the  commissioner has become final, be credited or refunded in
 accordance with subdivision (a) of section 11-1928  of  this  subchapter
 and shall not exceed the amount of tax which the commissioner determines
 as part of his or her decision was paid:
   (1) after the mailing of the notice of deficiency, or
   (2) within the period which would be applicable under subdivision (a),
 (b) or (c)  of this section, if on the date of the mailing of the notice
 of  deficiency a claim has been filed, whether or not filed, stating the
 grounds upon which the commissioner finds that there is an overpayment.
   (g) Early return. For purposes  of  this  section,  any  return  filed
 before  the  last day prescribed for the filing thereof shall be consid-
 S. 8474                           1011
 
 ered as filed on such last day, determined without regard to any  exten-
 sion of time granted the taxpayer.
   (h)  Prepaid  tax.  For  purposes of this section, any tax paid by the
 taxpayer before the last day prescribed for its payment, any  tax  with-
 held  from the taxpayer during any calendar year, and any amount paid by
 the taxpayer as estimated tax for a taxable year shall be deemed to have
 been paid by the taxpayer on the  fifteenth  day  of  the  fourth  month
 following  the  close  of  his or her taxable year with respect to which
 such amount constitutes a credit or payment.
   (i) Return and payment of withholding tax. Notwithstanding subdivision
 (g) of this section, for purposes of this section with  respect  to  any
 withholding tax:
   (1)  if  a return for any period ending with or within a calendar year
 is filed before April fifteenth of the succeeding  calendar  year,  such
 return  shall  be considered filed on April fifteenth of such succeeding
 calendar year; and
   (2) if a tax with respect  to  remuneration  paid  during  any  period
 ending  with or within a calendar year is paid before April fifteenth of
 the succeeding calendar year, such tax shall be considered paid on April
 fifteenth of such succeeding calendar year.
   (j) Cross reference. For provision barring refund of overpayment cred-
 ited against tax of a succeeding year, see subdivision  (d)  of  section
 11-1928 of this subchapter.
   §  11-1930  Interest  on overpayment. (a) General. Notwithstanding the
 provisions of section three-a of the  general  municipal  law,  interest
 shall be allowed and paid as follows at the appropriate rates prescribed
 for  overpayments  of tax under chapter seventeen of this title upon any
 overpayment in respect of the tax imposed by this chapter:
   (1) from the date of the overpayment to the  due  date  of  an  amount
 against which a credit is taken; or
   (2)  from  the  date of the overpayment to a date, to be determined by
 the commissioner, preceding the date of a refund check by not more  than
 thirty days, whether or not such refund check is accepted by the taxpay-
 er  after  tender of such check to the taxpayer.  The acceptance of such
 check shall be without prejudice to any right of the taxpayer  to  claim
 any additional overpayment and interest thereon.
   No  interest  shall  be  allowed or paid if the amount thereof is less
 than one dollar.
   (b) Advance payment of tax, payment of estimated tax, and  credit  for
 tax  withholding.  The  provisions  of  subdivisions (g), (h) and (i) of
 section 11-1929 of this subchapter applicable in determining the date of
 payment of tax for purposes of determining the period of limitations  on
 credit or refund, shall be applicable in determining the date of payment
 for purposes of this section.
   (c)  Refund within three months of due date of tax. If any overpayment
 of tax imposed by this chapter is refunded within three months after the
 last date prescribed, or permitted by extension of time, for filing  the
 return  of  such  tax or within three months after the return was filed,
 whichever is later, no interest shall be allowed under this  section  on
 such overpayment.
   (d)  Cross-reference. For provision terminating interest after failure
 to file notice of federal or New York state change under section 11-1922
 of this chapter, see subdivision (c) of 11-1929 of this subchapter.
   § 11-1931  Petition to commissioner. (a) General. The form of a  peti-
 tion to the commissioner, and further proceedings before the commission-
 er  in any case initiated by the filing of a petition, shall be governed
 S. 8474                           1012
 
 by such rules as the commissioner shall prescribe.  No petition shall be
 denied in whole or in part without opportunity for a hearing on  reason-
 able prior notice.  Such hearing shall be conducted by the commissioner,
 or  by a hearing officer designated by the commissioner to take evidence
 and report to the commissioner.  The commissioner shall decide the  case
 as  quickly  as  practicable.    Notice  of the decision shall be mailed
 promptly to the taxpayer by certified or registered mail at his  or  her
 last  known  address  and such notice shall set forth the commissioner's
 findings of fact and a brief statement of the grounds of  decision    in
 each  case  decided  in whole or in part adversely to the taxpayer.  Any
 portion of an assessment of a deficiency disallowed by  the  commission-
 er's  decision,  shall  be  forthwith  abated,  or  if paid, credited or
 refunded to the taxpayer without the making of a claim therefor.
   (b) Petition for redetermination of a deficiency. Within ninety  days,
 or one hundred fifty days if the notice is addressed to a person outside
 of  the  United  States,  after  the mailing of the notice of deficiency
 authorized by section 11-1923 of this subchapter, the taxpayer may  file
 a  petition with the commissioner for a redetermination of the deficien-
 cy.  Such petition may also assert a claim for refund for the same taxa-
 ble year or years, subject to the  limitations  of  subdivision  (f)  of
 section 11-1929 of this subchapter.
   (c)  Petition  for  refund.  A  taxpayer  may file a petition with the
 commissioner for the amounts asserted in a claim for refund if:
   (1) the taxpayer has filed a timely claim for refund with the  commis-
 sioner,
   (2)  the  taxpayer  has  not  previously filed with the commissioner a
 timely petition under subdivision (b)   of this  section  for  the  same
 taxable  year  unless  the  petition under this subdivision relates to a
 separate claim for credit or refund properly filed under subdivision (e)
 of section 11-1929 of this subchapter, and
   (3) either: (A) six months have expired since the claim was filed,  or
 (B) the commissioner has mailed to the taxpayer, by registered or certi-
 fied  mail,  a notice of disallowance of such claim in whole or in part.
 No petition under this subdivision shall be filed more  than  two  years
 after  the  date of mailing of a notice of disallowance, unless prior to
 the expiration of such a two-year period  it has been extended by  writ-
 ten  agreement between the taxpayer and the commissioner.  If a taxpayer
 files a written waiver of the requirement that he or  she  be  mailed  a
 notice  of disallowance, the two year period prescribed by this subdivi-
 sion for filing a petition for refund shall begin on the date such waiv-
 er is filed.
   (d) Assertion and assessment of deficiency after filing petition.
   (1) Petition for redetermination of  deficiency. If a  taxpayer  files
 with  the  commissioner  a petition for redetermination of a deficiency,
 the commissioner shall have power to  determine  and  assess  a  greater
 deficiency  than  asserted  in the notice of deficiency and to determine
 and assess any addition to tax or penalty provided in section 11-1927 of
 this subchapter, if claim therefor is asserted at or before the  hearing
 and  within  the  period  in  which  an assessment would be timely under
 section 11-1925 of this subchapter under the rules of the commissioner.
   (2) Petition for refund. If the taxpayer files with the commissioner a
 petition for credit or refund for a taxable year, the commissioner may:
   (A) determine and assess a deficiency for such year as to  any  amount
 of deficiency claim, which shall be an assessment, for which is asserted
 at or before the hearing under rules of the commissioner, and within the
 S. 8474                           1013
 
 period  in  which an assessment would be timely under section 11-1925 of
 this subchapter, or
   (B) deny so much of the amount for which credit or refund is sought in
 the  petition, as is offset by other issues pertaining to the same taxa-
 ble year which are asserted at or before the hearing under rules of  the
 commissioner.
   (3)  Opportunity  to  respond.  A taxpayer shall be given a reasonable
 opportunity to respond to any matters asserted by the commissioner under
 this subdivision.
   (4) Restriction on further notices  of  deficiency.  If  the  taxpayer
 files  a petition with the commissioner under this section, no notice of
 deficiency under section 11-1923 of this subchapter  may  thereafter  be
 issued  by the commissioner for the same taxable year, except in case of
 fraud or with respect to a change or correction in federal or  New  York
 state  taxable  income or self-employment income required to be reported
 under section 11-1922 of this chapter.
   (e) Burden of proof. In any case before the  commissioner  under  this
 chapter, the burden of proof shall be upon the petitioner except for the
 following  issues,  as  to  which  the burden of proof shall be upon the
 commissioner:
   (1) whether the petitioner has been guilty of  fraud  with  intent  to
 evade tax;
   (2)  whether the petitioner is liable as the transferee of property of
 a taxpayer, except where the petitioner's liability arises by reason  of
 section  11-1936  of  this subchapter, but not to show that the taxpayer
 was liable for the tax; and
   (3)  whether the petitioner is liable for any increase in a deficiency
 where such increase is asserted initially after a notice  of  deficiency
 was mailed and a petition under this section filed, unless such increase
 in  deficiency is the result of a change or correction of federal or New
 York state taxable income  or  self-employment  income  required  to  be
 reported  under  section 11-1922 of this chapter, and of which change or
 correction the commissioner had no notice at the time he or  she  mailed
 the notice of deficiency.
   (f)  Evidence  of related federal determination. Evidence of a federal
 determination relating to issues raised in a case before the commission-
 er under this section shall be admissible, under  rules  established  by
 the commissioner.
   (g)  Jurisdiction  over  other  years. The commissioner shall consider
 such facts with relation to the taxes for other years as may  be  neces-
 sary  correctly  to  determine  the  tax for the taxable year, but in so
 doing shall have no jurisdiction to determine whether or not the tax for
 any other year has been overpaid or underpaid.
   § 11-1932 Review of commissioner's decision. (a) General.  A  decision
 of the commissioner shall be subject to judicial review for error, ille-
 gality  or  unconstitutionality at the instance of any taxpayer affected
 thereby in the manner provided by law for the review of a final decision
 or action of administrative agencies of the city.  An application  by  a
 taxpayer for such review must be made within four months after notice of
 the decision is sent by certified or registered mail to the taxpayer.
   (b)  Judicial  review  exclusive  remedy  of taxpayer. The review of a
 decision of the commissioner provided by this section shall be exclusive
 remedy available to any taxpayer for the judicial determination  of  the
 liability of the taxpayer for the taxes imposed by this chapter.
   (c)  Collection  pending  review;  review  bond.  Irrespective  of any
 restrictions on the collection  of  assessments  for  deficiencies,  the
 S. 8474                           1014
 
 commissioner may collect by levy or, otherwise any assessment of a defi-
 ciency  after  the expiration of the period specified in subdivision (a)
 of this section, notwithstanding that an application for judicial review
 in respect of such deficiency has been duly made by the taxpayer, unless
 the taxpayer, at or before the time his or her application for review is
 made,  has  paid the assessed deficiency, has deposited with the commis-
 sioner the amount of the assessed deficiency,  or  has  filed  with  the
 commissioner  a bond, which may be a jeopardy bond under subdivision (h)
 of section 11-1937 of this subchapter, in the amount of the  portion  of
 the  assessed  deficiency,  including  interest  and  other  amounts, in
 respect of which the application for review is made with surety approved
 by a justice of the supreme court of the state of New York,  conditioned
 upon  the  payment  of  the  assessed deficiency, including interest and
 other amounts, as finally determined.  If as a result of a waiver of the
 restrictions on the collection of a deficiency any part  of  the  amount
 determined  by  the  commissioner is paid after the filing of the review
 bond, such bond shall, at the request of the taxpayer, be proportionate-
 ly reduced.  A similar bond for all costs and charges which  may  accrue
 against the taxpayer in the prosecution of such judicial review proceed-
 ing  must  be  filed with the commissioner before any such proceeding is
 instituted.
   (d) Credit, refund or abatement after review. If the amount of a defi-
 ciency assessed and determined by  the  commissioner  is  disallowed  in
 whole  or in part by the court of review, the amount so disallowed shall
 be credited or refunded to the taxpayer, without  the  making  of  claim
 therefor, or, if payment has not been made, shall be abated.
   (e)  Date  of  finality  of commissioner's decision. A decision of the
 commissioner shall become final upon the expiration of the period speci-
 fied in subdivision (a)  of this section for making an  application  for
 review,  if  no such application has been duly made within such time, or
 if such application has been duly made, upon expiration of the time  for
 all  further  judicial review, or upon the rendering by the commissioner
 of a decision in accordance with the mandate of  the  court  on  review.
 Provided,  however, for the purpose of making an application for review,
 the decision of the commissioner shall be deemed final on the  date  the
 notice  of  decision  is  sent  by  certified  or registered mail to the
 taxpayer.
   § 11-1933 Mailing rules; holidays. (a) Timely mailing. If  any  claim,
 statement,  notice, petition, or other document, including to the extent
 authorized by the commissioner, a return  or  declaration  of  estimated
 tax,  required  to be filed within a prescribed period or on or before a
 prescribed date under authority of any provision  of  this  chapter  is,
 after  such  period or such date, delivered by the United States mail to
 the commissioner, bureau, office, officer or person with which  or  with
 whom  such  document  is  required  to  be filed, the date of the United
 States postmark stamped on the envelope shall be deemed to be  the  date
 of  delivery.    This  subdivision shall apply only if the postmark date
 falls within the prescribed period or on or before the  prescribed  date
 for the filing of such document, determined with regard to any extension
 granted  for such filing, and only if such document was deposited in the
 mail, postage prepaid, properly addressed to the  commissioner,  bureau,
 office,  officer  or  person  with  which  or  with whom the document is
 required to be filed.  If any document is sent by United  States  regis-
 tered  mail,  such  registration shall be prima facie evidence that such
 document was delivered to the commissioner, bureau, office,  officer  or
 person  to  which  or to whom addressed.  To the extent that the commis-
 S. 8474                           1015
 
 sioner shall prescribe by regulation, certified mail may be used in lieu
 of registered mail under this section.  This subdivision shall apply  in
 the  case of postmarks not made by the United States post office only if
 and to the extent provided by regulations of the commissioner.
   (b)  Last  known  address.  For purposes of this chapter, a taxpayer's
 last known address shall be the address given in the last  return  filed
 by  the  taxpayer,  unless  subsequent  to the filing of such return the
 taxpayer shall have notified the commissioner of a change of address.
   (c) Last day a Saturday, Sunday or legal holiday. When  the  last  day
 prescribed  under  authority of this chapter, including any extension of
 time, for performing any act falls on Saturday, Sunday, or a legal holi-
 day in the state of New York, the  performance  of  such  act  shall  be
 considered timely if it is performed on the next succeeding day which is
 not a Saturday, Sunday or a legal holiday.
   §  11-1934  Collection, levy and liens. (a) Collection procedures. The
 taxes imposed by this chapter shall be collected  by  the  commissioner,
 and  he  or she may establish the mode or time for the collection of any
 amount due the commissioner under this chapter if not  otherwise  speci-
 fied.   The commissioner shall, upon request, give a receipt for any sum
 collected under this chapter.  The commissioner may authorize  banks  or
 trust  companies  which are depositories or financial agents of the city
 to receive and give a receipt for any tax imposed under this chapter  in
 such manner, at such times, and under such conditions as the commission-
 er may prescribe; and the commissioner shall prescribe the manner, times
 and  conditions  under  which  the receipt of such tax by such banks and
 trust companies is to be treated as payment of such tax to  the  commis-
 sioner.
   (b) Notice and demand for tax. The commissioner shall as soon as prac-
 ticable  and,  in  the  case of an assessment the collection of which is
 restricted by the provisions of subdivision (c) of  section  11-1923  of
 this  subchapter,  as  soon  as practicable after the expiration of such
 restrictions give notice to each person liable for any  amount  of  tax,
 addition  to  tax,  penalty  or  interest,  which  has been assessed but
 remains unpaid, stating the amount and demanding payment thereof.   Such
 notice  shall be left at the dwelling or usual place of business of such
 person or shall be sent by mail to such  person's  last  known  address.
 Except  where the commissioner determines that collection would be jeop-
 ardized by delay, if any tax is assessed prior to the last date, includ-
 ing any date fixed by extension, prescribed for  payment  of  such  tax,
 payment of such tax shall not be demanded until after such date.
   (c)  Issuance of warrant after notice and demand. If any person liable
 under this chapter for the payment of any tax, addition to tax,  penalty
 or  interest  neglects  or refuses to pay the same within ten days after
 notice and demand therefor is given to such person under subdivision (b)
 of this section, the commissioner may within six years after the date of
 the expiration of the period of restriction on the  collection  of  such
 assessment  issue a warrant directed to the sheriff of any county of the
 state, or to any officer or employee of the department of finance of the
 city, commanding the sheriff or such officer or employee  to  levy  upon
 and sell such person's real and personal property for the payment of the
 amount  assessed,  with the cost of executing the warrant, and to return
 such warrant to the commissioner  and  pay  to  him  or  her  the  money
 collected  by  virtue thereof within sixty days after the receipt of the
 warrant.  If the commissioner finds that the collection of tax or  other
 amount  is  in jeopardy, notice and demand for immediate payment of such
 tax may be made by the commissioner and upon failure or refusal  to  pay
 S. 8474                           1016
 
 such  tax  or  other amount the commissioner may issue a warrant without
 regard to the ten-day period provided in this subdivision.
   (d) Copy of warrant to be filed and lien to be created. Any sheriff or
 officer or employee who receives a warrant under subdivision (c) of this
 section  shall within five days thereafter file a copy with the clerk of
 the appropriate county.  The clerk shall thereupon enter in the judgment
 docket, in the column for judgment debtors, the  name  of  the  taxpayer
 mentioned  in  the  warrant, and in appropriate columns the tax or other
 amounts for which the warrant is issued and the date when such  copy  is
 filed;  and such amount shall thereupon be a binding lien upon the real,
 personal and other property of the taxpayer.
   (e) Judgment. When a warrant has been filed with the county clerk  the
 commissioner  shall,  on  behalf of the city, be deemed to have obtained
 judgment against the taxpayer for the tax or other amounts.
   (f) Execution. The sheriff or  officer  or  employee  shall  thereupon
 proceed  upon the judgment in all respects, with like effect, and in the
 same manner prescribed by law in respect to  executions  issued  against
 property  upon  judgments  of  a court of record, and a sheriff shall be
 entitled to the same fees for such sheriff's services in  executing  the
 warrant,  to be collected in the same manner.  An officer or employee of
 the department of finance of the city may proceed in any county or coun-
 ties of this state and shall have all the powers of execution  conferred
 by law upon sheriffs, but shall be entitled to no fee or compensation in
 excess  of  actual expenses paid in connection with the execution of the
 warrant.
   (g) Taxpayer not then a resident. Where  a  notice  and  demand  under
 subdivision  (b) of this section shall have been given to a taxpayer who
 is not then a resident of this state, and it appears to the commissioner
 that it is not practicable to find in this state property of the taxpay-
 er sufficient to pay the entire balance of tax or other amount owing  by
 such taxpayer who is not then a resident of this state, the commissioner
 may, in accordance with subdivision (c) of this section, issue a warrant
 directed  to  an officer or employee of the department of finance of the
 city a copy of which warrant shall be mailed by certified or  registered
 mail  to  the  taxpayer at his or her last known address, subject to the
 rules for mailing provided in subdivision (a) of section 11-1933 of this
 subchapter.   Such warrant shall command  the  officer  or  employee  to
 proceed  in  the  city,  and such officer or employee shall, within five
 days after receipt of the warrant, file the warrant and obtain  a  judg-
 ment  in  accordance  with  this section. Thereupon the commissioner may
 authorize the institution of any action  or  proceeding  to  collect  or
 enforce  the  judgment  in  any  place and by any procedure where and by
 which a civil judgment of the supreme court of the  state  of  New  York
 could  be  collected or enforced.   The commissioner may also, in his or
 her discretion, designate agents or retain counsel for  the  purpose  of
 collecting,  outside  the state of New York, any unpaid taxes, additions
 to tax, penalties or interest which have been assessed under this  chap-
 ter  against taxpayers who are not then residents of this state, may fix
 the compensation of such agents and counsel to  be  paid  out  of  money
 appropriated  or  otherwise  lawfully available for payment thereof, and
 may require of them bonds or other security for the faithful performance
 of their duties, in such form and in such  amount  as  the  commissioner
 shall deem proper and sufficient.
   (h) Action by the city for recovery of taxes. Action may be brought by
 the  corporation counsel or other appropriate officer of the city at the
 insistence of the commissioner to  recover  the  amount  of  any  unpaid
 S. 8474                           1017
 
 taxes,  additions to tax, penalties or interest which have been assessed
 under this chapter within six years prior to  the  date  the  action  is
 commenced.    The  period  during  which collection of any assessment is
 prohibited  by  subdivision  (c)  of section 11-1923 of this subchapter,
 shall be added to such six years.
   (i) Release of lien. The commissioner, if he or  she  finds  that  the
 interest  of  the  city  will  not thereby be jeopardized, and upon such
 conditions as may require, may release any property from the lien of any
 warrant for unpaid taxes, additions to tax, penalties and interest filed
 pursuant to this section, and such release may be recorded in the office
 of any recording officer in which such warrant has been filed.
   § 11-1935 Transferees. (a) General. The liability, at law or in  equi-
 ty,  of a transferee of property of a taxpayer for any tax, additions to
 tax, penalty or interest due to the city under this  chapter,  shall  be
 assessed, paid, and collected in the same manner and subject to the same
 provisions  and limitations as in the case of the tax to which liability
 relates, except that the period of limitations  for  assessment  against
 the  transferee shall be extended by one year for each successive trans-
 fer, in order, from the original taxpayer to  the  transferee  involved,
 but  not by more than three years in the aggregate.  The term "transfer-
 ee" includes donee, heir, legatee, devisee  and  distributee;  and  also
 includes  a  person  liable for the amount of any tax, additions to tax,
 penalty or interest under the provisions  of  section  11-1936  of  this
 subchapter.
   (b)  Exceptions. (1) If before the expiration of the period of limita-
 tions for assessment of liability of the transferee, a  claim  has  been
 filed  by the commissioner in any court against the original taxpayer or
 the last preceding transferee based upon the liability of  the  original
 taxpayer,  then  the period of limitation for assessment of liability of
 the transferee shall in no event expire prior to  one  year  after  such
 claim has been finally allowed, disallowed or otherwise disposed of.
   (2)  If,  before  the expiration of the time prescribed in subdivision
 (a) of this section or paragraph one of this subdivision for the assess-
 ment of the liability, the commissioner and  the  transferee  have  both
 consented  in  writing  to its assessment after such time, the liability
 may be assessed at any time prior to the expiration of the period agreed
 upon.  The period so agreed upon may be extended  by  subsequent  agree-
 ments  in  writing  made  before the expiration of the period previously
 agreed upon.  For the purpose of determining the period of limitation on
 credit or refund to the transferee of overpayments of tax made  by  such
 transferee or overpayments of tax made by the transferor as to which the
 transferee  is  legally entitled to credit or refund, such agreement and
 any extension thereof shall be deemed an agreement and extension thereof
 referred to in subdivision (b) of section 11-1929  of  this  subchapter.
 If the agreement is executed after the expiration of the period of limi-
 tation  for  assessment  against the original taxpayer, then in applying
 the limitations  under  subdivision  (b)  of  section  11-1929  of  this
 subchapter  on the amount of the credit or refund, the periods specified
 in subdivision (a) of  section  11-1929  of  this  subchapter  shall  be
 increased  by the period from the date of such expiration to the date of
 the agreement.
   (c) Deceased transferor. If any person  is  deceased,  the  period  of
 limitation  for  assessment against such person shall be the period that
 would be in effect if he or she had lived.
   (d) Evidence. Notwithstanding the provisions  of  section  11-1942  of
 this  subchapter,  the  commissioner shall use his or her powers to make
 S. 8474                           1018

 available to the transferee evidence necessary to enable the  transferee
 to determine the liability of the original taxpayer and of any preceding
 transferees,  but  without  undue  hardship  to the original taxpayer or
 preceding  transferee.    See subdivision (e) of section 11-1931 of this
 subchapter for rule as to burden of proof.
   § 11-1936 Liability of bulk transferees.  Whenever  there  is  made  a
 sale, transfer or assignment in bulk of any part or the whole of a stock
 of merchandise or of fixtures, or merchandise and of fixtures pertaining
 to the conducting of the business of the seller, transferor or assignor,
 otherwise than in the ordinary course of trade and in the regular prose-
 cution  of said business, the purchaser, transferee or assignee shall at
 least ten days before taking possession of such  merchandise,  fixtures,
 or merchandise and fixtures, or paying therefor, notify the commissioner
 by  registered  mail  of  the  proposed sale and of the price, terms and
 conditions thereof, whether or not the seller, transferor  or  assignor,
 has  represented  to, or informed the purchaser, transferee or assignee,
 that it owes any tax pursuant  to  this  chapter,  whether  or  not  the
 purchaser,  transferee  or  assignee  has  knowledge that such taxes are
 owing, and whether or not any such taxes are in fact owing.
   Whenever the purchaser, transferee or assignee shall fail to give  the
 notice  to  the  commissioner  required by this section, or whenever the
 commissioner shall inform the purchaser, transferee or assignee  that  a
 possible claim for such tax or taxes exists, any sums of money, property
 or choses in action, or other consideration, which the purchaser, trans-
 feree or assignee is required to transfer over to the seller, transferor
 or  assignor shall be subject to a first priority right and lien for any
 such taxes theretofore or thereafter determined to be due from the sell-
 er, transferor or assignor to the city, and the purchaser, transferee or
 assignee is forbidden to transfer to the seller, transferor or  assignor
 any  such  sums  of money, property or choses in action to the extent of
 the amount of the  city's  claim.    For  failure  to  comply  with  the
 provisions of this subdivision the purchaser, transferee or assignee, in
 addition  to being subject to the liabilities and remedies imposed under
 the provisions of article six of the uniform commercial code,  shall  be
 personally  liable for the payment to the city of any such taxes, there-
 tofore or thereafter determined to be due to the city from  the  seller,
 transferor  or  assignor and such liability may be assessed and enforced
 in the same manner as the liability for tax is imposed under this  chap-
 ter.
   §  11-1937  Jeopardy  determination  or  assessment. (a) Authority for
 making. If the commissioner believes that the assessment  or  collection
 of  a deficiency will be jeopardized by delay, he or she shall, notwith-
 standing the provisions of sections 11-1923 and 11-1939 of this subchap-
 ter, immediately assess or proceed to collect such deficiency,  together
 with  all  interest, penalties and additions to tax provided for by law,
 and notice and demand shall be made by the commissioner for the  payment
 thereof.
   (b)  Notice  of  deficiency. If the jeopardy assessment is made before
 any notice in respect of  the  tax  to  which  the  jeopardy  assessment
 relates  has  been mailed under section 11-1923 of this subchapter, then
 the commissioner shall mail a notice under  such  section  within  sixty
 days after making of the assessment.
   (c)  Amount  assessable  before decision of commissioner. The jeopardy
 assessment may be made in respect of a deficiency greater or  less  than
 that  of  which  notice is mailed to the taxpayer and whether or not the
 taxpayer has therefor filed a  petition  with  the  commissioner.    The
 S. 8474                           1019
 
 commissioner  may,  at  any  time  before rendering his or her decision,
 abate such assessment or any unpaid portion thereof, to the extent  that
 he  or  she  believes  the  assessment  to be excessive in amount.   The
 commissioner may in his or her decision redetermine the entire amount of
 the  deficiency  and  of  all  amounts  assessed  at  the  same  time in
 connection therewith.
   (d) Amount assessable after decision of commissioner. If the  jeopardy
 assessment  of  determination  of jeopardy is made after the decision of
 the commissioner is rendered, such assessment or  determination  may  be
 made only in respect of the deficiency determined by the commissioner in
 his or her decision.
   (e) Expiration of right to assess. A jeopardy determination may not be
 made  after  the  decision of the commissioner has become final or after
 the taxpayer has made an application for review of the decision  of  the
 commissioner.
   (f)  Collection of unpaid amounts. When a petition has been filed with
 the commissioner and when the amount which should have been assessed has
 been determined by a decision  of  the  commissioner  which  has  become
 final,  then any unpaid portion, the collection of which has been stayed
 by bond, shall be collected as part of the tax upon  notice  and  demand
 from the commissioner, and any remaining portion of the assessment shall
 be  abated.    If the amount already collected exceeds the amount deter-
 mined as the amount which should have been assessed, such  excess  shall
 be  credited  or refunded to the taxpayer as provided in section 11-1928
 of this subchapter without the filing of claim therefor.  If the  amount
 determined as the amount which should have been assessed is greater than
 the  amount actually assessed, then the difference shall be assessed and
 shall be collected as part of the tax upon notice and  demand  from  the
 commissioner.
   (g)   Abatement if jeopardy does not exist. The commissioner may abate
 the jeopardy determination if he or she finds  that  jeopardy  does  not
 exist.    Such abatement may not be made after a decision of the commis-
 sioner in respect of the deficiency has been rendered or, if no petition
 is filed with the commissioner, after the expiration of the  period  for
 filing  such petition.  The period of limitation on the making of a levy
 or a proceeding for collection, in respect of any deficiency,  shall  be
 determined  as  if  the jeopardy assessment so abated has not been made,
 except that the running of such period shall in any event  be  suspended
 for  the  period  from the date of such jeopardy determination until the
 expiration of the tenth day after the day on which such jeopardy  deter-
 mination is abated.
   (h) Bond to stay collection. The collection of the whole or any amount
 of  any  assessment determined to be in jeopardy may be stayed by filing
 with the commissioner, within such time as may be fixed by regulation, a
 bond in an amount equal to the amount as to which the  stay  is  desired
 conditioned upon the payment of the amount, together with interest ther-
 eon, the collection of which is stayed at the time at which, but for the
 making  of  the jeopardy assessment, such amount would be due.  Upon the
 filing of the bond, the collection of so much of the amount assessed  as
 is  covered  by  the  bond shall be stayed.  The taxpayer shall have the
 right to waive such stay at any time in respect of the whole or any part
 of the amount covered by the bond and, if as a result of such waiver any
 part of the amount covered by the bond is paid, then the bond shall,  at
 the request of the taxpayer, be proportionately reduced.  If any portion
 of the jeopardy assessment is abated, or if a notice of deficiency under
 section 11-1923 of this subchapter is mailed to the taxpayer in a lesser
 S. 8474                           1020
 
 amount,  the  bond shall, at the request of the taxpayer, be proportion-
 ately reduced.
   (i) Petition to commissioner. If the bond is given before the taxpayer
 has  filed his or her petition under section 11-1931 of this subchapter,
 the bond shall contain a further condition that if  a  petition  is  not
 filed  within  the period provided in such section, then the amount, the
 collection of which is stayed by the bond, will be paid  on  notice  and
 demand  at  any  time after the expiration of such period, together with
 interest thereon from the date of the jeopardy notice and demand to  the
 date  of  notice  and  demand under this subdivision.  The bond shall be
 conditioned upon the payment of so much of such  assessment,  collection
 of  which  is  stayed by the bond, as is not abated by a decision of the
 commissioner which has become final.   If  the  commissioner  determines
 that  the  amount  assessed is greater than the amount which should have
 been assessed, then the bond shall, at the request of the  taxpayer,  be
 proportionately  reduced  when  the  decision  of  the  commissioner  is
 rendered.
   (j) Stay of sale of seized property pending  commissioner's  decision.
 Where  a jeopardy assessment or a determination of jeopardy is made, the
 property seized for the collection of the tax shall not be sold:
   (1) if subdivision (b) of this section is  applicable,  prior  to  the
 issuance  of  the  notice  of  deficiency and the expiration of the time
 provided in section 11-1931 of this subchapter  for  filing  a  petition
 with the commissioner, and
   (2)  if  a  petition is filed with the commissioner, whether before or
 after the making of such jeopardy assessment or determination, prior  to
 the  expiration  of  the period during which the collection of the defi-
 ciency assessed would be prohibited if subdivision (a) of  this  section
 were not applicable.
   Such  property may be sold if the taxpayer consents to the sale, or if
 the commissioner determines that the expenses of conservation and  main-
 tenance  will  greatly  reduce  the  net proceeds, or if the property is
 perishable.
   (k) Interest. For the purpose of subdivision (a) of section 11-1926 of
 this subchapter, the last date prescribed for payment  shall  be  deter-
 mined  without  regard to any notice and demand for payment issued under
 this section prior to  the  last  date  otherwise  prescribed  for  such
 payment.
   (l)  Early termination of taxable year. If the commissioner finds that
 a taxpayer designs quickly to depart from this state or to remove his or
 her property therefrom, or to conceal himself or herself or his  or  her
 property  therein,  or  to  do  any other act tending to prejudice or to
 render wholly or partly ineffectual proceedings to collect the  tax  for
 the  current  or  the  preceding taxable year unless such proceedings be
 brought without delay, the commissioner shall declare the taxable period
 for such taxpayer immediately terminated, and shall cause notice of such
 finding and declaration to be given the taxpayer, together with a demand
 for immediate payment of the tax for  the  taxable  period  so  declared
 terminated  and  of the tax for the preceding taxable year or so much of
 such tax as is unpaid, whether or not the time otherwise allowed by  law
 for  filing  return and paying the tax has expired; and such taxes shall
 thereupon become immediately due and payable.  In any proceeding brought
 to enforce payment of taxes made  due  and  payable  by  virtue  of  the
 provisions  of this subdivision, the finding of the commissioner made as
 herein provided, whether made after notice to the taxpayer or not, shall
 be for all purposes presumptive evidence of jeopardy.
 S. 8474                           1021
 
   (m)  Reopening of taxable period. Notwithstanding the  termination  of
 the  taxable  period  of the taxpayer by the commissioner as provided in
 subdivision (1) of this section, the commissioner may reopen such  taxa-
 ble  period  each time the taxpayer is found by the commissioner to have
 received  wages or net earnings from self-employment, within the current
 taxable year, since the termination of such period.  A taxable period so
 terminated by the commissioner may be reopened by the taxpayer if he  or
 she  files  with  the commissioner a true and accurate return of taxable
 wages and net earnings from self-employment under this chapter for  such
 taxable period, together with such other information as the commissioner
 may by regulation prescribe.
   (n)    Furnishing  of bond where taxable year is closed by the commis-
 sioner. Payment of taxes shall not be enforced by any proceedings  under
 the  provisions  of subdivision (1) of this section prior to the expira-
 tion of the time otherwise allowed for paying such taxes if the taxpayer
 furnishes, under regulations prescribed by the commissioner, a  bond  to
 insure  the  timely  making  of returns with respect to, and payment of,
 such taxes or any taxes for prior years.
   § 11-1938 Criminal penalties. (a)  Attempt to evade tax. Any  individ-
 ual, corporation or partnership or any officer or employee of any corpo-
 ration,  or  member  or employee of any partnership, who, with intent to
 evade any tax or any requirement of this chapter or any lawful  require-
 ment  of  the  commissioner thereunder, shall fail to pay the tax, or to
 make, render, sign or certify any return  or  declaration  of  estimated
 tax,  or  to supply any information within the time required by or under
 the provisions of this chapter, or who, with like  intent,  shall  make,
 render,  sign  or certify any false or fraudulent return, declaration or
 statement, or shall supply any false or fraudulent information,  or  who
 shall  fail  to comply with the provisions of subdivision (b) of section
 11-1912 of this chapter after the service of a notice by the commission-
 er thereunder,  shall  be  guilty  of  a  misdemeanor  and  shall,  upon
 conviction,  be  fined  not to exceed five thousand dollars or be impri-
 soned not to exceed one year, or both, at the discretion of the court.
   (b)  Limitations. Notwithstanding the provisions of section  30.10  of
 the  criminal  procedure law or of any other law of this state, a prose-
 cution for any offense under this section may be commenced at  any  time
 not later than three years after the commission of such offense provided
 that,  if  such offense is the failure to do an act required by or under
 any provision of this chapter to be done before a certain date, a prose-
 cution for such offense may be commenced  not  later  than  three  years
 after such date.
   (c)  Willful failure to withhold. Any individual, corporation or part-
 nership  or  any  officer  or  employee  of any corporation, including a
 dissolved corporation, or member or employee  of  any  partnership,  who
 willfully  fails to collect or pay over any withholding tax as required,
 shall, in addition to other penalties provided by law, be  guilty  of  a
 misdemeanor,  and, upon conviction thereof, shall be fined not to exceed
 five thousand dollars or imprisoned not to exceed one year, or both.
   (d)  Two or more charges. In the prosecution of  offenses  under  this
 section,  if  there are two or more charges against any person or corpo-
 ration,  involving  a  violation  or  violations  of  any  provision  or
 provisions  of  this  chapter, whether for the same or different taxable
 years, instead of returning several indictments or filing several infor-
 mations, all of such charges may be joined in one indictment or informa-
 tion, in separate counts, and if two or more indictments are  found,  or
 two  or  more  informations  are  filed,  the court may order them to be
 S. 8474                           1022
 
 consolidated.  If a person or corporation shall be convicted of  two  or
 more  offenses  constituting  different  crimes  set  forth in different
 counts of one indictment or information, or in separate  indictments  or
 informations consolidated as hereinbefore provided, the court may impose
 a  separate  sentence  for each offense, and if imprisonment is imposed,
 the court may order any of such sentences to be served  concurrently  or
 consecutively.
   (e)    Miscellaneous  rules. Any prosecution under this section may be
 conducted in any county where the person or  corporation  to  whose  tax
 liability the proceeding relates resides, or has a place of business, or
 in  any  county  in  which any such crime is committed.  The corporation
 counsel of the city shall have concurrent jurisdiction with any district
 attorney in the prosecution of any offense under this section.   If  the
 provisions  of  this  section conflict with those contained in any other
 law, this section shall control.  The certificate of the commissioner to
 the effect that a tax has not been paid, that a return or declaration of
 estimated tax has not been filed,  or  that  information  has  not  been
 supplied,  as required by or under the provisions of this chapter, shall
 be prima facie evidence that such tax  has  not  been  paid,  that  such
 return  or  declaration has not been filed, or that such information has
 not been supplied.  All fines levied under this section shall be paid to
 the commissioner and deposited in the same manner as revenues  collected
 or received under this chapter.
   §  11-1939 Armed forces relief provisions. (a) Time to be disregarded.
 In the case of an individual serving in the armed forces of  the  United
 States or serving in support of such armed forces, in an area designated
 by  the  president  of the United States by executive order as a "combat
 zone" at any time during the period designated by the president by exec-
 utive order as the period of  combatant  activities  in  such  zone,  or
 hospitalized  outside  the  state  as  a result of injury received while
 serving in such an area during such time, the period of service in  such
 area,  plus  the period  of continuous hospitalization outside the state
 attributable to such injury, and the next one hundred eighty days there-
 after, shall be  disregarded  in  determining,  under  this  chapter  in
 respect  of the tax liability, including any interest, penalty, or addi-
 tion to the tax, of such individual:
   (1) Whether any of the following acts was performed  within  the  time
 prescribed therefor:
   (A) filing any return of tax, except withholding tax;
   (B)  payment  of  any  tax, except withholding tax, or any installment
 thereof or of any other liability to the commissioner, in respect there-
 of;
   (C) filing a petition with the commissioner for credit  or  refund  or
 for  redetermination  of  a  deficiency,  or application for review of a
 decision rendered by the commissioner;
   (D) allowance of a credit or refund of tax;
   (E) filing a claim for credit or refund of tax;
   (F) giving or making any notice or demand for the payment of any  tax,
 or with respect to any liability to the commissioner in respect of tax;
   (G)  collection,  by  the  commissioner,  by  levy or otherwise of the
 amount of any liability in respect of tax;
   (H) bringing suit by the city, or  any  officer,  on  its  behalf,  in
 respect of any liability in respect of tax; and
   (I)  any  other act required or permitted under this chapter or speci-
 fied in the regulations prescribed under this section by the commission-
 er.
 S. 8474                           1023
 
   (2) The amount of any credit or refund, including interest.
   (b)  Action  taken  before  ascertainment  of  right  to benefits. The
 collection of the tax imposed by this chapter or of any liability to the
 commissioner in respect of such tax, or any action or proceeding  by  or
 on  behalf  of  the  commissioner  in connection therewith, may be made,
 taken, begun, or prosecuted in accordance with law,  without  regard  to
 the  provisions of subdivision (a) of this section, unless prior to such
 collection, action, or proceeding it  is  ascertained  that  the  person
 concerned is entitled to the benefit of subdivision (a) of this section.
   (c) Members of armed forces dying in action. In the case of any person
 who  dies while in active service as a member of the armed forces of the
 United States, if such death occurred while serving  in  a  combat  zone
 during  a  period  of combatant activities in such zone, as described in
 subdivision (a) of this section, or as a result of  wounds,  disease  or
 injury  incurred while so serving, the tax imposed by this chapter shall
 not apply with respect to the taxable year in which falls  the  date  of
 his or her death, or with respect to any prior taxable year ending on or
 after  the first day so served in a combat zone, and no returns shall be
 required in behalf of such person or his or her estate  for  such  year;
 and  the  tax  for  any such taxable year which is unpaid at the date of
 death, including interest, additions to tax and penalties, if any, shall
 not be assessed and, if assessed, the assessment shall be abated and, if
 collected, shall be refunded to the legal representative of such  estate
 if  one  has been appointed and has qualified, or, if no legal represen-
 tative has been appointed or has qualified, to the surviving spouse.
   § 11-1940 General powers of commissioner. (a) General. The commission-
 er shall administer and enforce the tax imposed by this chapter and  the
 commissioner  is  authorized  to make such rules and regulations, and to
 require such facts and information to be reported, as  the  commissioner
 may  deem  necessary  to  enforce the provisions of this chapter and the
 commissioner may delegate his or her  powers  and  functions  under  all
 subchapters  of  this  chapter  to  one of his or her deputies or to any
 employee or employees of his or her department.
   (b) Examination of books  and  witnesses.  The  commissioner  for  the
 purpose  of  ascertaining  the  correctness  of  any  return, or for the
 purpose of making an estimate of taxable wages  and  net  earnings  from
 self-employment  of  any person, shall have power to examine or to cause
 to have examined, by any agent or representative designated  by  him  or
 her  for  that  purpose, any books, papers, records or memoranda bearing
 upon the matters required to be included in the return, and may  require
 the  attendance  of  the  person  rendering the return or any officer or
 employee of such person, or the attendance of any  other  person  having
 knowledge in the premises, may take testimony and require proof material
 for  the  commissioner's  information, with power to administer oaths to
 such person or persons and may issue commissions for the examination  of
 witnesses  who  are  out  of  the  state  or unable to attend before the
 commissioner or excused from  attendance,  and  for  the  production  of
 books, papers, records or memoranda.
   (c)  Abatement  authority. The commissioner, of his or her own motion,
 may abate any small unpaid balance of  an  assessment  of  tax,  or  any
 liability  in  respect  thereof,  if  the  commissioner determines under
 uniform rules prescribed by him  or  her  that  the  administration  and
 collection  costs  involved  would  not warrant collection of the amount
 due.  The commissioner may also abate, of his or  her  own  motion,  the
 unpaid  portion of the assessment of any tax or any liability in respect
 thereof, which is excessive in amount, or is assessed after the  expira-
 S. 8474                           1024
 
 tion  of  the  period  of  limitation properly applicable thereto, or is
 erroneously or illegally assessed.  No claim for  abatement  under  this
 subdivision shall be filed by a taxpayer.
   (d)  Special  refund  authority. Where no questions of fact or law are
 involved and it appears from the records of the  commissioner  that  any
 moneys have been erroneously or illegally collected from any taxpayer or
 other  person,  or paid by such taxpayer or other person under a mistake
 of facts, pursuant to the provisions of this chapter,  the  commissioner
 at any time, without regard to any period of limitations, shall have the
 power,  upon  making a record of his or her reasons therefor in writing,
 to cause such moneys so paid and being erroneously and illegally held to
 be refunded.
   (e) Cooperation with the United States and  other  states.    Notwith-
 standing  the  provisions  of  section  11-1942  of this subchapter, the
 commissioner may permit the secretary of  the  treasury  of  the  United
 States  or  such secretary's delegates, or the proper tax officer of any
 other state imposing an income tax upon the income  of  individuals,  or
 the  authorized  representative  of  either such officer, to inspect any
 return filed under this chapter, or may furnish to such officer  or  his
 or  her  authorized  representative  an  abstract  of any such return or
 supply him or her with information concerning an item contained  in  any
 such  return,  or  disclosed by any investigation of tax liability under
 this chapter, but such permission shall be granted or  such  information
 furnished  to such officer or his or her representative only if the laws
 of the United States or of  such  state,  as  the  case  may  be,  grant
 substantially  similar  privileges to the commissioner and such informa-
 tion is to be used for tax  purposes  only;  and  provided  further  the
 commissioner  may furnish to the commissioner of internal revenue or his
 or her authorized representative   such returns filed under this chapter
 and other tax information as he or she may consider proper for  the  use
 in court actions or proceedings under the internal revenue code, whether
 civil or criminal, where a written request therefor has been made to the
 commissioner by the secretary of the treasury of the United States or by
 his  or  her  delegates,  provided  the  laws of the United States grant
 substantially similar powers to the secretary of  the  treasury  of  the
 United States or such secretary's delegates.  Where the commissioner has
 so  authorized  use  of returns and other information in such actions or
 proceedings, officers and employees of the department  of  taxation  and
 finance  may  testify  in such actions or proceedings in respect to such
 returns or other information.
   § 11-1941 Joint enforcement. (1) If there is assessed a tax under this
 chapter and there is also assessed a  tax  or  taxes  against  the  same
 taxpayer  pursuant  to  article  twenty-two  of  the  tax law and if the
 commissioner of the tax imposed by this chapter takes action  under  the
 tax  law  with  respect  to the enforcement and collection of the tax or
 taxes assessed under such tax  law,  the  commissioner  shall,  wherever
 possible,  accompany  such  action  with  a similar action under similar
 enforcement and collection provisions of this chapter.
   (2) Any monies collected as a result of such  joint  action  shall  be
 deemed  to have been collected in proportion in the amounts due, includ-
 ing tax, penalties, interest and additions to tax under article  twenty-
 two of the tax law and under this chapter.
   (3) Whenever the commissioner takes any action with respect to a defi-
 ciency  of  personal income tax, under article twenty-two of the tax law
 other than the action set forth in subdivision one of this  section  the
 S. 8474                           1025
 
 commissioner may, in his or her discretion, accompany such action with a
 similar action under this chapter.
   §  11-1942  Secrecy requirement and penalties for violation. 1. Except
 in accordance with proper judicial order or  as  otherwise  provided  by
 law,  it  shall be unlawful for the commissioner or any other officer or
 employee of the department of finance of the city, any person engaged or
 retained by such commissioner or department on an  independent  contract
 basis,  any  depository to which any return may be delivered as provided
 in subdivision two of this section, any  officer  or  employee  of  such
 depository, or any person who, pursuant to this section, is permitted to
 inspect any report or return or to whom a copy, an abstract or a portion
 of  any  report  or  return  is  furnished,  or  to whom any information
 contained in any report or return is furnished, to divulge or make known
 in any manner the amount of wages or earnings  or  any  particulars  set
 forth  or disclosed in any report or return required under this chapter.
 The commissioner or any other officer  and  employee  charged  with  the
 custody of such reports and returns shall not be required to produce any
 of  them  or  evidence  of  anything  contained in them in any action or
 proceeding in any court, except on behalf of the city in  an  action  or
 proceeding  under  the provisions of this chapter or in any other action
 or proceeding involving the collection of a tax due under  this  chapter
 to which the city is a party or a claimant, or on behalf of any party to
 any  action or proceeding  under the provisions of this chapter when the
 reports, returns or facts shown thereby are directly  involved  in  such
 action  or  proceeding, in any of which events the court may require the
 production of, and may admit in  evidence,  so  much  of  said  reports,
 returns or of the facts shown thereby, as are pertinent to the action or
 proceeding and no more; except as provided in subdivision (e) of section
 11-1940 of this subchapter.  The commissioner may, nevertheless, publish
 a  copy or a summary of any determination or decision rendered after the
 hearing required under section 11-1931 of this subchapter of this  chap-
 ter.   Nothing in this section shall be construed to prohibit the deliv-
 ery to a taxpayer or the taxpayer's duly authorized representative of  a
 certified  copy  of any return or report filed in connection with his or
 her tax or to prohibit the publication of statistics so classified as to
 prevent the identification of particular  reports  or  returns  and  the
 items  thereof,  or  the  inspection by the legal representatives of the
 city of the report or return of any taxpayer who shall bring  action  to
 set  aside or review the tax based thereon, or against whom an action or
 proceeding under this chapter has been recommended by the  commissioner.
 Reports  and  returns  shall be preserved for three years and thereafter
 until the commissioner orders them to be destroyed.   Any  violation  of
 the provisions of this section shall be punished by a fine not exceeding
 one thousand dollars or by imprisonment not exceeding one year, or both,
 at  the discretion of the court, and if the offender be the commissioner
 or any other officer or employee  of  the  city,  he  or  she  shall  be
 dismissed  from  office and be incapable of holding any public office in
 the city or the state for a period of five years thereafter.
   2. Notwithstanding the provisions of subdivision one of this  section,
 the  commissioner  of  finance, in his or her discretion, may require or
 permit any or all individuals, estates or trusts,  liable  for  any  tax
 imposed  by  this  chapter, to make payments on account of estimated tax
 and payment of any tax, penalty or interest imposed by this  chapter  to
 banks,  banking houses or trust companies designated by the commissioner
 of finance and to file declarations of estimated  tax  and  reports  and
 returns  with such banks, banking houses or trust companies as agents of
 S. 8474                           1026
 
 the commissioner of finance, in lieu of making any such payment directly
 to the commissioner of finance.   However, the commissioner  of  finance
 shall  designate  only  such banks, banking houses or trust companies as
 are depositories or financial agents of Staten Island.
   §  11-1943 Provisions not applicable. The provisions contained in this
 subchapter shall not be applicable with respect  to  taxes  imposed  for
 taxable  periods  commencing on or after January first, nineteen hundred
 seventy-six but, with respect to the tax imposed for  such  periods  the
 provisions contained in part VI of article twenty-two of the tax law and
 sections  six  hundred fifty-three, six hundred fifty-eight, six hundred
 sixty-two and thirteen hundred eleven  of  the  tax  law  including  the
 provisions  of  judicial  review  by a proceeding under article seventy-
 eight of the civil practice law and rules shall be applicable  with  the
 same  force  and  effect as if those provisions had been incorporated in
 full in this section except where inconsistent with  the  provisions  of
 this chapter.
   §  11-1944  Deposit  and  disposition of revenues by commissioner. All
 taxes, penalties and interest imposed under this chapter which are  paid
 to or collected by the commissioner of finance shall be deposited by the
 commissioner of finance in the general fund of the city.
   §  11-1945    Effect of invalidity in part; inconsistencies with other
 laws. (a) If any  clause,  sentence,  paragraph,  subdivision,  section,
 provision or other portion of this chapter or the application thereof to
 any  person  or  circumstances shall be held to be invalid, such holding
 shall not affect, impair or invalidate the remainder of this chapter  or
 the  application  of  such  portion held invalid, to any other person or
 circumstances, but shall be confined in its  operation  to  the  clause,
 sentence,  paragraph,  subdivision,  section, provision or other portion
 thereof directly involved in such holding or to the person  and  circum-
 stances therein involved.
   (b) If any provision of this chapter is inconsistent with, in conflict
 with,  or contrary to any other provision of law, such provision of this
 chapter shall prevail over such other provision and such other provision
 shall be deemed to have been amended,  superseded  or  repealed  to  the
 extent of such inconsistency, conflict or contrariety.
 
                                CHAPTER 20
                      SALES, EXCISE AND RELATED TAXES
                               SUBCHAPTER 1
                 GENERAL SALES AND COMPENSATING USE TAXES
 
   §  11-2001 Imposition of general sales and compensating use taxes. (a)
 There are hereby imposed and there shall be paid all of  the  sales  and
 compensating  use taxes described in article twenty-eight of the tax law
 as authorized by subdivision (a) of section twelve hundred  ten  of  the
 tax  law,  at  the  rate of four and one-half percent, provided that the
 taxes described in paragraph six of subdivision (c)  of  section  eleven
 hundred five of the tax law shall be imposed and paid at the rate of six
 percent.
   (b)  Notwithstanding  any  contrary provision of this section or other
 law, this section:  (1) does not impose tax on  (i)  receipts  from  the
 sale  of  the  services of laundering, dry-cleaning, tailoring, weaving,
 pressing, shoe repairing and shoe shining described in subparagraph (ii)
 of paragraph three of subdivision (c) of section eleven hundred five  of
 the  tax law; (ii) receipts from the sale of services described in para-
 graph six of subdivision (c) of section eleven hundred five of  the  tax
 S. 8474                           1027
 
 law at facilities owned and operated by the city or an agency or instru-
 mentality  of  the  city  or  a public corporation the majority of whose
 members are appointed by the mayor or the city council or both of  them;
 (2)  for  purposes  of  the  tax described in subdivision (e) of section
 eleven hundred five of the tax law, defines "permanent resident" to mean
 any occupant of any room or rooms in a hotel for at  least  one  hundred
 eighty consecutive days with regard to the period of such occupancy; (3)
 does not omit from the tax described in paragraph one of subdivision (f)
 of  section  eleven  hundred five of the tax law charges to a patron for
 admission to, or use of, facilities for  sporting  activities  in  which
 such  patron is to be a participant, such as bowling alleys and swimming
 pools; (4) provides the clothing and  footwear  exemption  in  paragraph
 thirty  of  subdivision (a) of section eleven hundred fifteen of the tax
 law; (5) omits the exemption provided in paragraph forty-one of subdivi-
 sion (a) of section eleven hundred fifteen of the tax law; (6) omits the
 exemption provided in subdivision (c) of section eleven hundred  fifteen
 of  the tax law insofar as it applies to fuel, gas, electricity, refrig-
 eration and steam, and gas, electric, refrigeration and steam service of
 whatever nature for use or consumption directly and exclusively  in  the
 production  of  gas,  electricity, refrigeration or steam; and (7) omits
 the provision for refund or credit contained in clause six  of  subdivi-
 sion (a) of section eleven hundred nineteen of the tax law.
   (c)  The taxes imposed by this section shall be in addition to any and
 all other taxes authorized or imposed under any other provision of law.
   (d) The taxes imposed  by  this  section  shall  be  administered  and
 collected  by the state commissioner of taxation and finance as provided
 in articles twenty-eight and twenty-nine of the tax law.
   (e) The provisions of articles twenty-eight and twenty-nine of the tax
 law relating or applicable to the taxes imposed by this section, includ-
 ing the applicable definitions,  transitional  provisions,  limitations,
 special  provisions, exemptions, exclusions, refunds, credits and admin-
 istrative provisions, so far as those provisions can be made  applicable
 to  the  taxes imposed by this section, shall apply to the taxes imposed
 by this section with the same force and effect as  if  those  provisions
 had  been  incorporated  in  full  into  this  section and had expressly
 referred to the taxes imposed by this section, except to the extent that
 any provision of article twenty-eight or twenty-nine of the tax  law  is
 either  inconsistent  with  or not relevant to the taxes imposed by this
 section.
   (f) Net collections from the taxes imposed by  this  section  paid  to
 this city by the state comptroller shall be credited to and deposited in
 the  general  fund  of  this  city,  but no part of such revenues may be
 expended unless appropriated in the annual budget of this city.
   (g) If any provision of this section or the application thereof  shall
 for  any reason be adjudged by any court of competent jurisdiction to be
 invalid, such judgment  shall  not  affect,  impair  or  invalidate  the
 remainder  of this section but shall be confined in its operation to the
 provision thereof directly involved in the  controversy  in  which  such
 judgment  shall have been rendered and the application of such provision
 to other persons or circumstances shall not be affected thereby.
   § 11-2002 Imposition of special sales taxes.   (a)  There  are  hereby
 imposed  and  there  shall  be  paid sales taxes at the rate of four and
 one-half percent on receipts from every sale of the services of  beauty,
 barbering, hair restoring, manicuring, pedicuring, electrolysis, massage
 services  and  similar  services,  and  every sale of services by weight
 control salons, health salons, gymnasiums, Turkish and  sauna  bath  and
 S. 8474                           1028
 
 similar  establishments and every charge for the use of such facilities,
 whether or not any tangible personal property is transferred in conjunc-
 tion therewith; but excluding services rendered by a  physician,  osteo-
 path, dentist, nurse, physiotherapist, chiropractor, podiatrist, optome-
 trist,  ophthalmic  dispenser  or  a  person performing similar services
 licensed under title eight of the education law, as amended, and exclud-
 ing such services when performed on pets and other animals,  as  author-
 ized  by  subdivision  (a) of section twelve hundred twelve-a of the tax
 law. Provided, however, that the tax hereby imposed shall not be imposed
 after November thirtieth, two thousand twenty-six.
   (b) The taxes imposed by this section shall be in addition to any  and
 all other taxes authorized or imposed under any other provision of law.
   (c)  The  taxes  imposed  by  this  section  shall be administered and
 collected by the state commissioner of taxation and finance as  provided
 in articles twenty-eight and twenty-nine of the tax law.
   (d) The provisions of articles twenty-eight and twenty-nine of the tax
 law relating or applicable to the taxes imposed by this section, includ-
 ing  the  applicable  definitions, transitional provisions, limitations,
 special provisions, exemptions, exclusions, refunds, credits and  admin-
 istrative  provisions, so far as those provisions can be made applicable
 to the taxes imposed by this section, shall apply to the  taxes  imposed
 by  this  section  with the same force and effect as if those provisions
 had been incorporated in  full  into  this  section  and  had  expressly
 referred to the taxes imposed by this section, except to the extent that
 any  provision  of article twenty-eight or twenty-nine of the tax law is
 either inconsistent with or not relevant to the taxes  imposed  by  this
 section.
   (e)  Net  collections  from  the taxes imposed by this section paid to
 this city by the state comptroller shall be credited to and deposited in
 the general fund of this city, but no  part  of  such  revenues  may  be
 expended unless appropriated in the annual budget of this city.
   (f)  If any provision of this section or the application thereof shall
 for any reason be adjudged by any court of competent jurisdiction to  be
 invalid,  such  judgment  shall  not  affect,  impair  or invalidate the
 remainder of this section but shall be confined in its operation to  the
 provision  thereof  directly  involved  in the controversy in which such
 judgment shall have been rendered and the application of such  provision
 to other persons or circumstances shall not be affected thereby.
   §  11-2032  Construction  and  enforcement. This subchapter   shall be
 construed and enforced in  conformity  with  articles  twenty-eight  and
 twenty-nine  of  the  tax law of the state of New York pursuant to which
 the same is enacted.
 
                               SUBCHAPTER 3
                       SALES TAX ON CREDIT SERVICES,
                    PROTECTIVE AND DETECTIVE SERVICES,
                     INTERIOR DECORATING AND DESIGNING
         SERVICES, AND INTERIOR CLEANING AND MAINTENANCE SERVICES
 
   § 11-2039 Definitions. (a) "Person" includes an  individual,  partner-
 ship,  society,  association,  joint-stock company, corporation, estate,
 receiver, trustee, assignee, referee, and any other person acting  in  a
 fiduciary  or  representative  capacity, whether appointed by a court or
 otherwise, and any combination of the foregoing.
   (b) When used in this subchapter for the purposes of the taxes imposed
 by this subchapter, the following terms shall mean:
 S. 8474                           1029
 
   (1) "Purchaser." A person  who  purchases  property  or  to  whom  are
 rendered  services,  the  receipts  from  which  are  taxable under this
 subchapter.
   (2)  "Receipt."  The  amount of the sale price of any property and the
 charge for any service taxable under this subchapter, valued  in  money,
 whether  received  in money or otherwise, including any amount for which
 credit is allowed by the vendor to the purchaser, without any  deduction
 for  expenses  or  early payment discounts, but excluding any credit for
 tangible personal property accepted in part  payment  and  intended  for
 resale.
   (3)  "Sale."  Any transfer of title or possession or both, exchange or
 barter, rental, lease or license  to  use  or  consume,  conditional  or
 otherwise, in any manner or by any means whatsoever for a consideration,
 or any agreement therefor, including the rendering of any service, taxa-
 ble  under  this subchapter, for a consideration or any agreement there-
 for.
   (4) "Vendor." A person making sales of tangible personal  property  or
 services, the receipts from which are taxed by this subchapter.
   (5) "Tax commission." Tax commission of the state of New York.
   (6) "Tax law." Tax law of the state of New York.
   §  11-2040  Imposition of tax.  (a) There is hereby imposed within the
 city and there shall be paid a tax at the  rate  of  four  and  one-half
 percent  upon the receipts from every sale, except for resale, of credit
 rating and credit reporting services, including,  but  not  limited  to,
 those  services  provided  by  mercantile  and consumer credit rating or
 reporting bureaus or agencies, whether rendered in written or oral  form
 or  in  any  other  manner, except to the extent otherwise taxable under
 article twenty-eight of the tax law; provided,  however,  that  the  tax
 hereby  imposed shall not be imposed after November thirtieth, two thou-
 sand twenty-six, on receipts from sales of  the  services  specified  in
 this subdivision.
   (b)  Wages,  salaries and other compensation paid by an employer to an
 employee for performing as an employee the services described in  subdi-
 vision (a) of this section are not receipts subject to the taxes imposed
 by such subdivision.
   (c)  Any taxes imposed by this subchapter are in addition to any other
 tax which the city may impose or may be imposing pursuant to any law.
   § 11-2041 Transitional provisions. The taxes imposed under subdivision
 (a) of section 11-2040 of this subchapter shall be paid with respect  to
 receipts  from  all sales of services on or after September first, nine-
 teen hundred seventy-five although rendered or  agreed  to  be  rendered
 under a prior contract. Where a service is sold on a monthly, quarterly,
 yearly or other term basis, the charge for such service shall be subject
 to  tax under this subchapter to the extent that such charge is applica-
 ble to any period on or after September first, nineteen  hundred  seven-
 ty-five,  and such charge shall be apportioned on the basis of the ratio
 of the number of days falling within such period to the total number  of
 days in the full term or period.
   §  11-2042  Exempt organizations. Except as otherwise provided in this
 section, any sale by or to any of the following shall not be subject  to
 the taxes imposed by this subchapter:
   (1)  The state of New York, or any of its agencies, instrumentalities,
 public  corporations, including a public corporation created pursuant to
 agreement or compact with another state or Canada, or political subdivi-
 sions where it is the purchaser, user or consumer,  or  where  it  is  a
 S. 8474                           1030
 
 vendor  of services or property of a kind not ordinarily sold by private
 persons;
   (2)  The United States of America, and any of its agencies and instru-
 mentalities,  insofar  as  it  is  immune  from taxation where it is the
 purchaser, user or consumer, or where it sells services or property of a
 kind not ordinarily sold by private persons;
   (3)  The United Nations or any international organization of which the
 United States of America is a member where it is the purchaser, user  or
 consumer,  or where it sells services or property of a kind not ordinar-
 ily sold by private persons;
   (4)  Any corporation, association, trust, or community chest, fund  or
 foundation,  organized  and operated exclusively for religious, charita-
 ble, scientific, testing for  public  safety,  literary  or  educational
 purposes,  or  for  the prevention of cruelty to children or animals, no
 part of the net earnings of which inures to the benefit of  any  private
 shareholder  or  individual,  no  substantial  part of the activities of
 which is carrying on propaganda, or otherwise  attempting  to  influence
 legislation, and which does not participate in, or intervene in, includ-
 ing  the publishing or distributing of statements any political campaign
 on behalf of any candidate for public office;
   (5)  A post or organization of war veterans, or an auxiliary  unit  or
 society of, or a trust or foundation for, any such post or organization:
   (A)  organized in this state,
   (B)    at  least  seventy-five percent of the members of which are war
 veterans and substantially all of the other members of which  are  indi-
 viduals  who  are  veterans, but not war veterans, or are cadets, or are
 spouses, widows or widowers of war veterans or such individuals, and
   (C)  no part of the net earnings of which inures to the benefit of any
 private shareholder or individual.
   § 11-2043 Refunds or credits based on proof of certain uses. A  refund
 or  credit  equal  to  the  amount  of the sales or compensating use tax
 imposed by section eleven hundred seven of the tax  law  or  by  section
 11-2001 of this chapter, as the case may be, and paid on the sale or use
 of  tangible  personal property which is later used by such purchaser in
 performing a service subject to  tax  under  this  subchapter  shall  be
 allowed  such  purchaser  against the tax imposed by this subchapter and
 collected by such person on the sale of such services if  such  property
 has  become  a  physical  component  part of the property upon which the
 service is performed or has been transferred to  the  purchaser  of  the
 service  in  conjunction  with the performance of the service subject to
 tax; provided, however, that any such refund or credit shall be  without
 interest.
   § 11-2044  Administration and collection. The taxes imposed by section
 11-2040  of  this  subchapter shall be administered and collected by the
 tax commission in the same manner as the taxes imposed by article  twen-
 ty-eight  of  the tax law are administered and collected by such commis-
 sion.  All of the provisions of such article relating to  or  applicable
 to  the administration and collection of the taxes imposed by that arti-
 cle shall apply to the  taxes  imposed  by  this  subchapter,  including
 sections  eleven hundred one, eleven hundred eleven, and sections eleven
 hundred thirty-one through eleven hundred  forty-seven  inclusive,  with
 the  same  force and effect as if those provisions had been incorporated
 in full into this subchapter and had expressly  referred  to  the  taxes
 imposed  by  this  subchapter,  except  as otherwise provided in section
 twelve hundred fifty of the tax law.  For purposes of  this  subchapter,
 S. 8474                           1031
 
 the  term  "tax"  in part IV of such article twenty-eight of the tax law
 shall include the taxes imposed by this subchapter.
   § 11-2045  Deposit and disposition of revenue. (a)  The tax commission
 shall deposit daily to the credit of the comptroller of the state of New
 York,  all taxes, penalties and interest collected under this subchapter
 in such responsible banks, banking houses or trust companies as  may  be
 designated by the comptroller.  Such deposits shall be kept in trust for
 the  city and separate and apart from all other monies in the possession
 of the comptroller.   The comptroller shall  require  adequate  security
 from all such depositories. Of the revenue collected under this subchap-
 ter  the comptroller shall retain in his or her hands such amount as the
 commissioner of taxation and finance of the state of New York may deter-
 mine to be necessary for refunds under this subchapter and  for  reason-
 able  costs  of  the  tax  commission  in  administering, collecting and
 distributing the taxes under this subchapter, out  of  which  the  comp-
 troller shall pay any refunds made under the provisions of this subchap-
 ter.   The comptroller, after reserving such refund fund and such costs,
 shall on or before the twelfth day of each month, pay to the commission-
 er of finance of this city all taxes, interest and  penalties  collected
 under  this subchapter and remaining to the comptroller's credit in such
 banks, banking houses or trust companies at the close of business on the
 last day of the preceding month, provided, however, that the comptroller
 shall on or before the last day of June  and  December  make  a  partial
 payment  consisting  of  the  collections  made during and including the
 first twenty-five days of said months to the commissioner of finance  of
 this  city.  The amount so payable shall be certified to the comptroller
 by the president of the tax commission or such president's delegate, who
 shall not be held liable for any inaccuracy in such certificate.   Where
 the  amount  so  paid over in any such distribution is more or less than
 the amount then due to this city,  the  amount  of  the  overpayment  or
 underpayment  shall  be certified to the comptroller by the president of
 the tax commission or such president's delegate, who shall not  be  held
 liable  for any inaccuracy in such certificate.  The amount of the over-
 payment shall be so certified to  the  comptroller  as  soon  after  the
 discovery  of the overpayment or underpayment as reasonably possible and
 subsequent payments and distributions by the comptroller  to  this  city
 shall be adjusted by subtracting the amount of any such overpayment from
 or  by  adding  the  amount  of  any such underpayment to such number of
 subsequent payments and distributions as the comptroller and the  presi-
 dent  of  the  state tax commission shall consider reasonable in view of
 the amount of the overpayment or underpayment and all  other  facts  and
 circumstances.
   (b)   All payments to the commissioner of finance pursuant to subdivi-
 sion (a) of this section shall be  credited  to  and  deposited  in  the
 general  fund of this city, but no part of such revenues may be expended
 unless appropriated in the annual budget of this city.
   § 11-2046   Construction and enforcement.  This  subchapter  shall  be
 construed  and  enforced  in  conformity  with articles twenty-eight and
 twenty-nine of the tax law of the state of New York pursuant to which it
 is enacted.
   § 11-2047  Effective date. This subchapter shall take effect September
 first, nineteen hundred seventy-five except that certificates of  regis-
 tration  may  be filed with the state tax commission and certificates of
 authority to collect tax may be issued by the state tax commission prior
 to such date.
 S. 8474                           1032
 
                               SUBCHAPTER 4
                          ADDITIONAL PARKING TAX
 
   §  11-2048  Definitions. (a) "Person" includes an individual, partner-
 ship, society, association, joint-stock  company,  corporation,  estate,
 receiver,  trustee,  assignee, referee, and any other person acting in a
 fiduciary or representative capacity, whether appointed by  a  court  or
 otherwise, and any combination of the foregoing.
   (b)  When used in this subchapter for the purpose of the taxes imposed
 by this subchapter, the following terms shall mean:
   (1) "Purchaser." A person  who  purchased  property  or  to  whom  are
 rendered  services,  the  receipts  from  which  are  taxable under this
 subchapter.
   (2) "Receipt." The amount of the sale price of any  property  and  the
 charge  for  any service taxable under this subchapter, valued in money,
 whether received in money or otherwise, including any amount  for  which
 credit  is allowed by the vendor to the purchaser, without any deduction
 for expenses or early payment discounts, but excluding  any  credit  for
 tangible  personal  property  accepted  in part payment and intended for
 resale.
   (3) "Sale." Any transfer of title or possession or both,  exchange  or
 barter,  rental,  lease  or  license  to  use or consume, conditional or
 otherwise, in any manner or by any means whatsoever for a consideration,
 or any agreement therefor, including the rendering of any service, taxa-
 ble under this subchapter, for a consideration or any  agreement  there-
 for.
   (4)  "Vendor."  A person making sales of tangible personal property or
 services, the receipts from which are taxed by this subchapter.
   (5) "Tax commission." Tax commission of the state of New York.
   (6) "Tax law." Tax law of the state of New York.
   § 11-2049 Imposition of tax. On and after  September  first,  nineteen
 hundred eighty, there is hereby imposed within the city of New York, and
 there shall be paid, a tax at the rate of eight percent on receipts from
 every  sale of the service of providing parking, garaging or storing for
 motor vehicles by persons operating a garage, other than a garage  which
 is  part  of  premises  occupied  solely  as a private one or two family
 dwelling, parking lot or other place of business  engaged  in  providing
 parking,  garaging or storing for motor vehicles, in every county within
 the city of New York with a population density in excess of fifty  thou-
 sand  persons  per square mile, as determined by reference to the latest
 federal census; provided, however, that receipts for such services  paid
 to  a homeowner's association by its members or receipts paid by members
 of a homeowner's association to a person leasing  the  parking  facility
 from the homeowner's association shall not be subject to the tax imposed
 by this section. For purposes of this section, a homeowner's association
 is  an  association, including a cooperative housing or apartment corpo-
 ration, (i) the membership of which is comprised exclusively  of  owners
 or residents of residential dwelling units, including owners of units in
 a  condominium,  and  including shareholders in a cooperative housing or
 apartment corporation,  where  such  units  are  located  in  a  defined
 geographical area such as a housing development or subdivision; and (ii)
 which  owns or operates a garage, parking lot or other place of business
 engaged in providing parking, garaging or  storing  for  motor  vehicles
 located  in  such area for use, whether or not exclusive, by such owners
 or residents. The tax imposed on the receipts described in this  section
 is  in addition to the tax imposed on such receipts under subchapter one
 S. 8474                           1033
 
 of this chapter or section eleven hundred seven of the tax law,  as  the
 case may be.
   §  11-2050 Transitional provisions. The taxes imposed by this subchap-
 ter shall be paid with respect to receipts from all sales of services on
 or after September first, nineteen hundred eighty although  rendered  or
 agreed  to  be rendered under a prior contract.  Where a service is sold
 on a monthly, quarterly, yearly or other term basis, the charge for such
 service shall be subject to tax under this subchapter to the extent that
 such charge is applicable to any period on  or  after  September  first,
 nineteen  hundred  eighty,  and  such charge shall be apportioned on the
 basis of the ratio of the number of days falling within such  period  to
 the total number of days in the full term or period.
   §  11-2051  Exempt organizations and individuals. (a) Except as other-
 wise provided in this section, any sale by or to any  of  the  following
 shall not be subject to the taxes imposed by this subchapter:
   (1)  The state of New York, or any of its agencies, instrumentalities,
 public corporations, including a public corporation created pursuant  to
 agreement or compact with another state or Canada, or political subdivi-
 sions  where  it  is  the  purchaser, user or consumer, or where it is a
 vendor of services of a kind not ordinarily sold by private persons;
   (2) The United States of America, and any of its agencies and  instru-
 mentalities,  insofar  as  it  is  immune  from taxation where it is the
 purchaser, user or consumer or where it sells services  of  a  kind  not
 ordinarily sold by private persons;
   (3)  The United Nations or any international organization of which the
 United States of America is a member where it is the purchaser, user  or
 consumer,  or  where  it sells services of a kind not ordinarily sold by
 private persons;
   (4) Any corporation, association, trust, or community chest,  fund  or
 foundation,  organized  and operated exclusively for religious, charita-
 ble, scientific, testing for  public  safety,  literary  or  educational
 purposes, or to foster national or international amateur sports competi-
 tion,  but  only  if  no part of its activities involve the provision of
 athletic facilities or equipment, or for the prevention  of  cruelty  to
 children  or animals, no part of the net earnings of which inures to the
 benefit of any private shareholder or individual, no substantial part of
 the activities of which is carrying on propaganda, or otherwise attempt-
 ing to influence legislation, except as otherwise provided in subsection
 (h) of section five hundred one of the United  States  internal  revenue
 code  of  nineteen  hundred  fifty-four,  as amended, and which does not
 participate in, or intervene in, including the publishing or  distribut-
 ing of statements, any political campaign on behalf of any candidate for
 public office;
   (5)  A  post  or  organization of past or present members of the armed
 forces of the United States, or an auxiliary unit or society  of,  or  a
 trust or foundation for, any such post or organization:
   (A) organized in this state,
   (B)  at least seventy-five percent of the members of which are past or
 present members of the armed forces of the United  States  and  substan-
 tially  all of the other members of which are individuals who are cadets
 or are spouses, widows or widowers of past or  present  members  of  the
 armed forces of the United States or of cadets, and
   (C)  no part of the net earnings of which inures to the benefit of any
 private shareholder or individual;
   (6) The following Indian nations or tribes residing in New York state:
 Cayuga, Oneida, Onondaga, Poospatuck, Saint Regis Mohawk, Seneca,  Shin-
 S. 8474                           1034
 
 necock,  Tonawanda  and  Tuscarora,  where  it is the purchaser, user or
 consumer;
   (7)  A  not-for-profit  corporation  operating as a health maintenance
 organization subject to the provisions  of  article  forty-four  of  the
 public health law; and
   (8)  Cooperative and foreign corporations doing business in this state
 pursuant to the rural electric cooperative law.
   (b) Nothing in this section shall  exempt  sales  of  the  service  of
 providing  parking,  garaging or storing for motor vehicles by an organ-
 ization described in paragraph four or paragraph five of subdivision (a)
 of this section operating a garage, other than a garage which is part of
 premises occupied solely as a private one-family or two-family dwelling,
 parking lot or other place of business  engaged  in  providing  parking,
 garaging or storing for motor vehicles.
   (c)  (1)  For  purposes  of  paragraph four of subdivision (a) of this
 section, in the case of a qualified amateur sports organization (A)  the
 requirement of such paragraph that no part of its activities involve the
 provision  of  athletic facilities or equipment shall not apply, and (B)
 such organization shall not fail to meet the requirement of  such  para-
 graph merely because its membership is local or regional in nature.
   (2)  For  purposes  of  this  subdivision, the term "qualified amateur
 sports organization"  means  any  organization  organized  and  operated
 exclusively  to foster national or international amateur sports competi-
 tion if such organization is also organized and  operated  primarily  to
 conduct  national  or  international competition in sports or to support
 and develop amateur athletes for national or  international  competition
 in sports.
   (d)  The tax imposed by this subchapter shall not apply to any sale of
 services to an individual resident of the county in which  such  tax  is
 imposed  when  such  services  are  rendered on a monthly or longer-term
 basis at the principal location for the parking, garaging or storing  of
 a  motor  vehicle owned or leased, but only in the case of a lease for a
 term of one year or more, by such individual resident. For  purposes  of
 this  subdivision, the term "individual resident" means a natural person
 who maintains in such county a permanent place of abode  which  is  such
 person's primary residence; the term "motor vehicle" means a motor vehi-
 cle  which  is registered pursuant to the vehicle and traffic law at the
 address of the primary residence referred to  in  this  subdivision,  or
 which  is  registered pursuant to the vehicle and traffic law and leased
 to an individual resident  at  the  address  of  the  primary  residence
 referred  to  in  this subdivision, and which is not used in carrying on
 any trade, business or commercial activity; and the term  "lease  for  a
 term  of one year or more" shall not include any lease the term of which
 is less than one year, irrespective of  the  fact  that  the  cumulative
 period  for which such lease may be in effect is one year or more as the
 result of the right to  exercise  an  option  to  renew  or  other  like
 provision.
   §  11-2052  Administration and collection; penalties; refunds. (a) The
 taxes imposed by this subchapter shall be administered and collected  by
 the  tax  commission  in the same manner as the taxes imposed by article
 twenty-eight of the tax law  are  administered  and  collected  by  such
 commission.  All of the provisions of such article relating to or appli-
 cable to the administration and collection of the taxes imposed by  that
 article  shall  apply to the taxes imposed by this subchapter, including
 section eleven  hundred  one  and  sections  eleven  hundred  thirty-one
 through  eleven  hundred  forty-seven inclusive, with the same force and
 S. 8474                           1035
 
 effect as if those provisions had been incorporated in  full  into  this
 subchapter  and  had  expressly  referred  to  the taxes imposed by this
 subchapter, except to the extent that any  provisions  of  such  article
 twenty-eight  are  either inconsistent with a provision of this subchap-
 ter, or of article twenty-nine of the tax law, or are  not  relevant  to
 this  subchapter  or to article twenty-nine of the tax law. For purposes
 of this subchapter, the term "tax" in part IV of  such  article  twenty-
 eight of the tax law shall include the taxes imposed by this subchapter.
   (b)  Notwithstanding  subdivision  (a)  of  this  section or any other
 provision of law to the contrary, the tax commission shall,  subject  to
 such  terms and conditions as it may consider necessary, delegate to the
 commissioner of finance the power and authority to develop and  adminis-
 ter  reasonable and necessary procedures, including the use of exemption
 certificates for presentation to vendors, for determining entitlement to
 exemption from tax under subdivision (d)  of  section  11-2051  of  this
 subchapter, and to prescribe, subject to the approval of the tax commis-
 sion,  rules  and  regulations necessary and appropriate in carrying out
 such responsibilities.
   (c) Any person who, in violation of any provision of  subdivision  (d)
 of  section 11-2051 of this subchapter or any rule or regulation promul-
 gated thereunder, obtains or uses a certificate of exemption relating to
 the exemption allowed by such subdivision, shall, if such violation  was
 due  to negligence or intentional disregard of such provision or rule or
 regulation, but without intent to defraud, be liable for  a  penalty  of
 not  more than one hundred dollars for each such violation, and, if such
 violation was due to fraud, be liable for a penalty  of  not  more  than
 five  hundred  dollars  for  each  such  violation.  The commissioner of
 finance shall have the power, in his or her discretion, to waive, reduce
 or compromise any penalty imposed  pursuant  to  this  subdivision.  The
 penalties  authorized  by  this  subdivision shall be in addition to any
 penalty provided by section eleven hundred forty-five of  the  tax  law,
 and  shall be paid and disposed of, and, if unpaid, shall be determined,
 assessed, collected and enforced,  in  the  same  manner  as  the  taxes
 imposed by this subchapter.
   (d)  Notwithstanding  subdivision  (d)  of  section  11-2051  of  this
 subchapter, section eleven hundred thirty-nine of the  tax  law  or  any
 other provision of law to the contrary, an individual resident shall not
 be  entitled  to  a  refund  or credit with respect to any amount of tax
 which was paid to a vendor prior to the date  such  individual  resident
 presented to the vendor a valid certificate of exemption from such tax.
   §  11-2053  Deposit and disposition of revenue. (a) The tax commission
 shall deposit daily to the credit of the comptroller of the state of New
 York, all taxes, penalties and interest collected under this  subchapter
 in  such  responsible banks, banking houses or trust companies as may be
 designated by the comptroller.  Such deposits shall be kept in trust for
 the city and separate and apart from all other monies in the  possession
 of  the  comptroller.    The comptroller shall require adequate security
 from all such  depositories.    Of  the  revenue  collected  under  this
 subchapter  the comptroller shall retain in his or her hands such amount
 as the commissioner of taxation and finance of the state of New York may
 determine to be necessary for refunds  under  this  subchapter  and  for
 reasonable  costs of the tax commission in administering, collecting and
 distributing the taxes under this subchapter, out  of  which  the  comp-
 troller shall pay any refunds made under the provisions of this subchap-
 ter.    The comptroller, after reserving such refund fund and such costs
 shall, on or before the twelfth day of each month, pay  to  the  commis-
 S. 8474                           1036

 sioner  of  finance  of  this  city  all  taxes,  interest and penalties
 collected under this subchapter during the next preceding calendar month
 and remaining to the comptroller's credit in such banks, banking  houses
 or  trust  companies  at  the  close of business on the last day of such
 preceding month, provided, however, that the  comptroller  shall  on  or
 before the last day of June and December make a partial payment consist-
 ing  of  the collections made during and including the first twenty-five
 days of said months to the commissioner of finance  of  this  city.  The
 amount so payable shall be certified to the comptroller by the president
 of  the  tax  commission  or such president's delegate, who shall not be
 held liable for any inaccuracy in such certificate.  Provided,  however,
 any such certification may be based on such information as may be avail-
 able  to  the  tax  commission at the time such certificate must be made
 under this section and may be estimated on the basis of  percentages  or
 other indices calculated from distributions for prior periods. Where the
 amount  so  paid  over in any such distribution is more or less than the
 amount then due to this city, the amount of the overpayment or underpay-
 ment shall be certified to the comptroller by the president of  the  tax
 commission  or  such  president's delegate, who shall not be held liable
 for any inaccuracy in such certificate. The amount of the overpayment or
 underpayment shall be so certified to the comptroller as soon after  the
 discovery  of the overpayment or underpayment as reasonably possible and
 subsequent payments and distributions by the comptroller  to  this  city
 shall be adjusted by subtracting the amount of any such overpayment from
 or  by  adding  the  amount  of  any such underpayment to such number of
 subsequent payments and distributions as the comptroller and the  presi-
 dent  of  the  tax  commission  shall consider reasonable in view of the
 amount of the overpayment  or  underpayment  and  all  other  facts  and
 circumstances.
   (b)  All  payments to the commissioner of finance pursuant to subdivi-
 sion (a) of this section shall be  credited  to  and  deposited  in  the
 general fund of this city.
   §  11-2054  Construction  and  enforcement.  This  subchapter shall be
 construed and enforced in  conformity  with  articles  twenty-eight  and
 twenty-nine of the tax law of the state of New York pursuant to which it
 is enacted.
 
                               SUBCHAPTER 5
                          TAX ON BEER AND LIQUOR

   §  11-2055  Definitions.  When  used  in this subchapter the following
 terms shall mean or include:
   1.   "Person."   An  individual,  partnership,  society,  association,
 corporation,  joint-stock  company,  and any combination of individuals,
 and also an executor, administrator, receiver, trustee or other  fiduci-
 ary.
   2.    "Alcohol."   Ethyl alcohol, hydrated oxide of ethyl or spirit of
 wine, from whatever source or by whatever process produced.
   3.  "Beers."  All alcoholic beer, lager beer, ale, porter, and  stout,
 and  all  other  fermented beverages of any name or description manufac-
 tured from malt, wholly or in part,  or  from  any  substitute  therefor
 containing one-half of one per centum, or more, of alcohol by volume.
   4.   "Liquors."   Any and all distilled or rectified spirits, alcohol,
 brandy, cordial, whether the base therefor be wine or  liquor,  whiskey,
 rum, gin and all other distilled beverages containing alcohol, including
 all dilutions and mixtures of one or more of such liquids, including any
 S. 8474                           1037
 
 alcoholic  liquids which would be wines if the alcoholic content thereof
 were not more than twenty-four per centum by volume. Such term shall not
 include liquors containing not more than twenty-four per centum of alco-
 hol by volume.
   5. "Alcoholic beverages." Beer or liquors.
   6. "Distributor." Any person who imports or causes to be imported into
 this  city any alcoholic beverages which are or will be offered for sale
 or used for any commercial purpose; any purchaser of warehouse  receipts
 for  alcoholic  beverages  stored in a warehouse in this city who causes
 such beverages to be removed from such warehouse; and  also  any  person
 who   produces,  distills,  manufactures,  brews,  compounds,  mixes  or
 ferments any alcoholic beverages within this city for sale, except:  (a)
 a  person  who  manufactures, mixes or compounds alcoholic beverages the
 ingredients of which consist only of alcoholic beverages  on  which  the
 taxes  imposed  by  this subchapter have been paid, and (b) a person who
 mixes or compounds alcoholic beverages  with  non-alcoholic  ingredients
 for  sale  and  immediate  consumption  on  the premises, who shall be a
 distributor only with respect to the ingredients which consist of  alco-
 holic beverages upon which the taxes imposed by this subchapter have not
 been paid.
   7.  "Noncommercial  importer."   A person other than a distributor who
 imports or causes to be imported into  this  city  alcoholic  beverages,
 except  that  such person shall not be a noncommercial importer where he
 or she imports or causes to be imported into this city alcoholic  bever-
 ages  in the quantities and under the conditions provided by subdivision
 (e) of section 11-2056 of this subchapter.
   8. "Sale."  Any transfer, exchange or barter in any manner or  by  any
 means whatsoever.  The sale of warehouse receipts given upon the storage
 of alcoholic beverages shall not be construed as a sale of the beverages
 represented by such receipts.
   9. "Use."  Any compounding or mixing of alcoholic beverages with other
 ingredients  or  other treatment of the same in such manner as to render
 them unfit or unsuitable for consumption as  a  beverage  and  also  the
 actual  consumption or possession for consumption of alcoholic beverages
 as a beverage or otherwise.
   10. "Gallon."  One hundred twenty-eight fluid  ounces;  "quart"  means
 thirty-two fluid ounces.
   11.  "Liter."    A metric unit of capacity equal to one thousand cubic
 centimeters of alcoholic beverages and equivalent  to  thirty-three  and
 eight hundred fourteen thousandths fluid ounces.
   12. "City."  The city of Staten Island.
   13. "Commissioner of finance."  Commissioner of finance of the city.
   14. "Tax commission."  The tax commission of the state of New York.
   15.  Unless  a different meaning is clearly required, any term used in
 this subchapter shall have the same meaning as when used in a comparable
 context in the laws of the state of New York relating to taxes on  alco-
 holic beverages.
   §  11-2056  Imposition  of  tax.  (a)    There are hereby imposed on a
 distributor and a noncommercial importer excise taxes at  the  following
 rates:
   (1) twelve cents per gallon upon beers; and
   (2) twenty-six and four-tenths cents per liter upon liquors, when sold
 or  used  within  this city, except when sold or used under such circum-
 stances that this city is without power to impose such tax or when  sold
 to  the  United  States, and except beers when sold to or by a voluntary
 unincorporated organization of the armed forces  of  the  United  States
 S. 8474                           1038
 
 operating  a place for the sale of goods pursuant to regulations promul-
 gated by the appropriate executive agency  of  the  United  States,  and
 except  when  sold  to professional foreign consuls-general, consuls and
 vice-consuls  who are nationals of the state appointing them and who are
 assigned to foreign consulates  in  this  city  provided  that  American
 consular  officers  of  equal rank who are citizens of the United States
 and who exercise their official functions at American consulates in such
 foreign country are granted reciprocal  exemptions;  provided,  however,
 that  the tax commission may permit the sale of alcohol without tax to a
 holder of any industrial  alcohol  permit,  alcohol  permit  or  alcohol
 distributor's  permit,  issued by the state liquor authority, and by the
 holder of an alcohol distributor's  permit,  class  A,  issued  by  such
 authority  to  a  holder  of a distiller's license, class B, or a winery
 license, issued by such authority and may also permit the use of alcohol
 for any purpose other than the production of alcoholic beverages by such
 holders without tax.
   Notwithstanding any  other  provision  of  this  subchapter,  the  tax
 commission may permit the purchase of liquors without tax by a holder of
 a  distiller's license issued by the state liquor authority from another
 holder of a distiller's license by such authority, in  which  event  the
 liquors  so  purchased  shall  be  subject  to  the  tax imposed by this
 subchapter in the hands of the purchaser in the same manner and  to  the
 same  extent  as if such purchaser had imported or caused the same to be
 imported into  this  city  or  had  produced,  distilled,  manufactured,
 brewed, compounded, mixed or fermented the same within this city.
   (b)  There  is  also  imposed on each person, other than a distributor
 within the meaning of this subchapter, who, on  August  first,  nineteen
 hundred  eighty,  owns  and  possesses for the purposes of sale beers or
 liquors, a floor tax at the rates applicable under subdivision (a)  upon
 such  beer  in  excess  of  one  hundred gallons and upon such liquor in
 excess of four hundred liters. Such floor tax shall be due  and  payable
 on  the twentieth day of the month succeeding the month of August, nine-
 teen hundred eighty.
   (c) If, prior to August first, nineteen hundred eighty, a contract  of
 sale  of  alcoholic beverages was made, and delivery thereof pursuant to
 such contract is made within this city on or after August  first,  nine-
 teen  hundred  eighty,  the vendor shall be deemed a distributor for the
 purposes of this subchapter,  and  such  alcoholic  beverages  shall  be
 deemed  to  be  sold, and shall be subject to such taxes, at the time of
 such delivery.
   (d) In any case where the  quantity  of  alcoholic  beverages  taxable
 pursuant  to  this  subchapter is a fractional part of one liter, or one
 gallon in the case of beers, or an amount greater than a whole  multiple
 of liters, or gallons in the case of beers, the amount of tax levied and
 imposed  on such fractional part of one liter, or one gallon in the case
 of beers, or fractional part of a liter, or gallon, in excess of a whole
 multiple of liters or gallons shall be such fractional part of the  rate
 imposed by subdivisions (a) and (b) of this section.
   (e)  Notwithstanding  any  other  provisions of this subchapter, there
 shall be exempt from the taxes imposed under this subchapter, per month,
 one quart of alcoholic beverages, or one gallon of such beverages in the
 case of a person arriving directly from  American  Samoa,  Guam  or  the
 Virgin  Islands  of  the  United States not more than one quart of which
 shall have been acquired elsewhere than in such insular possessions:
   (1) purchased outside this city as an incident to a journey from which
 the purchaser is returning and
 S. 8474                           1039
 
   (2) not to be offered for sale or used  for  any  commercial  purpose,
 provided  such  alcoholic  beverages accompany such person on his or her
 return to this city and provided, further, that in the case of a  person
 arriving  in  this  city  from  other than a state of the United States,
 including  the  District  of  Columbia, the Virgin Islands of the United
 States or a contiguous country maintaining a free  zone  or  free  port,
 such  person  shall  have  remained beyond the territorial limits of the
 United States for a period of not less than forty-eight hours.
   Provided, however, where the amounts purchased  outside  the  city  or
 brought  in exceed the amounts specified in this subdivision but are not
 in excess of one liter in the case of the references  to  one  quart  or
 four  liters  in  the  case of the reference to one gallon, and where no
 duty is required by the laws of the United States to  be  paid  on  such
 amounts,  such  metric  standards  of  fill shall be substituted for one
 quart and one gallon, respectively, and such  amounts  shall  be  exempt
 from tax under the conditions provided for in this subdivision.
   § 11-2057 Manner of administration and collection.  All the provisions
 of  article  eighteen of the tax law shall apply to the taxes imposed by
 subdivision  (a)  of  section  11-2056  of  this  subchapter,  and   the
 provisions  of  sections  four  hundred twenty, four hundred twenty-six,
 four hundred twenty-nine through four hundred thirty-four, four  hundred
 thirty-six  and  four hundred thirty-seven of the tax law shall apply to
 the tax imposed by subdivision (b) of section 11-2056 of  this  subchap-
 ter, so far as such sections can be made applicable to the taxes imposed
 by  this  subchapter  with such limitations as set forth in section four
 hundred forty-five of the tax law  and  such  modifications  as  may  be
 necessary  in  order to adapt such language to the taxes imposed by this
 subchapter.
   § 11-2058 State tax commission; administration.  The taxes imposed  by
 this  subchapter  shall be administered and collected by the tax commis-
 sion in the same manner as the taxes imposed under sections four hundred
 twenty-four and four hundred twenty-five of the tax law subject  to  all
 provisions  of that article as may be applicable. The tax commission may
 make such provisions as it deems necessary for the joint  administration
 and  collection  of  the state and local taxes imposed and authorized by
 article eighteen of the tax law and this  subchapter.  Nothing  in  such
 article eighteen or this subchapter which requires payment of both state
 and  local taxes to the tax commission shall be construed as the payment
 of either tax more than once.
   § 11-2059 Disposition of revenues.  All taxes, penalties and  interest
 imposed  by  this subchapter, which are collected by the tax commission,
 shall be deposited daily with such responsible banks, banking houses  or
 trust  companies,  as may be designated by the state comptroller, to the
 credit of the comptroller, in trust for this city. Such  deposits  shall
 be  kept  in  trust  and separate and apart from all other monies in the
 possession of the comptroller. The comptroller  shall  require  adequate
 security  from  all  such depositories of such revenues collected by the
 tax commission. The comptroller shall retain in his or  her  hands  such
 amount  as  the commissioner of taxation and finance may determine to be
 necessary for refunds in respect of the taxes imposed by  this  subchap-
 ter, and for reasonable costs of the state tax commission in administer-
 ing,  collecting  and  distributing  such  taxes, out of which the comp-
 troller shall pay any refunds of such taxes to which taxpayers shall  be
 entitled under the provisions of this subchapter. The comptroller, after
 reserving such refund and such costs shall, on or before the twelfth day
 of  each  month, pay to the commissioner of finance the taxes, penalties
 S. 8474                           1040
 
 and interest imposed by this subchapter,  collected  by  the  state  tax
 commission  pursuant to this subchapter during the next preceding calen-
 dar month. The amount so payable shall be certified to  the  comptroller
 by the president of the state tax commission or his or her delegate, who
 shall  not  be held liable for any inaccuracy in such certificate. Where
 the amount so paid over to the city in any such distribution is more  or
 less than the amount then due to the city, the amount of the overpayment
 or  underpayment  shall be certified to the comptroller by the president
 of the state tax commission or his or her delegate,  who  shall  not  be
 held  liable  for  any inaccuracy in such certificate. The amount of the
 overpayment or underpayment shall be so certified to the comptroller  as
 soon  after  the discovery of the overpayment or underpayment as reason-
 ably possible and subsequent payments and  distributions  by  the  comp-
 troller  to  the city shall be adjusted by subtracting the amount of any
 such overpayment from or by adding the amount of any  such  underpayment
 to  such  number  of  subsequent payments and distributions as the comp-
 troller and the president of the state  tax  commission  shall  consider
 reasonable  in view of the amount of the overpayment or underpayment and
 all other facts or circumstances.
   § 11-2060 Construction.    This  subchapter  shall  be  construed  and
 enforced  in  conformity with section four hundred forty-five of the tax
 law, pursuant to which it is enacted.
 
                                CHAPTER 21
                             REAL PROPERTY TAX
 
   § 11-2101 Definitions. When used in this chapter the  following  terms
 shall mean or include:
   1.  "Person."  An individual, partnership, society, association, joint
 stock company, corporation, estate, receiver, trustee, assignee, referee
 or any other person acting in a fiduciary  or  representative  capacity,
 whether  appointed  by a court or otherwise, any combination of individ-
 uals, and any other form of unincorporated enterprise owned or conducted
 by two or more persons.
   2. "Deed." Any document or writing, other than a will,  regardless  of
 where made, executed or delivered, whereby any real property or interest
 therein  is  created,  vested,  granted,  bargained,  sold, transferred,
 assigned or otherwise conveyed, including any such document  or  writing
 whereby  any leasehold interest in real property is granted, assigned or
 surrendered.
   3. "Instrument." Any document or writing, other than a deed or a will,
 regardless of where made, executed or delivered,  whereby  any  economic
 interest in real property is transferred.
   4.  "Transaction." Any act or acts, regardless of where performed, and
 whether or not reduced to writing, unless evidenced by a deed or instru-
 ment, whereby any economic interest in  real  property  is  transferred,
 other than a transfer pursuant to the laws of intestate succession.
   5. "Real property." Every estate or right, legal or equitable, present
 or  future,  vested or contingent, in lands, tenements or hereditaments,
 which are located in whole or in part within the city of Staten  Island.
 It  shall not include a mortgage, a release of mortgage or, for purposes
 of paragraph three and subparagraphs (ii) and (iii) of  paragraph  seven
 of  subdivision a of section 11-2102 of this chapter, a leasehold inter-
 est in a one, two or three-family house or an individual  dwelling  unit
 in a dwelling which is to be occupied or is occupied as the residence or
 S. 8474                           1041
 
 home  of  four  or  more families living independently of each other. It
 shall not include rights to sepulture.
   6.  "Economic  interest  in real property." The ownership of shares of
 stock in a corporation which owns real property;  the  ownership  of  an
 interest  or interests in a partnership, association or other unincorpo-
 rated entity which owns real property; and the ownership of a beneficial
 interest or interests in a trust which owns real property.
   7. "Transfer" or "transferred." When used in relation to  an  economic
 interest  in  real property, the terms "transfer" or "transferred" shall
 include the transfer or transfers or issuance of shares of  stock  in  a
 corporation,  interest  or  interests  in  a partnership, association or
 other unincorporated entity, or beneficial interest in a trust,  whether
 made  by  one  or  several  persons, or in one or several related trans-
 actions, which shares of stock or interest  or  interests  constitute  a
 controlling  interest  in  such  corporation,  partnership, association,
 trust or other entity.
   8. "Controlling interest." In the case of a corporation, fifty percent
 or more of the total combined voting power of all classes  of  stock  of
 such  corporation,  or  fifty  percent  or more of the total fair market
 value of all classes of stock of such corporation; and, in the case of a
 partnership, association, trust or other entity, fifty percent  or  more
 of  the  capital,  profits  or  beneficial interest in such partnership,
 association, trust or other entity.
   9. "Consideration." The price actually paid or required to be paid for
 the real property or economic interest therein,  without  deduction  for
 mortgages,  liens  or encumbrances, whether or not expressed in the deed
 or instrument and whether paid or required to be paid by money,  proper-
 ty,  or  any  other thing of value. It shall include the cancellation or
 discharge of an indebtedness or obligation. It shall  also  include  the
 amount  of  any  mortgage, lien or other encumbrance, whether or not the
 underlying indebtedness is assumed.
   10. "Net consideration." Any consideration, exclusive of any  mortgage
 or  other  lien  or encumbrance on the real property or interest therein
 which existed before the delivery of the deed and remains thereon  after
 the delivery of the deed.
   11. "Comptroller." The comptroller of the city of Staten Island.
   12. "Commissioner of finance." The commissioner of finance of the city
 of Staten Island.
   13. "City." The city of Staten Island.
   14.  "Grantor."  The person or persons making, executing or delivering
 the deed. The term "grantor" also includes the entity with  an  interest
 in  real  property  or  the  person  or persons who transfer an economic
 interest in real property.
   15. "Grantee." The person or persons accepting the deed or who  obtain
 any  of the real property which is the subject of the deed or any inter-
 est therein. The term "grantee" also includes the person or  persons  to
 whom an economic interest in real property is transferred.
   16.  "Affixed."  Includes attached or annexed by adhesion, stapling or
 otherwise, or a notation by stamp, imprint or writing.
   17. "Register." Includes the city register and the county clerk of the
 county of Richmond.
   18. "Tax appeals tribunal." The tax appeals  tribunal  established  by
 section  one hundred sixty-eight of the charter of the preceding munici-
 pality as it existed January first, nineteen hundred ninety-four.
   § 11-2102 Imposition of tax. a. A tax is hereby imposed on  each  deed
 at the time of delivery by a grantor to a grantee when the consideration
 S. 8474                           1042
 
 for  the  real  property  and  any  improvement  thereon, whether or not
 included in the same deed, exceeds twenty-five thousand dollars. The tax
 shall be:
   (1) at the rate of one-half of one per centum of the net consideration
 with  respect  to  conveyances  made before July first, nineteen hundred
 seventy-one, or made in performance  of  a  contract  therefor  executed
 before such date;
   (2)  at the rate of one percent of such net consideration with respect
 to
   (i) all conveyance made on  or  after  July  first,  nineteen  hundred
 seventy-one  and  before February first, nineteen hundred eighty-two, or
 made in performance of a contract therefor executed during such period;
   (ii) conveyances made on or after  February  first,  nineteen  hundred
 eighty-two  and  before  July first, nineteen hundred eighty-two of one,
 two or three-family houses and individual residential condominium units,
 and
   (iii) conveyances made on or after February  first,  nineteen  hundred
 eighty-two  and before July first, nineteen hundred eighty-two where the
 consideration is less than five hundred  thousand  dollars,  other  than
 grants, assignments or surrenders of leasehold interests in real proper-
 ty taxable under paragraph three of this subdivision;
   (3)  at  the  rate of one percent of the consideration with respect to
 grants, assignments or surrenders of leasehold interests in real proper-
 ty made on or after February  first,  nineteen  hundred  eighty-two  and
 before  July  first, nineteen hundred eighty-two where the consideration
 if five hundred thousand dollars or more,  provided  however,  that  for
 purposes  of  this  paragraph the amount subject to tax in the case of a
 grant of a leasehold interest in real property shall be only such amount
 as is not considered rent for purposes of the  tax  imposed  by  chapter
 seven of this title;
   (4)  at  the  rate of two percent of the consideration with respect to
 all other conveyances made on or after February first, nineteen  hundred
 eighty-two  and  before  July first, nineteen hundred eighty-two, except
 that, for purposes of this paragraph, where the  consideration  includes
 the  amount  of  any  mortgage  or other lien or encumbrance on the real
 property or interest therein which existed before the  delivery  of  the
 deed  and remains thereon after the delivery of the deed, the portion of
 the consideration ascribable to such mortgage, lien or encumbrance shall
 be taxed at the rate of one  percent,  and  only  the  balance  of  such
 consideration shall be taxed at the rate of two percent;
   (5)  at  the  rate of one percent of the consideration with respect to
 conveyances made on or after July first, nineteen hundred eighty-two and
 before August first, nineteen hundred eighty-nine of one, two or  three-
 family houses and individual residential condominium units;
   (6)  at  the  rate of one percent of the consideration with respect to
 conveyances made on or after July first, nineteen hundred eighty-two and
 before August first, nineteen hundred eighty-nine  where  the  consider-
 ation  is  less  than  five hundred thousand dollars, other than grants,
 assignments or surrenders of leasehold interests in real property  taxa-
 ble as hereafter provided;
   (7)  (i)  at the rate of one percent of the consideration with respect
 to a grant, assignment or surrender, made on or after July first,  nine-
 teen hundred eighty-two and before August first, nineteen hundred eight-
 y-nine,  of  a leasehold interest in a one, two or three-family house or
 an individual dwelling unit in a dwelling which is to be occupied or  is
 S. 8474                           1043
 
 occupied  as the residence or home of four or more families living inde-
 pendently of each other,
   (ii)  at  the rate of one percent of the consideration with respect to
 grants, assignments or surrenders of leasehold interests in real proper-
 ty made on or after July first, nineteen hundred eighty-two  and  before
 August  first,  nineteen  hundred eighty-nine where the consideration is
 less than five hundred thousand dollars, or
   (iii) at the rate of two percent of the consideration with respect  to
 grants, assignments or surrenders of leasehold interests in real proper-
 ty  made  on or after July first, nineteen hundred eighty-two and before
 August first, nineteen hundred eighty-nine where  the  consideration  is
 five hundred thousand dollars or more;
   (iv)  provided,  however, that for purposes of subparagraphs (i), (ii)
 and (iii) of this paragraph, the amount subject to tax in the case of  a
 grant  of  a  leasehold  interest  shall  be  only such amount as is not
 considered rent for purposes of the tax imposed by chapter seven of this
 title; and
   (8) at the rate of two percent of the consideration  with  respect  to
 all  other  conveyances  made  on  or after July first, nineteen hundred
 eighty-two and before August first, nineteen hundred eighty-nine;
   (9) with respect to conveyances made on or after August  first,  nine-
 teen  hundred  eighty-nine, other than grants, assignments or surrenders
 of leasehold interests in real property taxable as provided in paragraph
 ten of this subdivision, the tax shall be at the following rates:
   (i) at the rate of one percent of the consideration for conveyances of
 one, two or three-family houses and individual  residential  condominium
 units  where the consideration is five hundred thousand dollars or less,
 and at the rate of one and four hundred twenty-five thousandths  of  one
 percent  of  the  consideration for such conveyances where the consider-
 ation is more than five hundred thousand dollars, and
   (ii) at the rate of one and four hundred  twenty-five  thousandths  of
 one  percent  of the consideration with respect to all other conveyances
 where the consideration is five hundred thousand dollars or less, and at
 the rate of two and six hundred twenty-five thousandths of  one  percent
 where  the  consideration for such conveyances is more than five hundred
 thousand dollars;
   (10) With respect to a grant, assignment or surrender of  a  leasehold
 interest  in  real  property  made  on  or  after August first, nineteen
 hundred eighty-nine, the tax shall be at the following rates:
   (i) at the rate of one percent of the consideration for the  granting,
 assignment  or surrender of a leasehold interest in a one, two or three-
 family house or an individual dwelling unit in a dwelling which is to be
 occupied or is occupied as the residence or home of four or  more  fami-
 lies  living independently of each other where the consideration is five
 hundred thousand dollars or less, and  at  the  rate  of  one  and  four
 hundred  twenty-five  thousandths  of  one  percent of the consideration
 where the consideration for granting, assignment or  surrender  or  such
 leasehold interest is more than five hundred thousand dollars; and
   (ii)  at  the  rate of one and four hundred twenty-five thousandths of
 one percent of the consideration for the granting, assignment or surren-
 der of a leasehold interest in all other real property where the consid-
 eration is five hundred thousand dollars or less, and at the rate of two
 and six hundred twenty-five thousandths of one percent of the  consider-
 ation  where the consideration for the granting, assignment or surrender
 of such a leasehold interest is more than five hundred thousand dollars;
 and
 S. 8474                           1044
 
   (iii) provided, however, that for purposes of  subparagraphs  (i)  and
 (ii) of this paragraph, the amount subject to tax in the case of a grant
 of  a  leasehold interest shall be only such amount as is not considered
 rent for purposes of the tax imposed by chapter seven of this title.
   Where  any  real property is situated partly within and partly without
 the boundaries of the city of Staten Island the  consideration  and  net
 consideration  subject  to tax shall be such part of the total consider-
 ation and total net consideration attributable to that portion  of  such
 real property situated within the city of Staten Island or to the inter-
 est in such portion.
   b.  (1)  In  addition  to  the  taxes imposed by subdivision a of this
 section, there is hereby imposed a tax  on  each  instrument  or  trans-
 action, unless evidenced by a deed subject to tax under subdivision a of
 this section, at the time of the transfer, whereby any economic interest
 in  real  property  is  transferred by a grantor to a grantee, where the
 consideration exceeds twenty-five thousand dollars.
   (A) With respect to such transfers made on or after  July  thirteenth,
 nineteen  hundred  eighty-six  and before August first, nineteen hundred
 eighty-nine, the tax shall be (i) at the rate  of  one  percent  of  the
 consideration  where the real property the economic interest in which is
 transferred is a one, two or three-family house, an  individual  cooper-
 ative  apartment, an individual residential condominium unit or an indi-
 vidual dwelling unit in a dwelling which is to be occupied or  is  occu-
 pied  as  the  residence  or  home  of  four  or  more  families  living
 independently of each other, or where the consideration for the transfer
 is less than five hundred thousand dollars, and (ii) at the rate of  two
 percent of the consideration with respect to all other transfers.
   (B)  With  respect  to  such  transfers made on or after August first,
 nineteen hundred eighty-nine, the tax shall be at the following rates:
   (i) at the rate of one percent of the  consideration  where  the  real
 property,  the  economic interest in which is transferred, is a one, two
 or three-family house, an individual cooperative apartment, an  individ-
 ual  residential  condominium  unit  or an individual dwelling unit in a
 dwelling which is to be occupied or is occupied as the residence or home
 of four or more families living independently of each  other  and  where
 the consideration for such transfer of an economic interest in such real
 property  is  five  hundred thousand dollars or less, and at the rate of
 one and four hundred twenty-five  thousandths  of  one  percent  of  the
 consideration  where  the consideration for such transfer of an economic
 interest in such property is more than five  hundred  thousand  dollars,
 and
   (ii)  at  the  rate of one and four hundred twenty-five thousandths of
 one percent of the consideration with respect to all other transfers  of
 an  economic  interest  in real property where the consideration is five
 hundred thousand dollars or less, and at the rate of two and six hundred
 twenty-five thousandths of one percent of the  consideration  where  the
 consideration  for  such  transfers  is  more than five hundred thousand
 dollars.
   (C) Where any real property, the economic interest in which is  trans-
 ferred,  is  situated partly within and partly without the boundaries of
 the city of Staten Island, the consideration subject  to  tax  shall  be
 such  part  of  the  consideration as is attributable to that portion of
 such real property which is situated within the city of Staten Island.
   (2) Notwithstanding the definition of "controlling interest" contained
 in subdivision eight of section 11-2101 of this chapter or  anything  to
 the contrary contained in subdivision seven of such section, in the case
 S. 8474                           1045
 
 of  any transfer of shares of stock in a cooperative housing corporation
 in connection with the grant or transfer of a proprietary leasehold, the
 tax imposed by this subdivision shall apply to (i) the original transfer
 of  such  shares  of stock by the cooperative corporation or cooperative
 plan sponsor, and (ii) any subsequent transfer of such shares  of  stock
 by  the  owner thereof. Notwithstanding any provision of this chapter to
 the contrary, in the case of a transfer described in clause (ii) of this
 subparagraph which  relates  to  an  individual  residential  unit,  the
 consideration  for  such  transfer  shall not include any portion of the
 unpaid principal of any mortgage on the real property of the cooperative
 housing corporation.  In determining the tax on a transfer described  in
 clause (i) of this subparagraph, a credit shall be allowed for a propor-
 tionate  part  of  the amount of any tax paid upon the conveyance to the
 cooperative housing corporation of the land and  building  or  buildings
 comprising  the  cooperative  dwelling  or dwellings. Such proportionate
 part shall be the amount determined by multiplying  the  amount  of  tax
 paid  upon  the  conveyance  to the cooperative housing corporation by a
 fraction, the numerator of which shall be the number of shares of  stock
 transferred  in  a  transaction described in clause (i) of this subpara-
 graph and the  denominator  of  which  shall  be  the  total  number  of
 outstanding  shares  of  stock  of  the cooperative housing corporation,
 including any stock held by the corporation. In no event, however, shall
 such credit reduce the tax on a transfer described in clause (i) of this
 subparagraph below zero, nor shall any such credit be  allowed  for  any
 tax  paid more than twenty-four months prior to the date on which occurs
 the first in a series of transfers of shares of stock in an offering  of
 cooperative  housing  corporation shares described in clause (i) of this
 subparagraph.  For purposes of this  paragraph,  the  term  "cooperative
 housing  corporation"  shall not include a housing company organized and
 operating pursuant to the provisions of article two, four, five or elev-
 en of the private housing finance law.
   (3) Notwithstanding the definition of "controlling interest" contained
 in paragraph eight of section 11-2101 of this chapter or anything to the
 contrary contained in paragraph seven of such section, in the case of  a
 corporation,  other than a cooperative housing corporation, partnership,
 association, trust or other entity formed for the purpose of cooperative
 ownership of real property, the tax imposed by  this  subdivision  shall
 apply  to each transfer of shares of stock in such corporation, interest
 in such partnership, association or other entity or beneficial  interest
 in such trust, in connection with the grant or transfer of a proprietary
 leasehold.  Notwithstanding any provision of this chapter to the contra-
 ry, in the case of a transfer described in this paragraph which  relates
 to  an  individual residential unit, other than the original transfer of
 such a unit by the cooperative entity or cooperative plan  sponsor,  the
 consideration  for  such  transfer  shall not include any portion of the
 unpaid principal of any mortgage on the real  property  of  such  corpo-
 ration, partnership, association, trust or other entity. Notwithstanding
 any  other  provision  of law to the contrary, all revenues arising from
 the tax imposed pursuant to this paragraph  shall  be  credited  to  and
 deposited  in the general fund of the city, but no part of such revenues
 may be expended unless appropriated in the annual budget of the city.
   c. (1) Anything to the contrary notwithstanding, in the  case  of  any
 conveyance or transfer of real property or any economic interest therein
 in  complete or partial liquidation of a corporation, partnership, asso-
 ciation, trust or other entity, the taxes imposed by this section  shall
 be measured by (i) the consideration for such conveyance or transfer, or
 S. 8474                           1046
 
 (ii) the value of the real property or economic interest therein, which-
 ever is greater.
   (2) If, within twenty-four months following the transfer of an econom-
 ic interest in real property which is subject to the tax imposed by this
 chapter, the corporation, partnership, association, trust or other enti-
 ty owning the real property the economic interest in which was so trans-
 ferred, is liquidated, and such real property is conveyed to the grantee
 or grantees of such economic interest, a credit shall be allowed against
 the  tax  imposed by this chapter upon such conveyance in liquidation to
 such grantee or grantees. The amount of such credit shall  be  equal  to
 the  amount  of  the  tax  paid  upon the prior transfer of the economic
 interest in such real property, but shall in no event  be  greater  than
 the tax payable upon the conveyance in liquidation.
   d.  In  the  case  of a transfer of an economic interest in any entity
 that owns assets in addition to real property or interest  therein,  the
 consideration  subject  to  tax shall be deemed equal to the fair market
 value of the real property or interest therein apportioned based on  the
 percentage of the ownership interest in the entity transferred.
   e.  (1)  Notwithstanding  anything  contained in this section, the tax
 imposed under subdivisions a and b of this section on any deed or  other
 instrument  or transaction conveying or transferring real property or an
 economic interest therein, that qualifies as a  real  estate  investment
 trust  transfer,  as  defined below, shall be imposed at a rate equal to
 fifty percent of the otherwise applicable rate.
   (2) For purposes of this subdivision, a real estate  investment  trust
 transfer  shall  mean  (A)  any  deed or other instrument or transaction
 conveying or transferring real property or an economic interest  therein
 to  a  real  estate investment trust as defined in section eight hundred
 fifty-six of the internal revenue code (a "REIT") or to a partnership or
 corporation in which a REIT  owns  a  controlling  interest  immediately
 following the transaction; and (B) any issuance or transfer of an inter-
 est in a REIT, or in a partnership or corporation in which a REIT owns a
 controlling  interest  immediately following the issuance or transfer in
 connection with a transaction described  in  subparagraph  (A)  of  this
 paragraph.
   Provided,    however, a transaction described in the opening paragraph
 of this paragraph shall not constitute a real  estate  investment  trust
 transfer  unless  (i) it occurs in connection with the initial formation
 of the REIT and the conditions described in subparagraphs (C) and (D) of
 this paragraph are satisfied, or (ii) in the case  of  any  real  estate
 investment  trust  transfer occurring on or after July thirteenth, nine-
 teen hundred ninety-six and before September first, two  thousand  twen-
 ty-six,  the  transaction is described in subparagraph (E) of this para-
 graph in which case the provision of such subparagraph shall apply.
   (C) The value of the ownership interests in the REIT, or in a partner-
 ship or corporation in which  the  REIT  owns  a  controlling  interest,
 received by the grantor as consideration for such conveyance or transfer
 must  be  equal to an amount not less than forty percent of the value of
 the equity interest in the real property or  economic  interest  therein
 conveyed or transferred by the grantor to the grantee and such ownership
 interests must be retained by the grantor or owners of the grantor for a
 period  of not less than two years following the date of such conveyance
 or transfer; provided, however, that in the case of  the  death  of  the
 grantor or an owner of the grantor within such two year period, this two
 year retention requirement shall be deemed to be satisfied notwithstand-
 ing  any conveyance or transfer of such ownership interests held by such
 S. 8474                           1047
 
 individual as a result of such death. The value of the  equity  interest
 in  such real property or economic interest therein shall be computed by
 subtracting from the consideration for the conveyance or transfer of the
 real  property  or  economic  interest therein the unpaid balance of any
 loans secured by mortgages or other encumbrances which are liens on  the
 real  property  or  economic  interest  therein  immediately  before the
 conveyance or transfer. For purposes of this computation, in the case of
 a conveyance or transfer of real property other  than  a  conveyance  or
 transfer  of  an  economic  interest in real property, the amount of the
 unpaid balance of any loans secured by mortgages or  other  encumbrances
 to  be  subtracted  from  consideration is determined by multiplying the
 total unpaid balance of any loans secured by mortgages or  other  encum-
 brances on the real property by the percentage of the ownership interest
 in  the  real  property being conveyed or transferred to the grantee. In
 the case of a transfer of an economic interest in  real  property,  such
 amount  to  be  subtracted is equal to the sum of the following amounts:
 (i) a reasonable apportionment to the interests in real  property  owned
 by  the entity of the amount of any loans secured by encumbrances on the
 ownership interests in the entity which are  being  conveyed  or  trans-
 ferred  and  (ii)  the amount of any loans secured by mortgages or other
 encumbrances on the real  property  of  the  entity  multiplied  by  the
 percentage  interest  in  the  entity  which is being conveyed or trans-
 ferred.
   Provided, however, that for purposes of the computation made  pursuant
 to  this  subparagraph,  any mortgages or other encumbrances on the real
 property or economic interest therein which are created in contemplation
 of the initial formation of the REIT or in contemplation of the  convey-
 ance  or  transfer of such real property or economic interest therein to
 the REIT or to a partnership or corporation in which  the  REIT  owns  a
 controlling  interest  immediately  following the conveyance or transfer
 shall not be considered.
   (D) Seventy-five percent or more of the cash proceeds received by such
 REIT from the sale of ownership interests in such REIT upon its  initial
 formation  must  be  used:  (i) to make payments on loans secured by any
 interest in real property, including an ownership interest in an  entity
 owning  real  property,  which  is  owned directly or indirectly by such
 REIT; (ii) to pay for capital  improvements  to  real  property  or  any
 interest therein owned directly or indirectly by such REIT; (iii) to pay
 brokerage  fees and commissions, professional fees and payments to or on
 behalf of a tenant as an inducement to enter into a  lease  or  sublease
 incurred  in  connection  with  the  creation of a leasehold or sublease
 pertaining to real property or any interest therein  owned  directly  or
 indirectly  by such REIT; (iv) to acquire any interest in real property,
 including an ownership interest in  any  entity  owning  real  property,
 apart  from any acquisition to which a reduced rate of tax is applicable
 pursuant to this subdivision, without regard to  this  subparagraph;  or
 (v) for reserves established for any of the purposes described in clause
 (i),  (ii)  or (iii) of this subparagraph. For purposes of this subpara-
 graph, the term real  property  shall  include  real  property  wherever
 located.
   (E) If a transaction otherwise described in subparagraph (A) or (B) of
 this  paragraph  occurs other than in connection with the initial forma-
 tion of a REIT, the condition set forth in  subparagraph  (D)  shall  be
 disregarded and such transaction shall constitute a "real estate invest-
 ment  trust  transfer"  if  the  condition set forth in subparagraph (C)
 S. 8474                           1048
 
 would be satisfied if "fifty percent" is substituted for "forty percent"
 therein.
   (3)  For  purposes  of determining the consideration for a real estate
 investment trust transfer taxable under this subdivision  the  value  of
 the  real  property  or interest therein shall be equal to the estimated
 market value as determined by the commissioner of finance for real prop-
 erty tax purposes as reflected on the most recent notice  of  assessment
 issued  by  such  commissioner,  or such other value as the taxpayer may
 establish to the satisfaction of such commissioner.
   (4) This subdivision shall only apply to real estate investment  trust
 transfers occurring on or after the effective date of this subdivision.
   f. Notwithstanding any other provision of this chapter, in determining
 the  tax  imposed  by this chapter with respect to a deed, instrument or
 transaction conveying or transferring a one, two or three-family  house,
 an  individual  residential  condominium unit, an individual residential
 cooperative apartment, or an interest  therein,  the  consideration  for
 such  conveyance  or  transfer  shall  exclude,  to the extent otherwise
 included therein, the amount of any mortgage or  other  lien  or  encum-
 brance  on the real property or interest therein that existed before the
 delivery of the deed or the transfer and remains thereon after the  date
 of  delivery  of the deed or the transfer, other than any mortgage, lien
 or encumbrance placed on the property or interest in connection with, or
 in anticipation of, the conveyance or transfer, or by reason of deferred
 payments of the purchase price whether represented by  notes  or  other-
 wise.  Provided,  however,  that  this  subdivision shall not apply to a
 conveyance or transfer (1)  to  a  mortgagee,  lienor  or  encumbrancer,
 regardless  of  whether  the  grantor or transferor is or was personally
 liable for the indebtedness secured by the mortgage, lien or encumbrance
 or whether the mortgage, lien or encumbrance is canceled of  record,  or
 (2)  which  qualifies  as  a  "real estate investment trust transfer" as
 defined in subdivision e of this section.
   §  11-2103  Presumptions and burden of proof. For the purpose  of  the
 proper  administration of this chapter and to prevent evasion of the tax
 hereby imposed, it shall be presumed that all  deeds  and  transfers  of
 economic  interests  in  real property are taxable.  Where the consider-
 ation includes property other than money, it shall be presumed that  the
 consideration  is  the  value  of the real property or interest therein.
 Such presumptions shall prevail until the contrary  is  established  and
 the burden of proving the contrary shall be on the taxpayer.  The burden
 of  proving  that  a lien or encumbrance existed on the real property or
 interest therein before the delivery of the deed  and  remained  thereon
 thereafter  and  the burden of proving the amount of such lien or encum-
 brance at the time of the delivery of the deed shall be on the taxpayer.
   § 11-2104 Payment.  The tax imposed hereunder shall  be  paid  by  the
 grantor  to the commissioner of finance at the office of the register in
 the county where the deed is or would be  recorded  within  thirty  days
 after  the delivery of the deed by the grantor to the grantee but before
 the recording of such deed, or, in the case of a tax on the transfer  of
 an economic interest in real property, at such place as the commissioner
 of  finance  shall designate, within thirty days after the transfer. The
 grantee shall also be liable for the payment of such tax  in  the  event
 that  the amount of tax due is not paid by the grantor or the grantor is
 exempt from tax.  All moneys received as such payments by  the  register
 during  the  preceding month shall be transmitted to the commissioner of
 finance on the first day of each month or on such other day as is  mutu-
 ally agreeable to the commissioner of finance and the register. From the
 S. 8474                           1049

 moneys  so received by him or her, the commissioner of finance shall set
 said in a special account:
   (1)  the  total  amount of taxes imposed pursuant to the provisions of
 paragraph three of subdivision a of  section  11-2102  of  this  chapter
 including any interest or penalties thereon;
   (2) fifty percent of the total amount of taxes imposed pursuant to the
 provisions of paragraph four of subdivision a of section 11-2102 of this
 chapter,  including  fifty percent of any interest or penalties thereon,
 provided, however, that where such tax is measured by the  consideration
 for  a  conveyance  without  deduction for the amount of any mortgage or
 other lien or encumbrance on the real property or interest therein which
 existed before the delivery of the deed and remains  thereon  after  the
 delivery  of  the  deed, the entire amount of tax imposed at the rate of
 one percent on the portion  of  the  consideration  ascribable  to  such
 nondeductible  mortgage, lien or other encumbrance, including any inter-
 est or penalties thereon, and fifty percent of the tax on the balance of
 the consideration, including fifty percent of any interest or  penalties
 thereon, shall be set aside in such special account;
   (3) fifty percent of the total amount of taxes imposed pursuant to the
 provisions  of subparagraph (iii) of paragraph seven of subdivision a of
 section 11-2102 of this chapter, including fifty percent of any interest
 or penalties thereon;
   (4) fifty percent of the total amount of taxes imposed pursuant to the
 provisions of paragraph eight of subdivision a  of  section  11-2102  of
 this chapter, including fifty percent of any interest or penalties ther-
 eon;
   (5)  fifty percent of the total amount of taxes imposed at the rate of
 two percent pursuant to the provisions of clause (ii) of subparagraph  A
 of  paragraph  one  of  subdivision b of section 11-2102 of this chapter
 including fifty percent of any interest or penalties thereon;
   (6) with respect to any conveyance of real property,  transfer  of  an
 economic  interest  therein,  or any grant, assignment or surrender of a
 leasehold interest in real property, made  on  or  after  August  first,
 nineteen  hundred  eighty-nine  and  taxable under this chapter, in each
 instance where the tax rate is in excess of two percent,  a  portion  of
 the  tax  received  equal to one percent of the consideration subject to
 the tax plus any interest or penalty attributable to such portion of the
 tax; and
   (7) notwithstanding anything in subdivision six of this section to the
 contrary, in each instance where the tax rate imposed pursuant to subdi-
 vision e of section 11-2102 of this chapter is in excess of one percent,
 a portion of the tax received equal to one-half of one  percent  of  the
 total  consideration  for the real property or economic interest therein
 conveyed or transferred, plus any interest or  penalty  attributable  to
 such portion of the tax.
   Moneys  in such account shall be used for payment by such commissioner
 to the state comptroller for deposit in the urban mass transit operating
 assistance account of the mass transportation operating assistance  fund
 of any amount of insufficiency certified by the state comptroller pursu-
 ant  to  the  provisions of subdivision six of section eighty-eight-a of
 the state finance law, and, on the fifteenth  day  of  each  month,  the
 commissioner  of finance shall transmit all funds in such account on the
 last day of the preceding month, except  the  amount  required  for  the
 payment  of  any  amount  of  insufficiency certified by the state comp-
 troller and such amount as he or she deems  necessary  for  refunds  and
 such other amounts necessary to finance the New York City transportation
 S. 8474                           1050
 
 disabled  committee  and  the New York City paratransit system as estab-
 lished by section fifteen-b of the transportation law, provided,  howev-
 er, that such amounts shall not exceed six percent of the total funds in
 the  account but in no event be less than one hundred seventy-five thou-
 sand dollars beginning April first,  nineteen  hundred  eighty-six,  and
 further  that beginning November fifteenth, nineteen hundred eighty-four
 and during the entire period prior to  operation  of  such  system,  the
 total  of such amounts shall not exceed three hundred seventy-five thou-
 sand dollars for the administrative expenses of such committee and fifty
 thousand dollars for the expenses of the agency designated  pursuant  to
 paragraph  b  of  subdivision  five  of  such section, and other amounts
 necessary to finance the operating needs of the  private  bus  companies
 franchised by the city of New York and eligible to receive state operat-
 ing  assistance  under  section  eighteen-b  of  the transportation law,
 provided, however, that such amounts shall not exceed  four  percent  of
 the  total  funds in the account, to the New York city transit authority
 for mass transit within the city.
   § 11-2105  Returns.  a. A joint return shall  be  filed  by  both  the
 grantor and the grantee for each deed whether or not a tax is due there-
 on.  Such  return shall be filed with the commissioner of finance within
 thirty days after the delivery of the deed by the grantor to the grantee
 but before the recording of such deed. The commissioner of finance  may,
 by rule, require that such returns be filed electronically.
   Filing  shall be accomplished by delivering the return to the register
 for transmittal to the commissioner of finance or, where required by the
 commissioner of finance, by electronic filing of the return in a  manner
 designated  by the commissioner of finance. In the case of a transfer of
 an economic interest in real property, a joint return shall be filed  in
 the above manner by both the grantor and the grantee for each instrument
 or  transaction by which such transfer is effected, whether or not a tax
 is due thereon. Such return shall be  filed  with  the  commissioner  of
 finance,  at  such  place  and in such manner as he or she may designate
 within thirty days after the transfer. The commissioner of finance shall
 prescribe the form of the return and  the  information  which  it  shall
 contain. The return shall be signed by both the grantor or the grantor's
 agent  and the grantee or the grantee's agent. Where the commissioner of
 finance requires electronic filing, the return shall be signed electron-
 ically. Upon the filing of such return  for  a  deed,  evidence  of  the
 filing shall be affixed to the deed by the register. The commissioner of
 finance  may  provide  for  the use of stamps as evidence of payment and
 that they shall be affixed to the deed  before  it  is  recorded.  Where
 either the grantor or grantee has failed to sign the return, it shall be
 accepted as a return, but the party who has failed to sign the return or
 file a separate return shall be subject to the penalties applicable to a
 person who has failed to file a return and the period of limitations for
 assessment  of  tax  or of additional tax shall not apply to such party.
 For good cause, the commissioner of finance may waive any rule requiring
 electronic filing and may permit a return to  be  filed  in  such  other
 manner as the commissioner of finance may designate.
   b.    Returns  shall be preserved for three years and thereafter until
 the commissioner of finance permits them to be destroyed.
   c. The commissioner of finance may require amended returns to be filed
 within twenty days after notice and to contain the information specified
 in the notice.
   d. If a return required by this chapter is not filed or  if  a  return
 when  filed is incorrect or insufficient on its face the commissioner of
 S. 8474                           1051
 
 finance shall take the necessary steps to enforce the filing of  such  a
 return or of a corrected return.
   e.  Where a deed, or instrument or transaction has more than one gran-
 tor or more than one grantee, the return may be signed by any one of the
 grantors and by any one of the grantees, provided, however,  that  those
 not  signing  shall not be relieved of any liability for the tax imposed
 by this chapter.
   f. The payment of, and the filing of returns relating  to,  the  taxes
 imposed  hereunder,  shall  be  required as a condition precedent to the
 recording or filing of a deed, lease, assignment or surrender  of  lease
 or  other  instrument effecting a conveyance or transfer subject to such
 taxes.
   g. Every cooperative housing corporation shall be required to file  an
 information  return  with  the  commissioner of finance as follows: such
 information return shall be filed by February fifteenth of the year  two
 thousand  and  of  each  year  thereafter, covering the reporting period
 beginning on January sixth of the year preceding the filing  and  ending
 on January fifth of the year of the filing. For reporting periods begin-
 ning  before  January sixth, nineteen hundred ninety-nine, such informa-
 tion return shall be filed by July fifteenth of each year  covering  the
 preceding  period of January first through June thirtieth and by January
 fifteenth of each year covering  the  preceding  period  of  July  first
 through  December thirty-first provided, however, that for the reporting
 period from January  first  through  June  thirtieth,  nineteen  hundred
 eighty-nine,  such  information  return  shall  be filed by July thirty-
 first, nineteen hundred  eighty-nine.  The  return  shall  contain  such
 information regarding the transfer of shares of stock in the cooperative
 housing  corporation  as  the commissioner may deem necessary, including
 but not limited to, the names,  addresses  and  employer  identification
 numbers  or  social security numbers of the grantor and the grantee, the
 number of shares transferred, the date of the transfer and the consider-
 ation paid for such transfer, provided, however, that  if  such  cooper-
 ative  housing corporation elects that such information return be deemed
 an application for an abatement pursuant to paragraph (f) of subdivision
 three of section four hundred sixty-seven-a of  the  real  property  tax
 law,  such  return  shall  contain  the information required pursuant to
 paragraph (d) of subdivision three of such section. The commissioner  of
 finance  may  enter  into an agreement with the commissioner of taxation
 and finance of the state of New York to provide that a  single  informa-
 tion return may be filed for purposes of the tax imposed by this chapter
 and  the  real  estate transfer tax imposed by article thirty-one of the
 tax law.
   h. Returns with respect to the conveyance  of  a  one-  or  two-family
 dwelling  will not be accepted for filing unless accompanied by an affi-
 davit signed by the grantor and grantee indicating that the premises  is
 equipped  with  an  approved  and  operational smoke detecting device as
 provided in article six of subchapter seventeen of chapter one of  title
 twenty-seven of this code.
   i.  When the grantor or grantee of a deed for a building used as resi-
 dential real property containing up to four family dwelling units  is  a
 limited  liability  company,  the joint return shall not be accepted for
 filing unless it is accompanied by a document which identifies the names
 and business addresses of all members, managers, and any  other  author-
 ized  persons,  if  any, of such limited liability company and the names
 and business addresses or, if none, the business addresses of all share-
 holders, directors, officers, members,  managers  and  partners  of  any
 S. 8474                           1052
 
 limited  liability  company  or other business entity that are to be the
 members, managers or authorized persons, if any, of such limited liabil-
 ity company. The identification of such names and addresses shall not be
 deemed  an  unwarranted invasion of personal privacy pursuant to article
 six of the public officers law. If any such member, manager  or  author-
 ized person of the limited liability company is itself a limited liabil-
 ity  company or other business entity other than a publicly traded enti-
 ty, a REIT, an UPREIT, or a mutual fund, the names and addresses of  the
 shareholders, directors, officers, members, managers and partners of the
 limited  liability  company  or  other  business  entity  shall  also be
 disclosed until full disclosure of ultimate ownership by natural persons
 is achieved. For purposes of  this  subdivision,  the  terms  "members",
 "managers",  "authorized person", "limited liability company" and "other
 business entity" shall have the same meaning as those terms are  defined
 in section one hundred two of the limited liability company law.
   §  11-2106    Exemptions.  a.  The  following shall be exempt from the
 payment of the tax imposed by this chapter and from filing a return:
   1.  The state of New York, or any of its agencies,  instrumentalities,
 public  corporations, including a public corporation created pursuant to
 agreement or compact with another state or the Dominion  of  Canada,  or
 political subdivisions;
   2.  The  United States of America, and any of its agencies and instru-
 mentalities, insofar, as they are immune from taxation, provided, howev-
 er, that the exemption of such governmental bodies or persons shall  not
 relieve  a  grantee  from them of liability for the tax or from filing a
 return.
   b. The tax imposed by this chapter shall  not  apply  to  any  of  the
 following deeds, instruments or transactions:
   1.  A  deed,  instrument or transaction conveying or transferring real
 property or an economic interest therein by or to the United Nations  or
 other  world-wide international organizations of which the United States
 of America is a member;
   2. A deed, instrument or transaction conveying  or  transferring  real
 property  or  an  economic interest therein by or to any corporation, or
 association, or trust, or community chest, fund or foundation, organized
 or  operated  exclusively  for  religious,  charitable,  or  educational
 purposes,  or  for the prevention of cruelty to children or animals, and
 no part of the net earnings of  which  inures  to  the  benefit  of  any
 private  shareholder or individual and no substantial part of the activ-
 ities of which is carrying on propaganda,  or  otherwise  attempting  to
 influence legislation; provided, however, that nothing in this paragraph
 shall include an organization operated for the primary purpose of carry-
 ing on a trade or business for profit, whether or not all of its profits
 are payable to one or more organizations described in this paragraph;
   3.  A  deed,  instrument or transaction conveying or transferring real
 property or an economic interest therein to  any  governmental  body  or
 person  exempt from payment of the tax pursuant to subdivision a of this
 section;
   4. A deed delivered pursuant to a contract made prior  to  May  first,
 nineteen hundred fifty-nine;
   5.  A  deed  delivered  by any governmental body or person exempt from
 payment of the tax pursuant to subdivision a of this section as a result
 of a sale at a public auction held in accordance with the provisions  of
 a contract made prior to May first, nineteen hundred fifty-nine;
   6. A deed or instrument given solely as security for, or a transaction
 the  sole  purpose of which is to secure, a debt or obligation or a deed
 S. 8474                           1053

 or instrument given, or a  transaction  entered  into,  solely  for  the
 purpose of returning such security;
   7.  A  deed,  instrument or transaction conveying or transferring real
 property or an economic interest therein from a mere agent, dummy, straw
 man or conduit to his principal or a  deed,  instrument  or  transaction
 conveying  or transferring real property or an economic interest therein
 from the principal to his agent, dummy, straw man or conduit.
   8. A deed, instrument or transaction conveying  or  transferring  real
 property  or  an economic interest therein that effects a mere change of
 identity or form of ownership or organization to the extent the  benefi-
 cial  ownership  of  such  real  property  or  economic interest therein
 remains the same, other than  a  conveyance  to  a  cooperative  housing
 corporation of the land and building or buildings comprising the cooper-
 ative  dwelling  or dwellings.  For purposes of this paragraph, the term
 "cooperative housing corporation" shall not include  a  housing  company
 organized and operating pursuant to the provisions of article two, four,
 five or eleven of the private housing finance law.
   9.  A  deed,  instrument or transaction conveying or transferring real
 property or an economic interest therein by or to any  housing  develop-
 ment  fund  company  organized pursuant to article eleven of the private
 housing finance law or to an entity, the controlling interest  of  which
 is  held  by such a company, if at the time of such conveyance or trans-
 fer, such real property is  subject  to,  or  simultaneously  with  such
 conveyance  or  transfer is made subject to, a regulatory agreement with
 the state of New York, a  municipal  corporation  or  any  other  public
 corporation  created  by or pursuant to any law of the state of New York
 that: encumbers the real property for thirty  years  or  more,  requires
 mutual  consent  for  revocation or amendment, restricts more than fifty
 percent of the floor area, other than common areas, to residential  real
 property,  and  restricts  at  least sixty-six and two-thirds percent of
 such residential real property to purchase, lease, license or other  use
 by  persons  of low income and families of low income within the meaning
 of section two of the private housing finance  law;  provided,  however,
 that  if  such  regulatory  agreement  restricts  less  than one hundred
 percent of the floor area, other than common areas, to purchase,  lease,
 license or other use by persons of low income and families of low income
 within  the  meaning  of section two of the private housing finance law,
 the tax shall apply to the consideration less the product of the consid-
 eration and a fraction, the numerator of which is the  floor  area  that
 such regulatory agreement restricts to purchase, lease, license or other
 use by persons of low income and families of low income within the mean-
 ing  of section two of the private housing finance law and the denomina-
 tor of which is the entire floor area, minus the floor  area  of  common
 areas; provided further, that if such real property is made subject to a
 regulatory  agreement  that meets the terms of this paragraph within two
 years of the conveyance or transfer then the commissioner of finance may
 issue a refund based on the application of this  paragraph  pursuant  to
 the provisions of section 11-2108 of this chapter, treating the transfer
 or  conveyance  as if such real property were subject to such regulatory
 agreement as of the date of such transfer or  conveyance,  if,  notwith-
 standing  any other time limitation set forth in section 11-2108 of this
 chapter, application to the commissioner of finance for such  refund  is
 made  within  twelve  months  of  the  effective date of such regulatory
 agreement.
   c. Notwithstanding any provision of  this  chapter  to  the  contrary,
 where  stock  of  a  cooperative housing corporation and the appurtenant
 S. 8474                           1054
 
 proprietary leasehold are transferred to such cooperative housing corpo-
 ration or a wholly owned subsidiary of such housing corporation,  or  to
 the  holder of a mortgage on the real property of such cooperative hous-
 ing  corporation  or a wholly owned subsidiary of such holder of a mort-
 gage on the real property of such cooperative housing corporation,  such
 cooperative  housing corporation or its wholly owned subsidiary, or such
 mortgage holder or its wholly owned subsidiary, shall not be  liable  as
 grantee  for  the  tax  determined to be due under this chapter from the
 grantor in such transfer, provided that such transfer occurred  pursuant
 to,  as  the  result of, or in connection with an action, proceeding, or
 other procedure to which  such  cooperative  housing  corporation  is  a
 party,  to  enforce  a  lien, security interest or other rights on or in
 such stock and proprietary  leasehold,  including  but  not  limited  to
 rights  under  the  proprietary  lease.  This subdivision shall apply to
 transfers occurring on or after June sixteenth, nineteen  hundred  nine-
 ty-two.
   §  11-2107  Determination of tax. If a return required by this chapter
 is not filed, or if a return when filed is  incorrect  or  insufficient,
 the amount of tax due shall be determined by the commissioner of finance
 from such information as may be obtainable, including the assessed valu-
 ation  of the real property or interest therein. Notice of such determi-
 nation shall be given to the person liable for the  tax.  Such  determi-
 nation  shall  finally  and  irrevocably  fix  the tax unless the person
 against whom it is assessed, within ninety  days  after  the  giving  of
 notice  of  such  determination,  or, if the commissioner of finance has
 established a conciliation procedure pursuant to section 11-124  of  the
 code  of  the  preceding  municipality  and the taxpayer has requested a
 conciliation conference in accordance therewith, within ninety days from
 the mailing of a conciliation decision or the date of the commissioner's
 confirmation of the discontinuance of the conciliation proceeding,  both
 (1)  serves  a petition upon the commissioner of finance and (2) files a
 petition with the tax appeals tribunal for a  hearing,  or,  unless  the
 commissioner  of  finance of his or her own motion shall redetermine the
 same. Such hearing and any appeal to the tax appeals tribunal sitting en
 banc from the decision rendered in such hearing shall  be  conducted  in
 the manner and subject to the requirements prescribed by the tax appeals
 tribunal  pursuant  to  sections  one  hundred  sixty-eight  through one
 hundred seventy-two of the charter of the preceding municipality  as  it
 existed January first, nineteen hundred ninety-four.  After such hearing
 the tax appeals tribunal shall give notice of its decision to the person
 against  whom the tax is assessed and to the commissioner of finance.  A
 decision of the tax appeals tribunal sitting en banc shall be reviewable
 for error, illegality or unconstitutionality or any other reason whatso-
 ever by a proceeding under article seventy-eight of the  civil  practice
 law  and  rules  if application therefor is made to the supreme court by
 the person against whom the tax was assessed within  four  months  after
 the  giving  of  the  notice  of  such  tax appeals tribunal decision. A
 proceeding under article seventy-eight of the  civil  practice  law  and
 rules  shall  not  be instituted by a taxpayer unless: (a) the amount of
 any tax sought to be reviewed, with penalties and interest  thereon,  if
 any, shall be first deposited with the commissioner of finance and there
 shall  be  filed with the commissioner of finance an undertaking, issued
 by a surety company authorized to transact business in  this  state  and
 approved by the superintendent of insurance of this state as to solvency
 and  responsibility,  in such amount and with such sureties as a justice
 of the supreme court shall approve, to the effect that if such  proceed-
 S. 8474                           1055
 
 ing  be  dismissed or the tax confirmed, the taxpayer will pay all costs
 and charges which may accrue in the prosecution of  the  proceeding;  or
 (b)  at  the  option  of  the  taxpayer  such undertaking filed with the
 commissioner  of  finance may be in a sum sufficient to cover the taxes,
 penalties and interest thereon stated in such decision  plus  the  costs
 and  charges  which  may  accrue  against  it  in the prosecution of the
 proceeding, in which event the taxpayer shall not be required to deposit
 such taxes, penalties and interest  as  a  condition  precedent  to  the
 application.
   §    11-2108    Refunds. a. In the manner provided in this section the
 commissioner of finance shall refund or credit,  without  interest,  any
 tax,  penalty  or  interest erroneously, illegally or unconstitutionally
 collected or paid if application to the commissioner of finance for such
 refund shall be made within one year from the payment thereof.  Whenever
 a  refund  is made or denied by the commissioner of finance, the commis-
 sioner shall state his or her reason therefor and give notice thereof to
 the taxpayer in writing. Such application may be made  by  the  grantor,
 grantee  or other person who has actually paid the tax. The commissioner
 of finance may, in lieu of any refund required to be made, allow  credit
 therefor on payments due from the applicant.
   b.   Any determination of the commissioner of finance denying a refund
 or credit pursuant to subdivision a of this section shall be  final  and
 irrevocable unless the applicant for such refund or credit, within nine-
 ty  days  from  the  mailing of notice of such determination, or, if the
 commissioner of finance has established a conciliation procedure  pursu-
 ant  to section 11-124 of the code of the preceding municipality and the
 applicant has requested a conciliation conference in  accordance  there-
 with,  within ninety days from the mailing of a conciliation decision or
 the date of the commissioner's confirmation of the discontinuance of the
 conciliation proceeding, both (1) serves a petition upon the commission-
 er of finance and (2) files a petition with the tax appeals tribunal for
 a hearing. Such petition for a refund or credit made as herein  provided
 shall  be  deemed  an  application for a revision of any tax, penalty or
 interest complained of. Such hearing and any appeal to the  tax  appeals
 tribunal  sitting  en  banc  from  the decision rendered in such hearing
 shall be conducted  in  the  manner  and  subject  to  the  requirements
 prescribed  by the tax appeals tribunal pursuant to sections one hundred
 sixty-eight through one  hundred  seventy-two  of  the  charter  of  the
 preceding  municipality  as  it  existed January first, nineteen hundred
 ninety-four. After such hearing, the tax  appeals  tribunal  shall  give
 notice of its decision to the applicant and the commissioner of finance.
 The  applicant  shall  be  entitled  to  review such decision of the tax
 appeals tribunal sitting en banc by a  proceeding  pursuant  to  article
 seventy-eight  of  the  civil  practice  law  and  rules,  provided such
 proceeding is instituted within four months after the giving  of  notice
 of  such  decision,  and  provided,  in  the case of an application by a
 taxpayer, that a final determination of tax due was not previously made.
 Such a proceeding shall not be instituted by a taxpayer unless an under-
 taking is filed with the commissioner of finance in such amount and with
 such sureties as a justice of the supreme court  shall  approve  to  the
 effect  that  if  such proceeding be dismissed or the tax confirmed, the
 taxpayer will pay all costs and charges which may accrue in  the  prose-
 cution of such proceeding.
   c.  A  person  shall  not  be entitled to a revision, refund or credit
 under this section of a tax, interest or penalty which had  been  deter-
 mined  to  be  due pursuant to the provisions of section 11-2107 of this
 S. 8474                           1056

 chapter where he or she has had a hearing or an opportunity for a  hear-
 ing,  as  provided  in  said  section, or has failed to avail himself or
 herself of the remedies therein provided. No refund or credit  shall  be
 made  of  a  tax,  interest or penalty paid after a determination by the
 commissioner of finance made pursuant to section 11-2107 of this chapter
 unless it be found that such determination  was  erroneous,  illegal  or
 unconstitutional  or  otherwise  improper,  by  the tax appeals tribunal
 after a hearing, or on the commissioner of finance's own motion, or,  if
 such  tax appeals tribunal affirms in whole or in part the determination
 of the commissioner of finance, in a proceeding under  article  seventy-
 eight of the civil practice law and rules, pursuant to the provisions of
 said  section, in which event refund or credit without interest shall be
 made of the tax, interest or penalty found to have been overpaid.
   §   11-2109   Reserves. In cases where  the  grantor  or  grantee  has
 applied  for  a  refund  and  has  instituted a proceeding under article
 seventy-eight of the civil practice law and rules to review  a  determi-
 nation  adverse  to him or her on his or her application for refund, the
 comptroller shall set up  appropriate  reserves  to  meet  any  decision
 adverse to the city.
   §  11-2110    Remedies  exclusive.  The  remedies provided by sections
 11-2107 and 11-2108 of this chapter shall be exclusive  remedies  avail-
 able to any person for the review of tax liability imposed by this chap-
 ter;  and  no determination or proposed determination of tax or determi-
 nation on any application for refund shall be enjoined or reviewed by an
 action for declaratory judgment, an action for money had and received or
 by any action or proceeding other than a proceeding in the nature  of  a
 certiorari  proceeding under article seventy-eight of the civil practice
 law and rules; provided, however, that a taxpayer may proceed by declar-
 atory judgment if he or she institutes suit within thirty days  after  a
 deficiency  assessment  is  made  and  pays the amount of the deficiency
 assessment to the commissioner of finance prior to  the  institution  of
 such  suit  and posts a bond for costs as provided in section 11-2107 of
 this chapter.
   § 11-2111   Proceedings to recover tax. a.  Whenever  any  grantor  or
 grantee  shall  fail to pay any tax, penalty or interest imposed by this
 chapter as herein provided, the  corporation  counsel  shall,  upon  the
 request  of  the commissioner of finance bring or cause to be brought an
 action to enforce the payment of the same  on  behalf  of  the  city  of
 Staten  Island  in  any  court  of the state of New York or of any other
 state or of the United States.  If, however, the commissioner of finance
 in his or her discretion believes  that  any  such  grantor  or  grantee
 subject  to  the  provisions of this chapter is about to cease business,
 leave the state or remove or dissipate the assets out of which  the  tax
 or penalty might be satisfied, and that any such tax or penalty will not
 be  paid  when due, such commissioner may declare such tax or penalty to
 be immediately due and payable and may issue a warrant immediately.
   b. As an additional or alternate remedy, the commissioner  of  finance
 may  issue a warrant, directed to the city sheriff commanding him or her
 to levy upon and sell the real and personal  property  of  the  grantor,
 grantee or other person liable for the tax which may be found within the
 city, for the payment of the amount thereof, with any penalty and inter-
 est,  and  the cost of executing the warrant, and to return such warrant
 to the commissioner of finance and to  pay  to  him  or  her  the  money
 collected  by virtue thereof within sixty days after the receipt of such
 warrant.  The city sheriff shall within five days after the  receipt  of
 the  warrant  file  with  the county clerk a copy thereof, and thereupon
 S. 8474                           1057
 
 such clerk shall enter in the judgment docket the  name  of  the  person
 mentioned in the warrant and the amount of the tax, penalty and interest
 for  which  the  warrant is issued and the date when such copy is filed.
 Thereupon  the  amount  of  such warrant so docketed shall become a lien
 upon the title to and the interest in real and personal property of  the
 person  against whom the warrant is issued.  The city sheriff shall then
 proceed upon the warrant in the same manner, and with  like  effect,  as
 that  provided  by  law in respect to executions issued against property
 upon judgments of a court of record and for services  in  executing  the
 warrant he or she shall be entitled to the same fees, which such sheriff
 may  collect  in the same manner.  In the discretion of the commissioner
 of finance a warrant of like terms, force and effect may be  issued  and
 directed  to an officer or employee of the department of finance, and in
 the execution thereof such officer or employee shall have all the powers
 conferred by law upon sheriffs, but shall  be  entitled  to  no  fee  or
 compensation in excess of the actual expenses paid in the performance of
 such  duty.  If a warrant is returned not satisfied in full, the commis-
 sioner of finance may from time to time issue  new  warrants  and  shall
 also  have  the same remedies to enforce the amount due thereunder as if
 the city had recovered judgment therefor and execution thereon had  been
 returned unsatisfied.
   c.  The commissioner of finance, if he or she finds that the interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the commissioner of finance may require, may release any  property  from
 the  lien  of any warrant or vacate such warrant for unpaid taxes, addi-
 tions to tax, penalties and interest filed pursuant to subdivision b  of
 this  section,  and  such  release  or  vacating  of  the warrant may be
 recorded in the office of any recording officer in  which  such  warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   §  11-2112  General powers of the commissioner of finance. In addition
 to the powers granted to the commissioner of finance in this chapter, he
 or she is hereby authorized and empowered:
   1. To make, adopt and amend rules and regulations appropriate  to  the
 carrying out of this chapter and the purposes thereof;
   2.  To  extend,  for cause shown, the time for filing any return for a
 period not exceeding thirty days; and to compromise disputed  claims  in
 connection with the taxes hereby imposed;
   3.  To request information from the tax commission of the state of New
 York or the treasury department of the United  States  relative  to  any
 person; and to afford returns, reports and other information to such tax
 commission or such treasury department relative to any person, any other
 provision of this chapter to the contrary notwithstanding;
   4.  To  delegate  his  or her functions under this section to a deputy
 commissioner of finance or any employee or employees of  the  department
 of finance;
   5.  To prescribe the methods for determining the consideration and net
 consideration attributable to that  portion  of  real  property  located
 partly  within  and  partly  without  the city of Staten Island which is
 located within the city of Staten Island or any interest therein;
   6. To require any grantor or grantee to keep  such  records,  and  for
 such  length of time as may be required for the proper administration of
 this chapter and to furnish such records to the commissioner of  finance
 upon request;
   7.  To  assess,  determine,  revise and adjust the taxes imposed under
 this chapter.
 S. 8474                           1058
 
   § 11-2113 Administration of oaths and  compelling  testimony.  a.  The
 commissioner  of finance, his or her employees or agents duly designated
 and authorized by him or her, the tax appeals tribunal and  any  of  its
 duly  designated  and authorized employees or agents shall have power to
 administer  oaths  and  take  affidavits  in  relation  to any matter or
 proceeding in the exercise of their powers and duties under  this  chap-
 ter. The commissioner of finance and the tax appeals tribunal shall have
 power  to  subpoena  and  require  the  attendance  of witnesses and the
 production of books, papers and documents to secure  information  perti-
 nent  to the performance of the duties of the commissioner or of the tax
 appeals tribunal under this chapter and of the enforcement of this chap-
 ter and to examine them in relation thereto, and  to  issue  commissions
 for  the  examination of witnesses who are out of the state or unable to
 attend before such commissioner or the tax appeals tribunal  or  excused
 from attendance.
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 testimony  of  witnesses  and  the  production and examination of books,
 papers and documents called for by the subpoena of the  commissioner  of
 finance or the tax appeals tribunal under this chapter.
   c.  Cross-reference; criminal penalties. For failure to obey subpoenas
 or for testifying falsely,  see  section  11-4007  of  this  title;  for
 supplying  false  or fraudulent information, see section 11-4009 of this
 title.
   d. The officers who serve the summons or subpoena of the  commissioner
 of  finance  or  the  tax  appeals  tribunal  and witnesses attending in
 response thereto shall be entitled to the same fees as  are  allowed  to
 officers  and  witnesses  in  civil cases in courts of record, except as
 herein otherwise provided. Such officers shall be the city  sheriff  and
 his  or  her duly appointed deputies or any officers or employees of the
 department of finance or the tax appeals tribunal, designated  to  serve
 such process.
   §  11-2114  Interest  and penalties. (a) Interest on underpayments. If
 any amount of tax is not paid on or before the last date prescribed  for
 payment,  without  regard  to any extension of time granted for payment,
 interest on such amount at the rate set by the commissioner  of  finance
 pursuant  to  subdivision (g) of this section, or, if no rate is set, at
 the rate of seven and one-half percent per annum, shall be paid for  the
 period  from  such  last  date  to the date of payment. In computing the
 amount of interest to be paid, such interest shall be compounded  daily.
 Interest  under this subdivision shall not be paid if the amount thereof
 is less than one dollar.
   (b) (1) Failure to file return. (A) In  case  of  failure  to  file  a
 return  under  this chapter on or before the prescribed date, determined
 with regard to any extension of time for filing, unless it is shown that
 such failure is due to reasonable cause and not due to willful  neglect,
 there  shall  be added to the amount required to be shown as tax on such
 return five percent of the amount of such tax if the failure is for  not
 more than one month, with an additional five percent for each additional
 month  or  fraction  thereof  during  which  such failure continues, not
 exceeding twenty-five percent in the aggregate.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to any extension of time for filing, unless it is shown that such  fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion  to  tax under subparagraph (A) of this paragraph shall not be less
 S. 8474                           1059
 
 than the lesser of one hundred dollars or one  hundred  percent  of  the
 amount required to be shown as tax on such return.
   (C)  For  purposes of this paragraph, the amount of tax required to be
 shown on the return shall be reduced by the amount of any  part  of  the
 tax  which  is  paid on or before the date prescribed for payment of the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2) Failure to pay tax shown on return. In case of failure to pay  the
 amount  shown as tax on a return required to be filed under this chapter
 on or before the prescribed date, determined with regard to  any  exten-
 sion of time for payment, unless it is shown that such failure is due to
 reasonable cause and not due to willful neglect, there shall be added to
 the  amount  shown  as tax on such return one-half of one percent of the
 amount of such tax if the failure is not for more than one  month,  with
 an additional one-half of one percent for each additional month or frac-
 tion  thereof during which such failure continues, not exceeding twenty-
 five percent in the aggregate. For the purpose of computing the addition
 for any month the amount of tax shown on the return shall be reduced  by
 the  amount of any part of the tax which is paid on or before the begin-
 ning of such month and by the amount of any credit against the tax which
 may be claimed upon the return. If the amount  of  tax  required  to  be
 shown  on  a return is less than the amount shown as tax on such return,
 this paragraph shall be applied by substituting such lower amount.
   (3) Failure to pay tax required to be shown  on  return.  In  case  of
 failure  to pay any amount in respect of any tax required to be shown on
 a return required to be filed under this chapter which is not so  shown,
 including a determination made pursuant to section 11-2107 of this chap-
 ter, within ten days of the date of a notice and demand therefor, unless
 it  is shown that such failure is due to reasonable cause and not due to
 willful neglect, there shall be added to the amount  of  tax  stated  in
 such  notice and demand one-half of one percent of such tax if the fail-
 ure is not for more than one month, with an additional one-half  of  one
 percent  for each additional month or fraction thereof during which such
 failure continues, not exceeding twenty-five percent in  the  aggregate.
 For  the  purpose of computing the addition for any month, the amount of
 tax stated in the notice and demand shall be reduced by  the  amount  of
 any part of the tax which is paid before the beginning of such month.
   (4) Limitations on additions.
   (A) With respect to any return, the amount of the addition under para-
 graph  one  of  this  subdivision  shall be reduced by the amount of the
 addition under paragraph two of this subdivision for any month to  which
 an  addition  applies under both paragraphs one and two of this subdivi-
 sion. In any case described in subparagraph (B) of paragraph one of this
 subdivision, the amount of the addition under such paragraph  one  shall
 not be reduced below the amount provided in such subparagraph.
   (B)  With  respect  to  any return, the maximum amount of the addition
 permitted under paragraph three of this subdivision shall be reduced  by
 the  amount  of  the  addition  under paragraph one of this subdivision,
 determined without regard to subparagraph (B)  of  such  paragraph  one,
 which is attributable to the tax for which the notice and demand is made
 and which is not paid within ten days of such notice and demand.
   (c) Underpayment due to negligence. (1) If any part of an underpayment
 of  tax is due to negligence or intentional disregard of this chapter or
 any rules or regulations hereunder, but without intent to defraud, there
 shall be added to the tax a penalty equal to five percent of the  under-
 payment.
 S. 8474                           1060
 
   (2)  There shall be added to the tax, in addition to the amount deter-
 mined under paragraph one of this subdivision, an amount equal to  fifty
 percent  of  the  interest payable under subdivision (a) of this section
 with respect to the portion of the underpayment described in such  para-
 graph  one which is attributable to the negligence or intentional disre-
 gard referred to in such paragraph one, for the period beginning on  the
 last date prescribed by law for payment of such underpayment, determined
 without  regard  to any extension, and ending on the date of the assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
   (d) Underpayment due to fraud. (1) If any part of an  underpayment  of
 tax  is due to fraud, there shall be added to the tax a penalty equal to
 fifty percent of the underpayment.
   (2) There shall be added to the tax, in addition to the penalty deter-
 mined under paragraph one of this subdivision, an amount equal to  fifty
 percent  of  the  interest payable under subdivision (a) of this section
 with respect to the portion of the underpayment described in such  para-
 graph  one  which  is attributable to fraud, for the period beginning on
 the last day prescribed by law for payment of such underpayment,  deter-
 mined  without  regard  to  any extension, and ending on the date of the
 assessment of the tax, or, if earlier, the date of the  payment  of  the
 tax.
   (3)  The penalty under this subdivision  shall be in lieu of any other
 addition to tax imposed by subdivision (b) or (c) of this section.
   (e) Additional penalty. Any person who, with fraudulent intent,  shall
 fail to pay any tax imposed by this chapter, or to make, render, sign or
 certify  any  return,  or  to  supply  any  information  within the time
 required by or under this chapter, shall be liable for a penalty of  not
 more  than  one  thousand  dollars,  in  addition  to  any other amounts
 required under this chapter to be imposed, assessed and collected by the
 commissioner of finance. The commissioner  of  finance  shall  have  the
 power,  in  his  or  her  discretion, to waive, reduce or compromise any
 penalty under this subdivision.
   (f) The interest and penalties imposed by this section shall  be  paid
 and  disposed of in the same manner as other revenues from this chapter.
 Unpaid interest and penalties may be enforced in the same manner as  the
 tax imposed by this chapter.
   (g)(1)  Authority  to  set interest rates. The commissioner of finance
 shall set the rate of interest to be paid pursuant to subdivision (a) of
 this section, but if no such rate of interest is set, such rate shall be
 deemed to be set at seven and one-half percent per  annum.    Such  rate
 shall  be  the  rate prescribed in paragraph two of this subdivision but
 shall not be less than seven and one-half percent per  annum.  Any  such
 rate  set  by  the  commissioner of finance shall apply to taxes, or any
 portion thereof, which remain or become due on  or  after  the  date  on
 which  such  rate becomes effective and shall apply only with respect to
 interest computed or computable  for  periods  or  portions  of  periods
 occurring in the period in which such rate is in effect.
   (2)  General  rule.  The  rate  of interest set under this subdivision
 shall be the sum of (i) the federal short-term rate  as  provided  under
 paragraph three of this subdivision, plus (ii) seven percentage points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A)  The  federal  short-term  rate for any month shall be the federal
 short-term rate determined by the United States secretary of the  treas-
 ury  during  such  month  in  accordance  with subsection (d) of section
 twelve hundred seventy-four of the internal  revenue  code  for  use  in
 connection  with  section  six  thousand  six  hundred twenty-one of the
 S. 8474                           1061
 
 internal revenue code. Any such rate shall be  rounded  to  the  nearest
 full  percent,  or,  if a multiple of one-half of one percent, such rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i)  In  general.  Except  as provided in clause (ii) of this subpara-
 graph, the federal short-term rate for the first month in each  calendar
 quarter  shall  apply  during the first calendar quarter beginning after
 such month.
   (ii) Special rule for the month of September, nineteen hundred  eight-
 y-nine.  The  federal  short-term  rate for the month of April, nineteen
 hundred eighty-nine shall apply with respect  to  setting  the  rate  of
 interest for the month of September, nineteen hundred eighty-nine.
   (4)  Publication  of  interest rate. The commissioner of finance shall
 cause to be published in the City Record,  and  give  other  appropriate
 general notice of, the interest rate to be set under this subdivision no
 later  than  twenty days preceding the first day of the calendar quarter
 during which such interest rate applies. The setting and publication  of
 such  interest rate shall not be included within paragraph (a) of subdi-
 vision five of section one thousand forty-one of the city charter of the
 preceding municipality as it existed  January  first,  nineteen  hundred
 ninety-four relating to the definition of a rule.
   (h)  Miscellaneous.  (1)  The  certificate  of the commissioner to the
 effect that a tax has not been paid or that  information  has  not  been
 supplied pursuant to the provisions of this chapter shall be presumptive
 evidence thereof.
   (2)  Cross-reference:    For  criminal penalties, see chapter forty of
 this title.
   (i) Failure to file  information  return.  If  a  cooperative  housing
 corporation  fails to file an information return required under subdivi-
 sion g of section 11-2105 of this chapter on or  before  the  prescribed
 date, determined with regard to any extension of time for filing, unless
 it  is shown that such failure is due to reasonable cause and not due to
 willful neglect, there shall be  imposed  on  such  cooperative  housing
 corporation a penalty of one hundred dollars for each such failure.
   §  11-2115   Returns to be secret. a. Except in accordance with proper
 judicial order, or as otherwise provided by law, it  shall  be  unlawful
 for the commissioner of finance, register or tax appeals tribunal or any
 officer  or  employee  of  the  department  of  finance, register or tax
 appeals tribunal to divulge or make known in any manner any  information
 contained in or relating to any return provided for by this chapter. The
 officers  charged with the custody of such returns shall not be required
 to produce any of them or evidence of anything contained in them in  any
 action  or proceeding in any court, except on behalf of the commissioner
 of finance in an action or proceeding under the provisions of this chap-
 ter, or on behalf of any party to an  action  or  proceeding  under  the
 provisions  of  this chapter when the returns or facts shown thereby are
 directly involved in such action  or  proceeding,  in  either  of  which
 events  the  court  may  require  the  production  of,  and may admit in
 evidence, so much of said returns or of the facts shown thereby, as  are
 pertinent  to  the  action  or proceeding and no more.   Nothing in this
 section shall be construed to prohibit the  delivery  to  a  grantor  or
 grantee  of  a  deed  or  to  any  subsequent owner of the real property
 conveyed by such deed or to the duly authorized representative of any of
 them of a certified copy of any return filed in connection with the  tax
 on  such  deed; nor to prohibit the delivery of such a certified copy of
 such return or of any information contained in or  relating  thereto  to
 S. 8474                           1062
 
 the United States of America or any department thereof, the state of New
 York or any department thereof, the city of Staten Island or any depart-
 ment thereof provided the same is required for official business; nor to
 prohibit  the  inspection  for  official business of such returns by the
 register, the corporation counsel or other legal representatives of  the
 city or by the district attorney of Richmond county; nor to prohibit the
 publication of statistics so classified as to prevent the identification
 of particular returns or items thereof.
   b.  (1) Any officer or employee of the city who willfully violates the
 provisions of subdivision a of this  section  shall  be  dismissed  from
 office  and be incapable of holding any public office in this city for a
 period of five years thereafter.
   (2) Cross-reference:   For criminal penalties, see  chapter  forty  of
 this title.
   c. This section  shall be deemed a state statute for purposes of para-
 graph (a) of subdivision two of section eighty-seven of the public offi-
 cers law.
   d.  Notwithstanding  anything  in subdivision a of this section to the
 contrary, if a taxpayer has petitioned  the  tax  appeals  tribunal  for
 administrative  review as provided in section one hundred seventy of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four, the commissioner of finance shall  be  author-
 ized  to  present to the tribunal any report or return of such taxpayer,
 or any information contained therein or relating thereto, which  may  be
 material  or  relevant  to  the  proceeding before the tribunal. The tax
 appeals tribunal shall be authorized to publish a copy or a  summary  of
 any decision rendered pursuant to section one hundred seventy-one of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four.
   e.  This  section  shall  not apply to any information contained in or
 relating to a return filed on or after the first  day  of  January,  two
 thousand three with respect to a transaction or transfer occurring on or
 after  that date; provided, however, that this section shall continue to
 apply to any social security account number contained in any  report  or
 return pursuant to this chapter.
   §  11-2116   Notices and limitations of time. a. Any notice authorized
 or required under the provisions of this chapter may be given by mailing
 the same to the person for whom it is intended in  a  postpaid  envelope
 addressed  to  such person at the address given in the last return filed
 by him or her pursuant to the provisions of this chapter in any applica-
 tion made by him or her, or in any  deed  or  instrument  which  is  the
 subject  of  the  notice, or, if no return has been filed or application
 made or address stated in the deed or instrument, then to  such  address
 as  may  be obtainable.  The mailing of such notice shall be presumptive
 evidence of the receipt of the same by the  person  to  whom  addressed.
 Any  period  of  time which is determined according to the provisions of
 this chapter by the giving of notice shall commence to run from the date
 of mailing of such notice.
   b. The provisions of the civil practice law and rules or any other law
 relative to limitations of time for the enforcement of  a  civil  remedy
 shall  not  apply to any proceeding or action taken by the city to levy,
 appraise, assess, determine or enforce the  collection  of  any  tax  or
 penalty  provided  by  this  chapter.   However, except in the case of a
 wilfully false or fraudulent return with intent to  evade  the  tax,  no
 assessment  of additional tax shall be made after the expiration of more
 than three years from the date of the  filing  of  a  return;  provided,
 S. 8474                           1063
 
 however,  that where no return has been filed as provided by law the tax
 may be assessed at any time.
   c.  Where,  before  the  expiration  of  the period prescribed in this
 section for  the  assessment  of  an  additional  tax,  a  taxpayer  has
 consented  in  writing  that such period be extended, the amount of such
 additional tax due may be determined at any time  within  such  extended
 period.    The  period so extended may be further extended by subsequent
 consents in writing made before the expiration of the extended period.
   d. Except as otherwise provided in this subdivision,  if  any  return,
 claim,  statement, notice, application, or other document required to be
 filed, or any payment required to be made, within a prescribed period or
 on or before a prescribed date under authority of any provision of  this
 chapter  is,  after such period or such date, delivered by United States
 mail to the commissioner of finance, the tax appeals  tribunal,  bureau,
 office,  officer  or  person  with  which  or with whom such document is
 required to be filed, or to which or to whom such payment is required to
 be made, the date of the United States postmark stamped on the  envelope
 shall be deemed to be the date of delivery. This subdivision shall apply
 only  if  the  postmark date falls within the prescribed period or on or
 before the prescribed date for the  filing  of  such  document,  or  for
 making  the  payment, including any extension granted for such filing or
 payment, and only if such document or payment was deposited in the mail,
 postage prepaid, properly addressed to the commissioner of finance,  the
 tax  appeals  tribunal,  bureau, office, officer or person with which or
 with whom the document is required to be filed or to which  or  to  whom
 such  payment  is required to be made. If any document is sent by United
 States registered mail, such registration shall be prima facie  evidence
 that such document was delivered to the commissioner of finance, the tax
 appeals  tribunal, bureau, office, officer or person to which or to whom
 addressed, and the date of registration shall  be  deemed  the  postmark
 date.  The  commissioner of finance and, where relevant, the tax appeals
 tribunal are authorized to provide by regulation the extent to which the
 provisions of  the  preceding  sentence  with  respect  to  prima  facie
 evidence  of  delivery  and  the  postmark date shall apply to certified
 mail. Except as provided in subdivision f of this section, this subdivi-
 sion shall apply in the case of postmarks not made by the United  States
 postal  service  only if and to the extent provided by regulation of the
 commissioner of finance or, where relevant, the  tax  appeals  tribunal.
 Any  return filed electronically shall be deemed to be filed on the date
 of issuance by the commissioner of finance of a confirmation.
   e. When the last day  prescribed  under  authority  of  this  chapter,
 including  any  extension  of  time,  for  performing any act falls on a
 Saturday, Sunday or legal holiday in the state, the performance of  such
 act shall be considered timely if it is performed on the next succeeding
 day which is not a Saturday, Sunday or legal holiday.
   f.  (1)  Any  reference in subdivision d of this section to the United
 States mail shall be treated as including a reference  to  any  delivery
 service designated by the secretary of the treasury of the United States
 pursuant  to  section  seventy-five  hundred two of the internal revenue
 code and any reference in subdivision d of  this  section  to  a  United
 States  postmark  shall  be treated as including a reference to any date
 recorded or marked in  the  manner  described  in  section  seventy-five
 hundred  two  of  the  internal  revenue  code  by a designated delivery
 service. If the commissioner of finance finds that any delivery  service
 designated  by  such  secretary is inadequate for the needs of the city,
 the commissioner of finance may withdraw such designation  for  purposes
 S. 8474                           1064
 
 of this title. The commissioner of finance may also designate additional
 delivery  services  meeting the criteria of section seventy-five hundred
 two of the internal revenue code for purposes  of  this  title,  or  may
 withdraw  any such designation if the commissioner of finance finds that
 a delivery service so designated is inadequate  for  the  needs  of  the
 city.  Any  reference  in  subdivision  d  of this section to the United
 States mail shall be treated as including a reference  to  any  delivery
 service  designated  by the commissioner of finance and any reference in
 subdivision d of this section to  a  United  States  postmark  shall  be
 treated  as  including a reference to any date recorded or marked in the
 manner described in section seventy-five hundred  two  of  the  internal
 revenue  code  by  a  delivery service designated by the commissioner of
 finance, provided, however, any withdrawal of designation or  additional
 designation  by  the  commissioner of finance shall not be effective for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal of designation or additional designation is ratified  by  the
 president of the tax appeals tribunal.
   (2)  Any  equivalent of registered or certified mail designated by the
 United States secretary of the treasury, or as may be designated by  the
 commissioner  of  finance  pursuant  to  the  same criteria used by such
 secretary for such designations pursuant to section seventy-five hundred
 two of the internal revenue code, shall be included within  the  meaning
 of  registered  or  certified  mail  as  used  in  subdivision d of this
 section. If the commissioner of finance finds  that  any  equivalent  of
 registered or certified mail designated by such secretary or the commis-
 sioner  of  finance is inadequate for the needs of the city, the commis-
 sioner of finance may withdraw such designation  for  purposes  of  this
 title,  provided,  however,  any withdrawal of designation or additional
 designation by the commissioner of finance shall not  be  effective  for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal  of  designation or additional designation is ratified by the
 president of the tax appeals tribunal.
   §  11-2117  Construction  and  enforcement.  This  chapter  shall   be
 construed  and  enforced  in conformity with chapter ninety-three of the
 laws of nineteen hundred sixty-five, as amended.
   § 11-2118 Disposition of revenues. Except as otherwise  provided,  all
 revenues  resulting  from  the  imposition of the tax under this chapter
 shall be paid into the treasury of the city and shall be credited to and
 deposited in the  general  fund  of  the  city.    Except  as  otherwise
 provided,  no  part of such revenues may be expended unless appropriated
 in the annual budget of the city.
   § 11-2119 Foreclosure proceedings. Where the conveyance consists of  a
 transfer  of  property  made  as  a result of an order of the court in a
 foreclosure proceeding ordering the sale of such property,  the  referee
 or  sheriff effectuating the transfer shall not be liable for any inter-
 est or penalties authorized by this chapter or  chapter  forty  of  this
 title.
 
                                CHAPTER 22
                      TAX ON OWNERS OF MOTOR VEHICLES
 
   §  11-2201 Definitions. When used in this chapter, the following terms
 shall mean and include:
   1. "City". The city of Staten Island.
   2. "Commissioner of finance". The commissioner of finance of the city.
 S. 8474                           1065
 
   3. "Highway". The entire width between the boundary lines of every way
 publicly maintained when any part thereof is open  to  the  use  of  the
 public for purposes of vehicular travel.
   4.  "Individual  resident".  One  or more natural persons other than a
 firm, copartnership, trustee or trustees conducting a business or  asso-
 ciation who, or one of whom, owns a motor vehicle registered or required
 to be registered pursuant to section four hundred one of the vehicle and
 traffic  law, the registration fees for which are provided for by subdi-
 vision six of such section, who, at the time he or she makes application
 for registration or renewal thereof  of  such  motor  vehicle,  or  such
 application  is made on his or her behalf: (a) is domiciled in the city,
 unless he or she maintains no permanent place  of  abode  in  the  city,
 maintains a permanent place of abode elsewhere, and during the period of
 one  year  next  preceding the date upon which such application is made,
 spent in the aggregate not more than thirty days in the city; or (b)  is
 not  domiciled  in  the city but maintains a permanent place of abode in
 the city and, during the period of one year next preceding the date upon
 which such application is made, spent in the  aggregate  more  than  one
 hundred  eighty-three days in the city, unless such individual is in the
 armed forces of the United States.
   5. "Motor vehicle". Every vehicle, except electrically-driven  invalid
 chairs being operated or driven by an invalid, operated or driven upon a
 public  highway  by any power, other than muscular power, which includes
 electric power obtained from overhead  trolley  wires,  except  vehicles
 which run only upon rails or tracks.
   6.  "Other  resident".  Every firm, copartnership, trustee or trustees
 conducting a business or association or  a  corporation,  who  or  which
 regularly  keeps,  stores,  garages or maintains within the city a motor
 vehicle owned by it which, at the time it makes application  for  regis-
 tration or renewal of registration thereof, is registered or required to
 be registered pursuant to subdivision six of section four hundred one of
 the vehicle and traffic law.
   7.  "Person".  Unless otherwise indicated, an individual, partnership,
 society, association, joint-stock company, corporation, estate,  receiv-
 er, trustee, assignee, referee or any other person acting in a fiduciary
 or  representative  capacity, whether appointed by a court or otherwise,
 and any other form of unincorporated enterprise.
   8. "Owner". A person, other than a lien holder, having the property in
 or title to a vehicle. The term includes a person entitled  to  the  use
 and  possession  of  a vehicle subject to a security interest in another
 person.
   9. "Vehicle". Every device in, upon or by which any person or property
 is or may be transported or drawn upon a highway, except  devices  moved
 by human power or used exclusively upon stationary rails or tracks.
   10.  "Leased  or  rented  passenger motor vehicles". Any motor vehicle
 owned by any person engaged in the business of renting or leasing  motor
 vehicles  to  be operated on the public highways for carrying passengers
 registered or required to be registered pursuant  to  any  provision  of
 section  four  hundred one of the vehicle and traffic law, which vehicle
 at the time when application is made for  registration,  re-registration
 or  renewal  thereof is regularly kept, stored, garaged or maintained in
 the city, including such vehicles which have been rented and  leased  by
 the  owner  and  are  in possession of lessees when such application for
 registration, re-registration or renewal is made.
 S. 8474                           1066

   11. "Tax appeals tribunal." The tax appeals  tribunal  established  by
 section  one hundred sixty-eight of the charter of the preceding munici-
 pality as it existed January first, nineteen hundred ninety-four.
   §  11-2202    Imposition  of  tax.  Notwithstanding  the provisions of
 section four hundred of the vehicle and traffic law and  of  subdivision
 ten  of  section  four hundred one of the vehicle and traffic law to the
 contrary, a tax of fifteen dollars per annum is hereby imposed:
   1.  With respect to each motor vehicle registered or  required  to  be
 registered  pursuant  to  subdivision six of section four hundred one of
 the vehicle and traffic law:
   a.  Upon each individual resident for each such motor  vehicle  regis-
 tered or for which registration is renewed, or required to be registered
 or renewed by him or her; and
   b.    Upon  each  other  resident of each such motor vehicle regularly
 kept, stored, garaged or  maintained  in  the  city  and  registered  or
 required to be registered or renewed by such other resident; and
   2.    With  respect  to each leased or rented passenger motor vehicle,
 upon the owner thereof.
   § 11-2203  Exemptions. The tax imposed by this chapter  shall  not  be
 imposed upon:
   (1)  owners  of motor vehicles, the registration fees for which are or
 may be prescribed, governed or established by subdivisions seven, except
 for leased  or  rented  passenger  vehicles,  eight,  twelve,  thirteen,
 sixteen  of  section  four hundred one, articles fifteen and sixteen, or
 section four hundred twenty of the vehicle and traffic law;
   (2) any owner to whom the provisions of the vehicle  and  traffic  law
 relative  to registration and equipment of motor vehicles are made inap-
 plicable by the provisions of article three of such law, for the  period
 of such inapplicability;
   (3)  the state of New York, or any of its agencies, instrumentalities,
 public corporations, including a public corporation created pursuant  to
 agreement  or  compact  with another state or the Dominion of Canada, or
 political subdivision;
   (4) the United States of America, and any of its agencies and  instru-
 mentalities insofar as it is immune from taxation;
   (5)  the  United Nations or other international organizations of which
 the United States of America is a member;
   (6) any corporation, or association, or  trust,  or  community  chest,
 fund  or  foundation,  organized and operated exclusively for religious,
 charitable, or educational purposes, or for the prevention of cruelty to
 children or animals, and no part of the net earnings of which inures  to
 the  benefit of any private shareholder or individual and no substantial
 part of the activities of which is carrying on propaganda, or  otherwise
 attempting  to influence legislation; provided, however, that nothing in
 this subdivision shall include an organization operated for the  primary
 purpose  of  carrying  on a trade or business for profit, whether or not
 all of its profits are payable to one or more organizations described in
 this subdivision.
   § 11-2204  Payment of tax and evidence of tax payment. Every owner  of
 a  motor  vehicle  subject  to  tax under this chapter shall pay the tax
 thereon to the commissioner of motor vehicles of the state of  New  York
 on  or  before  the date upon which he or she registers or renews his or
 her registration thereof or is required to register or renew his or  her
 registration thereof pursuant to section four hundred one of the vehicle
 and traffic law.
 S. 8474                           1067
 
   Notwithstanding  the provisions of section four hundred of the vehicle
 and traffic law to the contrary, the payment of  such  tax  shall  be  a
 condition precedent to the registration or renewal thereof of such motor
 vehicle  and  to  the  issuance  of  any certificate of registration and
 plates  or  removable tag specified in subdivision three of section four
 hundred one and in sections four hundred three and four hundred four  of
 the  vehicle  and  traffic law, and no such certificate of registration,
 plates or tag shall be issued unless  such  tax  has  been  paid.    The
 commissioner  of  motor  vehicles shall not issue a registration certif-
 icate for any motor  vehicle for which the registrant's address is with-
 in any such city, except upon proof, in a form approved by  the  commis-
 sioner  of  motor  vehicles, that such tax has been paid, or is not due,
 with respect to such motor vehicle.  The commissioner of motor vehicles,
 upon the payment of such tax or  upon  the  application  of  any  person
 exempt  therefrom,  shall  furnish  to  each  taxpayer  paying the tax a
 receipt for such tax and to each such taxpayer or exempt person a state-
 ment, document or other form approved by the commissioner of motor vehi-
 cles, showing that such tax has been paid or is not due, with respect to
 such motor vehicle.
   § 11-2205  Returns. a.  At the time the payment of the tax imposed  by
 this chapter becomes due, every person subject to tax under this chapter
 shall  file a return with the commissioner of motor vehicles in form and
 containing such information as may be prescribed by such commissioner of
 motor vehicles.   The taxpayer's application  for  registration  or  the
 renewal  of registration shall constitute the return required under this
 chapter, unless the commissioner of motor vehicles, by regulation, shall
 otherwise provide.
   b.  Returns shall be preserved for three years  and  thereafter  until
 the commissioner of motor vehicles permits them to be destroyed.
   c.   The commissioner of motor vehicles may require amended returns or
 certificates of facts to be filed within twenty days after notice and to
 contain the information specified in the notice.   Any such  certificate
 shall be deemed to be part of the return required to be filed.
   d.    If a return required by this chapter is not filed or if a return
 when filed is incorrect or insufficient on its face the commissioner  of
 motor  vehicles  or  the commissioner of finance if designated as his or
 her agent shall take the necessary steps to enforce the filing of such a
 return or of a corrected return.
   § 11-2206 Determination of tax. If a return required by  this  chapter
 is  not filed or if a return when filed is incorrect or insufficient, or
 if a tax or any part thereof due pursuant to this chapter  be  not  paid
 when  required, the amount of tax due shall be determined by the commis-
 sioner of motor vehicles or by the commissioner of finance if designated
 as his or her agent, from such information as may be obtainable, includ-
 ing motor vehicle registration with the department of motor vehicles  of
 the  state  of  New  York or other factors. Notice of such determination
 shall be given to the person liable for the tax. Such a determination by
 the commissioner of motor vehicles shall finally and irrevocably fix the
 tax unless the person against whom it is assessed,  within  ninety  days
 after  the  giving  of  notice of such determination, shall apply to the
 commissioner of motor vehicles for a hearing, or unless such commission-
 er of his or her own motion shall redetermine the same. If  the  commis-
 sioner  of  finance  is  designated  as the agent of the commissioner of
 motor vehicles, such a determination  by  the  commissioner  of  finance
 shall finally and irrevocably fix the tax unless the person against whom
 it  is  assessed,  within  ninety days after the giving of such determi-
 S. 8474                           1068

 nation, or, if the commissioner of finance  has  established  a  concil-
 iation procedure pursuant to section 11-124 of the code of the preceding
 municipality and the taxpayer has requested a conciliation conference in
 accordance  therewith,  within ninety days from the mailing of a concil-
 iation decision or the date of the commissioner's  confirmation  of  the
 discontinuance  of  the conciliation proceeding, both (1) serves a peti-
 tion upon the commissioner of finance and (2) applies to the tax appeals
 tribunal for a hearing by filing a petition, or unless the  commissioner
 of  finance of his or her own motion shall redetermine the same. A hear-
 ing following a petition to the tax appeals tribunal and any  appeal  to
 the  tax  appeals tribunal sitting en banc from the decision rendered in
 such hearing shall be  conducted  in  the  manner  and  subject  to  the
 requirements prescribed by the tax appeals tribunal pursuant to sections
 one  hundred  sixty-eight through one hundred seventy-two of the charter
 of the preceding municipality as  it  existed  January  first,  nineteen
 hundred  ninety-four.    After such hearing by the commissioner of motor
 vehicles or the tax appeals tribunal, the commissioner  of  motor  vehi-
 cles, if he or she holds the hearing, or the tax appeals tribunal if the
 tax  appeals tribunal holds the hearing, shall give notice of the deter-
 mination or decision to the person against whom the tax is assessed  and
 in  the  case of a tax appeals tribunal decision, to the commissioner of
 finance. Such determination by the commissioner of motor vehicles, or  a
 decision of the tax appeals tribunal sitting en banc shall be reviewable
 for error, illegality or unconstitutionality or any other reason whatso-
 ever  by  a proceeding under article seventy-eight of the civil practice
 law and rules if application therefor is made to the  supreme  court  by
 the  person  against  whom the tax was assessed within four months after
 the giving of the notice of such determination or tax  appeals  tribunal
 decision.    A proceeding under article seventy-eight of the civil prac-
 tice law and rules shall not be instituted by a taxpayer unless (a)  the
 amount  of  any  tax  sought to be reviewed, with penalties and interest
 thereon, if any, shall be first deposited with the commissioner of motor
 vehicles and there shall be filed with the commissioner of  motor  vehi-
 cles  an  undertaking, issued by a surety company authorized to transact
 business in this state and approved by the superintendent  of  insurance
 of  this  state  as  to solvency and responsibility, in such amount as a
 justice of the supreme court shall approve, to the effect that  if  such
 proceeding  be dismissed or the tax confirmed, the taxpayer will pay all
 costs and charges which may accrue in the prosecution of the proceeding;
 or (b) at the option of the taxpayer such  undertaking  filed  with  the
 commissioner  of  motor vehicles may be in a sum sufficient to cover the
 taxes, penalties and interest thereon stated in  such  determination  or
 decision,  plus the costs and charges which may accrue against it in the
 prosecution of the proceeding, in which event the taxpayer shall not  be
 required  to  deposit  such taxes, penalties and interest as a condition
 precedent to the application.
   § 11-2207  Refunds for certain unused registrations. Whenever any  fee
 or  portion  of a fee paid for the registration of a motor vehicle under
 the provisions of the vehicle and traffic law is  refunded  pursuant  to
 the  provisions  of subdivision one of section four hundred twenty-eight
 of the vehicle and traffic law, the amount of any tax paid  pursuant  to
 this  chapter  upon  such  registration  shall  also  be refunded by the
 commissioner.
   § 11-2208 Refunds. a. In the  manner  provided  in  this  section  the
 commissioner of motor vehicles shall refund or credit, without interest,
 any  tax,  penalty  or  interest  erroneously,  illegally or unconstitu-
 S. 8474                           1069
 
 tionally collected or paid if application for such refund shall be  made
 within  one  year  from the payment thereof to the commissioner of motor
 vehicles or to the commissioner of finance if designated as his  or  her
 agent.  Whenever  a refund is made or denied, the reasons therefor shall
 be stated in writing by the commissioner of motor  vehicles  or  by  the
 commissioner  of finance, as the case may be, who in lieu of any refund,
 may allow credit therefor on payments due from the applicant.
   b.  (1) If the commissioner of motor vehicles has not  designated  the
 commissioner of finance as his or her agent, application for a refund or
 credit  made  as provided under this section shall be deemed an applica-
 tion for a revision of any tax, penalty or interest  complained  of  and
 the  commissioner  of  motor  vehicles  shall hold a hearing and receive
 evidence with respect thereto. After such hearing, the  commissioner  of
 motor  vehicles  shall give notice of the determination of such applica-
 tion to the applicant who shall be entitled to review such determination
 by a proceeding pursuant to article seventy-eight of the civil  practice
 law and rules, provided such proceeding is instituted within four months
 after  the  giving  of notice of such determination, and provided that a
 final determination of tax due was not previously made.  Such a proceed-
 ing shall not be instituted unless an  undertaking  is  filed  with  the
 commissioner  of motor vehicles in such amount and with such sureties as
 a justice of the supreme court shall approve, to the effect that if such
 proceeding be dismissed or the tax confirmed, the  petitioner  will  pay
 all  costs  and  charges  which  may  accrue  in the prosecution of such
 proceeding.
   (2) If the commissioner of motor vehicles has designated  the  commis-
 sioner  of  finance  as his or her agent, a determination of the commis-
 sioner of finance denying a refund or credit pursuant to  subdivision  a
 of  this section shall be final and irrevocable unless the applicant for
 such refund or credit, within ninety days from the mailing of notice  of
 such determination, or, if the commissioner of finance has established a
 conciliation  procedure  pursuant  to  section 11-124 of the code of the
 preceding municipality and the applicant has  requested  a  conciliation
 conference  in accordance therewith, within ninety days from the mailing
 of a conciliation decision or the date of the  commissioner's  confirma-
 tion  of  the  discontinuance  of  the conciliation proceeding, both (1)
 serves a petition upon the commissioner of finance and (2) files a peti-
 tion with the tax appeals tribunal for a hearing. Such  petition  for  a
 refund  or  credit, made as provided under this section, shall be deemed
 an application for a revision of any tax, penalty or interest complained
 of. Such hearing and any appeal to the tax appeals tribunal  sitting  en
 banc  from  the  decision rendered in such hearing shall be conducted in
 the manner and subject to the requirements prescribed by the tax appeals
 tribunal pursuant  to  sections  one  hundred  sixty-eight  through  one
 hundred  seventy-two  of the charter of the preceding municipality as it
 existed January first, nineteen hundred ninety-four. After such hearing,
 the tax appeals tribunal shall give notice of its decision to the appli-
 cant and to the commissioner of finance. The applicant shall be entitled
 to institute a proceeding pursuant to article seventy-eight of the civil
 practice law and rules to review a decision of the tax appeals  tribunal
 sitting  en  banc  if  application to the supreme court be made therefor
 within four months after the giving of  notice  of  such  decision,  and
 provided,  in  the  case  of  an application by a taxpayer, that a final
 determination of tax due was not  previously  made.  Such  a  proceeding
 shall  not be instituted by a taxpayer unless an undertaking shall first
 be filed with the commissioner of motor vehicles,  in  such  amount  and
 S. 8474                           1070
 
 with  such  sureties as a justice of the supreme court shall approve, to
 the effect that if such proceeding be dismissed or  the  tax  confirmed,
 the  taxpayer  will  pay  all  costs and charges which may accrue in the
 prosecution of such proceeding.
   c.  A  person  shall  not  be entitled to a revision, refund or credit
 under this section of a tax, interest or penalty which has  been  deter-
 mined  to  be  due pursuant to the provisions of section 11-2206 of this
 chapter where he or she has had a hearing or an opportunity for a  hear-
 ing,  as  provided  in  such  section, or has failed to avail himself or
 herself of the remedies provided in such section.  No refund  or  credit
 shall  be  made of a tax, interest or penalty paid after a determination
 made pursuant to section 11-2206 of this chapter,  unless  it  be  found
 that  such  determination  was erroneous, illegal or unconstitutional or
 otherwise improper after a hearing, or on his or her own motion, by  the
 commissioner  of  motor  vehicles  or after a hearing by the tax appeals
 tribunal, or on his or her own motion by the commissioner of finance, as
 the case may be, or in a proceeding under article seventy-eight  of  the
 civil  practice  law  and  rules,  pursuant  to  the  provisions of said
 section, in which event refund or credit without interest shall be  made
 of the tax, interest or penalty found to have been overpaid.
   §  11-2209    Reserves.  In  cases  where a taxpayer has applied for a
 refund and has instituted a proceeding under  article  seventy-eight  of
 the  civil  practice  law and rules to review a determination adverse to
 such taxpayer on his or her application for refund, the commissioner  of
 motor  vehicles  shall  set up appropriate reserves to meet any decision
 adverse to the city.
   § 11-2210   Remedies exclusive.  The  remedies  provided  by  sections
 11-2206  and  11-2208  of  this  chapter shall be the exclusive remedies
 available to any person for the review of tax liability imposed by  this
 chapter; and no determination or proposed determination of tax or deter-
 mination  on  any  application  for  refund by the commissioner of motor
 vehicles or by the commissioner of finance, nor any decision by the  tax
 appeals  tribunal  or  any  of  its  administrative law judges, shall be
 enjoined or reviewed by an action for declaratory  judgment,  an  action
 for money had and received or by any action or proceeding other than, in
 the  case of a final determination by the commissioner of motor vehicles
 or a decision by the tax appeals tribunal sitting en banc, a  proceeding
 in  the nature of a certiorari proceeding under article seventy-eight of
 the civil practice law and rules; provided, however, that a taxpayer may
 proceed by declaratory judgment if he  or  she  institutes  suit  within
 thirty days after a deficiency assessment is made and pays the amount of
 the deficiency assessment to the commissioner of motor vehicles prior to
 the  institution  of such suit and posts a bond for costs as provided in
 section 11-2206 of this chapter.
   § 11-2211  Proceedings to recover tax. a.  Whenever any  person  shall
 fail  to  pay  any tax, penalty or interest imposed by this chapter, the
 corporation counsel, upon the request of the commissioner of motor vehi-
 cles or of the commissioner of finance  if  designated  as  his  or  her
 agent,  shall  bring  or  cause  to  be brought an action to enforce the
 payment of the same on behalf of the city of Staten Island in any  court
 of  the  state  of  New York or of any other state of the United States.
 However, if in his or her discretion the commissioner of motor vehicles,
 or the commissioner of finance  if  designated  as  his  or  her  agent,
 believes  that any such person subject to the provisions of this chapter
 is about to cease business, leave the state or remove or  dissipate  the
 assets  out of which the tax or penalty might be satisfied, and that any
 S. 8474                           1071
 
 such tax or penalty will not be paid when due, he  or  she  may  declare
 such  tax  or  penalty to be immediately due and payable and may issue a
 warrant immediately.
   b.    As  an additional or alternate remedy, the commissioner of motor
 vehicles, or the commissioner of finance if designated  as  his  or  her
 agent,  may issue a warrant, directed to the city sheriff commanding him
 or her to levy upon and sell the  real  and  personal  property  of  the
 person  liable  for  the tax which may be found within the city, for the
 payment of the amount thereof, with any penalty and  interest,  and  the
 cost  of executing the warrant, and to return such warrant to the person
 who issued it and to pay to him or her the  money  collected  by  virtue
 thereof  within  sixty  days after the receipt of such warrant. The city
 sheriff shall within five days after the receipt  of  the  warrant  file
 with  the  county  clerk  a copy thereof, and thereupon such clerk shall
 enter in the judgment docket the name of the  person  mentioned  in  the
 warrant  and  the  amount of the tax, penalty and interest for which the
 warrant is issued and the date when such copy is  filed.  Thereupon  the
 amount of such warrant so docketed shall become a lien upon the title to
 and  the  interest  in  real and personal property of the person against
 whom the warrant is issued.  The city sheriff shall  then  proceed  upon
 the  warrant  in the same manner, and with like effect, as that provided
 by law in respect to executions issued against property  upon  judgments
 of  a  court  of  record  and for services in executing the warrant such
 sheriff shall be entitled to the same fees, which he or she may  collect
 in  the  same  manner.    In the discretion of the commissioner of motor
 vehicles, or of the commissioner of finance if designated as his or  her
 agent,  a  warrant  of  like  terms,  force and effect may be issued and
 directed to an officer or employee of the department of finance  of  the
 city,  and  in the execution thereof such officer or employee shall have
 all the powers conferred by law upon sheriffs, but shall be entitled  to
 no  fee  or  compensation  in  excess of the actual expenses paid in the
 performance of such duty.  If a warrant is  returned  not  satisfied  in
 full, the commissioner of motor vehicles or the commissioner of finance,
 as  the  case may be, may from time to time issue new warrants and shall
 also have the same remedies to enforce the amount due thereunder  as  if
 he or she had recovered judgment therefor and execution thereon had been
 returned unsatisfied.
   c.  The commissioner of finance, if he or she finds that the interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the commissioner of finance may require, may release any  property  from
 the  lien  of any warrant or vacate such warrant for unpaid taxes, addi-
 tions to tax, penalties and interest filed pursuant to subdivision b  of
 this  section,  and  such  release  or  vacating  of  the warrant may be
 recorded in the office of any recording officer in  which  such  warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   §  11-2212    General powers of the commissioner of motor vehicles. In
 addition to the powers granted to the commissioner of motor vehicles  in
 this chapter, he or she is hereby authorized and empowered:
   1.   To make, adopt and amend rules and regulations appropriate to the
 carrying out of this chapter and the purposes thereof;
   2.  For cause shown, to remit penalties; and  to  compromise  disputed
 claims in connection with the taxes imposed under this chapter;
   3.    To  request  information  concerning  motor vehicles and persons
 subject to the provisions of this chapter from the department  of  motor
 vehicles  of  any  other  state or the treasury department of the United
 S. 8474                           1072
 
 States, or any city or county of the state of New York;  and  to  afford
 such information to such other state, treasury department, city or coun-
 ty, any provision of this chapter to the contrary notwithstanding;
   4.    To  delegate his or her functions under this section to a deputy
 commissioner in the department of motor  vehicles  or  any  employee  or
 employees of his or her department or to any county clerk or other offi-
 cer  who  acts  as the agent of such commissioner in the registration of
 motor vehicles;
   5.  To prescribe methods for determining the tax;
   6.  To require all persons owning motor vehicles  subject  to  tax  to
 keep  such records as he or she may prescribe and to furnish such infor-
 mation upon his or her request;
   7.  To request the police department of the  city  to  assist  in  the
 enforcement of the provisions of this chapter.
   §  11-2213  Administration  of  oaths and compelling testimony. a. The
 commissioner of motor vehicles or his or her employees  or  agents  duly
 designated  and  authorized  by  such  commissioner, and the tax appeals
 tribunal, shall have power to administer oaths and  take  affidavits  in
 relation  to  any matter or proceeding in the exercise of the powers and
 duties under this chapter. The commissioner of motor  vehicles,  or  the
 commissioner  of  finance  if  designated as his or her agent or the tax
 appeals tribunal, shall have the  power  to  subpoena  and  require  the
 attendance  of  witnesses  and the production of books, papers and docu-
 ments to secure information pertinent to the performance of  the  duties
 of  the  commissioner  of motor vehicles, the commissioner of finance or
 the tax appeals tribunal pursuant to this chapter and of the enforcement
 of this chapter and to examine them in relation thereto,  and  to  issue
 commissions for the examination of witnesses who are out of the state or
 unable  to  attend  before  him  or  her  or the tax appeals tribunal or
 excused from attendance.
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 testimony of witnesses and production and examination of  books,  papers
 and  documents  called  for by the subpoena of the commissioner of motor
 vehicles, or, if the commissioner of finance is designated as his or her
 agent under this chapter, of the commissioner of  finance  and  the  tax
 appeals tribunal.
   c.  Cross-reference; criminal penalties. For failure to obey subpoenas
 or for testifying falsely,  see  section  11-4007  of  this  title;  for
 supplying  false  or fraudulent information, see section 11-4009 of this
 title.
   d. The officers who serve the summons or subpoena of the  commissioner
 of  motor  vehicles, or the commissioner of finance if designated as his
 or her agent, or the tax appeals tribunal if the commissioner of finance
 is designated as the agent of the commissioner of  motor  vehicles,  and
 witnesses  attending  in  response thereto shall be entitled to the same
 fees as are allowed to officers and witnesses in civil cases  in  courts
 of  record, except as otherwise provided in this section.  Such officers
 shall be the city sheriff and his or her duly appointed deputies, or any
 officers or employees of the department of motor vehicles designated  by
 the commissioner of motor vehicles to serve such process or any officers
 or  employees of the department of finance of the city designated by the
 commissioner of finance to serve such process or any officers or employ-
 ees of the tax appeals tribunal designated to serve such process.
   § 11-2214  Penalties and interest. a.  Any person failing  to  file  a
 return or to pay any tax or any portion thereof within the time required
 S. 8474                           1073
 
 by  this  chapter shall be subject to a penalty of five times the amount
 of the tax due, plus interest of five percent of such tax for each month
 of delay or fraction thereof, but the commissioner of motor vehicles, or
 the commissioner of finance if designated as his or her agent, if satis-
 fied  that  the  delay  was excusable, may remit all or any part of such
 penalty, but not interest at the rate of six percent per year.    Penal-
 ties  and  interest  shall be paid and disposed of in the same manner as
 other revenues under this chapter.  Unpaid penalties and interest may be
 enforced in the same manner as the tax imposed by this chapter.
   b.  The certificate of the commissioner of motor vehicles  or  of  the
 commissioner  of finance if designated as his or her agent to the effect
 that a tax has not been paid, or that a return required by this  chapter
 has  not  been filed, or that information has not been supplied pursuant
 to the provisions of this chapter shall be presumptive evidence thereof.
   c. Cross-reference: For criminal penalties, see chapter forty of  this
 title.
   §  11-2215  Returns to be secret. a.  Except in accordance with proper
 judicial order or as otherwise provided by law, it shall be unlawful for
 the commissioner of motor vehicles,  any  officer  or  employee  of  the
 department  of  motor vehicles, the commissioner of finance, any officer
 or employee of the department of finance, the tax appeals tribunal,  any
 commissioner or employee of such tribunal, any agent of the commissioner
 of  motor  vehicles,  or  any  person  who, pursuant to this section, is
 permitted to inspect any return or  to  whom  a  copy,  an  abstract  or
 portion of any return is furnished, or to whom any information contained
 in  any  return  is furnished to divulge or make known in any manner any
 information contained in or relating to any return provided for by  this
 chapter.    The  officers charged with the custody of such returns shall
 not be required to produce any of them or evidence of anything contained
 in them in any action or proceeding in any court, except  on  behalf  of
 the  commissioner of motor vehicles or the commissioner of finance in an
 action or proceeding under the provisions of this chapter, or on  behalf
 of  any  party  to  an action or proceeding under the provisions of this
 chapter when the returns or facts shown thereby are directly involved in
 such action or proceeding, in either  of  which  events  the  court  may
 require  the  production  of, and may admit in evidence, so much of said
 returns or of the facts shown thereby, as are pertinent to the action or
 proceeding and no more. The commissioner of motor vehicles  may,  never-
 theless,  publish  a  copy or a summary of any determination or decision
 rendered after a formal hearing held  pursuant  to  section  11-2206  or
 11-2208  of this chapter.  Nothing under this section shall be construed
 to prohibit the delivery to a person  or  his  or  her  duly  authorized
 representative  of  a  certified  copy of any return filed by him or her
 pursuant to this chapter, or of the  receipt,  document  or  other  form
 issued  pursuant to section 11-2204 of this chapter, or a duplicate copy
 thereof; nor to prohibit the delivery of such a certified copy  of  such
 return  or  of  any information contained in or relating thereto, to the
 United States of America or any department thereof,  the  state  of  New
 York or any department thereof, the city of Staten Island or any depart-
 ment thereof provided the same is required for official business; nor to
 prohibit  the  inspection  for  official business of such returns by the
 corporation counsel or other legal representatives of the city or by the
 district attorney of Richmond county; nor to prohibit the publication of
 statistics so classified as to prevent the identification of  particular
 returns or items thereof.
 S. 8474                           1074
 
   b.  (1)  Any  officer or employee of the state of New York or the city
 who willfully violates the provisions of subdivision a of  this  section
 shall  be  dismissed  from office and be incapable of holding any public
 office in the state of New York or this city for a period of five  years
 thereafter.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   c.  This section shall be deemed a state statute for purposes of para-
 graph (a) of subdivision two of section eighty-seven of the public offi-
 cers law.
   d. Notwithstanding anything in subdivision a of this  section  to  the
 contrary,  if  a  taxpayer  has  petitioned the tax appeals tribunal for
 administrative review as provided in section one hundred seventy of  the
 charter of the preceding municipality as it existed January first, nine-
 teen  hundred  ninety-four, the commissioner of finance shall be author-
 ized to present to the tax appeals tribunal any report or return of such
 taxpayer, or any information  contained  therein  or  relating  thereto,
 which  may  be  material  or  relevant  to the proceeding before the tax
 appeals tribunal. The  tax  appeals  tribunal  shall  be  authorized  to
 publish a copy or a summary of any decision rendered pursuant to section
 one  hundred seventy-one of the charter of the preceding municipality as
 it existed January first, nineteen hundred ninety-four.
   § 11-2216 Notices and limitations of time. a. Any notice authorized or
 required under the provisions of this chapter may be  given  by  mailing
 the  same  to  the person for whom it is intended in a postpaid envelope
 addressed to such person at the address given in the last  return  filed
 by  him or her pursuant to the provisions of this chapter, in any appli-
 cation made by him or her, or in any application for  registration  made
 by  him  or  her pursuant to section four hundred one of the vehicle and
 traffic law or, if no return has been filed or application made, then to
 such address as may be obtainable. The mailing of such notice  shall  be
 presumptive  evidence  of  the receipt of the same by the person to whom
 addressed.  Any period of time which  is  determined  according  to  the
 provisions of this chapter by the giving of notice shall commence to run
 from the date of mailing of such notice.
   b. The provisions of the civil practice law and rules or any other law
 relative  to  limitations  of time for the enforcement of a civil remedy
 shall not apply to any proceeding or action taken by the commissioner of
 motor vehicles, or the commissioner of finance if designated as  his  or
 her   agent,  to  levy,  appraise,  assess,  determine  or  enforce  the
 collection of any tax or penalty provided by  this  chapter.    However,
 except  in the case of a wilfully false or fraudulent return with intent
 to evade the tax, no assessment of additional tax shall  be  made  after
 the expiration of more than three years from the date of the filing of a
 return;  provided,  however,  that  where  no  return  has been filed as
 provided by law the tax may be assessed at any time.
   c. Where, before the expiration of the period  prescribed  under  this
 section  for  the  assessment  of  an  additional  tax,  a  taxpayer has
 consented in writing that such period be extended, the  amount  of  such
 additional  tax may be determined at any time within such extended peri-
 od. The period  so  extended  may  be  further  extended  by  subsequent
 consents in writing made before the expiration of the extended period.
   d.  If  any  return,  claim,  statement, notice, application, or other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 of any provision of this title is,  after  such  period  or  such  date,
 S. 8474                           1075
 
 delivered  by  United States mail to the commissioner of motor vehicles,
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer or person with which or with whom such document is  required  to  be
 filed,  or  to which or to whom such payment is required to be made, the
 date of the United States postmark stamped  on  the  envelope  shall  be
 deemed to be the date of delivery.  This subdivision shall apply only if
 the postmark date falls within the prescribed period or on or before the
 prescribed  date  for  the  filing  of  such document, or for making the
 payment, including any extension granted for such filing or payment, and
 only if such document or payment was  deposited  in  the  mail,  postage
 prepaid,  properly  addressed  to  the  commissioner  of motor vehicles,
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer or person with which or with whom the document  is  required  to  be
 filed or to which or to whom such payment is required to be made. If any
 document  is  sent  by  United States registered mail, such registration
 shall be prima facie evidence that such document was  delivered  to  the
 commissioner of motor vehicles, commissioner of finance, the tax appeals
 tribunal,  bureau,  office,  officer  or  person  to  which  or  to whom
 addressed, and the date of registration shall  be  deemed  the  postmark
 date.  The  commissioner  of  motor vehicles is authorized to provide by
 regulation the extent to which, such provisions with  respect  to  prima
 facie  evidence of delivery and the postmark date, shall apply to certi-
 fied mail. This subdivision shall apply in the  case  of  postmarks  not
 made  by  the  United  States  Postal  Service only if and to the extent
 provided by regulation of the commissioner of motor vehicles.
   e. When the last day prescribed under authority of this title, includ-
 ing any extension of time, for performing any act falls on  a  Saturday,
 Sunday  or  legal  holiday  in the state of New York, the performance of
 such act shall be considered timely if  it  is  performed  on  the  next
 succeeding day which is not a Saturday, Sunday or legal holiday.
   §  11-2217 Commissioner of finance as agent. The commissioner of motor
 vehicles is hereby authorized to designate the commissioner  of  finance
 as  his  or her agent to exercise any or all of his or her functions and
 powers specified or provided for in subdivision (d) of  section  11-2205
 and  in sections 11-2206, 11-2208, 11-2211, 11-2213, 11-2214 and 11-2216
 of this chapter. Where the commissioner of finance has  been  so  desig-
 nated  as  agent, the commissioner of finance, in addition to the powers
 elsewhere granted to him or her in this chapter,  is  hereby  authorized
 and empowered:
   1.  To  delegate such functions and powers to a commissioner or deputy
 commissioner in the department of finance or to any employee or  employ-
 ees of the department of finance;
   2.  For  cause  shown,  to  remit penalties and to compromise disputed
 claims in connection with the taxes hereby imposed;
   3. To  request  information  concerning  motor  vehicles  and  persons
 subject  to  the provisions of this chapter from the department of motor
 vehicles of any other state or the treasury  department  of  the  United
 States,  or  any  city or county of the state of New York; and to afford
 such information to such other state, treasury department, city or coun-
 ty, any provision of this chapter to the contrary notwithstanding;
   4. To request the police department of  the  city  to  assist  in  the
 enforcement of the provisions of this chapter.
   §  11-2218  Agreement between commissioner of finance and commissioner
 of motor vehicles. The commissioner of finance is hereby authorized  and
 empowered  to  enter  into  an  agreement with the commissioner of motor
 vehicles to govern  the  administration  and  collection  of  the  taxes
 S. 8474                           1076

 imposed by this chapter, which agreement shall provide for the exclusive
 method of collection of such taxes, custody and remittal of the proceeds
 of  such  tax;  for  the  payment by the city of the reasonable expenses
 incurred  by the department of motor vehicles in collecting and adminis-
 tering such tax; and for the audit, upon request of the commissioner  of
 finance  or  his  or  her  delegate,  of  the  accuracy of the payments,
 distributions and remittances to the commissioner of finance pursuant to
 the provisions of this chapter, to be conducted at a time agreed upon by
 the state comptroller and to be allowed not more frequently than once in
 each calendar year.  Such agreement shall have the force and effect of a
 rule or regulation of the commissioner of motor vehicles, and  shall  be
 filed and published in accordance with any statutory requirements relat-
 ing thereto.
   §  11-2219  Notification  to  corporation counsel. The commissioner of
 motor vehicles shall promptly notify the corporation counsel of the city
 of any litigation instituted against him or  her  which  challenges  the
 constitutionality  or  validity  of any provision of this chapter, or of
 the enabling act pursuant to which it was adopted, or which attempts  to
 limit or question the applicability of either such law, and such notifi-
 cation shall include a copy of the papers served upon him or her.
   §   11-2220  Construction  and  enforcement.  This  chapter  shall  be
 construed and enforced in conformity with subdivisions (g)  and  (h)  of
 section  twelve  hundred  one  of  the  tax law, pursuant to which it is
 enacted.
   § 11-2221 Disposition of revenues. All  revenues  resulting  from  the
 imposition of the tax under this chapter shall be paid into the treasury
 of  the  city and shall be credited to and deposited in the general fund
 of the city, but no part of such revenues may be expended unless  appro-
 priated in the annual budget of the city.
 
                               CHAPTER 23-A
                     ENHANCED 911 TELEPHONE SURCHARGE
 
   § 11-2321 Short title. This chapter shall be known and may be cited as
 the "enhanced 911 telephone surcharge act."
   §  11-2322  Definitions. When used in this chapter the following terms
 shall mean:
   (a) "E911 system" means an enhanced emergency telephone service  which
 automatically  connects a person dialing the digits 9-1-1 to the answer-
 ing point established within the city of Staten  Island  police  depart-
 ment, and which shall include, but not be limited to, selective routing,
 automatic number identification and automatic location identification.
   (b)  "Lifeline"  means  a  discounted  or low-priced telephone service
 available to eligible low-income residential customers.
   (c) "Access line" means  a  communications  circuit  that  connects  a
 customer location to a facility housing the switching system and related
 equipment that provides telephone service.
   (d) "911 service area" means the area within the geographic boundaries
 of the city of Staten Island.
   (e) "Municipality" means any New York city agency, or any public bene-
 fit  corporation,  local  development  corporation or other governmental
 entity the majority of whose members or governing body is appointed by a
 city official.
   (f) "Public safety agency" means a public safety agency as defined  in
 subdivision five of section three hundred one of the county law.
 S. 8474                           1077

   (g) "Service supplier" means a service supplier as defined in subdivi-
 sion  seven of section three hundred one of the county law that provides
 service within the 911 service area.
   (h) "System costs" means the costs associated with obtaining and main-
 taining  the telecommunication equipment, all operations and maintenance
 costs and the  telephone  services  costs  necessary  to  establish  and
 provide an E911 system.
   (i)  "Voice  over  internet  protocol service" or "VOIP service" shall
 mean any service that (1)  enables  real-time,  two-way  voice  communi-
 cations;  (2)  requires a broadband connection from the user's location;
 (3) requires internet protocol compatible  customer  premises  equipment
 (CPE);  and  (4) permits users generally to receive calls that originate
 on the public switched telephone network and to terminate calls  to  the
 public switched telephone network.
   §  11-2323 Establishment of surcharge for E911 system.  (a) In accord-
 ance with the provisions of article six of the county law,  as  amended,
 there  is  hereby  established  a  surcharge of one dollar per telephone
 access line, or equivalent, per month on the customers of every  service
 supplier within the city of New York.
   (b)  The surcharge imposed by subdivision (a) of this section shall be
 used to pay for the costs associated with obtaining, operating and main-
 taining the telecommunication equipment and telephone services needed to
 provide an enhanced 911 emergency telephone system to serve the city  of
 New York.
   (c) All service suppliers that provide local access service within the
 911  service area in the city of New York shall begin to add the monthly
 surcharge of one dollar per telephone access line per month as  provided
 in  subdivision  (a)  of this section to all service bills no later than
 the forty-fifth day after the effective  date  of  the  local  law  that
 increased  such  surcharge  to  one dollar per telephone access line per
 month. Notwithstanding the  provisions of this subdivision, all  provid-
 ers  of  voice  over internet protocol service that provide such service
 within the 911 service area shall begin to add the monthly surcharge  of
 one  dollar  per  telephone  access  line,  or  equivalent, per month as
 provided in subdivision (a) of this section  to  all  service  bills  no
 later than September fifth, two thousand ten.
   §  11-2324  Application;  limitations;  exemptions.  (a) The surcharge
 established pursuant to the provisions of section 11-2323 of this  chap-
 ter  shall  be  imposed  on a per access line basis on all current bills
 rendered for local exchange access service within the 911 service area.
   (b) No such surcharge shall be imposed upon:
   (1) more than seventy-five exchange  access  lines  per  customer  per
 location;
   (2) any lifeline customers of a local telephone service supplier; or
   (3) a public safety agency; or
   (4) any municipality, as defined in subdivision (e) of section 11-2322
 of this chapter.
   § 11-2325 Collection of surcharge. (a) The appropriate service suppli-
 er or suppliers serving the city of Staten Island 911 service area shall
 act  as  collection  agents  for  the  city  and  shall  remit the funds
 collected as the surcharge to the commissioner of  finance  each  month.
 Such  funds  shall  be remitted no later than thirty days after the last
 business day of such period.
   (b) The service supplier shall be entitled to retain as an administra-
 tive fee an amount equal to two per  cent  of  its  collections  of  the
 surcharge.
 S. 8474                           1078
 
   (c)  The  surcharge  required  to be collected by the service supplier
 shall be added to and stated separately in its billings to the customer.
   (d) The service supplier shall annually provide to the commissioner of
 finance an accounting of the surcharge amounts billed and collected.
   §  11-2326  Liability  for surcharge. (a) Each service supplier who is
 subject to the provisions of this chapter shall be liable  to  the  city
 for  the  surcharge  until  it  has  been  paid to the city, except that
 payment to a service supplier is sufficient to relieve the customer from
 further liability for such surcharge.
   (b) The service supplier customer shall have no obligation to take any
 legal action to enforce the collection of any surcharge. However,  when-
 ever the service supplier remits the funds collected as the surcharge to
 the  city,  it  shall also provide the city with the name and address of
 any customer refusing or failing to pay the surcharge  imposed  by  this
 chapter and shall state the amount of such surcharge remaining unpaid.
   §  11-2327 System revenues; adjustment of surcharge. (a) All surcharge
 monies remitted to the commissioner of finance by a service supplier and
 all other monies dedicated to the payment of system costs from  whatever
 source  derived  or  received  by  the  city  of  Staten Island shall be
 expended only upon authorization of the council, and only for payment of
 system costs as permitted by this chapter. The finance commissioner  and
 the  director  of  the  office of management and budget shall separately
 account for and keep adequate records of the amount and  source  of  all
 such  revenues  and  of the amount and object or purpose of all expendi-
 tures thereof.
   (b) If at the end of any fiscal year the  total  amount  of  all  such
 revenues  exceeds  the  amount  necessary for payment of system costs in
 such fiscal year, such excess shall be reserved and carried over for the
 payment of system costs in the following fiscal year. However, if at the
 end of any fiscal year in conformance with  applicable  law,  such  E911
 reserved  fund  balance exceeds an amount equal to five per cent of that
 necessary for the payment of system costs in such fiscal year, the coun-
 cil shall by local law reduce the surcharge  for  the  following  fiscal
 year  to  a level that more adequately reflects the system cost require-
 ments of its E911 system. The council may also reestablish  or  increase
 such surcharge, subject to the provisions of section three hundred three
 of  the  county  law, if the revenues generated by such surcharge and by
 any other source are not adequate to pay for system costs.
                               CHAPTER 23-B
                 WIRELESS COMMUNICATIONS SERVICE SURCHARGE
   § 11-2341 Short title. This chapter shall be known and may be cited as
 the "wireless communications service surcharge act."
   § 11-2342 Definitions. (a) "Wireless communications device" means  any
 equipment used to access a wireless communications service.
   (b)  "Wireless  communications  service"  means  all commercial mobile
 services, as that term is defined in subdivision (d)  of  section  three
 hundred  thirty-two  of  title forty-seven of the United States Code, as
 amended from time to time, including, but not limited to, all  broadband
 personal  communications  services,  wireless  radio telephone services,
 geographic  area  specialized  and  enhanced  specialized  mobile  radio
 services,  and  incumbent-wide  area specialized mobile radio licensees,
 which offer real time, two-way voice or data service that  is  intercon-
 nected  with the public switched telephone network or otherwise provides
 access to emergency communications services.
   (c) "Wireless communications service supplier"  means  any  commercial
 entity that operates a wireless communications service.
 S. 8474                           1079
 
   (d)  "Place of primary use" means the street address that is represen-
 tative of where  the  customer's  use  of  the  wireless  communications
 service  primarily  occurs, which address must be either the residential
 street address or the primary business street address of  the  customer;
 and  within  the  licensed  service  area of the wireless communications
 service provider.
   § 11-2343  Establishment  of  surcharge  for  wireless  communications
 devices.  (a)  In  accordance  with the provisions of article six of the
 county law, as amended, there is hereby established a surcharge of thir-
 ty cents per month on wireless communications service in the city of New
 York. The surcharge shall be imposed  on  each  wireless  communications
 device  and  shall  be  reflected and made payable on bills rendered for
 wireless communications service that is provided  to  a  customer  whose
 place of primary use is within the city of New York.
   (b)  The surcharge imposed by subdivision (a) of this section shall be
 used to pay for the costs  associated  with  the  design,  construction,
 operation,  maintenance,  and  administration  of public safety communi-
 cations networks serving the city of New York.
   (c) All wireless communications service suppliers that provide service
 to customers whose place of primary use is within the city of  New  York
 shall  begin to add the monthly surcharge as provided in subdivision (a)
 of this section to all service bills no later than the  forty-fifth  day
 after the effective date of the local law that added this chapter.
   (d) Notwithstanding any provision of law to the contrary, no surcharge
 shall  be  imposed  pursuant to this chapter on or after December first,
 two thousand seventeen.
   § 11-2344 Collection of surcharge. (a)  Each  wireless  communications
 service  supplier  serving  the city of New York shall act as collection
 agent for the city of Staten Island and shall remit the funds  collected
 pursuant  to  the surcharge imposed under the provisions of this chapter
 to the commissioner of finance each month. Such funds shall be  remitted
 no later than thirty days after the last business day of the month.
   (b) Each wireless communications service supplier shall be entitled to
 retain, as an administrative fee, an amount equal to two per cent of its
 collections of the surcharge.
   (c)  The  surcharge  required to be collected by the wireless communi-
 cations service supplier shall be added to and stated separately in  its
 billings to customers.
   (d)  Each  wireless  communications  service  supplier  shall annually
 provide to the city of Staten Island  an  accounting  of  the  surcharge
 amounts billed and collected.
   §  11-2345  Liability  for surcharge. (a) Each wireless communications
 service customer who is subject to the provisions of this chapter  shall
 be  liable  to  the city of Staten Island for the surcharge until it has
 been paid to the city except that payment to a  wireless  communications
 service  supplier  is  sufficient  to  relieve the customer from further
 liability for such surcharge.
   (b) No wireless communications service supplier  shall  have  a  legal
 obligation  to enforce the collection of any surcharge imposed under the
 provisions of this chapter, provided, however, that whenever  the  wire-
 less  communications  service supplier remits the funds collected to the
 city of Staten Island, it shall also provide the city with the name  and
 address  of  any  customer  refusing or failing to pay the surcharge and
 shall state the amount of such surcharge remaining unpaid.
   § 11-2346 Systems revenues; adjustment of surcharge. (a) All surcharge
 monies remitted to the city of Staten  Island  by  a  wireless  communi-
 S. 8474                           1080
 
 cations  service  supplier  shall be expended only upon authorization of
 the council and only for payment of system costs or other costs  associ-
 ated with the design, construction, operation, maintenance, and adminis-
 tration  of  public  safety  communications networks serving the city of
 Staten Island.  The finance commissioner and the director of the  office
 of  management and budget shall separately account for and keep adequate
 books and records of the amount and source of all such monies and of the
 amount and object or purpose of all expenditures thereof.
   (b) If, at the end of any fiscal year, the total amount  of  all  such
 monies  exceeds  the amount necessary for payment of the above mentioned
 costs in such fiscal year, such excess shall  be  reserved  and  carried
 over for the payment of those costs in the following fiscal year.
 
                               CHAPTER 23-C
                     WIRELESS COMMUNICATIONS SURCHARGE
 
   §  11-2351 Surcharge on wireless communications service.  (a) There is
 hereby imposed within the territorial  limits  of  the  city  of  Staten
 Island, in accordance with the provisions of section  one hundred eight-
 y-six-g  of the tax law, a surcharge on wireless communications service,
 as such surcharge is described in paragraph (b) of  subdivision  two  of
 section one hundred eighty-six-g of the tax law.
   (b)  Such  surcharge  shall be imposed at the rate of thirty cents per
 month on each wireless communications device in service during any  part
 of the month.
   (c) A wireless communications service supplier shall begin to add such
 surcharge  to the billings of its customers on December first, two thou-
 sand seventeen.
   § 11-2352 Surcharge on the retail sale of each prepaid wireless commu-
 nications service.  (a) There is hereby imposed within  the  territorial
 limits  of  the city of Staten Island, in accordance with the provisions
 of section one hundred eighty-six-g of  the  tax  law,  a  surcharge  on
 prepaid  wireless communications service, as such surcharge is described
 in paragraph (c) of subdivision two of section  one hundred eighty-six-g
 of the tax law.
   (b) Such surcharge shall be imposed at the rate of  thirty  cents  per
 retail sale.
   (c)  A  prepaid  wireless communications seller shall begin to collect
 such surcharge from its customers on December first, two thousand seven-
 teen.

                                CHAPTER 24
           TAX ON RETAIL LICENSEES OF THE STATE LIQUOR AUTHORITY
 
   § 11-2401  Definitions. When used in this chapter the following  terms
 shall mean or include:
   1. "Person."  An individual, partnership, society, association, joint-
 stock company, corporation, estate, receiver, lessee, trustee, assignee,
 referee,  or  any  other  person acting in a fiduciary or representative
 capacity, whether appointed by a court or otherwise, and any combination
 of individuals.
   2.  "Retail licensee."  Any person to whom a license has  been  issued
 by the state liquor authority under the state alcoholic beverage control
 law who sells at retail in the city, for on or off premises consumption,
 any liquor, wine or beer for the sale of which such license is required.
 S. 8474                           1081

   3.   "Return."  Any return required to be filed as provided under this
 chapter.
   4.  "State."  The state of New York.
   5.  "City."  The city of Staten Island.
   6.   "Commissioner." The commissioner of finance of the city of Staten
 Island.
   7.  "Tax year."  June first of any calendar year through  May  thirty-
 first of the following calendar year.
   8.  "Tax  appeals  tribunal."  The tax appeals tribunal established by
 section one hundred sixty-eight of the charter of the preceding  munici-
 pality as it existed January first, nineteen hundred ninety-four.
   §  11-2402    Imposition  of tax. For the privilege of selling liquor,
 wine or beer at retail, for on or off premises consumption,  within  the
 city  of  Staten Island, there is hereby imposed and there shall be paid
 annually for each tax year, commencing with the tax year beginning  June
 first, nineteen hundred eighty, a tax to be paid by each retail licensee
 in  an  amount  equal to twenty-five percent of the license fees payable
 under the state alcoholic beverage control law by such  retail  licensee
 for the license year in effect at the commencement of the tax year under
 this chapter.  A retail licensee who obtains a license subsequent to the
 commencement  of  a  tax  year shall pay the tax based upon fees payable
 under the state alcoholic beverage control law by such licensee for  the
 license  year  in  effect  at the time such license is issued.  This tax
 shall be in addition to any and all other  taxes  paid  by  such  retail
 licensee.
   § 11-2403  Exemptions. The tax imposed by this chapter shall not apply
 to the following:
   (a)  The state of New York, or any of its agencies, instrumentalities,
 public corporations, including a public corporation created pursuant  to
 agreement or compact with another state or Canada, or political subdivi-
 sions;
   (b)  The United States of America, and any of its agencies and instru-
 mentalities insofar as it is immune from taxation;
   (c) The United Nations or other international organizations  of  which
 the United States of America is a member; and
   (d)  Any  corporation,  or  association, or trust, or community chest,
 fund or foundation, organized and operated  exclusively  for  religious,
 charitable, or educational purposes, or for the prevention of cruelty to
 children  or animals, and no part of the net earnings of which inures to
 the benefit of any private shareholder or individual, and no substantial
 part of the activities of which is carrying on propaganda, or  otherwise
 attempting  to influence legislation; provided, however, that nothing in
 this paragraph shall include an organization operated  for  the  primary
 purpose  of  carrying  on a trade or business for profit, whether or not
 all of its profits are payable to one or more organizations described in
 this subdivision.
   § 11-2404  Records to be kept.  Every retail licensee shall keep  such
 records  of  its  business  and  in such form as the commissioner may by
 regulation require.  Such records shall be offered  for  inspection  and
 examination  at  any  time upon demand by the commissioner or his or her
 duly authorized agent or employee and shall be preserved for a period of
 three  years,  except  that  the  commissioner  may  consent  to   their
 destruction within that period or may require that they be kept longer.
   §  11-2405  Returns.  a.  On or before the twenty-fifth day of June in
 each tax year, every person subject to tax under this chapter shall file
 a return with the commissioner on a form prescribed by the commissioner.
 S. 8474                           1082
 
 A retail licensee who obtains a license subsequent to  the  commencement
 of  a  tax  year  shall file a return for such tax year on or before the
 twenty-fifth day of the month following the month in which such  license
 was obtained.
   b.    The  return  shall  state the amount of license fees paid to the
 state under the alcoholic beverage control  law  and  the  date  when  a
 license  under  such  law  was  issued  to the retail licensee and shall
 contain any other information which the commissioner may deem  necessary
 for  the  proper  administration of this chapter.   The commissioner may
 require amended returns to be filed within twenty days after notice  and
 to contain the information specified in the notice.
   c.    If a return required by this chapter is not filed or if a return
 when filed is incorrect or insufficient on its  face,  the  commissioner
 shall take the necessary steps to enforce the filing of such a return or
 of a corrected return.
   d.   The return otherwise required to be filed on or before June twen-
 ty-fifth, nineteen hundred eighty under the provisions of subdivision  a
 of  this  section,  shall  be made and filed on or before August twenty-
 fifth, nineteen hundred eighty.
   § 11-2406  Payment of tax.  At the time of filing a return each person
 shall pay to the commissioner the tax imposed under this chapter.   Such
 tax  shall  be  due  and payable on the last day on which such return is
 required to be filed, regardless of whether a return is filed or whether
 the return which is filed correctly indicates the amount of tax due.
   § 11-2407 Determination of tax. If a return required by  this  chapter
 is  not  filed,  or if a return when filed is incorrect or insufficient,
 the commissioner shall determine the amount of tax due from such  infor-
 mation  as  may be obtainable and, if necessary, may estimate the tax on
 the basis of external indices.  Notice of such  determination  shall  be
 given  to  the  person liable for the payment of the tax.  Such determi-
 nation shall finally and irrevocably  fix  the  tax  unless  the  person
 against  whom  it  is  assessed,  within ninety days after the giving of
 notice of such determination, or, if the  commissioner  of  finance  has
 established  a  conciliation procedure pursuant to section 11-124 of the
 code of the preceding municipality and  the  taxpayer  has  requested  a
 conciliation conference in accordance therewith, within ninety days from
 the mailing of a conciliation decision or the date of the commissioner's
 confirmation  of the discontinuance of the conciliation proceeding, both
 (1) serves a petition upon the commissioner of finance and (2)  files  a
 petition  with  the  tax  appeals  tribunal for a hearing, or unless the
 commissioner of his or her own motion shall redetermine the  same.  Such
 hearing  and any appeal to the tax appeals tribunal sitting en banc from
 the decision rendered in such hearing shall be conducted in  the  manner
 and  subject  to the requirements prescribed by the tax appeals tribunal
 pursuant to sections one hundred sixty-eight through one hundred  seven-
 ty-two  of the charter of the preceding municipality as it existed Janu-
 ary first, nineteen hundred ninety-four.   After such  hearing  the  tax
 appeals tribunal shall give notice of its decision to the person against
 whom the tax is assessed and to the commissioner of finance.  A decision
 of  the  tax  appeals  tribunal  sitting en banc shall be reviewable for
 error, illegality or unconstitutionality or any other reason  whatsoever
 by  a  proceeding  under article seventy-eight of the civil practice law
 and rules if application therefor is made to the supreme  court  by  the
 person  against  whom  the tax was assessed within four months after the
 giving of the notice of such tax appeals tribunal decision.  A  proceed-
 ing  under  article  seventy-eight  of  the civil practice law and rules
 S. 8474                           1083

 shall not be instituted by a taxpayer unless:  (a) the amount of any tax
 sought to be reviewed, with penalties  and  interest  thereon,  if  any,
 shall  be first deposited with the commissioner and there shall be filed
 with  the commissioner an undertaking issued by a surety company author-
 ized to transact business in this state and approved by the  superinten-
 dent  of  insurance  of this state as to solvency and responsibility, in
 such amount as a justice of the supreme  court  shall  approve,  to  the
 effect  that  if  such proceeding be dismissed or the tax confirmed, the
 taxpayer will pay all costs and charges which may accrue in  the  prose-
 cution  of  the  proceedings  or (b) at the option of the taxpayer, such
 undertaking may be in a sum sufficient to cover the taxes, interest  and
 penalties  stated in such decision, plus the costs and charges which may
 accrue against it in the prosecution of the proceeding, in  which  event
 the taxpayer shall not be required to pay such taxes, interest or penal-
 ties as a condition precedent to the application.
   §  11-2408   Refunds. a.   In the manner provided in this section, the
 commissioner shall refund or credit, without interest, any tax,  penalty
 or  interest  erroneously,  illegally or unconstitutionally collected or
 paid, if written application to the commissioner for such  refund  shall
 be  made  within one year from the payment thereof. Whenever a refund or
 credit is made or denied, the commissioner shall state his or her reason
 therefor and give notice thereof to the taxpayer in writing. The commis-
 sioner may, in lieu of any refund required  to  be  made,  allow  credit
 therefor on payments due from the applicant.
   b.   Any determination of the commissioner of finance denying a refund
 or credit pursuant to subdivision a of this section shall be  final  and
 irrevocable unless the applicant for such refund or credit, within nine-
 ty  days  from  the  mailing of notice of such determination, or, if the
 commissioner of finance has established a conciliation procedure  pursu-
 ant  to section 11-124 of the code of the preceding municipality and the
 applicant has requested a conciliation conference in  accordance  there-
 with,  within ninety days from the mailing of a conciliation decision or
 the date of the commissioner's confirmation of the discontinuance of the
 conciliation proceeding, both (1) serves a petition upon the commission-
 er of finance and (2) files a petition with the tax appeals tribunal for
 a hearing. Such petition for a refund or credit made as provided in this
 section shall be deemed an application for a revision of any tax, penal-
 ty or interest complained of. Such hearing and any appeal to the  tribu-
 nal  sitting en banc from the decision rendered in such hearing shall be
 conducted in the manner and subject to the  requirements  prescribed  by
 the  tax  appeals  tribunal pursuant to sections one hundred sixty-eight
 through one hundred seventy-two of the charter of the preceding  munici-
 pality  as it existed January first, nineteen hundred ninety-four. After
 such hearing, the tax appeals tribunal shall give notice of its decision
 to the applicant and to the commissioner of finance. The applicant shall
 be entitled to institute a proceeding pursuant to article  seventy-eight
 of  the  civil  practice  law  and rules to review a decision of the tax
 appeals tribunal sitting en banc if application to the supreme court  be
 made  therefor  within  four  months  after the giving of notice of such
 decision, and provided, in the case of an  application  by  a  taxpayer,
 that  a  final  determination of tax due was not previously made. Such a
 proceeding shall not be instituted by a taxpayer unless  an  undertaking
 shall first be filed with the commissioner, in such amount and with such
 sureties  as a justice of the supreme court shall approve, to the effect
 that if such proceeding be dismissed or the tax confirmed, the  taxpayer
 S. 8474                           1084
 
 will  pay  all  costs and charges which may accrue in the prosecution of
 the proceeding.
   c.  A  person  shall  not  be entitled to a revision, refund or credit
 under this section, of a tax, interest or penalty which had been  deter-
 mined  to  be  due pursuant to the provisions of section 11-2407 of this
 chapter where such person has had a hearing  or  an  opportunity  for  a
 hearing,  as  provided in such section or has failed to avail himself or
 herself of the remedies as provided in such section.  No refund or cred-
 it shall be made of a tax, interest or penalty  paid  after  a  determi-
 nation  by  the  commissioner  made  pursuant to section 11-2407 of this
 chapter unless it be found that such determination was erroneous,  ille-
 gal or unconstitutional or otherwise improper, by the tax appeals tribu-
 nal after a hearing or of the commissioner's own motion, or, if such tax
 appeals  tribunal  affirms  in whole or in part the determination of the
 commissioner of finance, in a proceeding under article seventy-eight  of
 the  civil  practice  law  and rules, pursuant to the provisions of said
 section in which event refund or credit without interest shall  be  made
 of the tax, interest or penalty found to have been overpaid.
   §  11-2409  Remedies exclusive.  The remedies provided by this chapter
 shall be the exclusive remedies available to any person for  the  review
 of  tax  liability  imposed  by  this  chapter;  and no determination or
 proposed determination of tax or determination on  any  application  for
 refund  by  the  commissioner  of  finance,  nor any decision by the tax
 appeals tribunal or any of  its  administrative  law  judges,  shall  be
 enjoined    or reviewed by an action for declaratory judgment, an action
 for money had and received or by any action or proceeding other than, in
 the case of a decision by the tax appeals tribunal sitting  en  banc,  a
 proceeding  under  article  seventy-eight  of the civil practice law and
 rules; provided, however, that a taxpayer  may  proceed  by  declaratory
 judgment  if  such  taxpayer  institutes suit within thirty days after a
 deficiency assessment is made and pays  the  amount  of  the  deficiency
 assessment to the commissioner prior to the institution of such suit and
 posts a bond for costs as provided in section 11-2407 of this chapter.
   §  11-2410   Reserves.   In cases where the taxpayer has applied for a
 refund and has instituted a proceeding under  article  seventy-eight  of
 the  civil  practice  law and rules to review a determination adverse to
 such taxpayer on his or her application for refund, the city comptroller
 shall set up appropriate reserves to meet any decision  adverse  to  the
 city.
   §  11-2411  Proceedings to recover tax.  a.  Whenever any person shall
 fail to pay any tax or penalty or interest imposed by this chapter,  the
 corporation  counsel  shall, upon the request of the commissioner, bring
 or cause to be brought an action to enforce payment of the same  against
 the person liable for the same on behalf of the city of Staten Island in
 any  court  of  the  state  of  New York or of any other state or of the
 United States.  If, however, the commissioner in his or  her  discretion
 believes  that  a  taxpayer subject to the provisions of this chapter is
 about to cease business, leave the state  or  remove  or  dissipate  the
 assets  out of which tax or penalties or interest might be satisfied and
 that any such tax or penalty or interest will not be paid when  due,  he
 or she may declare such tax or penalty or interest to be immediately due
 and payable and may issue a warrant immediately.
   b.    As an additional or alternate remedy, the commission may issue a
 warrant, directed to the city sheriff, commanding such sheriff  to  levy
 upon and sell the real and personal property of such person which may be
 found  within  the city, for the payment of the amount thereof, with any
 S. 8474                           1085
 
 penalties and interest, and the cost of executing the  warrant,  and  to
 return  such  warrant  to  the commissioner and to pay to him or her the
 money collected by virtue thereof within sixty  days  after  receipt  of
 such  warrant.    The  city  sheriff  shall,  within five days after the
 receipt of the warrant, file with the county clerk a copy  thereof,  and
 thereupon  such clerk shall enter in the judgment docket the name of the
 person mentioned in the warrant and the amount of the tax, penalties and
 interest for which the warrant is issued and the date when such copy  is
 filed.   Thereupon the amount of such warrant so docketed shall become a
 lien upon the title to and interest in real and personal property of the
 person against whom the warrant is issued.  The city sheriff shall  then
 proceed upon the warrant in the same manner and with like effect as that
 provided  by  law  in respect to executions issued against property upon
 judgments of a court of  record,  and  for  services  in  executing  the
 warrant  such sheriff shall be entitled to the same fees which he or she
 may collect in the same manner.  In the discretion of the commissioner a
 warrant of like terms, force and effect may be issued  and  directed  to
 any  officer  or  employee  of  the  department  of  finance, and in the
 execution thereof such officer or employee shall  have  all  the  powers
 conferred  by  law  upon sheriffs, but he or she shall be entitled to no
 fee for compensation in excess  of  the  actual  expenses  paid  in  the
 performance  of  such  duty.   If a warrant is returned not satisfied in
 full, the commissioner may from time to  time  issue  new  warrants  and
 shall  also  have the same remedies to enforce the amount due thereunder
 as if the city had recovered judgment therefor and execution thereon had
 been returned unsatisfied.
   c.  Whenever there is made a sale, transfer or assignment in  bulk  of
 any  part  or  the  whole  of  a stock of merchandise or of fixtures, or
 merchandise and of fixtures pertaining to the conducting of the business
 of the seller, transferor or assignor, otherwise than  in  the  ordinary
 course  of  trade  and  in the regular prosecution of said business, the
 purchaser, transferee or assignee shall at least ten days before  taking
 possession  of  such merchandise, fixtures, or merchandise and fixtures,
 or paying therefor, notify the commissioner by registered mail   of  the
 proposed  sale and of the price, terms and conditions thereof whether or
 not the seller, transferor or assignor, has represented to, or  informed
 the  purchaser,  transferee or assignee that it owes any tax pursuant to
 this chapter and whether or not the purchaser,  transferee  or  assignee
 has  knowledge that such taxes are owing, and whether any such taxes are
 in fact owing.
   Whenever the purchaser, transferee or  assignee  shall  fail  to  give
 notice  to the commissioner as required by the opening paragraph of this
 subdivision, or whenever the commissioner shall  inform  the  purchaser,
 transferee  or  assignee  that  a  possible  claim for such tax or taxes
 exists, any sums of money,  property  or  choses  in  action,  or  other
 consideration,  which  the purchaser, transferee or assignee is required
 to transfer over to the seller, transferor or assignor shall be  subject
 to  a  first  priority  right and lien for any such taxes theretofore or
 thereafter determined to be due from the seller, transferor or  assignor
 to  the  city, and the purchaser, transferee or assignee is forbidden to
 transfer to the seller, transferor or assignor any such sums  of  money,
 property  or  choses in action to the extent of the amount of the city's
 claim.  For failure to comply with the provisions of  this  subdivision,
 the  purchaser,  transferee or assignee, in addition to being subject to
 the liabilities and remedies imposed under the provisions of article six
 of the uniform commercial code,  shall  be  personally  liable  for  the
 S. 8474                           1086

 payment  to  the city of any such taxes theretofore or thereafter deter-
 mined to be due to the city from the seller, transferor or assignor, and
 such liability may be assessed and enforced in the same  manner  as  the
 liability for tax under this chapter.
   d.  The commissioner of finance, if he or she finds that the interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the commissioner of finance may require, may release any  property  from
 the  lien  of any warrant or vacate such warrant for unpaid taxes, addi-
 tions to tax, penalties and interest filed pursuant to subdivision b  of
 this  section,  and  such  release  or  vacating  of  the warrant may be
 recorded in the office of any recording officer in  which  such  warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   §  11-2412    General  powers of the commissioner.  In addition to all
 other powers granted to the commissioner in this chapter, he or  she  is
 hereby authorized and empowered:
   1.   To make, adopt and amend rules and regulations appropriate to the
 carrying out of this chapter and the purposes thereof; and to  prescribe
 the  form  of blanks, reports and other records relating to the enforce-
 ment and administration of this chapter;
   2.  To extend, for cause shown, the time for filing any return  for  a
 period  not  exceeding thirty days; and to compromise disputed claims in
 connection with the taxes hereby imposed;
   3.  To request information from the department of taxation and finance
 of the state of New York or the state liquor authority or the  officials
 of any political subdivision of this state or the treasury department of
 the  United  States relative to any person; and to afford information to
 such department of taxation and finance, liquor authority, officials  or
 treasury  department relative to any person, any other provision of this
 chapter to the contrary notwithstanding;
   4.  To delegate his or her functions under this section to a deputy or
 assistant or other employee or employees of his or her department;
   5.   To assess, reassess, determine, revise  and  readjust  the  taxes
 imposed under this chapter;
   6.    To provide by regulation for granting a refund of an appropriate
 portion of the tax where the  retail  licensee  ceases  to  do  business
 during  the  course of the tax year under circumstances which result in,
 or would entitle such licensee to, a refund of license fee by the  state
 liquor  authority.    The  provisions of section 11-2408 of this chapter
 shall be applicable to such refunds.
   § 11-2413 Administration of oaths and  compelling  testimony.  a.  The
 commissioner, his or her employees duly designated and authorized by the
 commissioner,  the  tax  appeals tribunal and any of its duly designated
 and authorized employees shall have power to administer oaths  and  take
 affidavits  in  relation  to any matter or proceeding in the exercise of
 their powers and duties under this chapter. The commissioner and the tax
 appeals tribunal shall have power to subpoena and require the attendance
 of witnesses and the production of books, papers and documents to secure
 information pertinent to the performance of the duties  of  the  commis-
 sioner  or  the  tax  appeals  tribunal  under  this  chapter and of the
 enforcement of this chapter and to examine them in relation thereto, and
 to issue commissions for the examination of witnesses who are out of the
 state or unable to attend before the commissioner  or  the  tax  appeals
 tribunal or excused from attendance.
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 S. 8474                           1087
 
 testimony  of  witnesses  and  the  production and examination of books,
 papers and documents called for by the subpoena of the  commissioner  or
 the tax appeals tribunal under this chapter.
   c.  Cross-reference; criminal penalties. For failure to obey subpoenas
 or for testifying falsely,  see  section  11-4007  of  this  title;  for
 supplying  false  or fraudulent information, see section 11-4009 of this
 title.
   d. The officers who serve the summons or subpoena of the  commissioner
 of  finance or the tax appeals tribunal under this chapter and witnesses
 attending in response thereto shall be entitled to the same fees as  are
 allowed  to  officers  and witnesses in civil cases in courts of record,
 except as otherwise provided in this chapter.   Such officers  shall  be
 the city sheriff, and his or her duly appointed deputies or any officers
 or  employees  of the department of finance or the tax appeals tribunal,
 designated to serve such process.
   § 11-2414 Interest and penalties. (a) Interest on underpayments.    If
 any  amount of tax is not paid on or before the last date prescribed for
 payment, without regard to any extension of time  granted  for  payment,
 interest  on  such amount at the rate set by the commissioner of finance
 pursuant to subdivision (g) of this section, or, if no rate is  set,  at
 the  rate of seven and one-half percent per annum, shall be paid for the
 period from such last date to the date  of  payment.  In  computing  the
 amount  of interest to be paid, such interest shall be compounded daily.
 Interest under this subdivision shall not be paid if the amount  thereof
 is less than one dollar.
   (b)  (1)  Failure  to  file return.   (A) In case of failure to file a
 return under this chapter on or before the prescribed  date,  determined
 with regard to any extension of time for filing, unless it is shown that
 such  failure is due to reasonable cause and not due to willful neglect,
 there shall be added to the amount required to be shown as tax  on  such
 return  five percent of the amount of such tax if the failure is for not
 more than one month, with an additional five percent for each additional
 month or fraction thereof  during  which  such  failure  continues,  not
 exceeding twenty-five percent in the aggregate.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to  any extension of time for filing, unless it is shown that such fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion to tax under subparagraph (A) of this paragraph shall not  be  less
 than  the  lesser  of  one hundred dollars or one hundred percent of the
 amount required to be shown as tax on such return.
   (C) For purposes of this paragraph, the amount of tax required  to  be
 shown  on  the  return shall be reduced by the amount of any part of the
 tax which is paid on or before the date prescribed for  payment  of  the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2) Failure to pay tax shown on return.  In case of failure to pay the
 amount  shown as tax on a return required to be filed under this chapter
 on or before the prescribed date, determined with regard to  any  exten-
 sion of time for payment, unless it is shown that such failure is due to
 reasonable cause and not due to willful neglect, there shall be added to
 the  amount  shown  as tax on such return one-half of one percent of the
 amount of such tax if the failure is not for more than one  month,  with
 an additional one-half of one percent for each additional month or frac-
 tion  thereof during which such failure continues, not exceeding twenty-
 five percent in the aggregate. For the purpose of computing the addition
 S. 8474                           1088
 
 for any month the amount of tax shown on the return shall be reduced  by
 the  amount of any part of the tax which is paid on or before the begin-
 ning of such month and by the amount of any credit against the tax which
 may  be  claimed  upon  the  return. If the amount of tax required to be
 shown on a return is less than the amount shown as tax on  such  return,
 this paragraph shall be applied by substituting such lower amount.
   (3)  Failure  to  pay  tax required to be shown on return.  In case of
 failure to pay any amount in respect of any tax required to be shown  on
 a  return required to be filed under this chapter which is not so shown,
 including a determination made pursuant to section 11-2407 of this chap-
 ter, within ten days of the date of a notice and demand therefor, unless
 it is shown that such failure is due to reasonable cause and not due  to
 willful  neglect,  there  shall  be added to the amount of tax stated in
 such notice and demand one-half of one percent of such tax if the  fail-
 ure  is  not for more than one month, with an additional one-half of one
 percent for each additional month or fraction thereof during which  such
 failure  continues,  not exceeding twenty-five percent in the aggregate.
 For the purpose of computing the addition for any month, the  amount  of
 tax  stated  in  the notice and demand shall be reduced by the amount of
 any part of the tax which is paid before the beginning of such month.
   (4) Limitations on additions.
   (A) With respect to any return the amount of the addition under  para-
 graph  one  of  this  subdivision  shall be reduced by the amount of the
 addition under paragraph two of this subdivision for any month to  which
 an  addition  applies  under  both  paragraphs  one and two. In any case
 described in subparagraph (B) of paragraph one of this subdivision,  the
 amount  of  the  addition  under such paragraph one shall not be reduced
 below the amount provided in such subparagraph.
   (B) With respect to any return, the maximum  amount  of  the  addition
 permitted  under paragraph three of this subdivision shall be reduced by
 the amount of the addition under  paragraph  one  of  this  subdivision,
 determined  without  regard  to  subparagraph (B) of such paragraph one,
 which is attributable to the tax for which the notice and demand is made
 and which is not paid within ten days of such notice and demand.
   (c) Underpayment due to negligence.  (1) If any part of  an  underpay-
 ment  of tax is due to negligence or intentional disregard of this chap-
 ter or any rules or regulations relating thereto, but without intent  to
 defraud, there shall be added to the tax a penalty equal to five percent
 of the underpayment.
   (2)  There shall be added to the tax, in addition to the amount deter-
 mined under paragraph one of this subdivision, an amount equal to  fifty
 percent  of  the  interest payable under subdivision (a) of this section
 with respect to the portion of the underpayment described in such  para-
 graph  one which is attributable to the negligence or intentional disre-
 gard referred to in such paragraph one, for the period beginning on  the
 last date prescribed by law for payment of such underpayment, determined
 without  regard  to any extension, and ending on the date of the assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
   (d) Underpayment due to fraud.  (1) If any part of an underpayment  of
 tax  is due to fraud, there shall be added to the tax a penalty equal to
 fifty percent of the underpayment.
   (2) There shall be added to the tax, in addition to the penalty deter-
 mined under paragraph one of this subdivision, an amount equal to  fifty
 percent  of  the  interest payable under subdivision (a) of this section
 with respect to the portion of the underpayment described in such  para-
 graph  one  which  is attributable to fraud, for the period beginning on
 S. 8474                           1089
 
 the last day prescribed by law for payment of such underpayment,  deter-
 mined  without  regard  to  any extension, and ending on the date of the
 assessment of the tax, or, if earlier, the date of the  payment  of  the
 tax.
   (3)  The  penalty under this subdivision shall be in lieu of any other
 addition to tax imposed by subdivision (b) or (c) of this section.
   (e) Additional penalty.  Any person who, with fraudulent intent, shall
 fail to pay any tax imposed by this chapter, or to make, render, sign or
 certify any return,  or  to  supply  any  information  within  the  time
 required  by or under this chapter, shall be liable for a penalty of not
 more than one  thousand  dollars,  in  addition  to  any  other  amounts
 required under this chapter to be imposed, assessed and collected by the
 commissioner  of  finance.  The  commissioner  of finance shall have the
 power, in his or her discretion, to  waive,  reduce  or  compromise  any
 penalty under this subdivision.
   (f)  The  interest and penalties imposed by this section shall be paid
 and disposed of in the same manner as other revenues from this  chapter.
 Unpaid  interest and penalties may be enforced in the same manner as the
 tax imposed by this chapter.
   (g)(1) Authority to set interest rates.  The commissioner  of  finance
 shall set the rate of interest to be paid pursuant to subdivision (a) of
 this section, but if no such rate of interest is set, such rate shall be
 deemed  to  be  set  at seven and one-half percent per annum.  Such rate
 shall be the rate prescribed in paragraph two of  this  subdivision  but
 shall  not  be  less than seven and one-half percent per annum. Any such
 rate set by the commissioner of finance shall apply  to  taxes,  or  any
 portion  thereof,  which  remain  or  become due on or after the date on
 which such rate becomes effective and shall apply only with  respect  to
 interest  computed  or  computable  for  periods  or portions of periods
 occurring in the period in which such rate is in effect.
   (2) General rule. The rate of  interest  set  under  this  subdivision
 shall  be  the  sum of (i) the federal short-term rate as provided under
 paragraph three of this subdivision, plus (ii) seven percentage points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A) The federal short-term rate for any month  shall  be  the  federal
 short-term  rate determined by the United States secretary of the treas-
 ury during such month in  accordance  with  subsection  (d)  of  section
 twelve  hundred  seventy-four  of  the  internal revenue code for use in
 connection with section six  thousand  six  hundred  twenty-one  of  the
 internal  revenue  code.  Any  such rate shall be rounded to the nearest
 full percent, or, if a multiple of one-half of one  percent,  such  rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i)  In  general.  Except  as provided in clause (ii) of this subpara-
 graph, the federal short-term rate for the first month in each  calendar
 quarter  shall  apply  during the first calendar quarter beginning after
 such month.
   (ii) Special rule for the month of September, nineteen hundred  eight-
 y-nine.  The  federal  short-term  rate for the month of April, nineteen
 hundred eighty-nine shall apply with respect  to  setting  the  rate  of
 interest for the month of September, nineteen hundred eighty-nine.
   (4)  Publication  of  interest rate. The commissioner of finance shall
 cause to be published in the City Record,  and  give  other  appropriate
 general notice of, the interest rate to be set under this subdivision no
 later  than  twenty days preceding the first day of the calendar quarter
 during which such interest rate applies. The setting and publication  of
 S. 8474                           1090
 
 such  interest rate shall not be included within paragraph (a) of subdi-
 vision five of section one thousand forty-one of the city charter of the
 preceding municipality as it existed  January  first,  nineteen  hundred
 ninety-four relating to the definition of a rule.
   (h) Miscellaneous. (1)  The certificate of the commissioner of finance
 to  the  effect that a tax has not been paid, that a return has not been
 filed, that information has not been supplied pursuant to the provisions
 of this chapter or that records have not been retained pursuant  to  the
 provisions of this chapter shall be prima facie evidence thereof.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   §  11-2415  Returns to be secret. (a) Except in accordance with proper
 judicial order, or as otherwise provided by law, it  shall  be  unlawful
 for the commissioner, the tax appeals tribunal or any officer or employ-
 ee  of  the  city to divulge or make known in any manner any information
 relating to the business of a taxpayer contained in any return  required
 under  this  chapter.  The  officers  charged  with  the custody of such
 returns shall not be required to produce any  of  them  or  evidence  of
 anything  contained  in  them  in any action or proceeding in any court,
 except on behalf of the commissioner in an action  or  proceeding  under
 the  provisions of this chapter, or on behalf of any party to any action
 or proceeding under the provisions of this chapter when the  returns  or
 facts  shown thereby are directly involved in such action or proceeding,
 in either of which events the court may require the production  of,  and
 may  admit  in  evidence,  so much of said returns or of the facts shown
 thereby, as are pertinent to the  action  or  proceeding  and  no  more.
 Nothing  under  this section shall be construed to prohibit the delivery
 to a taxpayer or the taxpayer's  duly  authorized  representative  of  a
 certified copy of any return filed in connection with his or her tax nor
 to  prohibit  the  publication of statistics so classified as to prevent
 the identification of particular returns and the items thereof,  or  the
 inspection  by the corporation counsel or other legal representatives of
 the city, or by the district attorney of Richmond county, of the  return
 of  any  taxpayer  who shall bring action to set aside or review the tax
 based thereon, or against whom an action or proceeding under this  chap-
 ter  may  be  instituted. Returns shall be preserved for three years and
 thereafter until the commissioner permits them to be destroyed.
   (b) (1) Any officer or employee of the city who willfully violates the
 provisions of subdivision (a) of this section shall  be  dismissed  from
 office  and be incapable of holding any public office in this city for a
 period of five years thereafter.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   (c) This section   shall be deemed a state  statute  for  purposes  of
 paragraph  (a)  of subdivision two of section eighty-seven of the public
 officers law.
   (d) Notwithstanding anything in subdivision (a) of this section to the
 contrary, if a taxpayer has petitioned  the  tax  appeals  tribunal  for
 administrative  review as provided in section one hundred seventy of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four, the commissioner of finance shall  be  author-
 ized  to  present to the tribunal any report or return of such taxpayer,
 or any information contained therein or relating thereto, which  may  be
 material  or  relevant  to  the  proceeding before the tribunal. The tax
 appeals tribunal shall be authorized to publish a copy or a  summary  of
 any decision rendered pursuant to section one hundred seventy-one of the
 S. 8474                           1091
 
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four.
   §  11-2416  Notices and limitations of time.  a. Any notice authorized
 or required under the provisions of this chapter may be given by mailing
 the same to the person for whom it is intended in  a  postpaid  envelope
 addressed  to  such person at the address given in the last return filed
 by him or her pursuant to the provisions  of  this  chapter  or  in  any
 application  made  by  him  or  her,  or, if no return has been filed or
 application made, then to such address as may be obtainable. The mailing
 of such notice shall be presumptive evidence of the receipt of the  same
 by the person to whom addressed.  Any period of time which is determined
 according  to  the  provisions  of  this chapter by the giving of notice
 shall commence to run from the date of mailing of such notice.
   b. The provisions of the civil practice law and rules or any other law
 relative to limitations of time for the enforcement of  a  civil  remedy
 shall  not  apply to any proceeding or action taken by the city to levy,
 appraise, assess, determine or enforce the  collection  of  any  tax  or
 penalty  or  interest  provided  by this chapter. However, except in the
 case of a wilfully false or fraudulent return with intent to  evade  the
 tax,  no assessment of additional tax shall be made after the expiration
 of more than three years from the  date  of  the  filing  of  a  return,
 provided,  however,  that  where no return has been filed as provided by
 law the tax may be assessed at any time.
   c. Where, before the expiration  of  the  period  prescribed  in  this
 section  for  the  assessment  of  an  additional  tax,  a  taxpayer has
 consented in writing that such period be extended, the  amount  of  such
 additional  tax  due  may be determined at any time within such extended
 period. The period so extended may be  further  extended  by  subsequent
 consents in writing made before the expiration of the extended period.
   d.  If  any  return,  claim,  statement, notice, application, or other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 of any provision of this chapter is, after such  period  or  such  date,
 delivered  by United States mail to the commissioner of finance, the tax
 appeals tribunal, bureau, office, officer or person with which  or  with
 whom  such document is required to be filed, or to which or to whom such
 payment is required to be made, the date of the United  States  postmark
 stamped on the envelope shall be deemed to be the date of delivery. This
 subdivision  shall  apply  only  if  the  postmark date falls within the
 prescribed period or on or before the prescribed date for the filing  of
 such document, or for making the payment, including any extension grant-
 ed  for such filing or payment, and only if such document or payment was
 deposited in the  mail,  postage  prepaid,  properly  addressed  to  the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer  or  person  with  which or with whom the document is required to be
 filed or to which or to whom such payment is required to be made. If any
 document is sent by United States  registered  mail,  such  registration
 shall  be  prima  facie evidence that such document was delivered to the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer or person to which or to whom addressed, and the date  of  registra-
 tion shall be deemed the postmark date. The commissioner of finance and,
 where  relevant,  the  tax appeals tribunal are authorized to provide by
 regulation the extent to which, such provisions with  respect  to  prima
 facie  evidence of delivery and the postmark date, shall apply to certi-
 fied mail. Except as provided in subdivision f  of  this  section,  this
 subdivision  shall apply in the case of postmarks not made by the United
 S. 8474                           1092
 
 States postal service only if and to the extent provided  by  regulation
 of  the  commissioner  of  finance  or,  where relevant, the tax appeals
 tribunal.
   e.  When  the  last  day  prescribed  under authority of this chapter,
 including any extension of time, for  performing  any  act  falls  on  a
 Saturday,  Sunday or legal holiday in the state, the performance of such
 act shall be considered timely if it is performed on the next succeeding
 day which is not a Saturday, Sunday or legal holiday.
   f. (1) Any reference in subdivision d of this section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the secretary of the treasury of the United States
 pursuant to section seventy-five hundred two  of  the  internal  revenue
 code  and  any  reference  in  subdivision d of this section to a United
 States postmark shall be treated as including a reference  to  any  date
 recorded  or  marked  in  the  manner  described in section seventy-five
 hundred two of the  internal  revenue  code  by  a  designated  delivery
 service.  If the commissioner of finance finds that any delivery service
 designated by such secretary is inadequate for the needs  of  the  city,
 the  commissioner  of finance may withdraw such designation for purposes
 of this title. The commissioner of finance may also designate additional
 delivery services meeting the criteria of section  seventy-five  hundred
 two  of  the  internal  revenue  code for purposes of this title, or may
 withdraw any such designation if the commissioner of finance finds  that
 a  delivery  service  so  designated  is inadequate for the needs of the
 city. Any reference in subdivision d  of  this  section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the commissioner of finance and any  reference  in
 subdivision  d  of  this  section  to  a United States postmark shall be
 treated as including a reference to any date recorded or marked  in  the
 manner  described  in  section  seventy-five hundred two of the internal
 revenue code by a delivery service designated  by  the  commissioner  of
 finance,  provided, however, any withdrawal of designation or additional
 designation by the commissioner of finance shall not  be  effective  for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal  of  designation or additional designation is ratified by the
 president of the tax appeals tribunal.
   (2) Any equivalent of registered or certified mail designated  by  the
 United  States secretary of the treasury, or as may be designated by the
 commissioner of finance pursuant to  the  same  criteria  used  by  such
 secretary for such designations pursuant to section seventy-five hundred
 two  of  the internal revenue code, shall be included within the meaning
 of registered or certified  mail  as  used  in  subdivision  d  of  this
 section.  If  the  commissioner  of finance finds that any equivalent of
 registered or certified mail designated by such secretary or the commis-
 sioner of finance is inadequate for the needs of the city,  the  commis-
 sioner  of  finance  may  withdraw such designation for purposes of this
 title, provided, however, any withdrawal of  designation  or  additional
 designation  by  the  commissioner of finance shall not be effective for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal of designation or additional designation is ratified  by  the
 president of the tax appeals tribunal.
   §  11-2417  Construction  and  enforcement.      This chapter shall be
 construed and enforced in conformity with article twenty-nine of the tax
 law, pursuant to which it is enacted.
 S. 8474                           1093

                                CHAPTER 25
                      TAX ON OCCUPANCY OF HOTEL ROOMS
 
   §  11-2501  Definitions. When used in this chapter the following terms
 shall mean or include:
   1. "Person." An individual, partnership, society, association,  joint-
 stock  company, corporation, estate, receiver, trustee, assignee, refer-
 ee, or any other person acting in a fiduciary or representative  capaci-
 ty,  whether  appointed  by  a  court  or  otherwise and any combination
 thereof.
   2. "Operator." Any person operating a hotel  in  the  city  of  Staten
 Island,  including,  but not limited to, the owner or proprietor of such
 premises, lessee, sublessee, mortgagee in possession,  licensee  or  any
 other person otherwise operating such hotel.
   3.  "Occupant." A person who, for a consideration, uses, possesses, or
 has the right to use or possess, any room or rooms in a hotel under  any
 lease,  concession,  permit,  right  of  access, license to use or other
 agreement, or otherwise.  "Right to use or possess" includes the  rights
 of a room remarketer as described in subdivision twelve of this section.
   4.  "Occupancy."  The  use  or  possession, or the right to the use or
 possession of any room or rooms in a hotel, or the right to the  use  or
 possession  of  the  furnishings  or  to the services and accommodations
 accompanying the use and possession of the room or rooms.  "Right to use
 or possess" includes the rights of a room  remarketer  as  described  in
 subdivision twelve of this section.
   5.  "Hotel."  A  building or portion of it which is regularly used and
 kept open as such for the lodging of guests. The term  "hotel"  includes
 an  apartment  hotel,  a  motel,  boarding house or club, whether or not
 meals are served.
   6. "Room." Any room of any kind, other than a bathroom or lavatory, in
 any part or portion of a hotel which is available for, or let  out  for,
 use  or  possession  for  any  purpose other than a place of assembly as
 defined in section 27-232 of the code of the preceding municipality.
   7. "Rent." The consideration received for occupancy valued  in  money,
 whether  received  in  money or otherwise, including all receipts, cash,
 credits, and property or services of any kind or nature,  including  any
 service or other charge or amount required to be paid as a condition for
 occupancy, and also any amount for which credit is allowed by the opera-
 tor  or room remarketer to the occupant, without any deduction therefrom
 whatsoever, whether received by the operator or  a  room  remarketer  or
 another person on behalf of either of them.
   8.  "Permanent resident." Any occupant of any room or rooms in a hotel
 for at least one hundred eighty consecutive days shall be  considered  a
 permanent resident with regard to the period of such occupancy.
   9. "Commissioner of finance." The commissioner of finance of the city.
   10. "Comptroller." The comptroller of the city.
   11.  "Tax  appeals  tribunal." The tax appeals tribunal established by
 section one hundred sixty-eight of the charter of the preceding  munici-
 pality as it existed January first, nineteen hundred ninety-four.
   12.  "Room  remarketer." A person who reserves, arranges for, conveys,
 or furnishes occupancy, whether directly or indirectly, to  an  occupant
 for  rent  in  an amount determined by such room remarketer, directly or
 indirectly, whether pursuant to  a  written  or  other  agreement.  Such
 person's  ability  or  authority  to  reserve,  arrange  for, convey, or
 furnish occupancy, directly or indirectly, and to determine rent  there-
 for,  shall  be  the "rights of a room remarketer". A room remarketer is
 S. 8474                           1094
 
 not a permanent resident with respect to a room for  which  such  person
 has the rights of a room remarketer.
   §  11-2502 Imposition of tax. a. (1) On and after July first, nineteen
 hundred  seventy  until  and  including  August  thirty-first,  nineteen
 hundred  eighty,  there  is hereby imposed and there shall be paid a tax
 for every occupancy of each room in a hotel in the city of Staten Island
 at the rates set forth in, and determined in accordance with the follow-
 ing table:
 If the rent per day for the room is:                         The tax is:
 Less than $10 ............................................. $.25 per day
 $10 or more, but less than $15 ............................ $.50 per day
 $15 or more, but less than $20 ............................ $.75 per day
 $20 or more .............................................. $1.00 per day
   (2) On and after September first, nineteen hundred  eighty,  there  is
 hereby imposed and there shall be paid a tax for every occupancy of each
 room  in a hotel in the city of Staten Island at the rates set forth in,
 and determined in accordance with, the following table:
 If the rent per day for the room is:                         The tax is:
 $10 or more, but less than $20 ............................ $.50 per day
 $20 or more, but less than $30 ........................... $1.00 per day
 $30 or more, but less than $40 ........................... $1.50 per day
 $40 or more .............................................. $2.00 per day
 Where a person occupies a room for less than a full day  and  pays  less
 than  the  rent  for  a full day, the tax shall nevertheless be the same
 amount as would be due had such person occupied the room for a full  day
 at the rent for a full day.
   (3)  In  addition to the tax imposed by paragraph two of this subdivi-
 sion, there is hereby imposed and there shall be paid a  tax  for  every
 occupancy  of  each  room in a hotel in the city (A) at the rate of five
 percent of the rent or charge per day for  each  such  room  up  to  and
 including  August thirty-first, nineteen hundred ninety, (B) at the rate
 of six percent of the rent or charge per day for each such room  on  and
 after  September  first,  nineteen  hundred  ninety  and before December
 first, nineteen hundred ninety-four, (C) at the rate of five percent  of
 the  rent  or  charge  per  day for each such room on and after December
 first, nineteen hundred ninety-four and before March first, two thousand
 nine, (D) at the rate of five and seven-eighths percent of the  rent  or
 charge per day for each such room on and after March first, two thousand
 nine  and  before December first, two thousand thirteen, (E) at the rate
 of five percent of the rent or charge per day for each such room on  and
 after  December first, two thousand thirteen and before December twenti-
 eth, two thousand thirteen, (F) at the rate of  five  and  seven-eighths
 percent  of  the  rent or charge per day for each such room on and after
 December twentieth, two thousand thirteen and before December first, two
 thousand twenty-three, and (G) at the rate of five percent of  the  rent
 or  charge  per  day for each such room on and after December first, two
 thousand twenty-three.
   (4) (A) When occupancy is provided, for a single  consideration,  with
 property,  services, amusement charges, or any other items, the separate
 sale of which is not subject to tax under this  chapter,  and  the  rent
 paid  for  such  occupancy  does  not  qualify for the exemption in this
 subdivision, the entire consideration shall be treated as  rent  subject
 to  tax under paragraph one of this subdivision; provided, however, that
 where the amount of the rent for occupancy is stated separately from the
 price of such property, services, amusement charges or  other  items  on
 any  sales slip, invoice, receipt, or other statement given the occupant
 S. 8474                           1095

 and such rent is reasonable in relation to the value of  such  property,
 services, amusement charges, or other items, only such separately stated
 rent  will  be  subject to tax under this subdivision.  (B) In regard to
 the  collection  of tax on occupancies by remarketers, when occupancy is
 provided, for a single consideration, with property, services, amusement
 charges, or any other items, whether or not such other items  are  taxa-
 ble,  the  rent  portion  of  the  consideration  for such sale shall be
 computed as follows: the total consideration for the sale multiplied  by
 a  fraction,  the  numerator of which shall be the consideration paid to
 the hotel for the occupancy and the denominator of which  shall  be  the
 consideration paid to the hotel for the occupancy plus the consideration
 paid  to  the  providers  of the other items being sold, or by any other
 reasonable method pursuant to which the rent  portion  of  consideration
 would  be  no less than the computation of rent portion of consideration
 under subparagraph (A) of this paragraph. Nothing  in  this  subdivision
 shall  be  construed to subject to tax or exempt from tax any service or
 property or amusement charge or other items otherwise subject to tax  or
 exempt from tax under this chapter.
   (5)  A room remarketer shall be allowed a refund or credit against the
 taxes collected and required to be remitted pursuant to section  11-2505
 of  this chapter in the amount of the tax it paid to the operator of the
 hotel or another  room  remarketer  under  this  subdivision.  Provided,
 however,  that  in  order  to  qualify for a refund or credit under this
 paragraph with respect to any quarterly period, as described in subdivi-
 sion a of section 11-2504 of this chapter,  the  room  remarketer  must,
 with respect to such quarter, (A) be registered for hotel room occupancy
 tax  purposes under section 11-2514 of this chapter, and (B) collect the
 taxes imposed by paragraphs two and three of this  subdivision.  Subject
 to  the  conditions and limitations of this paragraph, the provisions of
 section 11-2507 of this chapter shall apply to refunds or credits  under
 this paragraph.
   (6)  Where  the  rent  is  paid  or charged or billed, or falls due on
 either a weekly, monthly or other term basis, the daily rent upon  which
 the  tax is determined shall be the result obtained by dividing the rent
 for such term by the number of days in such term. Where the rent is  for
 more  than  one room, including but not limited to a suite of rooms, the
 daily rent per room upon which tax is determined shall be calculated  by
 multiplying  the  daily  rent  for the group of rooms by a fraction, the
 numerator of which shall be the daily rent for the particular room, or a
 similar room, when such room is rented alone with similar  bath  facili-
 ties,  and the denominator of which shall be the total of the daily rent
 for the individual rooms in the group of rooms, or similar  rooms,  when
 such rooms are rented alone with similar bath facilities. In any case in
 which  it  is  not  possible to determine the daily rent per room in the
 manner described under this paragraph, the commissioner of finance shall
 prescribe methods for making such determination.
   b. (1) No tax shall be imposed under this  chapter  upon  a  permanent
 resident.
   (2)   For purposes of this subdivision, an occupant who is eligible to
 request and has requested a lease pursuant to the  provisions  of  para-
 graph two of subdivision (a) of section 2522.5 of the rent stabilization
 regulations promulgated by the division of housing and community renewal
 of  the  state  of New York, shall tentatively be accorded the status of
 permanent resident as of the date of such request, notwithstanding  that
 such  occupant  has  not  met  the  one  hundred  eighty-consecutive-day
 requirement contained in subdivision eight of section  11-2501  of  this
 S. 8474                           1096
 
 chapter  as of such date.  In the case of such an occupant, the operator
 or room remarketer shall not collect the taxes imposed by  this  chapter
 for  any  day,  commencing  with the date such lease is requested, which
 falls within a period of continuous occupancy by such occupant of a room
 or  rooms  in  the hotel.  Provided, however, if such occupant ceases to
 occupy a room or rooms in the hotel  prior  to  the  completion  of  one
 hundred  eighty  consecutive  days of occupancy, any taxes not collected
 theretofore by reason of the provisions of this paragraph  shall  become
 immediately  due  and  payable on the date of cessation of occupancy and
 shall be collected by the operator or room remarketer  from  such  occu-
 pant.    In  the event, however, that the operator or room remarketer is
 unable to collect such taxes from the occupant,  the  operator  or  room
 remarketer  shall  not  be  liable  to  the  city  for such taxes.   The
 provisions  of  this  paragraph  shall  apply  with  respect  to  leases
 requested on or after September first, nineteen hundred ninety.
   c.  No  tax  shall be imposed under this chapter upon any organization
 described in subdivision (a) of section eleven hundred  sixteen  of  the
 tax  law  to  the  extent  such  organization  is not subject to the tax
 imposed under subdivision (e) of section eleven hundred five of the  tax
 law.
   d.  (1)  No  tax  shall  be imposed under this chapter upon any person
 occupying any room or rooms in a hotel solely and directly as  a  result
 of such person's involuntary displacement from premises by the attack on
 the World Trade Center on September eleventh, two thousand one, provided
 such premises were not subject to the tax imposed by this section or the
 tax imposed under section eleven hundred seven of the tax law.
   (2)  Where  an  occupant  claims  exemption  from  the  tax  under the
 provisions of paragraph one of  this  subdivision,  the  rent  shall  be
 deemed taxable under this chapter unless the operator shall receive from
 the occupant claiming such exemption a signed written statement describ-
 ing  the  specific  circumstances providing the basis for such claim and
 containing such other information as the  commissioner  of  finance  may
 require.  The operator shall retain such statement and provide it to the
 commissioner of finance upon request.
   e. Where any corporation,  or  association,  or  trust,  or  community
 chest,  fund or foundation, organized and operated exclusively for reli-
 gious, charitable, or educational purposes, or  for  the  prevention  of
 cruelty to children or animals, and no part of the net earnings of which
 inures  to  the  benefit of any private shareholder or individual and no
 substantial part of the activities of which is carrying  on  propaganda,
 or  otherwise attempting to influence legislation, carries on its activ-
 ities in furtherance of any of the purposes for which it was  organized,
 in  premises  in which, as part of said activities, it operates a hotel,
 occupancy of rooms in said premises and rents therefrom received by such
 corporation or association shall not be subject to tax under this  chap-
 ter.    Nothing in this subdivision shall be deemed to include an organ-
 ization operated for the primary purpose of carrying on a trade or busi-
 ness for profit, whether or not all of its profits are payable to one or
 more organizations described in this subdivision.
   f. The tax to be collected shall be stated and charged separately from
 the rent and shown separately on any record thereof, at  the  time  when
 the  occupancy  is  arranged  or contracted for and charged for and upon
 every evidence of occupancy or any bill or statement or charge made  for
 said occupancy issued or delivered by the operator or room remarketer.
   (1)  Where an occupant rents a room directly from an operator, the tax
 shall be paid by the occupant to the operator  as  trustee  for  and  on
 S. 8474                           1097
 
 account of the city, and the operator shall be liable for the collection
 of the tax on the rent and for the payment of the tax on the rent.
   (2)  The  operator or room remarketer and any officer of any corporate
 operator or room remarketer shall be personally liable for  the  portion
 of the tax collected or required to be collected under this chapter, and
 the  operator shall have the same right in respect to collecting the tax
 from the occupant, or in respect to nonpayment of the tax by  the  occu-
 pant  as if the tax were a part of the rent for the occupancy payable at
 the time such tax shall become due and owing, including  all  rights  of
 eviction, dispossession, repossession and enforcement of any innkeeper's
 lien  that  he or she may have in the event of nonpayment of rent by the
 occupant; provided however, that the commissioner of  finance  shall  be
 joined as a party in any action or proceeding brought by the operator to
 collect or enforce collection of the tax.
   g.  Where  the  occupant  has  failed  to pay and the operator or room
 remarketer has failed to collect a tax as imposed by this chapter,  then
 in addition to all other rights, obligations and remedies provided, such
 tax  shall  be  payable  by the occupant directly to the commissioner of
 finance, and it shall be the duty of the occupant to file a return ther-
 eof with the commissioner of finance and to pay the tax imposed  therein
 to  the  commissioner  of finance within fifteen days after such tax was
 due.
   h. The commissioner of finance may, wherever he or she deems it neces-
 sary for the proper enforcement of this chapter, provide  by  regulation
 that the occupant shall file returns and pay directly to the commission-
 er  of finance the tax imposed by this chapter, at such times as returns
 are required to be filed and payment over made by the operator  or  room
 remarketer.
   i. The tax imposed by this chapter shall be paid upon any occupancy on
 and  after July first, nineteen hundred seventy, although such occupancy
 is had pursuant to a contract, lease or other arrangement made prior  to
 such effective date.  Where rent is paid, or charged or billed, or falls
 due  on either a weekly, monthly, or other term basis, the rent so paid,
 charged, billed or falling due shall be subject to the  tax  imposed  by
 this  chapter  to the extent that it covers any portion of the period on
 and after July first, nineteen hundred seventy, and such payment,  bill,
 charge or rent due shall be apportioned on the basis of the ratio of the
 number  of  days falling within said period, to the total number of days
 covered thereby. Where any tax has been paid pursuant  to  this  chapter
 upon  any  rent  which has been ascertained to be worthless, the commis-
 sioner of finance may by regulation provide for credit or refund of  the
 amount  of  such  tax  upon  application therefor as provided in section
 11-2507 of this chapter.
   j. For the purpose of the proper administration of this chapter and to
 prevent evasion of the tax hereby imposed, it shall be presumed that all
 rents are subject to tax until the  contrary  is  established,  and  the
 burden  of  proving  that a rent for occupancy is not taxable under this
 chapter shall be upon the operator, the room remarketer,  or  the  occu-
 pant.  Where  an  occupant  claims  exemption  from  the  tax  under the
 provisions of subdivision c of this section, the rent  shall  be  deemed
 taxable  under this chapter unless the operator or room remarketer shall
 receive from the occupant claiming such exemption a copy of  the  exempt
 organization  certificate that is necessary to obtain exemption from the
 tax imposed under subdivision (e) of section eleven hundred five of  the
 tax  law,  together with a certificate duly executed by the organization
 named in such certificate certifying that the  occupant  is  its  agent,
 S. 8474                           1098
 
 representative  or  employee and that his or her occupancy is paid or to
 be paid by, and is  necessary  or  required  in  the  course  of  or  in
 connection with the affairs of said organization.
   k.  No  operator or room remarketer shall advertise or hold out to the
 public in any manner, directly or indirectly, that the  tax  imposed  by
 this  chapter  is  not  considered  as  a mandatory addition to the rent
 charged to the occupant.
   1. An occupancy that an  operator  conveys  or  furnishes  to  a  room
 remarketer  that  the  room  remarketer  intends  to  convey or furnish,
 directly or indirectly, to an occupant for rent shall be exempt from the
 taxes imposed by  this  section,  provided  that  such  room  remarketer
 furnishes  the  operator  with a certificate in such form and containing
 such information as may be prescribed by the  commissioner  of  finance.
 The  operator  shall retain such statement and provide it to the commis-
 sioner of finance upon request.
   § 11-2503   Records to be kept.  a.  Every  operator  and  every  room
 remarketer  shall  keep records of every occupancy and of all rent paid,
 charged or due thereon and of the tax payable thereon, in such  form  as
 the  commissioner  of  finance  may by regulation require.  Such records
 shall be available for inspection  and  examination  at  any  time  upon
 demand  by  the  commissioner  of  finance or his or her duly authorized
 agent or employee and shall be preserved for a period  of  three  years,
 except that the commissioner of finance may consent to their destruction
 within that period or may require that they be kept longer.
   b.  Notwithstanding  the provisions of sections three hundred five and
 three hundred nine of the state technology law or  any  other  law,  the
 commissioner  may  require  any person who has elected to maintain in an
 electronic format any portion of the records required to  be  maintained
 by that person under this chapter, to make the electronic records avail-
 able  and  accessible  to  the  commissioner,  notwithstanding  that the
 records are also maintained in a hard copy format.
   § 11-2504 Returns. a. Every operator and every room  remarketer  shall
 file  with  the  commissioner  of  finance  a return of occupancy and of
 rents, and of the taxes  payable  thereon,  for  the  quarterly  periods
 ending  on  the  last  day of February, May, August and November of each
 year. Such returns shall be filed within twenty days after  the  end  of
 the  quarterly  period  covered thereby. The commissioner of finance may
 permit or require returns to be made by  other  periods  and  upon  such
 dates as he or she may specify.  If the commissioner of finance deems it
 necessary  in  order  to  insure  the payment of the tax imposed by this
 chapter, he or she may require returns to be made  for  shorter  periods
 than those prescribed pursuant to the provisions of this subdivision and
 upon such dates as he or she may specify.
   b.  The  forms  of  returns shall be prescribed by the commissioner of
 finance and shall contain such information as he or she may deem  neces-
 sary  for the proper administration of this chapter. The commissioner of
 finance may require amended returns to be filed within twenty days after
 notice and to contain the information specified in the notice.
   c. If a return required by this chapter is not filed or  if  a  return
 when  filed is incorrect or insufficient on its face the commissioner of
 finance shall take the necessary steps to enforce the filing of  such  a
 return or a corrected return.
   §  11-2505 Payment of tax. At the time of filing a return of occupancy
 and of rents each operator and room remarketer shall pay to the  commis-
 sioner  of  finance  the  taxes  imposed  by this chapter upon the rents
 required to be included in such return, as  well  as  all  other  moneys
 S. 8474                           1099
 
 collected by the operator or room remarketer acting or purporting to act
 under  the  provisions  of  this  chapter,  even though it be judicially
 determined that the tax collected is invalidly imposed.  All  the  taxes
 for  the  period for which a return is required to be filed shall be due
 from the operator or room remarketer and payable to the commissioner  of
 finance  on the date limited for the filing of the return for such peri-
 od, without regard to whether a return is filed or  whether  the  return
 which  is  filed  correctly  shows the amount of rents and the taxes due
 thereon. Where the commissioner of finance  in  his  or  her  discretion
 deems it necessary to protect revenues to be obtained under this chapter
 he  or  she  may  require  any  operator  or room remarketer required to
 collect the tax imposed by this chapter to file with him or her a  bond,
 issued by a surety company authorized to transact business in this state
 and  approved  by  the  superintendent  of insurance of this state as to
 solvency and responsibility, in  such  amount  as  the  commissioner  of
 finance  may  fix,  to  secure  the  payment of any tax or penalties and
 interest due or which may become due from such operator or room  remark-
 eter.  In  the event that the commissioner of finance determines that an
 operator or room remarketer is to file such bond he or  she  shall  give
 notice to such operator or room remarketer to that effect specifying the
 amount  of the bond required. The operator or room remarketer shall file
 such bond within five days after the giving of such notice unless within
 such five days the operator or room remarketer shall request in  writing
 a  hearing  before  the  commissioner of finance at which the necessity,
 propriety and amount of the bond shall be determined by the commissioner
 of finance. Such determination shall be final and shall be complied with
 within fifteen days after the giving of notice thereof. In lieu of  such
 bond, securities approved by the commissioner of finance or cash in such
 amount  as he or she may prescribe, may be deposited which shall be kept
 in the custody of the commissioner of finance who may at any time  with-
 out  notice to the depositor apply them to any tax or interest or penal-
 ties due, and for that purpose the securities may be sold by him or  her
 at public or private sale without notice to the depositor thereof.
   §  11-2506  Determination of tax. If a return required by this chapter
 is not filed, or if a return when filed is  incorrect  or  insufficient,
 the amount of tax due shall be determined by the commissioner of finance
 from  such  information  as may be obtainable and, if necessary, the tax
 may be estimated on the basis of external indices,  such  as  number  of
 rooms,  location,  scale  of  rents,  comparable rents, type of accommo-
 dations and service, number of employees or other factors.    Notice  of
 such  determination  shall  be  given  to  the  person  liable  for  the
 collection and/or payment of the tax. Such determination  shall  finally
 and  irrevocably  fix  the  tax  unless  the  person  against whom it is
 assessed, within ninety days after giving of  notice  of  such  determi-
 nation,  or,  if  the  commissioner of finance has established a concil-
 iation procedure pursuant to section 11-124 of the code of the preceding
 municipality and the taxpayer has requested a conciliation conference in
 accordance therewith, within ninety days from the mailing of  a  concil-
 iation  decision  or  the date of the commissioner's confirmation of the
 discontinuance of the conciliation proceeding, both (1) serves  a  peti-
 tion  upon the commissioner of finance and (2) files a petition with the
 tax appeals tribunal for  a  hearing,  or  unless  the  commissioner  of
 finance  of his or her own motion shall redetermine the same. Such hear-
 ing and any appeal to the tax appeals tribunal sitting en banc from  the
 decision  rendered  in such hearing shall be conducted in the manner and
 subject to the requirements  prescribed  by  the  tax  appeals  tribunal
 S. 8474                           1100
 
 pursuant  to sections one hundred sixty-eight through one hundred seven-
 ty-two of the charter of the preceding municipality as it existed  Janu-
 ary  first,  nineteen  hundred ninety-four.   After such hearing the tax
 appeals tribunal shall give notice of its decision to the person against
 whom  the  tax  is  assessed.    A  decision of the tax appeals tribunal
 sitting en banc shall be reviewable for error, illegality or unconstitu-
 tionality or any other reason whatsoever by a proceeding  under  article
 seventy-eight  of the civil practice law and rules if application there-
 for is made to the supreme court by the person against whom the tax  was
 assessed,  within four months after the giving of the notice of such tax
 appeals tribunal decision.  A proceeding under article seventy-eight  of
 the  civil  practice  law  and rules shall not be instituted by a person
 liable for the tax unless: (a) the  amount  of  any  tax  sought  to  be
 reviewed,  with  penalties  and interest thereon, if any, shall be first
 deposited with the commissioner of finance and there shall be filed with
 the commissioner of finance an undertaking, issued by a  surety  company
 authorized to transact business in this state and approved by the super-
 intendent  of insurance of this state as to solvency and responsibility,
 in such amount as a justice of the supreme court shall approve,  to  the
 effect  that  if such proceeding be dismissed or the tax confirmed, such
 person will pay all costs and charges which may  accrue  in  the  prose-
 cution  of  the  proceeding;  or  (b)  at the option of such person such
 undertaking filed with the commissioner of  finance  may  be  in  a  sum
 sufficient  to cover the taxes, penalties and interest thereon stated in
 such decision plus the costs and charges which may accrue against it  in
 the  prosecution of the proceeding, in which event such person shall not
 be required to deposit such taxes, penalties and interest as a condition
 precedent to the application.
   § 11-2507 Refunds. a. In the  manner  provided  in  this  section  the
 commissioner  of  finance  shall refund or credit, without interest, any
 tax, penalty or interest erroneously,  illegally  or  unconstitutionally
 collected  or paid if written application to the commissioner of finance
 for such refund shall be made within one year from the payment  thereof.
 Whenever  a  refund  or  credit is made or denied by the commissioner of
 finance, he or she shall state his or  her  reasons  therefor  and  give
 notice  thereof to the taxpayer in writing. Such application may be made
 by the occupant, operator, room remarketer or other person who has actu-
 ally paid the tax to the commissioner of finance. Such  application  may
 also  be  made  by  an operator or room remarketer who has collected and
 paid over such tax to the commissioner  of  finance  provided  that  the
 application  is  made  within one year of the payment by the occupant to
 the operator or room remarketer, but no actual refund of moneys shall be
 made to such operator or room remarketer until he  or  she  shall  first
 establish to the satisfaction of the commissioner of finance, under such
 regulations as the commissioner of finance may prescribe, that he or she
 has  repaid  to  the  occupant  the amount for which the application for
 refund is made. The commissioner of finance may, in lieu of  any  refund
 required  to  be  made,  allow  credit therefor on payments due from the
 applicant.
   b.  Any determination of the commissioner of finance denying a  refund
 or  credit  pursuant to subdivision a of this section shall be final and
 irrevocable unless the applicant for such refund or credit, within nine-
 ty days from the mailing of notice of such  determination,  or,  if  the
 commissioner  of finance has established a conciliation procedure pursu-
 ant to section 11-124 of the code of the preceding municipality and  the
 applicant  has  requested a conciliation conference in accordance there-
 S. 8474                           1101
 
 with, within ninety days from the mailing of a conciliation decision  or
 the date of the commissioner's confirmation of the discontinuance of the
 conciliation proceeding, both (1) serves a petition upon the commission-
 er of finance and (2) files a petition with the tax appeals tribunal for
 a  hearing.  Such  petition  for a refund or credit, made as provided in
 this section, shall be deemed an application for a revision of any  tax,
 penalty  or  interest  complained of. Such hearing and any appeal to the
 tax appeals tribunal sitting en banc from the decision rendered in  such
 hearing shall be conducted in the manner and subject to the requirements
 prescribed  by the tax appeals tribunal pursuant to sections one hundred
 sixty-eight through one  hundred  seventy-two  of  the  charter  of  the
 preceding  municipality  as  it  existed January first, nineteen hundred
 ninety-four.  After such hearing, the tax appeals  tribunal  shall  give
 notice  of  its  decision  to  the  applicant and to the commissioner of
 finance. The applicant shall be entitled to review such decision of  the
 tax appeals tribunal sitting en banc by a proceeding pursuant to article
 seventy-eight  of  the  civil  practice  law  and  rules,  provided such
 proceeding is instituted within four months  after  the  giving  of  the
 notice  of such decision, and provided, in the case of an application by
 a person liable for the tax, that a final determination of tax  was  not
 previously  made.  Such a proceeding shall not be instituted by a person
 liable for the tax unless an undertaking is filed with the  commissioner
 of  finance  in  such  amount and with such sureties as a justice of the
 supreme court shall approve to the effect that  if  such  proceeding  be
 dismissed  or  the  tax  confirmed,  such  person will pay all costs and
 charges which may accrue in the prosecution of such proceeding.
   c. A person shall not be entitled to  a  revision,  refund  or  credit
 under  this  section of a tax, interest or penalty which had been deter-
 mined to be due pursuant to the provisions of section  11-2506  of  this
 chapter  where he or she has had a hearing or an opportunity for a hear-
 ing, as provided in said section, or has  failed  to  avail  himself  or
 herself  of  the remedies therein provided. No refund or credit shall be
 made of a tax, interest or penalty paid after  a  determination  by  the
 commissioner of finance made pursuant to section 11-2506 of this chapter
 unless  it  be  found  that such determination was erroneous, illegal or
 unconstitutional or otherwise improper,  by  the  tax  appeals  tribunal
 after  a  hearing or of the commissioner of finance's own motion, or, if
 such tax appeals tribunal affirms in whole or in part the  determination
 of  the  commissioner of finance, in a proceeding under article seventy-
 eight of the civil practice law and rules, pursuant to the provision  of
 said  section, in which event refund or credit without interest shall be
 made of the tax, interest or penalty found to have been overpaid.
   § 11-2508  Reserves. In cases where the  occupant,  operator  or  room
 remarketer  has  applied  for  a  refund and has instituted a proceeding
 under article seventy-eight of the  civil  practice  law  and  rules  to
 review  a  determination  adverse  to  such  occupant,  operator or room
 remarketer on his or her application for refund, the  comptroller  shall
 set up appropriate reserves to meet any decision adverse to the city.
   §  11-2509  Remedies  exclusive.  The  remedies  provided  by sections
 11-2506 and 11-2507 of this chapter  shall  be  the  exclusive  remedies
 available  to any person for the review of tax liability imposed by this
 chapter; and no determination or proposed determination of tax or deter-
 mination on any application for refund by the commissioner  of  finance,
 nor  any  decision by the tax appeals tribunal or any of its administra-
 tive law judges, shall be enjoined or reviewed by an action for declara-
 tory judgment, and action for money had and received or by any action or
 S. 8474                           1102
 
 proceeding other than, in the case of a  decision  by  the  tax  appeals
 tribunal  sitting  en  banc,  a proceeding in the nature of a certiorari
 proceeding under article seventy-eight of the  civil  practice  law  and
 rules;  provided,  however,  that  a taxpayer may proceed by declaratory
 judgment if he or she institutes suit within thirty days after  a  defi-
 ciency  assessment is made and pays the amount of the deficiency assess-
 ment to the commissioner of finance prior to  the  institution  of  such
 suit  and  posts a bond for costs as provided in section 11-2506 of this
 chapter.
   § 11-2510 Proceedings to recover tax. a. Whenever any operator or room
 remarketer or any officer of a corporate operator or room remarketer  or
 any  occupant or other person shall fail to collect and pay over any tax
 and/or to pay any tax, penalty or interest imposed by  this  chapter  as
 provided, the corporation counsel shall, upon the request of the commis-
 sioner  of finance bring or cause to be brought an action to enforce the
 payment of the same on behalf of the city of Staten Island in any  court
 of  the state of New York or of any other state or of the United States.
 If, however, the commissioner  of  finance  in  his  or  her  discretion
 believes  that  any such operator, or room remarketer, officer, occupant
 or other person is about to cease business, leave the state or remove or
 dissipate the assets out of which the tax, penalties or  interest  might
 be  satisfied,  and  that  any such tax, penalty or interest will not be
 paid when due, he or she may declare such tax, penalty or interest to be
 immediately due and payable and may issue a warrant immediately.
   b. As an additional or alternate remedy, the commissioner  of  finance
 may  issue a warrant, directed to the city sheriff commanding him or her
 to levy upon and sell the real and personal property of the operator  or
 room remarketer or officer of a corporate operator or room remarketer or
 of  the  occupant or other person liable for the tax, which may be found
 within the city for the payment of the amount thereof, with  any  penal-
 ties  and interest, and the cost of executing the warrant, and to return
 such warrant to the commissioner of finance and to pay to him or her the
 money collected by virtue thereof within sixty days after the receipt of
 such warrant. The city sheriff shall within five days after the  receipt
 of  the warrant file with the county clerk a copy thereof, and thereupon
 such clerk shall enter in the judgment docket the  name  of  the  person
 mentioned in the warrant and the amount of the tax, penalties and inter-
 est  for  which  the  warrant  is  issued and the date when such copy is
 filed. Thereupon the amount of such warrant so docketed shall  become  a
 lien upon the title to and interest in real and personal property of the
 person  against  whom the warrant is issued. The city sheriff shall then
 proceed upon the warrant, in the same manner, and with like  effect,  as
 that  provided  by  law in respect to executions issued against property
 upon judgments of a court of record, and for services in  executing  the
 warrant such sheriff shall be entitled to the same fees, which he or she
 may collect in the same manner. In the discretion of the commissioner of
 finance  a  warrant  of  like  terms, force and effect may be issued and
 directed to any officer or employee of the department of finance, and in
 the execution thereof such officer or employee shall have all the powers
 conferred by law upon sheriffs, but shall  be  entitled  to  no  fee  or
 compensation in excess of the actual expenses paid in the performance of
 such  duty.  If a warrant is returned not satisfied in full, the commis-
 sioner of finance may from time to time issue  new  warrants  and  shall
 also  have  the same remedies to enforce the amount due thereunder as if
 the city had recovered judgment therefor and execution thereon had  been
 returned unsatisfied.
 S. 8474                           1103
 
   c.  Whenever an operator shall make a sale, transfer, or assignment in
 bulk of any part or the whole of such operator's hotel or of his or  her
 lease,  license  or  other agreement or right to possess or operate such
 hotel, or of the equipment, furnishings, fixtures, supplies or stock  of
 merchandise,  or  of the said premises or lease, license or other agree-
 ment or right to possess  or  operate  such  hotel  and  the  equipment,
 furnishings,  fixtures,  supplies and stock of merchandise pertaining to
 the conduct or operation of said hotel, otherwise than in  the  ordinary
 and regular prosecution of business, the purchaser, transferee or assig-
 nee  shall  at least ten days before taking possession of the subject of
 said sale, transfer  or  assignment,  or  paying  therefor,  notify  the
 commissioner  of  finance by registered mail of the proposed sale and of
 the price, terms and conditions  thereof  whether  or  not  the  seller,
 transferor  or  assignor, has represented to, or informed the purchaser,
 transferee or assignee that it owes any tax pursuant  to  this  chapter,
 and  whether  or not the purchaser, transferee or assignee has knowledge
 that such taxes are owing, and whether any such taxes are in fact owing.
   Whenever the purchaser, transferee or  assignee  shall  fail  to  give
 notice  to  the commissioner of finance as required by the opening para-
 graph of this subdivision, or whenever the commissioner of finance shall
 inform the purchaser, transferee or assignee that a possible  claim  for
 such  tax  or  taxes  exists,  any  sums of money, property or choses in
 action, or other  consideration,  which  the  purchaser,  transferee  or
 assignee  is  required  to  transfer  over  to the seller, transferor or
 assignor shall be subject to a first priority right  and  lien  for  any
 such taxes theretofore or thereafter determined to be due from the sell-
 er, transferor or assignor to the city, and the purchaser, transferee or
 assignee  is forbidden to transfer to the seller, transferor or assignor
 any such sums of money, property or choses in action to  the  extent  of
 the  amount  of  the  city's  claim.  For  failure  to  comply  with the
 provisions of this subdivision, the purchaser, transferee  or  assignee,
 in  addition  to  being  subject to the liabilities and remedies imposed
 under the provisions of article six  of  the  uniform  commercial  code,
 shall be personally liable for the payment to the city of any such taxes
 theretofore  or  thereafter  determined  to  be due to the city from the
 seller, transferor or assignor, and such liability may be  assessed  and
 enforced in the same manner as the liability for tax under this chapter.
   d.  The commissioner of finance, if he or she finds that the interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the commissioner of finance may require, may release any  property  from
 the  lien  of any warrant or vacate such warrant for unpaid taxes, addi-
 tions to tax, penalties and interest filed pursuant to subdivision b  of
 this  section,  and  such  release  or  vacating  of  the warrant may be
 recorded in the office of any recording officer in  which  such  warrant
 has been filed. The clerk shall thereupon cancel and discharge as of the
 original date of docketing the vacated warrant.
   §  11-2511  General powers of the commissioner of finance. In addition
 to the powers granted to the commissioner of finance in this chapter, he
 or she is hereby authorized and empowered:
   1. To make, adopt and amend rules and regulations appropriate  to  the
 carrying out of this chapter and the purposes thereof;
   2.  To  extend,  for cause shown, the time for filing any return for a
 period not exceeding thirty days; and to compromise disputed  claims  in
 connection with the taxes hereby imposed;
   3.  To request information from the tax commission of the state of New
 York or the treasury department of the United  States  relative  to  any
 S. 8474                           1104
 
 person;  and to afford information to such tax commission or such treas-
 ury department relative to any person, any other provision of this chap-
 ter to the contrary notwithstanding;
   4.  To  delegate  his or her functions under this section to a commis-
 sioner or deputy commissioner in the department of  finance  or  to  any
 employee or employees of the department of finance;
   5. To prescribe methods for determining the rents for occupancy and to
 determine the taxable and non-taxable rents;
   6. To require any operator within the city to keep detailed records of
 the  nature  and  type  of  hotel  maintained and the nature and type of
 service rendered, and to require any operator or room remarketer to keep
 detailed records of the rooms available and rooms occupied daily, leases
 or occupancy contracts or  arrangements,  rents  received,  charged  and
 accrued,  the  names  and addresses of the occupants, whether or not any
 occupancy is claimed to be subject to the tax imposed by  this  chapter,
 and  to  furnish  such  information  upon request to the commissioner of
 finance;
   7. To assess, determine, revise and readjust the taxes  imposed  under
 this chapter.
   §  11-2512  Administration  of  oaths and compelling testimony. a. The
 commissioner of finance, his or her employees or agents duly  designated
 and  authorized  by  him or her, the tax appeals tribunal and any of its
 duly designated and authorized employees or agents shall have  power  to
 administer  oaths  and  take  affidavits  in  relation  to any matter or
 proceeding in the exercise of their powers and duties under  this  chap-
 ter.    The  commissioner  of finance and the tax appeals tribunal shall
 have power to subpoena and require the attendance of witnesses  and  the
 production  of  books, papers and documents to secure information perti-
 nent to the performance of the duties of the  commissioner  or  the  tax
 appeals tribunal under this chapter and of the enforcement of this chap-
 ter  and  to  examine them in relation thereto, and to issue commissions
 for the examination of witnesses who are out of the state or  unable  to
 attend  before such commissioner or tax appeals tribunal or excused from
 attendance.
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 testimony of witnesses and the  production  and  examination  of  books,
 papers  and  documents called for by the subpoena of the commissioner of
 finance or the tax appeals tribunal under this chapter.
   c. Cross-reference; criminal penalties. For failure to obey  subpoenas
 or  for  testifying  falsely,  see  section  11-4007  of this title; for
 supplying false or fraudulent information, see section 11-4009  of  this
 title.
   d.  The officers who serve the summons or subpoena of the commissioner
 of finance or the  tax  appeals  tribunal  and  witnesses  attending  in
 response  thereto  shall  be entitled to the same fees as are allowed to
 officers and witnesses in civil cases in courts  of  record,  except  as
 otherwise  provided under this section.  Such officers shall be the city
 sheriff and his or her  duly  appointed  deputies  or  any  officers  or
 employees  of  the  department  of  finance or the tax appeals tribunal,
 designated to serve such process.
   §  11-2513  Reference to tax. Whenever reference is made  in  placards
 or  advertisements  or in any other publication to this tax, such refer-
 ence shall be substantially in the following form: "city tax on occupan-
 cy of hotel rooms", except that in any bill, receipt, statement or other
 S. 8474                           1105
 
 evidence or memorandum of occupancy or rent charge issued or employed by
 the operator the words "city tax" will suffice.
   §  11-2514  Registration. By June thirtieth, nineteen hundred seventy,
 or in the case of operators or room remarketers commencing  business  or
 opening  new  hotels  after  such  date,  within  three  days after such
 commencement or opening, every operator or room  remarketer  shall  file
 with the commissioner of finance a certificate of registration in a form
 prescribed  by  the commissioner of finance. The commissioner of finance
 shall within five days after such registration issue without  charge  to
 each  operator  or room remarketer a certificate of authority empowering
 such operator or room remarketer to collect the tax  from  the  occupant
 and duplicate thereof for each additional hotel of such operator or room
 remarketer.    Each  certificate  or  duplicate shall state the hotel to
 which it is applicable. Such certificates of authority shall  be  promi-
 nently  displayed by the operator or room remarketer in such manner that
 it may be seen and come to the notice of all occupants and persons seek-
 ing occupancy. Such certificates shall be non-assignable  and  nontrans-
 ferable  and  shall  be  surrendered  immediately to the commissioner of
 finance upon the cessation of business at the hotel named  or  upon  its
 sale  or  transfer,  or  upon  cessation  of  business of the named room
 remarketer.
   § 11-2515 Interest and penalties. (a) Interest  on  underpayments.  If
 any  amount  of  tax is not paid or paid over on or before the last date
 prescribed for payment, without regard to any extension of time  granted
 for payment, interest on such amount at the rate set by the commissioner
 of  finance  pursuant to subdivision (g) of this section, or, if no rate
 is set, at the rate of seven and one-half percent per  annum,  shall  be
 paid  for  the  period  from  such  last date to the date of payment. In
 computing the amount of interest to be  paid,  such  interest  shall  be
 compounded  daily.  Interest under this subdivision shall not be paid if
 the amount thereof is less than one dollar.
   (b) (1) Failure to file return. (A) In  case  of  failure  to  file  a
 return  under  this chapter on or before the prescribed date, determined
 with regard to any extension of time for filing, unless it is shown that
 such failure is due to reasonable cause and not due to willful  neglect,
 there  shall  be added to the amount required to be shown as tax on such
 return five percent of the amount of such tax if the failure is for  not
 more than one month, with an additional five percent for each additional
 month  or  fraction  thereof  during  which  such failure continues, not
 exceeding twenty-five percent in the aggregate.
   (B) In the case of a failure to file a return of tax within sixty days
 of the date prescribed for filing of such return, determined with regard
 to any extension of time for filing, unless it is shown that such  fail-
 ure is due to reasonable cause and not due to willful neglect, the addi-
 tion  to  tax under subparagraph (A) of this paragraph shall not be less
 than the lesser of one hundred dollars or one  hundred  percent  of  the
 amount required to be shown as tax on such return.
   (C)  For  purposes of this paragraph, the amount of tax required to be
 shown on the return shall be reduced by the amount of any  part  of  the
 tax  which  is  paid on or before the date prescribed for payment of the
 tax and by the amount of any credit against the tax which may be claimed
 upon the return.
   (2) Failure to pay tax shown on return. In case of failure to pay  the
 amount  shown as tax on a return required to be filed under this chapter
 on or before the prescribed date, determined with regard to  any  exten-
 sion of time for payment, unless it is shown that such failure is due to
 S. 8474                           1106
 
 reasonable cause and not due to willful neglect, there shall be added to
 the  amount  shown  as tax on such return one-half of one percent of the
 amount of such tax if the failure is not for more than one  month,  with
 an additional one-half of one percent for each additional month or frac-
 tion  thereof during which such failure continues, not exceeding twenty-
 five percent in the aggregate. For the purpose of computing the addition
 for any month the amount of tax shown on the return shall be reduced  by
 the  amount of any part of the tax which is paid on or before the begin-
 ning of such month and by the amount of any credit against the tax which
 may be claimed upon the return. If the amount  of  tax  required  to  be
 shown  on  a return is less than the amount shown as tax on such return,
 this paragraph shall be applied by substituting such lower amount.
   (3) Failure to pay tax required to be shown  on  return.  In  case  of
 failure  to pay any amount in respect of any tax required to be shown on
 a return required to be filed under this chapter which is not so  shown,
 including a determination made pursuant to section 11-2506 of this chap-
 ter, within ten days of the date of a notice and demand therefor, unless
 it  is shown that such failure is due to reasonable cause and not due to
 willful neglect, there shall be added to the amount  of  tax  stated  in
 such  notice and demand one-half of one percent of such tax if the fail-
 ure is not for more than one month, with an additional one-half  of  one
 percent  for each additional month or fraction thereof during which such
 failure continues, not exceeding twenty-five percent in  the  aggregate.
 For  the  purpose of computing the addition for any month, the amount of
 tax stated in the notice and demand shall be reduced by  the  amount  of
 any part of the tax which is paid before the beginning of such month.
   (4) Limitations on additions.
   (A) With respect to any return, the amount of the addition under para-
 graph  one  of  this  subdivision  shall be reduced by the amount of the
 addition under paragraph two of this subdivision for any month to  which
 an  addition  applies  under  both  paragraphs  one and two. In any case
 described in subparagraph (B) of paragraph one of this subdivision,  the
 amount  of  the  addition  under such paragraph one shall not be reduced
 below the amount provided in such paragraph.
   (B) With respect to any return, the maximum  amount  of  the  addition
 permitted  under paragraph three of this subdivision shall be reduced by
 the amount of the addition under  paragraph  one  of  this  subdivision,
 determined  without  regard  to  subparagraph (B) of such paragraph one,
 which is attributable to the tax for which the notice and demand is made
 and which is not paid within ten days of such notice and demand.
   (c) Underpayment due to negligence. (1) If any part of an underpayment
 of tax is due to negligence or intentional disregard of this chapter  or
 any rules or regulations related thereto, but without intent to defraud,
 there  shall  be added to the tax a penalty equal to five percent of the
 underpayment.
   (2) There shall be added to the tax, in addition to the amount  deter-
 mined  under paragraph one of this subdivision, an amount equal to fifty
 percent of the interest payable under subdivision (a)  of  this  section
 with  respect to the portion of the underpayment described in such para-
 graph one which is attributable to the negligence or intentional  disre-
 gard  referred to in such paragraph one, for the period beginning on the
 last date prescribed by law for payment of such underpayment, determined
 without regard to any extension, and ending on the date of  the  assess-
 ment of the tax, or, if earlier, the date of the payment of the tax.
 S. 8474                           1107
 
   (d)  Underpayment  due to fraud. (1) If any part of an underpayment of
 tax is due to fraud, there shall be added to the tax a penalty equal  to
 two times of the underpayment.
   (2)  The  penalty under this subdivision shall be in lieu of any other
 addition to tax imposed by subdivision (b) or (c) of this section.
   (e) Additional penalty. Any person who, with fraudulent intent,  shall
 fail to pay any tax imposed by this chapter, or to make, render, sign or
 certify  any  return,  or  to  supply  any  information  within the time
 required by or under this chapter, shall be liable for a penalty of  not
 more  than  one  thousand  dollars,  in  addition  to  any other amounts
 required under this chapter to be imposed, assessed and collected by the
 commissioner of finance. The commissioner  of  finance  shall  have  the
 power,  in  his  or  her  discretion, to waive, reduce or compromise any
 penalty under this subdivision.
   (f) The interest and penalties imposed by this section shall  be  paid
 and  disposed of in the same manner as other revenues from this chapter.
 Unpaid interest and penalties may be enforced in the same manner as  the
 tax imposed by this chapter.
   (g)(1)  Authority  to  set interest rates. The commissioner of finance
 shall set the rate of interest to be paid pursuant to subdivision (a) of
 this section, but if no such rate of interest is set, such rate shall be
 deemed to be set at seven and one-half percent per  annum.    Such  rate
 shall  be  the  rate prescribed in paragraph two of this subdivision but
 shall not be less than seven and one-half percent per  annum.  Any  such
 rate  set  by  the  commissioner of finance shall apply to taxes, or any
 portion thereof, which remain or become due on  or  after  the  date  on
 which  such  rate becomes effective and shall apply only with respect to
 interest computed or computable  for  periods  or  portions  of  periods
 occurring in the period in which such rate is in effect.
   (2)  General  rule.  The  rate  of interest set under this subdivision
 shall be the sum of (i) the federal short-term rate  as  provided  under
 paragraph three of this subdivision, plus (ii) seven percentage points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A)  The  federal  short-term  rate for any month shall be the federal
 short-term rate determined by the United States secretary of the  treas-
 ury  during  such  month  in  accordance  with subsection (d) of section
 twelve hundred seventy-four of the internal  revenue  code  for  use  in
 connection  with  section  six  thousand  six  hundred twenty-one of the
 internal revenue code. Any such rate shall be  rounded  to  the  nearest
 full  percent,  or,  if a multiple of one-half of one percent, such rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
   (i) In general. Except as provided in clause  (ii)  of  this  subpara-
 graph,  the federal short-term rate for the first month in each calendar
 quarter shall apply during the first calendar  quarter  beginning  after
 such month.
   (ii)  Special rule for the month of September, nineteen hundred eight-
 y-nine. The federal short-term rate for the  month  of  April,  nineteen
 hundred  eighty-nine  shall  apply  with  respect to setting the rate of
 interest for the month of September, nineteen hundred eighty-nine.
   (4) Publication of interest rate. The commissioner  of  finance  shall
 cause  to  be  published  in the City Record, and give other appropriate
 general notice of, the interest rate to be set under this subdivision no
 later than twenty days preceding the first day of the  calendar  quarter
 during  which such interest rate applies. The setting and publication of
 such interest rate shall not be included within paragraph (a) of  subdi-
 S. 8474                           1108
 
 vision five of section one thousand forty-one of the city charter of the
 preceding  municipality  as  it  existed January first, nineteen hundred
 ninety-four relating to the definition of a rule.
   (h)  Miscellaneous.  (1)  Officers  of  a  corporate  operator or room
 remarketer and partners in a partnership which is an  operator  or  room
 remarketer  shall be personally liable for the tax collected or required
 to be collected by such corporation or partnership under  this  chapter,
 and subject to the penalties and interest imposed by this section.
   (2)  The certificate of the commissioner of finance to the effect that
 a tax has not been paid, that a return, bond or registration certificate
 has  not  been filed, or that information has not been supplied pursuant
 to the provisions of this chapter, shall be presumptive evidence  there-
 of.
   (3) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   (i) Any person required to make or maintain records under this chapter
 who  fails  to  make  or  maintain or make available to the commissioner
 these records is subject to a penalty not to exceed one thousand dollars
 for the first quarterly period or part thereof  for  which  the  failure
 occurs and not to exceed five thousand dollars for each additional quar-
 terly period or part thereof for which the failure occurs.  This penalty
 is in addition to any other penalty provided for in this chapter but may
 not  be  imposed  and collected more than once for failures for the same
 quarterly period or part thereof. If the commissioner determines that  a
 failure  to  make or maintain or make available records in any quarterly
 period was entirely due to reasonable cause and not to willful  neglect,
 the commissioner must remit the penalty imposed for that quarterly peri-
 od.  These  penalties will be paid and disposed of in the same manner as
 other revenues from this chapter. These penalties  will  be  determined,
 assessed,  collected,  paid  and  enforced in the same manner as the tax
 imposed by this chapter, and all the provisions of this chapter relating
 to tax will be deemed also to apply to the  penalties  imposed  by  this
 subdivision.  For purposes of the penalty imposed by this subdivision, a
 person will be considered  to  have  failed  to  make  or  maintain  the
 required  records  when  the commissioner of finance determines that the
 records made or maintained by that person for a quarterly period do  not
 enable  the commissioner to verify occupancy or the amounts received for
 such occupancy or the taxability of that  occupancy  and  to  conduct  a
 complete audit.
   (j) Any person required to make or maintain records under this chapter
 who  fails  to  present and make available these records in an auditable
 form is subject to a penalty not to exceed one thousand dollars for each
 quarterly period or part thereof for which records  maintained  by  that
 person  are not presented and made available by that person in auditable
 form, even if these records are adequate to  verify  credits,  receipts,
 and the taxability thereof and to perform a complete audit.  This penal-
 ty is in addition to any other penalty provided for in this chapter, but
 will  not be imposed and collected more than once for these failures for
 the same quarterly period or part thereof. If  the  commissioner  deter-
 mines  that  any  failure  described in this subdivision for a quarterly
 period was entirely due to reasonable cause and not to willful  neglect,
 the  commissioner  must  remit the penalty imposed for that quarter. The
 penalties imposed by this subdivision will be paid and  disposed  of  in
 the  same  manner  as  other revenues from this chapter. These penalties
 will be determined, assessed, collected, paid and enforced in  the  same
 manner  as  the  tax  imposed by this chapter, and all the provisions of
 S. 8474                           1109
 
 this chapter relating to tax will be deemed also to apply to the  penal-
 ties imposed by this subdivision. For purposes of the penalty imposed by
 this  subdivision, a person will be considered to have failed to present
 and  make records available in auditable form when the records presented
 by that person for that quarter lack sufficient organization, such as by
 date, invoice number, sales receipts, or sequential  numbering,  or  are
 otherwise  inadequate,  without  reorganizing,  reordering  or otherwise
 rearranging the records into an auditable form, to permit direct  recon-
 ciliation  of  the receipts, invoices or other source documents with the
 entries for the quarterly period in the books and  records  and  on  the
 returns of that person.
   (k) Any person who, having elected to maintain in an electronic format
 any  portion  or  all  of  the records he or she is required to make and
 maintain by this chapter, fails to present and make these records avail-
 able and accessible to the commissioner in electronic format, is subject
 to a penalty not to exceed five  thousand  dollars  for  each  quarterly
 period  or  part  thereof  for  which  these  electronic records are not
 presented and made available and accessible upon request,  notwithstand-
 ing  that  the records may also be maintained and available in hard copy
 format. This penalty is in addition to any other penalty provided for in
 this chapter, but may not be imposed and collected more than once for  a
 failure for the same quarterly period or part thereof.  Provided, howev-
 er, nothing in this subdivision will prevent the separate imposition, if
 applicable,  of  any  penalty  imposed by subdivision (i) or (j) of this
 section for the same quarterly period or part thereof.  If  the  commis-
 sioner  determines  that  the failure to present and make electronically
 maintained records available and accessible for a quarterly  period  was
 entirely due to reasonable cause and not to willful neglect, the commis-
 sioner  must remit the penalty imposed for that quarter. These penalties
 will be paid and disposed of in the same manner as other  revenues  from
 this  chapter.  These penalties will be determined, assessed, collected,
 paid and enforced in the same manner as the tax imposed by this chapter,
 and all the provisions of this chapter relating to tax  will  be  deemed
 also  to  apply to the penalty imposed by this subdivision. For purposes
 of the penalty imposed by this subdivision, a  failure  to  present  and
 make  available  and accessible a record maintained in electronic format
 includes not only the denial of access to  the  requested  records  that
 were  maintained  electronically, but also the failure to make available
 to the commissioner the information, knowledge, or  means  necessary  to
 access  and  otherwise  use the electronically maintained records in the
 inspection and examination of these records.
   (l) Aiding or assisting in the giving of fraudulent returns,  reports,
 statements  or other documents. Any person who, with the intent that tax
 be evaded, for a fee or other compensation or  as  an  incident  to  the
 performance  of  other  services  for which that person receives compen-
 sation, aids or assists in, or procures, counsels, or advises the prepa-
 ration or presentation under this chapter, or  in  connection  with  any
 matter  arising  under this chapter, of any return, report, declaration,
 statement or other document that is fraudulent or false as to any  mate-
 rial matter, or supplies any false or fraudulent information, whether or
 not such falsity or fraud is with the knowledge or consent of the person
 authorized  or  required  to  present  that return, report, declaration,
 statement or other document, will pay a penalty not exceeding five thou-
 sand dollars. The definitions in subsection (l) of section one  thousand
 eighty-five of the tax law apply for the purposes of this penalty.
 S. 8474                           1110

   (m)  False or fraudulent document penalty. Any taxpayer that submits a
 false or fraudulent document to the department  will  be  subject  to  a
 penalty  of  one hundred dollars per document submitted, or five hundred
 dollars per tax return submitted. This penalty will be  in  addition  to
 any other penalty provided by law.
   §  11-2516   Returns to be secret. a. Except in accordance with proper
 judicial order, or as otherwise provided by law, it  shall  be  unlawful
 for  the commissioner of finance, any officer or employee of the depart-
 ment of finance, any  person  engaged  or  retained  on  an  independent
 contract  basis,  the tax appeals tribunal, any commissioner or employee
 of such tribunal, or any  person  who,  pursuant  to  this  section,  is
 permitted  to  inspect  any  return  or to whom a copy, an abstract or a
 portion of any return is furnished, or to whom any information contained
 in any return is furnished, to divulge or make known in any  manner  the
 rents  or  other  information  relating  to  the  business of a taxpayer
 contained in any  return  required  under  this  chapter.  The  officers
 charged  with  the  custody  of  such  returns  shall not be required to
 produce any of them or evidence of anything contained  in  them  in  any
 action  or proceeding in any court, except on behalf of the commissioner
 of finance in an action or proceeding under the provisions of this chap-
 ter or on behalf of any party to any  action  or  proceeding  under  the
 provisions  of  this chapter when the returns or facts shown thereby are
 directly involved in such action  or  proceeding,  in  either  of  which
 events  the  court  may  require  the  production  of,  and may admit in
 evidence, so much of said returns or of the facts shown thereby, as  are
 pertinent  to  the  action  or proceeding and no more.   Nothing in this
 section shall be construed to prohibit the delivery to a taxpayer or his
 or her duly authorized representative of a certified copy of any  return
 filed in connection with his or her tax; nor to prohibit the delivery of
 such  a certified copy of such return or of any information contained in
 or relating thereto, to the United States of America or  any  department
 thereof,  to  the state of New York or any department thereof, or to any
 agency or department of the city of Staten Island, provided the same  is
 requested  for  official  business;  nor  to prohibit the inspection for
 official business of such returns by the corporation  counsel  or  other
 legal  representatives  of  the  city or by the district attorney of any
 county within the city; nor to prohibit the publication of statistics so
 classified as to prevent the identification of  particular  returns  and
 the items thereof.  Returns shall be preserved for three years and ther-
 eafter until the commissioner of finance permits them to be destroyed.
   b. (1)  Any officer or employee of the city who willfully violates the
 provisions  of  subdivision  a  of  this section shall be dismissed from
 office and be incapable of holding any public office  for  a  period  of
 five years thereafter.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   c. This section  shall be deemed a state statute for purposes of para-
 graph (a) of subdivision two of section eighty-seven of the public offi-
 cers law.
   d.  Notwithstanding  anything  in subdivision a of this section to the
 contrary, if a taxpayer has petitioned  the  tax  appeals  tribunal  for
 administrative  review as provided in section one hundred seventy of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four, the commissioner of finance shall  be  author-
 ized  to  present to the tribunal any report or return of such taxpayer,
 or any information contained therein or relating thereto, which  may  be
 S. 8474                           1111
 
 material  or  relevant  to  the  proceeding before the tribunal. The tax
 appeals tribunal shall be authorized to publish a copy or a  summary  of
 any decision rendered pursuant to section one hundred seventy-one of the
 charter of the preceding municipality as it existed January first, nine-
 teen hundred ninety-four.
   § 11-2517 Notices and limitations of time. a. Any notice authorized or
 required  under  the  provisions of this chapter may be given by mailing
 the same to the person for whom it is intended in  a  postpaid  envelope
 addressed  to  such person at the address given in the last return filed
 by him or her pursuant to the provisions  of  this  chapter  or  in  any
 application made by him or her or, if no return has been filed or appli-
 cation  made,  then to such address as may be obtainable. The mailing of
 such notice shall be presumptive evidence of the receipt of the same  by
 the  person  to whom addressed.   Any period of time which is determined
 according to the provisions of this chapter  by  the  giving  of  notice
 shall commence to run from the date of mailing of such notice.
   b. The provisions of the civil practice law and rules or any other law
 relative  to  limitations  of time for the enforcement of a civil remedy
 shall not apply to any proceeding or action taken by the city  to  levy,
 appraise,  assess,  determine  or  enforce  the collection of any tax or
 penalty provided by this chapter. However,  except  in  the  case  of  a
 wilfully  false  or  fraudulent  return with intent to evade the tax, no
 assessment of additional tax shall be made after the expiration of  more
 than  three  years  from  the  date of the filing of a return; provided,
 however, that where no return has been filed as provided by law the  tax
 may be assessed at any time.
   c.  Where,  before  the  expiration  of  the period prescribed in this
 section for  the  assessment  of  an  additional  tax,  a  taxpayer  has
 consented  in  writing  that such period be extended, the amount of such
 additional tax due may be determined at any time  within  such  extended
 period.  The  period  so  extended may be further extended by subsequent
 consents in writing made before the expiration of the extended period.
   d. If any return, claim,  statement,  notice,  application,  or  other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 of  any  provision  of  this chapter is, after such period or such date,
 delivered by United States mail to the commissioner of finance, the  tax
 appeals  tribunal,  bureau, office, officer or person with which or with
 whom such document is required to be filed, or to which or to whom  such
 payment  is  required to be made, the date of the United States postmark
 stamped on the envelope shall be deemed to be the date of delivery. This
 subdivision shall apply only if  the  postmark  date  falls  within  the
 prescribed  period or on or before the prescribed date for the filing of
 such document, or for making the payment, including any extension grant-
 ed for such filing or payment, and only if such document or payment  was
 deposited  in  the  mail,  postage  prepaid,  properly  addressed to the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer or person with which or with whom the document  is  required  to  be
 filed or to which or to whom such payment is required to be made. If any
 document  is  sent  by  United States registered mail, such registration
 shall be prima facie evidence that such document was  delivered  to  the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer  or  person to which or to whom addressed, and the date of registra-
 tion shall be deemed the postmark date. The commissioner of finance and,
 where relevant, the tax appeals tribunal are authorized  to  provide  by
 regulation  the  extent  to which, such provisions with respect to prima
 S. 8474                           1112
 
 facie evidence of delivery and the postmark date, shall apply to  certi-
 fied  mail.  Except  as  provided in subdivision f of this section, this
 subdivision shall apply in the case of postmarks not made by the  United
 States  postal  service only if and to the extent provided by regulation
 of the commissioner of finance  or,  where  relevant,  the  tax  appeals
 tribunal.
   e.  When  the  last  day  prescribed  under authority of this chapter,
 including any extension of time, for  performing  any  act  falls  on  a
 Saturday,  Sunday or legal holiday in the state, the performance of such
 act shall be considered timely if it is performed on the next succeeding
 day which is not a Saturday, Sunday or legal holiday.
   f. (1) Any reference in subdivision d of this section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the secretary of the treasury of the United States
 pursuant to section seventy-five hundred two  of  the  internal  revenue
 code  and  any  reference  in  subdivision d of this section to a United
 States postmark shall be treated as including a reference  to  any  date
 recorded  or  marked  in  the  manner  described in section seventy-five
 hundred two of the  internal  revenue  code  by  a  designated  delivery
 service.  If the commissioner of finance finds that any delivery service
 designated by such secretary is inadequate for the needs  of  the  city,
 the  commissioner  of finance may withdraw such designation for purposes
 of this title. The commissioner of finance may also designate additional
 delivery services meeting the criteria of section  seventy-five  hundred
 two  of  the  internal  revenue  code for purposes of this title, or may
 withdraw any such designation if the commissioner of finance finds  that
 a  delivery  service  so  designated  is inadequate for the needs of the
 city. Any reference in subdivision d  of  this  section  to  the  United
 States  mail  shall  be treated as including a reference to any delivery
 service designated by the commissioner of finance and any  reference  in
 subdivision  d  of  this  section  to  a United States postmark shall be
 treated as including a reference to any date recorded or marked  in  the
 manner  described  in  section  seventy-five hundred two of the internal
 revenue code by a delivery service designated  by  the  commissioner  of
 finance,  provided,  however any withdrawal of designation or additional
 designation by the commissioner of finance shall not  be  effective  for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal  of  designation or additional designation is ratified by the
 president of the tax appeals tribunal.
   (2) Any equivalent of registered or certified mail designated  by  the
 United  States secretary of the treasury, or as may be designated by the
 commissioner of finance pursuant to  the  same  criteria  used  by  such
 secretary for such designations pursuant to section seventy-five hundred
 two  of  the internal revenue code, shall be included within the meaning
 of registered or certified  mail  as  used  in  subdivision  d  of  this
 section.  If  the  commissioner  of finance finds that any equivalent of
 registered or certified mail designated by such secretary or the commis-
 sioner of finance is inadequate for the needs of the city,  the  commis-
 sioner  of  finance  may  withdraw such designation for purposes of this
 title, provided, however, any withdrawal of  designation  or  additional
 designation  by  the  commissioner of finance shall not be effective for
 purposes of service upon the tax appeals tribunal, unless and until such
 withdrawal of designation or additional designation is ratified  by  the
 president of the tax appeals tribunal.
   §  11-2518    Construction  and  enforcement.  This  chapter  shall be
 construed and enforced in conformity with chapter one hundred  sixty-one
 S. 8474                           1113

 of  the  laws  of  nineteen  hundred  seventy, as amended by chapter one
 hundred sixty-two of the laws of nineteen hundred seventy,  pursuant  to
 which it is enacted.
   §  11-2519  Tourism and convention fund. Notwithstanding any provision
 of law to the contrary, with respect to the additional  tax  imposed  at
 the  rate  of six percent on and after September first, nineteen hundred
 ninety and before December first, nineteen hundred ninety-four  pursuant
 to  subparagraph  (B)  of  paragraph  three  of subdivision a of section
 11-2502 of this chapter, four and one-sixth percent of the total  reven-
 ues  resulting  from the imposition of such tax, including four and one-
 sixth percent of any interest or penalties thereon, shall be credited to
 and deposited in a special tourism and convention fund, which  shall  be
 used  solely for the purpose of promoting tourism and conventions in the
 city. Seven-eighths of the moneys in such fund shall be  made  available
 to  the  New  York Convention and Visitor's Bureau, Inc.  pursuant to an
 annual contract with the city which may specify, among other things, the
 services which shall be provided by such bureau with such moneys and the
 content and number of reports which will have to  be  provided  by  such
 bureau  to  the  city  concerning  the  expenditure  of such moneys, and
 provided that the annual budget and business  plan  of  such  bureau  is
 approved  by the mayor of the city or his or her designee. The remaining
 one-eighth of  the  fund  shall  be  spent  for  promoting  tourism  and
 conventions  which  may include, at the mayor's discretion, moneys spent
 in connection with additional contracts made with the New  York  Conven-
 tion  and  Visitor's Bureau, Inc. For purposes of this section, the term
 "promoting tourism and conventions" shall mean developing,  placing  and
 purchasing  advertising  promoting  the city, and engaging in such other
 efforts as are designed to attract tourists and conventions to the city.
 
                                CHAPTER 26
                             TAX ON MORTGAGES
 
   § 11-2601 Imposition of tax. a. A tax of  fifty  cents  for  each  one
 hundred  dollars  and each remaining major fraction thereof of principal
 debt or obligation which is, or under any contingency may be secured  at
 the date of execution thereof or at any time thereafter by a mortgage on
 real  property  situated within the city and recorded on or after August
 first, nineteen hundred seventy-one and prior to February  first,  nine-
 teen  hundred  eighty-two,  is  hereby imposed on each such mortgage and
 shall be collected and paid as provided in this chapter. If the  princi-
 pal  debt or obligation which is or by any contingency may be secured by
 such mortgage is less than one hundred dollars, a tax of fifty cents  is
 hereby  imposed  on  such  mortgage,  and shall be collected and paid as
 provided in this chapter.
   b. With respect to: (1) one, two or  three-family  houses,  individual
 cooperative apartments and individual residential condominium units, and
 (2)  real  property securing a principal debt or obligation of less than
 five hundred thousand dollars, a tax of fifty cents, and with respect to
 all other real property a tax of one  dollar  and  twelve  and  one-half
 cents,  for  each  one hundred dollars and each remaining major fraction
 thereof of principal debt or obligation which is, or under  any  contin-
 gency  may  be  secured  at the date of execution thereof or at any time
 thereafter by a mortgage on such real property situated within the  city
 and recorded on or after February first, nineteen hundred eighty-two and
 before  July  first,  nineteen  hundred eighty-two, is hereby imposed on
 each such mortgage and shall be collected and paid as provided  in  this
 S. 8474                           1114
 
 chapter.  If the principal debt or obligation which is or by any contin-
 gency may be secured by such mortgage is less than one hundred  dollars,
 a  tax  of  one  dollar is hereby imposed on such mortgage, and shall be
 collected and paid as provided in this chapter.
   c.  With  respect  to:  (1) real property securing a principal debt or
 obligation of less than five hundred thousand dollars, a  tax  of  fifty
 cents,  (2)  with respect to one, two or three-family houses, individual
 cooperative apartments  and  individual  residential  condominium  units
 securing a principal debt or obligation of five hundred thousand dollars
 or  more, a tax of sixty-two and one-half cents, and (3) with respect to
 all other real property, a tax of one dollar and twenty-five cents,  for
 each  one  hundred  dollars and each remaining major fraction thereof of
 principal debt or obligation which is, or under any contingency  may  be
 secured  at the date of execution thereof or at any time thereafter by a
 mortgage on such real property situated within the city and recorded  on
 or  after  July  first,  nineteen  hundred  eighty-two and before August
 first, nineteen hundred ninety, is hereby imposed on each such  mortgage
 and  shall  be  collected  and paid as provided in this chapter.  If the
 principal debt or obligation which is  or  by  any  contingency  may  be
 secured  by such mortgage is less than one hundred dollars, a tax of one
 dollar is hereby imposed on such mortgage and  shall  be  collected  and
 paid as provided in this chapter.
   d.  With  respect  to:  (1) real property securing a principal debt or
 obligation of less than five hundred thousand  dollars,  a  tax  of  one
 dollar, (2) with respect to one, two or three-family houses and individ-
 ual  residential  condominium  units  securing a principal debt or obli-
 gation of five hundred thousand dollars or more, a tax of one dollar and
 twelve and one-half cents, and (3) with respect to all other real  prop-
 erty,  a  tax of one dollar and seventy-five cents, for each one hundred
 dollars and each remaining major fraction thereof of principal  debt  or
 obligation which is, or under any contingency may be secured at the date
 of  execution  thereof,  or  at anytime thereafter by a mortgage on such
 real property situated within the city and recorded on or  after  August
 first,  nineteen hundred ninety, is hereby imposed on each such mortgage
 and shall be collected and paid as provided in this  chapter.    If  the
 principal  debt  or  obligation  which  is  or by any contingency may be
 secured by such mortgage is less than one hundred dollars, a tax of  one
 dollar  is  hereby  imposed  on such mortgage and shall be collected and
 paid as provided in this chapter.
   e. (1) For the purpose of determining whether a mortgage is subject to
 the tax imposed by subdivision b or c of  this  section  at  a  rate  in
 excess  of fifty cents, or by subdivision d of this section at a rate in
 excess of one dollar, for each one hundred dollars  and  each  remaining
 major  fraction  thereof  of principal debt or obligation, the principal
 debt or obligation which is or under any contingency may be  secured  at
 the  date of execution thereof, or at any time thereafter, by such mort-
 gage shall be aggregated with the principal debt or obligation which  is
 or  under any contingency may be secured at the date of execution there-
 of, or at any time thereafter, by any other mortgage, where  such  mort-
 gages form part of the same or related transactions and have the same or
 related  mortgagors.  If  the commissioner of taxation and finance finds
 that a mortgage transaction or mortgage transactions  have  been  formu-
 lated for the purpose of avoiding or evading a rate of tax imposed under
 this  section  in excess of the lowest such rate, rather than solely for
 an independent business or financial purpose,  such  commissioner  shall
 treat  all  of  the mortgages forming part of such transaction or trans-
 S. 8474                           1115
 
 actions as a single mortgage for the purpose of determining the applica-
 ble rate of tax.  For the purposes of this  subdivision,  all  mortgages
 having  the  same  or  related mortgagors offered for recording within a
 period  of twelve consecutive months shall be presumed to form part of a
 related transaction, unless clear and convincing evidence is offered  to
 the  contrary. The commissioner of taxation and finance may require such
 affidavits and forms, and may prescribe such rules and  regulations,  as
 he  or  she determines to be necessary to enforce the provisions of this
 subdivision.
   (2) The term "related", when used in this subdivision  with  reference
 to mortgagors, shall include, but shall not be limited to, the following
 relationships:
   (i) members of a family, including spouses, ancestors, lineal descend-
 ants, and brothers and sisters, whether by the whole or half blood;
   (ii)  a  shareholder  and a corporation more than fifty percent of the
 value of the outstanding stock of which is owned or controlled  directly
 or indirectly by such shareholder;
   (iii) a partner and a partnership more than fifty percent of the capi-
 tal  or  profits  interest  in  which is owned or controlled directly or
 indirectly by such partner;
   (iv) a beneficiary and a trust more than fifty percent of the  benefi-
 cial  interest in which is owned or controlled directly or indirectly by
 such beneficiary;
   (v) two or more corporations, partnerships, associations,  or  trusts,
 or  any  combination  thereof,  which  are  owned  or controlled, either
 directly or indirectly, by the same person, corporation or other entity,
 or interests; and
   (vi) a grantor of a trust and such trust.
   f. Notwithstanding any provision to the contrary in paragraph  (a)  of
 subdivision  one  of  section two hundred fifty-five of the tax law, the
 taxes imposed by subdivision c or d of this section shall also apply  to
 principal  indebtedness  or  obligation  secured  by  or which under any
 contingency may be secured by a supplemental  instrument  or  additional
 mortgage,  whether  or  not  there is any new or further indebtedness or
 obligation other than the principal indebtedness or  obligation  secured
 by a recorded primary mortgage, where (1) the supplemental instrument or
 additional  mortgage  imposes  the lien of a recorded mortgage upon real
 property situated within the city not previously subject to the mortgage
 or where  an  additional  mortgage  upon  such  additional  property  is
 recorded  as additional or substitute security for indebtedness or obli-
 gation already secured by a  recorded  mortgage  and  (2)  the  recorded
 primary  mortgage  was  on  real  property outside the city and recorded
 without payment of the city tax.
   § 11-2602  Payment and payment over of taxes.   The taxes  imposed  by
 this  chapter shall be payable on the recording of each mortgage of real
 property subject to taxes pursuant to such chapter. Such taxes shall  be
 paid  to  the recording officer of the county in which the real property
 or any part thereof is situated, except where real property is  situated
 within  and  without  the  city,  the recording officer of the county in
 which the mortgage is first recorded shall collect the  tax  imposed  by
 this  chapter,  as  required by subdivision three of section two hundred
 fifty-three-a of the tax law. It shall be the  duty  of  such  recording
 officer  to  indorse  upon each mortgage a receipt for the amount of the
 tax so paid. Any mortgage so endorsed may  thereupon  or  thereafter  be
 recorded  by any recording officer and the receipt for such tax indorsed
 upon each mortgage shall be  recorded  therewith.  The  record  of  such
 S. 8474                           1116
 
 receipt  shall be conclusive proof that the amount of tax stated therein
 has been paid upon such mortgage. Upon the first day of each  month  the
 city  register  and  the  recording officer of Richmond county shall pay
 over to the commissioner of finance of the city for credit to the gener-
 al  fund  of  such  city,  the balance of the moneys received during the
 preceding month upon account of taxes paid to him or her  as  prescribed
 in  this  section,  after deducting the necessary expenses of his or her
 office as provided in section two hundred  sixty-two  of  the  tax  law,
 except  taxes  paid  upon mortgages which are first to be apportioned by
 the commissioner of taxation and finance, which taxes and money shall be
 paid over by him or her as provided by the  determination  of  the  said
 commissioner  of  taxation  and  finance,  provided,  however,  in  each
 instance where the tax imposed pursuant to section 11-2601 of this chap-
 ter is one dollar and twenty-five cents for each one hundred dollars and
 each remaining major fraction thereof of such principal  debt  or  obli-
 gation,  fifty  percent of the total amount of such tax, including fifty
 percent of any interest or penalties thereon, shall be set  aside  in  a
 special  account  by  the  commissioner of finance, and in each instance
 where the tax imposed pursuant to that section is one dollar and  seven-
 ty-five  cents  for  each  one  hundred dollars and each remaining major
 fraction thereof of such principal debt or obligation,  thirty-five  and
 seven-tenths  percent of the total amount of such tax, including thirty-
 five and seven-tenths percent of  any  interest  or  penalties  thereon,
 shall also be set aside in such special account.  Moneys in such account
 shall  be used for payment by such commissioner to the state comptroller
 for deposit in the urban mass transit operating  assistance  account  of
 the  mass  transportation  operating  assistance  fund  of any amount of
 insufficiency  certified  by  the  state  comptroller  pursuant  to  the
 provisions  of  subdivision  six  of section eighty-eight-a of the state
 finance law, and on the fifteenth day of each month,  such  commissioner
 shall  transmit  all  funds  in such account at the end of the preceding
 month, except the amount required for  the  payment  of  any  amount  of
 insufficiency  certified  by the state comptroller and such amount as he
 or she deems necessary for refunds and such other amounts  necessary  to
 finance  the  city  transportation disabled committee and the city para-
 transit system as established by section fifteen-b of the transportation
 law, provided, however, that such amounts shall not exceed  six  percent
 of  the  total  funds  in  the  account but in no event be less than two
 hundred twenty-five thousand dollars  beginning  April  first,  nineteen
 hundred eighty-six, and further that beginning November fifteenth, nine-
 teen hundred eighty-four and during the entire period prior to operation
 of such system, the total of such amounts shall not exceed three hundred
 seventy-five  thousand  dollars  for the administrative expenses of such
 committee and fifty thousand dollars for  the  expenses  of  the  agency
 designated  pursuant to paragraph b of subdivision five of such section,
 and other amounts necessary  to  finance  the  operating  needs  of  the
 private bus companies franchised by the city of Staten Island and eligi-
 ble  to  receive  state operating assistance under section eighteen-b of
 the transportation law, provided, however, that such amounts  shall  not
 exceed  four  percent of the total funds in the account, to the New York
 city transit authority for mass transit within the city.
   §  11-2603  Manner of administration and collection. The taxes imposed
 under this chapter shall be  administered  and  collected  in  the  same
 manner as the taxes imposed under subdivision one of section two hundred
 fifty-three and subdivision one of section two hundred fifty-five of the
 tax  law.   All the provisions of article eleven of the tax law relating
 S. 8474                           1117
 
 to or applicable to the  administration  and  collection  of  the  taxes
 imposed by subdivision one of section two hundred fifty-three and subdi-
 vision  one of section two hundred fifty-five of the tax law shall apply
 to  the  taxes imposed under this chapter with the same force and effect
 as if those provisions had been set forth in full in this chapter except
 to the extent that any such provision  is  either  inconsistent  with  a
 provision  of  this  chapter  or not relevant to the tax imposed by this
 chapter.  For purposes of this chapter any reference in  article  eleven
 of  the  tax  law  to  the tax or taxes imposed by such article shall be
 deemed to refer to a tax imposed by this chapter, and any  reference  to
 the  phrase  "within  this  state"  shall  be read as "within this city"
 unless a different meaning is clearly required.  Whenever real  property
 covered  by the mortgage is partly within and partly without the city of
 Staten Island, the portion of the mortgage taxable  under  this  chapter
 shall  be  determined in the manner prescribed in the first paragraph of
 section two hundred sixty of the tax law where the property without  the
 city  is  located  within the state and, in the manner prescribed in the
 second paragraph of such section of the  tax  law,  where  the  property
 without the city is located without the state.
   §   11-2604   Tax additional. The tax imposed by this chapter shall be
 in addition to any taxes imposed by section two hundred  fifty-three  of
 the tax law.
 
                                CHAPTER 27
                            ANNUAL VAULT CHARGE
 
   §  11-2701 Definitions. When used in this chapter, the following terms
 shall mean or include:
   1. "Person." An individual, partnership, society, association,  joint-
 stock company, corporation, estate, receiver, lessee, trustee, assignee,
 referee,  or  any  other  person acting in a fiduciary or representative
 capacity, whether appointed by a court or otherwise, and any combination
 of individuals.
   2. "Vault." Any subsurface opening, structure or erection, whether  or
 not  wholly  or  partly covered over, to the extent that it extends from
 the building line into any street of the city, for the erection of which
 a license fee is required pursuant to the charter of the  city  or  this
 code.
   3.  "Street." Every public street, avenue, road, alley, lane, highway,
 boulevard, concourse, parkway, driveway,  culvert,  sidewalk,  crosswalk
 and  viaduct,  and every other class of public highway, road, square and
 place within or belonging to the city.
   4. "Using, occupying  or  maintaining."  Any  right  or  authority  to
 install, store or maintain property of any kind in a vault, or otherwise
 to  use,  occupy or maintain such vault for any purpose whatsoever. Such
 right or authority shall be deemed to exist wherever  a  vault  has  not
 been  filled in or closed by the licensee or abutting property owner and
 the street restored to its original condition pursuant to  the  require-
 ments of the charter of the city or this code.
   5.  "City  surveyor."  Any  person appointed a surveyor of the city of
 Staten Island pursuant to the code of the city.
   6. "Owner of the premises immediately adjoining the vault." Any person
 who is the owner of record of real property located in whole or in  part
 within the city, from which a vault has been extended.
   7.  "Depth."  The vertical distance from the ceiling, roof or top of a
 vault to the floor, bottom or lowest point thereof.
 S. 8474                           1118
 
   8. "City." The city of Staten Island.
   9. "Comptroller." The comptroller of the city.
   10.  "Commissioner  of  finance."  The  commissioner of finance of the
 city.
   11. "Return." Any return required to be filed as  under  this  chapter
 provided.
   12.  "Tax  appeals  tribunal." The tax appeals tribunal established by
 section one hundred sixty-eight of the charter of the preceding  munici-
 pality as it existed January first, nineteen hundred ninety-four.
   §    11-2702    Imposition of charge. (a)   In addition to any and all
 other license fees, charges and taxes, there is hereby imposed and there
 shall be paid an annual vault charge, beginning as of July first,  nine-
 teen  hundred  sixty-two, for the privilege of occupying, using or main-
 taining a vault in the streets of the city, to be paid by the  owner  of
 the premises immediately adjoining the vault.
   (A) For periods prior to July first, nineteen hundred seventy-one such
 annual vault charges shall be at the following rates:
   1.  On  any vault occupying up to two hundred and fifty square feet in
 plane or surface area but no more than twelve feet in depth, thirty-five
 cents per square foot but not less than five dollars for the total occu-
 pancy;
   2. On any vault occupying more than two hundred fifty square  feet  in
 plane  or  surface  area but not more than twelve feet in depth, thirty-
 five cents per square foot for the first two hundred fifty  square  feet
 of  an area and sixty cents per square foot for that portion of the area
 in excess of two hundred fifty square feet;
   3. On any vault more than twelve feet in depth, an  additional  charge
 for  each additional ten feet in depth or fraction thereof calculated by
 adding the plane or surface area for each such additional depth  to  the
 area calculated pursuant to subparagraphs one and two and by applying to
 such total area the same rates as provided in subparagraphs one and two.
 The  additional  area  for  any additional depth of ten feet or fraction
 thereof shall however, be reduced by ten percent for each foot of  depth
 less than ten feet.
   (B)  For  periods  beginning  on or after July first, nineteen hundred
 seventy-one and ending on or before May thirty-first,  nineteen  hundred
 eighty, such annual vault charges shall be at the following rates:
   1.  On  any  vault  occupying  no  more than twelve feet in depth, one
 dollar per square foot of plane or surface area but not less  than  five
 dollars for the total occupancy;
   2.  On  any vault more than twelve feet in depth, an additional charge
 for each additional ten feet in depth, or fraction thereof calculated by
 adding the plane or surface area for each such additional depth  to  the
 area  calculated  pursuant  to subparagraph one of this paragraph and by
 applying to such total area the same rate as  provided  in  subparagraph
 one  of this paragraph.  The additional area for any additional depth of
 ten feet or fraction thereof shall however, be reduced  by  ten  percent
 for each foot of depth less than ten feet.
   (C)  For  periods  beginning  on or after June first, nineteen hundred
 eighty such annual vault charge shall  be at the following rates:
   1. On any vault occupying no more  than  twelve  feet  in  depth,  two
 dollars per square foot of plane or surface area;
   2.  On  any vault more than twelve feet in depth, an additional charge
 for each additional ten feet in depth, or fraction thereof calculated by
 adding the plane or surface area for each such additional depth  to  the
 area  calculated  pursuant  to subparagraph one of this paragraph and by
 S. 8474                           1119

 applying to such total area the same rate as  provided  in  subparagraph
 one  of  this paragraph. The additional area for any additional depth of
 ten feet or fraction thereof shall however, be reduced  by  ten  percent
 for each foot of depth less than ten feet.
   (D)  Notwithstanding  any  provision of law to the contrary, no annual
 vault charge or additional charge shall  be  imposed  pursuant  to  this
 chapter on or after June first, nineteen hundred ninety-eight.
   (b)    Where the owner of the premises immediately adjoining the vault
 is exempt from or otherwise not liable for the annual vault charge,  the
 tenant,  lessee or any other person using, occupying or maintaining such
 vault shall be liable therefor.
   (c) The annual vault charge imposed by this section shall be due from,
 and shall be paid by, the person who is the owner of the premises  imme-
 diately  adjoining  the  vault  on the first day of July of the year for
 which such charge is imposed except that, on and after June first, nine-
 teen hundred seventy-two, such charge shall be due from,  and  shall  be
 paid  by the person who is the owner of the premises immediately adjoin-
 ing the vault on the first day of June of the year for which such charge
 is imposed.  Where the annual vault charge is imposed pursuant to subdi-
 vision (b) of this section, such annual vault charge shall be  due  from
 and  paid by, the tenant, lessee or any other person using, occupying or
 maintaining the vault on the first day of July of  the  year  for  which
 such charge is imposed, except that for years beginning on or after June
 first,  nineteen hundred seventy-two, such charge shall be due from, and
 paid by, the tenant, lessee or any  other  person  using,  occupying  or
 maintaining  the  vault  on  the first day of June of the year for which
 such charge is imposed.
   (d) In the event that the annual vault charge as imposed by this chap-
 ter shall be held invalid, then such annual vault charge shall be deemed
 a tax on the same basis and at the same rates as provided in this  chap-
 ter  and  all other provisions of this chapter shall be equally applica-
 ble.
   (e) Where, prior to the first day of August in any year in  which  the
 annual vault charge imposed under this chapter shall be due and payable,
 if a vault or part thereof is made unavailable for use or occupancy, the
 annual  vault  charge  paid for such year, pursuant to the provisions of
 this chapter, shall be refunded in full upon application to and furnish-
 ing of such proof as the commissioner of finance  may  require.    Where
 such  closing of a vault occurs prior to the last day of December in any
 such year, fifty percent of the annual vault  charge  due  and  actually
 paid  for  such  year shall be refunded to the payor upon application to
 and furnishing of such proof as the commissioner of finance may require.
 Where such closing is limited to a part of a vault, such a refund  shall
 be  granted  only to the extent that the closing reduces the area of the
 vault and thereby the amount of the charge for the vault.
   § 11-2703 Exemptions. The charges imposed by this  chapter  shall  not
 apply to the following:
   1.  The  state  of  New  York,  or any public corporation, including a
 public corporation created pursuant to agreement or compact with another
 state or the Dominion of Canada, improvement district or other political
 subdivision of the state;
   2. The United States of America, insofar as it is  immune  from  taxa-
 tion;
   3.  The United Nations or other world-wide international organizations
 of which the United States of America is a member;
 S. 8474                           1120
 
   4. Any corporation, or association, or trust, or community chest, fund
 or foundation, organized and operated exclusively for religious,  chari-
 table,  or  educational  purposes,  or  for the prevention of cruelty to
 children or animals, and no part of the net earnings of which inures  to
 the  benefit of any private shareholder or individual and no substantial
 part of the activities of which is carrying on propaganda, or  otherwise
 attempting  to influence legislation; provided, however, that nothing in
 this subdivision shall include an organization operated for the  primary
 purpose  of  carrying  on a trade or business for profit, whether or not
 all of its profits are payable to one or more organizations described in
 this subdivision.
   5. Any vault constituting property defined as a special  franchise  in
 section one hundred two of the real property tax law or assessed as such
 pursuant to article six of such law.
   6.  Any  vault  to  the extent that it is used, occupied or maintained
 pursuant to a  revocable  consent  granted  pursuant  to  section  three
 hundred  seventy-four of the charter of the preceding municipality as it
 existed January first, nineteen hundred ninety-four.
   7. Any vault immediately adjoining a building  or  structure  designed
 for  and  used  exclusively  as a single-family or a two-family dwelling
 house or any other real property which is classified as class  one  real
 property  pursuant  to section eighteen hundred two of the real property
 tax law.
   8. Any street occupancy usable solely and exclusively for the  melting
 of  snow  and  ice, or for delivery into the immediately adjoining prem-
 ises, of coal, oil or other fuel for the heating thereof.
   9. Any vault occupying no more than thirty-six square feet in plane or
 surface area, irrespective of the depth of such vault.
   §  11-2704  Filing of returns. a.  Every person subject to the  annual
 vault  charge  under  this  chapter shall, on or before the first day of
 August, nineteen hundred sixty-two, and on or before the  fifteenth  day
 of  July of every year thereafter, file with the commissioner of finance
 a return showing the dimensions of the vault as  to  length,  width  and
 depth,  except  that  the  return required to be filed on or before July
 fifteenth, nineteen hundred seventy-two shall be filed on or before June
 fifteenth, nineteen hundred seventy-two and those  due  in  later  years
 shall be required to be filed on or before June fifteenth of such years.
 The  commissioner  of finance, if he or she deems it necessary to insure
 adequate information with regard to the proper charge to be imposed, may
 require information returns from other persons, including the owners  of
 real property regardless of whether a vault has been extended therefrom,
 the  users or lessees of the vault or lessees or tenants of the property
 adjoining the vault.
   b. The forms of returns shall be prescribed  by  the  commissioner  of
 finance  and shall contain such information as he or she may deem neces-
 sary for the proper administration of this chapter; and the commissioner
 of finance or his or her duly authorized agents or  employees  shall  be
 empowered to require supplemental returns.  If a return required by this
 chapter  is not filed or if the return when filed is incorrect or insuf-
 ficient on its face, the commissioner of finance shall take  the  neces-
 sary  steps  to  enforce  the  filing of such a return or of a corrected
 return.  Upon failure to comply with a notice to furnish a return  or  a
 sufficient return, the commissioner of finance may require the filing of
 a certificate signed by a city surveyor specifying the dimensions of the
 vault.
 S. 8474                           1121
 
   c. For each annual vault charge year beginning on or after June first,
 nineteen  hundred  eighty-nine,  the  commissioner  of finance shall, at
 least thirty days prior to the commencement of such year, mail  to  each
 person  who  has filed an annual vault charge return for the immediately
 preceding  year  an  annual  vault  charge return form on which shall be
 shown the amount of the charge for such immediately preceding year. Such
 return form shall be accompanied by instructions which explain in  clear
 and  simple  terms  how to determine the dimensions and extent of street
 occupancy of a vault, how to calculate the amount  of  the  charge,  and
 such other matters as the commissioner considers necessary or helpful to
 an understanding of the requirements of this chapter, provided, however,
 neither  the  failure  of  the commissioner to mail such return form and
 instructions nor the failure of any person to  receive  the  same  shall
 relieve  any  person of the obligation to file any return required under
 this section or of liability  for  the  charge,  interest  or  penalties
 imposed by this chapter.
   d.  If  no  form  or other notice has previously been sent to a person
 subject to the annual vault charge with respect to the amount  of  vault
 charge  owed for any year, the commissioner of finance shall notify such
 person of the amount owed as soon as practicable after discovering  that
 such amount is owed.
   §  11-2705 Payment of vault charges. a. At the time of filing a return
 as required by this chapter the  person  subject  to  the  annual  vault
 charge  shall  pay  to the commissioner of finance the charge imposed by
 this chapter.  Such charge shall be due and payable on the last  day  on
 which  such  return is required to be filed, without regard to whether a
 return is filed or whether the return which is filed correctly shows the
 amount due.
   b. The charge otherwise required to be paid with the return due on  or
 before  June  fifteenth,  nineteen  hundred  eighty shall be paid in two
 equal installments as follows: one-half of the charge shall be paid with
 the return on or before June fifteenth,  nineteen  hundred  eighty,  and
 one-half  of  the charge shall be paid on or before September fifteenth,
 nineteen hundred eighty.
   § 11-2706  Presumption and burden of proof. For  the  purpose  of  the
 proper  administration  of  this  chapter  and to prevent evasion of the
 annual vault charge hereby imposed, it shall be presumed,  except  where
 the  depth of a vault exceeds twelve feet, that the size of the vault as
 indicated upon the license therefor  originally  issued  by  the  former
 borough  president of Staten Island up to and including December thirty-
 first, nineteen hundred sixty-two, and the commissioner  of  transporta-
 tion  thereafter is a proper measure of the charge until the contrary is
 established, and the burden of proving that the size of the vault is not
 accurately stated upon the license shall be upon the person so claiming.
 In cases where no license of record has been issued for a vault or where
 the depth of a vault exceeds twelve feet,  the  burden  of  proving  the
 actual  size  of the vault shall be upon the person liable for the vault
 charge.
   § 11-2707 Determination of vault charge. If a return required by  this
 chapter  is not filed or if a return when filed is incorrect or insuffi-
 cient, the amount of the vault charge due shall  be  determined  by  the
 commissioner  of finance from such information as may be obtainable and,
 if necessary, the charge may be  estimated  on  the  basis  of  external
 indices,  including  but not limited to the records of the department of
 transportation, the reports of tax assessors, the reports of  inspectors
 and  investigators  in  the  offices  of the commissioner of finance and
 S. 8474                           1122
 
 commissioner of transportation, or other information or factors.  Notice
 of  such  determination  shall  be  given  to  the person liable for the
 payment thereof. Such determination shall finally  and  irrevocably  fix
 the  vault  charge  unless the person against whom it is assessed shall,
 within ninety days after the giving of notice of such determination, or,
 if the commissioner of finance has established a conciliation  procedure
 pursuant to section 11-124 of the code of the preceding municipality and
 such person has requested a conciliation conference in accordance there-
 with,  within ninety days from the mailing of a conciliation decision or
 the date of the commissioner's confirmation of the discontinuance of the
 conciliation proceeding, both (1) serves a petition upon the commission-
 er of finance and (2) files a petition with the tax appeals tribunal, or
 unless the commissioner of finance of his or her own motion shall  rede-
 termine  the  same.    Upon  such  hearing  the tax appeals tribunal may
 require the filing of a certificate signed by a city surveyor specifying
 the dimensions of the vault.  After such hearing the tax appeals  tribu-
 nal  shall  give  notice  of its decision to the person against whom the
 vault charge is assessed.   A  decision  of  the  tax  appeals  tribunal
 sitting en banc shall be reviewable for error, illegality or unconstitu-
 tionality  or  any other reason whatsoever by a proceeding under article
 seventy-eight of the civil practice law and rules if application  there-
 for  is  made  to the supreme court by the person against whom the vault
 charge was assessed within four months after the giving of the notice of
 such tax appeals tribunal decision. A proceeding under article  seventy-
 eight  of  the civil practice law and rules shall not be instituted by a
 person against whom the vault charge is assessed unless (a)  the  amount
 of  any  vault charge sought to be reviewed, with penalties and interest
 thereon, if any, shall be  first  deposited  with  the  commissioner  of
 finance  and  there  shall  be filed with the commissioner of finance an
 undertaking in such amount and with such sureties as a  justice  of  the
 supreme  court  shall  approve, to the effect that if such proceeding be
 dismissed or the vault charge confirmed  the  person  against  whom  the
 vault charge is assessed will pay all costs and charges which may accrue
 in  the  prosecution  of  the  proceeding,  or (b) at the option of such
 person, such undertaking filed with the commissioner of finance  may  be
 in  a  sum  sufficient to cover the vault charge, penalties and interest
 thereon stated in such decision plus the costs  and  charges  which  may
 accrue against him or her in the prosecution of the proceeding, in which
 event  such  person  shall not be required to deposit such vault charge,
 penalties and interest as a condition precedent to the application.
   § 11-2708 Refunds. a. In the manner  provided  in  this  section,  the
 commissioner  of  finance  shall refund or credit, without interest, any
 vault charge, penalty or interest erroneously, illegally or  unconstitu-
 tionally collected or paid if application to the commissioner of finance
 for  such refund shall be made within one year from the payment thereof.
 Whenever a refund is made or denied by the commissioner of  finance,  he
 or she shall state his or her reason therefor and give notice thereof to
 the  applicant  in writing. Such application may be made by the owner of
 the premises, or other person, who has actually paid the  vault  charge.
 The  commissioner  of  finance may, in lieu of any refund required to be
 made, allow credit therefor on payments due from the applicant.
   b.  Any determination of the commissioner of finance denying a  refund
 or  credit  pursuant to subdivision a of this section shall be final and
 irrevocable unless the applicant for such refund or credit, within nine-
 ty days from the mailing of notice of such  determination,  or,  if  the
 commissioner  of finance has established a conciliation procedure pursu-
 S. 8474                           1123

 ant to section 11-124 of the code of the preceding municipality and  the
 applicant  has  requested a conciliation conference in accordance there-
 with, within ninety days from the mailing of a conciliation decision  or
 the date of the commissioner's confirmation of the discontinuance of the
 conciliation proceeding, both (1) serves a petition upon the commission-
 er of finance and (2) files a petition with the tax appeals tribunal for
 a  hearing.  Such  petition  for a refund or credit, made as provided in
 this section, shall be deemed an application for a revision of any vault
 charge, penalty or interest complained of. Such hearing and  any  appeal
 to  the  tax appeals tribunal sitting en banc from the decision rendered
 in such hearing shall be conducted in the  manner  and  subject  to  the
 requirements prescribed by the tax appeals tribunal pursuant to sections
 one  hundred  sixty-eight through one hundred seventy-two of the charter
 of the preceding municipality as  it  existed  January  first,  nineteen
 hundred  ninety-four. After such hearing, the tax appeals tribunal shall
 give notice of its decision to the applicant and to the commissioner  of
 finance.  The applicant shall be entitled to review such decision of the
 tax appeals tribunal sitting en banc by a proceeding pursuant to article
 seventy-eight of  the  civil  practice  law  and  rules,  provided  such
 proceeding  is  instituted  within  four  months after the giving of the
 notice of such decision, and provided, in the case of an application  by
 a  person against whom the vault charge is assessed, that a final deter-
 mination of the vault  charge  due  was  not  previously  made.  Such  a
 proceeding  shall  not  be instituted by a person against whom the vault
 charge is assessed unless an undertaking is filed with the  commissioner
 of  finance  in  such  amount and with such sureties as a justice of the
 supreme court shall approve to the effect that  if  such  proceeding  be
 dismissed  or the vault charge confirmed, such person will pay all costs
 and charges which may accrue in the prosecution of such proceeding.
   c. A person shall not be entitled to  a  revision,  refund  or  credit
 under this section of a vault charge, interest or penalty which had been
 determined  to  be  due pursuant to the provisions of section 11-2707 of
 this chapter where he or she has had a hearing or an opportunity  for  a
 hearing,  as provided in said section, or has failed to avail himself or
 herself of the remedies therein provided. No refund or credit  shall  be
 made  of  annual vault charge, interest or penalty paid after a determi-
 nation by the commissioner of finance made pursuant to  section  11-2707
 of  this  chapter unless it be found that such determination was errone-
 ous, illegal or unconstitutional  or  otherwise  improper,  by  the  tax
 appeals  tribunal  after  a hearing or on the commissioner's own motion,
 or, if such tax appeals tribunal affirms in whole or in part the  deter-
 mination  of  the commissioner of finance, in a proceeding under article
 seventy-eight of the civil practice  law  and  rules,  pursuant  to  the
 provisions  of  said  section,  in  which event refund or credit without
 interest shall be made of the vault charge, interest or penalty found to
 have been overpaid.
   § 11-2709  Reserves. In cases where the person or persons  liable  for
 the  vault  charge  imposed by this chapter has applied for a refund and
 has instituted a proceeding under article  seventy-eight  of  the  civil
 practice  law  and rules to review a determination adverse to him or her
 on his or her application for  refund,  the  comptroller  shall  set  up
 appropriate reserves to meet any decision adverse to the city.
   §  11-2710  Remedies  exclusive.  The  remedies  provided  by sections
 11-2707 and 11-2708 of this chapter  shall  be  the  exclusive  remedies
 available  to  any  person for the review of the liability imposed under
 this chapter, and no determination or proposed determination of an annu-
 S. 8474                           1124
 
 al vault charge or determination on any application for  refund  by  the
 commissioner of finance, nor any decision by the tax appeals tribunal or
 any  of  its administrative law judges, shall be enjoined or reviewed by
 an action for declaratory judgment, an action for money had and received
 or  by any action or proceeding other than, in the case of a decision by
 the tax appeals tribunal sitting en banc, a proceeding in the nature  of
 a  certiorari  proceeding under article seventy-eight of the civil prac-
 tice law and rules; provided, however, that  a  person  liable  for  the
 annual  vault  charge  may  proceed by declaratory judgment if he or she
 institutes suit within thirty days after a deficiency assessment is made
 and pays the amount of the deficiency assessment to the commissioner  of
 finance prior to the institution of such suit and posts a bond for costs
 as provided in section 11-2707 of this chapter.
   § 11-2711 Proceedings to recover annual vault charge. a.  Whenever any
 person  shall  fail to pay any vault charge, penalty or interest imposed
 by this chapter as provided in this  chapter,  the  corporation  counsel
 shall,  upon  the request of the commissioner of finance bring, or cause
 to be brought, an action to enforce the payment of the same on behalf of
 the city of Staten Island in any court of the state of New  York  or  of
 any other state or of the United States.
   b. As an additional remedy or as an alternate remedy, the commissioner
 of finance may issue a warrant, directed to the city sheriff, commanding
 him  or  her to levy upon and sell the real and personal property of the
 person liable for vault charges which may be found within the  city  for
 the  payment of the amount thereof, with any penalties and interest, and
 the cost of executing the warrant, and to return  such  warrant  to  the
 commissioner  of finance and to pay to him or her the money collected by
 virtue thereof within sixty days after the receipt of such warrant.  The
 city sheriff shall within five days after the  receipt  of  the  warrant
 file  with  the  county  clerk  a copy thereof, and thereupon such clerk
 shall enter in the judgment docket the name of the person  mentioned  in
 the warrant and the amount of the vault charge, penalty and interest for
 which the warrant is issued and the date when such copy is filed.  Ther-
 eupon  the  amount  of such warrant so docketed shall become a lien upon
 the title to and interest in real and personal property  of  the  person
 against whom the warrant is issued.  The city sheriff shall then proceed
 upon  the  warrant  in  the  same  manner, and with like effect, as that
 provided by law in respect to executions issued  against  property  upon
 judgments of a court of record and for services in executing the warrant
 he  or  she  shall  be  entitled  to  the same fees, which he or she may
 collect in the same manner.  In the discretion of  the  commissioner  of
 finance  a  warrant  of  like  terms, force and effect may be issued and
 directed to an officer or employee of the department of finance, and  in
 the execution thereof such officer or employee shall have all the powers
 conferred  by  law  upon  sheriffs,  but  shall be entitled to no fee or
 compensation in excess of the actual expenses paid in the performance of
 such duty.  If a warrant is returned not satisfied in full, the  commis-
 sioner  of  finance  may  from time to time issue new warrants and shall
 also have the same remedies to enforce the amount due thereunder  as  if
 the  city had recovered judgment therefor and execution thereon had been
 returned unsatisfied.
   c. In addition to any other lien provided for  in  this  section,  the
 annual vault charge imposed by this chapter shall become a lien, binding
 upon  the  premises  immediately  adjoining such vault, on the date such
 charge is required to be paid until the same is paid in full.
 S. 8474                           1125
 
   d. The commissioner of finance, if he or she finds that the  interests
 of the city will not thereby be jeopardized, and upon such conditions as
 the  commissioner  of finance may require, may release any property from
 the lien of any warrant or vacate such warrant for unpaid vault charges,
 additions  to  vault  charges,  penalties and interest filed pursuant to
 subdivision b of this section, and  such  release  or  vacating  of  the
 warrant  may be recorded in the office of any recording officer in which
 such warrant has been  filed.  The  clerk  shall  thereupon  cancel  and
 discharge as of the original date of docketing the vacated warrant.
   §  11-2712  General powers of the commissioner of finance. In addition
 to all other powers granted to the commissioner of finance in this chap-
 ter, he or she is hereby authorized and empowered:
   1. To make, adopt and amend rules and regulations appropriate  to  the
 carrying out of this chapter and the purpose thereof;
   2.  To  extend,  for cause shown, the time for filing any return for a
 period not exceeding sixty days; and to compromise  disputed  claims  in
 connection with the vault charges imposed under this chapter;
   3.  To  delegate  his  or her functions under this chapter to a deputy
 commissioner of finance or any employee or employees of  the  department
 of finance;
   4.  To  prescribe  methods for determining the size, dimensions, depth
 and extent of street occupancy of a vault; to set forth  the  manner  of
 computing  the  vault charges under this chapter; to prescribe standards
 or methods, by regulation or otherwise, for determining whether a  vault
 has  been made unavailable for use or occupancy; and the commissioner of
 finance or his or her designated employees or agents shall have power to
 inspect premises for the purpose of determining the extent, if  any,  of
 liability imposed by this chapter.
   5. To require any owner of premises or licensee or other person using,
 occupying  or  maintaining  a  vault  to obtain from the commissioner of
 finance a certificate stating the dimensions and depth of the vault  and
 that  the  vault charge thereon has been paid and to exhibit the same to
 duly authorized employees at the premises or real property adjoining the
 said vault, and to keep such records, and for such length  of  time,  as
 may  be  required  for the proper administration of this chapter, and to
 furnish such records to the commissioner of finance upon request;
   6. To assess, reassess,  determine,  revise  and  readjust  the  vault
 charges imposed under this chapter;
   7.  Where  he  or  she  has  exercised  his or her authorized power to
 require the filing of a certificate signed by a city surveyor specifying
 the dimensions of a vault and the owner of the premises  has  failed  to
 comply,  he  or  she may obtain such certificate and, in such situation,
 the necessary expense of obtaining such certificate shall  constitute  a
 lien against such premises until paid.
   8.  The  commissioner of finance or his or her designated employees or
 agents shall have power to inspect premises for the purpose of determin-
 ing the extent, if any, of liability imposed by this chapter.
   § 11-2713  Administration of oaths and compelling  testimony.  a.  The
 commissioner  of  finance,  his  or  her  employees  duly designated and
 authorized by the commissioner, the tax appeals tribunal and any of  its
 duly  designated and authorized employees shall have power to administer
 oaths and take affidavits in relation to any matter or proceeding in the
 exercise of their powers and duties under this chapter. The commissioner
 of finance and the tax appeals tribunal shall have power to subpoena and
 require the attendance of witnesses and the production of books,  papers
 and  documents to secure information pertinent to the performance of the
 S. 8474                           1126

 duties of the commissioner or of the tax  appeals  tribunal  under  this
 chapter  and  of  the enforcement of this chapter and to examine them in
 relation thereto, and  to  issue  commissions  for  the  examination  of
 witnesses  who  are  out  of  the  state or unable to attend before such
 commissioner or the tax appeals tribunal or excused from attendance.
   b. A justice of the supreme court either in court or at chambers shall
 have power summarily to enforce by proper proceedings the attendance and
 testimony of witnesses and the  production  and  examination  of  books,
 papers  and  documents called for by the subpoena of the commissioner of
 finance or the tax appeals tribunal under this chapter.
   c. Cross-reference; criminal penalties. For failure to obey  subpoenas
 or  for  testifying  falsely,  see  section  11-4007  of this title; for
 supplying false or fraudulent information, see section 11-4009  of  this
 title.
   d.  The officers who serve the summons or subpoena of the commissioner
 of finance or the tax appeals tribunal under this chapter and  witnesses
 attending  in response thereto shall be entitled to the same fees as are
 allowed to officers and witnesses in civil cases in  courts  of  record,
 except as otherwise provided under this chapter.  Such officers shall be
 the  city sheriff and his or her duly appointed deputies or any officers
 or employees of the department of finance or the tax  appeals  tribunal,
 designated to serve such process.
   §  11-2714  Interest  and penalties. (a) Interest on underpayments. If
 any annual vault  charge  is  not  paid  on  or  before  the  last  date
 prescribed  for payment, without regard to any extension of time granted
 for payment, interest on such amount at the rate set by the commissioner
 of finance pursuant to subdivision (g) of this section, or, if  no  rate
 is  set,  at  the rate of seven and one-half percent per annum, shall be
 paid for the period from such last date  to  the  date  of  payment.  In
 computing  the  amount  of  interest  to be paid, such interest shall be
 compounded daily. Interest under this subdivision shall not be  paid  if
 the amount thereof is less than one dollar.
   (b)  (1)  Failure  to  file  return.  (A) In case of failure to file a
 return under this chapter on or before the prescribed  date,  determined
 with regard to any extension of time for filing, unless it is shown that
 such  failure is due to reasonable cause and not due to willful neglect,
 there shall be added to the amount required to be shown as vault  charge
 on  such return five percent of the amount of such charge if the failure
 is for not more than one month, with an additional five percent for each
 additional month or fraction thereof during which such  failure  contin-
 ues, not exceeding twenty-five percent in the aggregate.
   (B)  In  the  case  of  a failure to file a vault charge return within
 sixty days of the date prescribed for filing of such return,  determined
 with regard to any extension of time for filing, unless it is shown that
 such  failure is due to reasonable cause and not due to willful neglect,
 the addition to the vault charge under subparagraph (A)  of  this  para-
 graph  shall  not  be less than the lesser of one hundred dollars or one
 hundred percent of the amount required to be shown as  vault  charge  on
 such return.
   (C)  For  purposes  of  this  paragraph,  the  amount  of vault charge
 required to be shown on the return shall be reduced by the amount of any
 part of the charge which is paid on or before the  date  prescribed  for
 payment of the charge and by the amount of any credit against the charge
 which may be claimed upon the return.
   (2) Failure to pay vault charge shown on return. In case of failure to
 pay  the  amount  shown as vault charge on a return required to be filed
 S. 8474                           1127
 
 under this chapter on or before the  prescribed  date,  determined  with
 regard  to  any  extension  of time for payment, unless it is shown that
 such failure is due to reasonable cause and not due to  willful neglect,
 there  shall be added to the amount shown as vault charge on such return
 one-half of one percent of the amount of such charge if the  failure  is
 not  for more than one month, with an additional one-half of one percent
 for each additional month or fraction thereof during which such  failure
 continues,  not  exceeding twenty-five percent in the aggregate. For the
 purpose of computing the addition for any  month  the  amount  of  vault
 charge shown on the return shall be reduced by the amount of any part of
 the charge which is paid on or before the beginning of such month and by
 the  amount  of  any credit against the charge which may be claimed upon
 the return. If the amount of vault charge required  to  be  shown  on  a
 return is less than the amount shown as such charge on such return, this
 paragraph shall be applied by substituting such lower amount.
   (3)  Failure  to  pay  vault charge required to be shown on return. In
 case of failure to pay  any  amount  in  respect  of  any  vault  charge
 required to be shown on a return required to be filed under this chapter
 which  is  not  so  shown,  including  a  determination made pursuant to
 section 11-1106 of this title, within ten days of the date of  a  notice
 and  demand  therefor,  unless  it  is shown that such failure is due to
 reasonable cause and not due to willful neglect, there shall be added to
 the amount of vault charge stated in such notice and demand one-half  of
 one  percent  of  such  charge  if  the failure is not for more than one
 month, with an additional one-half of one percent  for  each  additional
 month  or  fraction  thereof  during  which  such failure continues, not
 exceeding twenty-five percent in  the  aggregate.  For  the  purpose  of
 computing  the addition for any month, the amount of vault charge stated
 in the notice and demand shall be reduced by the amount of any  part  of
 the charge which is paid before the beginning of such month.
   (4) Limitations on additions.
   (A) With respect to any return, the amount of the addition under para-
 graph  one  of  this  subdivision  shall be reduced by the amount of the
 addition under paragraph two of this subdivision for any month to  which
 an  addition  applies  under  both  paragraphs  one and two. In any case
 described in subparagraph (B) of paragraph one of this subdivision,  the
 amount  of  the  addition  under such paragraph one shall not be reduced
 below the amount provided in such subparagraph.
   (B) With respect to any return, the maximum  amount  of  the  addition
 permitted  under paragraph three of this subdivision shall be reduced by
 the amount of the addition under  paragraph  one  of  this  subdivision,
 determined  without  regard  to  subparagraph (B) of such paragraph one,
 which is attributable to the charge for which the notice and  demand  is
 made and which is not paid within ten days of such notice and demand.
   (c) Underpayment due to negligence. (1) If any part of an underpayment
 of  a vault charge is due to negligence or intentional disregard of this
 chapter or any rules or regulations pursuant thereto, but without intent
 to defraud, there shall be added to the charge a penalty equal  to  five
 percent of the underpayment.
   (2)  There  shall  be  added  to the charge, in addition to the amount
 determined under paragraph one of this subdivision, an amount  equal  to
 fifty  percent  of  the  interest  payable under subdivision (a) of this
 section with respect to the portion of  the  underpayment  described  in
 such  paragraph  one  which  is attributable to the negligence or inten-
 tional disregard referred to in  such  paragraph  one,  for  the  period
 beginning  on the last date prescribed by law for payment of such under-
 S. 8474                           1128
 
 payment, determined without regard to any extension, and ending  on  the
 date  of  the  assessment of the charge, or, if earlier, the date of the
 payment of the charge.
   (d) Underpayment due to fraud. (1) If any part of an underpayment of a
 vault  charge  is  due  to  fraud,  there shall be added to the charge a
 penalty equal to fifty percent of the underpayment.
   (2) There shall be added to the charge, in  addition  to  the  penalty
 determined  under  paragraph one of this subdivision, an amount equal to
 fifty percent of the interest payable  under  subdivision  (a)  of  this
 section  with  respect  to  the portion of the underpayment described in
 such paragraph one which is attributable to fraud, for the period begin-
 ning on the last day prescribed by law for payment of such underpayment,
 determined without regard to any extension, and ending on  the  date  of
 the assessment of the charge, or, if earlier, the date of the payment of
 the charge.
   (3)  The  penalty under this subdivision shall be in lieu of any other
 addition to the vault charge imposed by subdivision (b) or (c)  of  this
 section.
   (e)  Additional penalty. Any person who, with fraudulent intent, shall
 fail to pay any vault charge  imposed  by  this  chapter,  or  to  make,
 render,  sign or certify any return, or to supply any information within
 the time required by or under this chapter, shall be liable for a penal-
 ty of not more than one thousand  dollars,  in  addition  to  any  other
 amounts  required  under  this  chapter  to  be  imposed,  assessed  and
 collected by the commissioner of finance. The  commissioner  of  finance
 shall  have  the  power,  in  his or her discretion, to waive, reduce or
 compromise any penalty under this subdivision.
   (f) The interest and penalties imposed by this section shall  be  paid
 and  disposed of in the same manner as other revenues from this chapter.
 Unpaid interest and penalties may be enforced in the same manner as  the
 vault charge imposed by this chapter.
   (g)(1)  Authority  to set interest rates. The commissioner of finance,
 shall set the rate of interest to be paid pursuant to subdivision (a) of
 this section, but if no such rate of interest is set, such rate shall be
 deemed to be set at seven and one-half  percent  per  annum.  Such  rate
 shall  be  the  rate prescribed in paragraph two of this subdivision but
 shall not be less than seven and one-half percent per  annum.  Any  such
 rate set by the commissioner of finance shall apply to vault charges, or
 any  portion thereof, which remain or become due on or after the date on
 which such rate becomes effective and shall apply only with  respect  to
 interest  computed  or  computable  for  periods  or portions of periods
 occurring in the period in which such rate is in effect.
   (2) General rule. The rate of  interest  set  under  this  subdivision
 shall  be  the  sum of (i) the federal short-term rate as provided under
 paragraph three of this subdivision, plus (ii) five percentage points.
   (3) Federal short-term rate. For purposes of this subdivision:
   (A) The federal short-term rate for any month  shall  be  the  federal
 short-term  rate determined by the United States secretary of the treas-
 ury during such month in  accordance  with  subsection  (d)  of  section
 twelve  hundred  seventy-four  of  the  internal revenue code for use in
 connection with section six  thousand  six  hundred  twenty-one  of  the
 internal  revenue  code.  Any  such rate shall be rounded to the nearest
 full percent, or, if a multiple of one-half of one  percent,  such  rate
 shall be increased to the next highest full percent.
   (B) Period during which rate applies.
 S. 8474                           1129
 
   (i)  In  general.  Except  as provided in clause (ii) of this subpara-
 graph, the federal short-term rate for the first month in each  calendar
 quarter  shall  apply  during the first calendar quarter beginning after
 such month.
   (ii)  Special rule for the month of September, nineteen hundred eight-
 y-nine. The federal short-term rate for the  month  of  April,  nineteen
 hundred  eighty-nine  shall  apply  with  respect to setting the rate of
 interest for the month of September, nineteen hundred eighty-nine.
   (4) Publication of interest rate. The commissioner  of  finance  shall
 cause  to  be  published  in the City Record, and give other appropriate
 general notice of, the interest rate to be set under this subdivision no
 later than twenty days preceding the first day of the  calendar  quarter
 during  which such interest rate applies. The setting and publication of
 such interest rate shall not be included within paragraph (a) of  subdi-
 vision five of section one thousand forty-one of the city charter of the
 preceding  municipality  as  it  existed January first, nineteen hundred
 ninety-four relating to the definition of a rule.
   (h) Miscellaneous. (1) The certificate of the commissioner of  finance
 to  the  effect  that a vault charge has not been paid, that a vault has
 not been licensed, that a return has not been filed, that access has not
 been allowed, or that information has not been supplied pursuant to  the
 provisions of this chapter, shall be presumptive evidence thereof.
   (2) Cross-reference: For criminal penalties, see chapter forty of this
 title.
   §  11-2715  Notices and limitations of time. a.  Any notice authorized
 or required under the provisions of this chapter may  be  given  to  the
 person  for  whom  it  is  intended by mailing it in a postpaid envelope
 addressed to such person at the address given in the return filed by him
 or her pursuant to the provisions of this chapter or in any  application
 made  by  him or her or, if no such return has been filed or application
 made, then to the address of  the  premises  immediately  adjoining  the
 vault.    The mailing of a notice as in this subdivision provided, shall
 be presumptive evidence of the receipt of the same by the person to whom
 addressed.  Any period of time which  is  determined  according  to  the
 provisions of this chapter by the giving of notice shall commence to run
 from the date of mailing of such notice as in this subdivision provided.
   b. The provisions of the civil practice law and rules or any other law
 relative  to  limitations  of time for the enforcement of a civil remedy
 shall not apply to any  proceeding  or  action  taken  by  the  city  to
 appraise, assess, determine, levy or enforce the collection of any vault
 charge or penalty provided by this chapter.  However, except in the case
 of  a wilfully false or fraudulent return with intent to evade the vault
 charge, no assessment shall be made after the expiration  of  more  than
 three  years from the date of such return; provided, however, that where
 no return has been filed as provided by law, the annual vault charge may
 be assessed at any time.
   c. Where, before the expiration  of  the  period  prescribed  in  this
 section  for  the assessment of an additional vault charge, a person has
 consented in writing that such period be extended, the  amount  of  such
 additional  vault  charge  due may be determined at any time within such
 extended period.   The period so extended may  be  further  extended  by
 subsequent  consents  in  writing  made  before  the  expiration  of the
 extended period.
   d. If any return, claim,  statement,  notice,  application,  or  other
 document required to be filed, or any payment required to be made, with-
 in a prescribed period or on or before a prescribed date under authority
 S. 8474                           1130
 
 of  any  provision  of  this chapter is, after such period or such date,
 delivered by United States mail to the commissioner of finance, the  tax
 appeals  tribunal,  bureau, office, officer or person with which or with
 whom  such document is required to be filed, or to which or to whom such
 payment is required to be made, the date of the United  States  postmark
 stamped  on  the  envelope  shall  be deemed to be the date of delivery.
 This subdivision shall apply only if the postmark date falls within  the
 prescribed  period or on or before the prescribed date for the filing of
 such document, or for making the payment, including any extension grant-
 ed for such filing or payment, and only if such document or payment  was
 deposited  in  the  mail,  postage  prepaid,  properly  addressed to the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer or person with which or with whom the document  is  required  to  be
 filed or to which or to whom such payment is required to be made. If any
 document  is  sent  by  United States registered mail, such registration
 shall be prima facie evidence that such document was  delivered  to  the
 commissioner of finance, the tax appeals tribunal, bureau, office, offi-
 cer  or  person to which or to whom addressed, and the date of registra-
 tion shall be deemed the postmark date. The commissioner of finance and,
 where relevant, the tax appeals tribunal are authorized  to  provide  by
 regulation  the  extent  to which, such provisions with respect to prima
 facie evidence of delivery and the postmark date, shall apply to  certi-
 fied  mail.  This  subdivision  shall apply in the case of postmarks not
 made by the United States postal service  only  if  and  to  the  extent
 provided  by  regulation  of the commissioner of finance or, where rele-
 vant, the tax appeals tribunal.
   e. When the last day  prescribed  under  authority  of  this  chapter,
 including  any  extension  of  time,  for  performing any act falls on a
 Saturday, Sunday or legal holiday in the state, the performance of  such
 act shall be considered timely if it is performed on the next succeeding
 day which is not a Saturday, Sunday or legal holiday.
   § 11-2715.1 Vault charge amnesty program. a. Notwithstanding any other
 provision  of  law  to the contrary, there is hereby established a nine-
 month amnesty program, beginning January first, nineteen hundred  eight-
 y-nine  and  ending  September  thirtieth,  nineteen hundred eighty-nine
 (hereinafter referred to as the "amnesty period"), for all persons owing
 the annual vault charge imposed by this chapter.  Such  amnesty  program
 shall  be administered by the commissioner of finance and shall apply to
 liabilities for annual vault charge years ending prior  to  June  first,
 nineteen hundred eighty-nine.
   b.  (1) A person seeking amnesty pursuant to this section must, during
 the amnesty period, file a written application therefor with the commis-
 sioner of finance, on a form prescribed by the  commissioner,  and  must
 provide  such  information  as the commissioner may require. In order to
 qualify for amnesty, such person must pay all annual vault  charges  for
 which  he  or  she is liable. Upon payment by such person to the commis-
 sioner of all such charges as provided in this subdivision, the  commis-
 sioner  shall waive any applicable penalties and interest, and no civil,
 administrative or criminal action or proceeding shall be brought against
 such person with respect to  the  charges  so  paid.  In  addition,  the
 commissioner shall release the lien binding upon the premises immediate-
 ly  adjoining  the vault pursuant to subdivision c of section 11-2711 of
 this chapter for charges which became payable prior  to  the  time  such
 person  acquired  title  to  the premises. Failure to pay all charges as
 provided in this subdivision shall invalidate any amnesty granted pursu-
 ant to this section.
 S. 8474                           1131
 
   (2) In the case of any vault adjoining premises owned by a person  who
 (A) prior to January first, nineteen hundred eighty-nine, paid all annu-
 al  vault  charges  and  interest  and penalties for which he or she was
 liable, and (B) is otherwise in full compliance with this  chapter,  the
 commissioner of finance shall release the lien binding upon the premises
 immediately  adjoining  the  vault  pursuant to subdivision c of section
 11-2711 of this chapter for charges which became payable  prior  to  the
 time such person acquired title to the premises.
   c.  Amnesty  shall  not be granted to any person subject to the annual
 vault charge who is a party to any civil litigation which is pending  on
 the  date of such person's application in any court of this state or the
 United States for nonpayment or other delinquency  in  relation  to  the
 annual  vault charge. A civil litigation shall not be deemed to be pend-
 ing if such person withdraws from such litigation prior to the  granting
 of amnesty.
   d.  No  refund  or  credit shall be granted of any penalty or interest
 paid prior to the time the person subject to  the  annual  vault  charge
 makes a request for amnesty pursuant to subdivision b of this section.
   e.  Unless  the commissioner of finance on his or her own motion rede-
 termines the amount of the annual vault  charge,  no  refund  or  credit
 shall be granted of any charges paid under this section.
   f. The commissioner of finance shall formulate such regulations as are
 necessary,  issue  forms  and  instructions,  and take any and all other
 actions necessary to implement the provisions of this section.  Further-
 more, prior to and throughout the duration of the  amnesty  period,  the
 commissioner  of finance shall implement a plan for prominently announc-
 ing and explaining the amnesty program. Such plan  shall  be  reasonably
 calculated  to  inform  all  property owners who may be liable for vault
 charges and may include written announcements  sent  in  tax  bills  and
 other  mailings  done  by  the city of Staten Island to property owners,
 public service announcements, advertisements in  newspapers  of  general
 circulation  and  notification  of  community  boards.  The  plan  shall
 include, but not be limited to, information which explains the  determi-
 nation of vault size and charge.
   §  11-2715.3 Severability. If any clause, sentence, paragraph, section
 or part of this chapter or the application  thereof  to  any  person  or
 circumstance  shall  for  any reason be adjudged by a court of competent
 jurisdiction to be invalid, such judgment shall not  affect,  impair  or
 invalidate  the  remainder of this chapter or the application thereof to
 other persons or circumstances, but shall be confined in  its  operation
 to  the  clause,  sentence,  paragraph, section or part thereof directly
 involved in the controversy in  which  such  judgment  shall  have  been
 rendered and to the person or circumstance involved.
   §  11-2716    Construction  and  enforcement.  This  chapter  shall be
 construed and enforced in conformity with chapter  nine  hundred  forty-
 nine  of the laws of nineteen hundred sixty-two, pursuant to which it is
 enacted.
   § 11-2717  Effective date. This chapter shall take effect July  first,
 nineteen  hundred  sixty-two  and  shall remain in effect so long as the
 power of the city to adopt such laws for revenue purposes shall exist.
 
                                CHAPTER 28
                  CLAIMS AGAINST FIRE INSURANCE PROCEEDS
 S. 8474                           1132
 
   § 11-2801 Claims against fire insurance proceeds.  Definitions. 1.  As
 used in this chapter, any inconsistent provision of law notwithstanding,
 the following terms shall have the following meanings:
   (a) "Commissioner" means the commissioner of finance.
   (b)  "Real  property"  means  property upon which there is erected any
 residential, commercial or industrial building or structure except a one
 or two family residential structure.
   (c) "Lien" means any lien including liens for taxes, special ad  valo-
 rem  levies, special assessments and municipal charges arising by opera-
 tion of law against property in favor of the city and remaining  undisc-
 harged for a period of one year or more.
   (d)  "Board"  means  the  board  created  by  subdivision five of this
 section.
   (e) "Special lien" means a lien upon fire insurance proceeds  pursuant
 to  this  chapter  and chapter seven hundred thirty-eight of the laws of
 nineteen hundred seventy-seven.
   (f) "Fund" means the fire insurance proceeds fund created pursuant  to
 subdivision ten of this section.
   2.  The commissioner shall file a notice of intention to claim against
 the proceeds of fire insurance policies pursuant to  section  twenty-two
 of  the general municipal law with the state superintendent of insurance
 for entry in the index of liens maintained by him or her as provided  in
 section three hundred thirty-one of the insurance law.
   3.  Prior  to the payment of any proceeds of a policy of insurance for
 damages caused by fire to real property, which policy insures the inter-
 est of an owner and is issued on real property located within the  city,
 and  following  notification  to  the  commissioner by an insurer of the
 filing of a claim for payment of such proceeds, the  commissioner  shall
 claim,  by  serving  a certificate of lien, against such proceeds to the
 extent of any lien, including interest and penalties to the date of  the
 claim,  thereon,  which  claim  when  made  and  perfected in the manner
 provided for in section twenty-two of  the  general  municipal  law  and
 section  three hundred thirty-one of the insurance law, shall constitute
 a special lien against such proceeds and shall, as to such proceeds,  be
 prior  to  all other liens and claims except the claim of a mortgagee of
 record named in such policy.  Notice of the service of  the  certificate
 of the special lien shall be given to the insured by certified mail.
   4.  The provisions of this chapter shall not be deemed or construed to
 alter or impair the right of the city to acquire  or  enforce  any  lien
 against property but shall be in addition to any other power provided by
 law to acquire or enforce such right.
   5.  The  fire insurance proceeds claims board is hereby established to
 administer the provisions of subdivisions six through thirteen  of  this
 section.    The board shall consist of the first deputy mayor, who shall
 be chairperson, the commissioner of buildings, the commissioner of hous-
 ing preservation and development, and the commissioner of finance,  each
 of  whom shall have the power to designate an alternate to represent him
 or her at board meetings with all the rights and powers,  including  the
 right  to vote, reserved to all board members, provided that such desig-
 nation shall be in writing to the chairperson. So far as practicable and
 subject to the approval of the mayor, the services  of  all  other  city
 departments  and  agencies  shall  be made available by their respective
 heads to the board for the carrying out of its functions.   Each  member
 shall serve without additional compensation except for expenses actually
 incurred.
 S. 8474                           1133
 
   6.  Whenever the proceeds of policy of fire insurance which will be or
 has been paid to the city instead of an insured, all  or  part  of  such
 proceeds may be paid or released to the insured if the insured satisfies
 the  board  that  the affected premises have been or will be repaired or
 restored,  that  such repairs or restoration are in the public interest,
 and the insured is issued and complies with a certificate of  the  board
 pursuant to this chapter.  To secure such payment or release of proceeds
 the insured must notify the board within forty-five days after the mail-
 ing  to  the  insured  of  a notice of the service of the certificate of
 special lien pursuant to subdivision  three  of  this  section,  of  the
 intention  to restore or repair the affected premises and must file with
 the board a completed application with all required supporting  documen-
 tation  pursuant  to subdivision seven of this section within sixty days
 thereafter, unless the board grants an extension for a stated period  of
 time.
   7.  The release or return to the insured of any amounts to which he or
 she or it would otherwise be entitled to claim shall be subject  to  the
 following conditions:
   (a)  Such release or return shall be subject to the repair or restora-
 tion  of the affected premises, in accordance with  applicable  building
 laws,  to the condition it was in prior to the time the lien of the city
 arose, or to an improved condition.
   (b) The insured shall file with the board an application in  affidavit
 form,  with  such  supporting  documentation as the board shall require,
 containing the following:
   (i) A complete description of the nature and extent of the  damage  to
 the  insured  premises and of the condition of the premises prior to the
 time the lien of the city arose;
   (ii) A complete description of the nature of the repairs  or  restora-
 tion to be undertaken and the cost thereof;
   (iii)  A  statement  as to the source of funds needed to complete such
 repairs or restoration if the  insurance  proceeds  are  not  sufficient
 therefor;
   (iv)  The  name  and  address  of each contractor who will effect such
 repairs or restoration;
   (v) An estimated time schedule showing how long the repairs or  resto-
 ration, and each phase thereof, will take; and
   (vi)  Such other information as may be required by the board to enable
 it to determine whether the repairs or restoration  are  in  the  public
 interest and will be or have been timely and properly made.
   (c)  Upon a preliminary approval by the board of an application pursu-
 ant to paragraph (b) of this subdivision, the board may issue a  certif-
 icate,  to be signed by the chairperson or his or her designee; evidenc-
 ing the  right  of  release  to  the  insured  of  amounts  representing
 insurance  proceeds,  upon  such conditions as may be set forth therein.
 The repairs or restoration required by the board shall be  completed  in
 compliance with the terms and conditions of the certificate prior to the
 release or return of any part of the insurance proceeds, provided howev-
 er  that  the  board may, upon the written request of the insured and in
 its sole discretion, approve a prior  release  of  such  proceeds  or  a
 portion  thereof,  in  a  lump sum or in installments, where the insured
 certifies and demonstrates that such release is required to permit  such
 repairs  or  restoration  to  go  forward.   Any such insurance proceeds
 released or returned prior to the completion of the repairs or  restora-
 tion  required  by  the  board may be paid directly to the contractor or
 contractors responsible for making such repairs or  restoration.    Such
 S. 8474                           1134
 
 payment  shall,  to  the  extent thereof, release the board from further
 liability to the insured.
   8.  If  the insured: (i) fails to notify the city of his or her or its
 intention to repair or restore the  affected  premises  as  required  in
 subdivision six of this section, (ii) fails to file a completed applica-
 tion  pursuant  to  this chapter, or (iii) fails to obtain a certificate
 from the board or comply therewith within the time set forth, the  right
 of  the insured to assert a claim against the insurance proceeds, except
 to the extent they exceed the amount of the lien, shall terminate.
   9. Until such termination, any insurance proceeds received by the city
 shall be deposited in a special fund  and  shall  be  retained  therein.
 Upon  termination  of the insured's right to claim against the proceeds,
 the proceeds and any interest accrued thereon shall be  applied  to  the
 liens affecting the premises in a manner determined by the board and may
 be transferred to the general fund.
   10.  There  shall  be  established in the office of the commissioner a
 fund for the deposit of fire insurance proceeds to be held  and  applied
 in  accordance  with this chapter. Such funds shall not be held together
 with the general tax levies in the general fund.
   11. The lien or liens against the affected  premises  upon  which  the
 special  lien against proceeds is based shall continue in full force and
 effect except to the extent that such lien or liens  are  or  have  been
 paid.
   12.  The  board  may, pursuant to this chapter, release, compromise or
 adjust the special lien upon insurance proceeds created by this chapter.
 Any certificate issued by such board pursuant to this chapter  shall  be
 for the purpose of preserving and evidencing the right of release of the
 special  lien  created  by  this chapter, shall be subject solely to the
 provisions of this chapter, and shall not be deemed  to  be  a  contract
 subject  to  city  regulation.    Any repair or restoration performed in
 anticipation of a release of insurance proceeds shall not be  deemed  to
 be  a public work or municipal project nor to have been done pursuant to
 a municipal contract.
   13. The board shall be empowered to promulgate rules  and  regulations
 and to adopt approved forms to be used by applicants.
 
                                CHAPTER 40
            CRIMES AND OTHER OFFENSES: SEIZURES AND FORFEITURES
 
   §  11-4001 Definitions. (a) As used in this chapter, the term "person"
 shall include, but shall not be limited to, an  individual,  corporation
 (including  a dissolved corporation), partnership, association, trust or
 estate.
   (b) As used in this chapter, the term "person" shall also  include  an
 officer, employee or agent of a corporation; a member, employee or agent
 of  a  partnership or association; an employee or agent of an individual
 proprietorship; an employee or agent of an estate or trust; or a fiduci-
 ary.
   (c) As used in this chapter, the term "felony" and the term "misdemea-
 nor" shall have the same meaning as they have in the penal law, and  the
 disposition of such offenses and the sentences imposed therefor shall be
 as  provided  in such law, except: (1) notwithstanding the provisions of
 paragraph a of subdivision one of section 80.00  and  paragraph  (a)  of
 subdivision  one  of section 80.10 of the penal law relating to the fine
 for a felony, the court may impose a fine not to exceed the  greater  of
 double  the  amount  of  the  underpaid tax liability resulting from the
 S. 8474                           1135
 
 commission of the crime or fifty thousand dollars, or, in the case of  a
 corporation  the fine may not exceed the greater of double the amount of
 the underpaid tax liability resulting from the commission of  the  crime
 or  two  hundred  fifty  thousand  dollars,  and (2) notwithstanding the
 provisions of subdivision one of section  80.05  and  paragraph  (b)  of
 subdivision  one  of section 80.10 of the penal law relating to the fine
 for a class A misdemeanor, the court may impose a fine not to exceed ten
 thousand dollars, except that in the case of a corporation the fine  may
 not exceed twenty thousand dollars.
   (d) As used in this chapter:
   (1) "city" shall mean the city of Staten Island; and
   (2) "state" shall mean the state of New York.
   § 11-4002 Tax fraud acts. (a) As used in this chapter, "tax fraud act"
 means  willfully engaging in an act or acts or willfully causing another
 to engage in an act or acts pursuant to which a person:
   (1) fails to make, render, sign, certify, or file any return or report
 required under the provisions of any designated chapter of this title or
 any rule or regulation promulgated thereunder within the  time  required
 by  or  under  the provisions of any designated chapter of this title or
 such rule or regulation;
   (2) knowing that a return, report, statement or other  document  under
 any  designated  chapter  of this title contains any materially false or
 fraudulent information, or omits  any  material  information,  files  or
 submits  that return, report, statement or document with the city or the
 state, or with any public office or public officer of the  city  or  the
 state;
   (3)  knowingly  supplies  or  submits  materially  false or fraudulent
 information in connection with  any  return,  audit,  investigation,  or
 proceeding or fails to supply information within the time required by or
 under the provisions of any designated chapter of this title or any rule
 or regulation promulgated under any designated chapter of this title;
   (4)  engages  in  any  scheme  to  defraud  the city or the state or a
 government instrumentality of the city or of the state by false or frau-
 dulent pretenses, representations or promises as to any material matter,
 in connection with any tax imposed under any designated chapter of  this
 title or any matter under any designated chapter of this title;
   (5)  fails  to  remit any tax collected in the name of the city or the
 state or on behalf of the city or the  state  when  such  collection  is
 required under any designated chapter of this title;
   (6)  fails  to  collect any tax required to be collected under chapter
 twelve, thirteen, twenty-three-A, twenty-three-B or twenty-five of  this
 title;
   (7)  with intent to evade any tax imposed under any designated chapter
 of this title, fails to pay such tax; or
   (8) issues an exemption certificate,  interdistributor  sales  certif-
 icate, resale certificate, or any other document capable of evidencing a
 claim that taxes imposed under a designated chapter of this title do not
 apply  to a transaction, which he or she does not believe to be true and
 correct as to any material matter, which omits any material information,
 or which is false, fraudulent, or counterfeit.
   (b) For purposes of this section,  the  term  "willfully"  shall  mean
 acting  with  either  intent  to defraud, intent to evade the payment of
 taxes or intent to avoid a requirement of this title, a lawful  require-
 ment of the commissioner or a known legal duty.
   (c)  For purposes of this chapter, the term "designated chapter" shall
 mean chapter five, six, seven, eight, nine,  eleven,  twelve,  thirteen,
 S. 8474                           1136
 
 fourteen,  fifteen, twenty-one, twenty-two, twenty-three-A, twenty-four,
 twenty-five or twenty-seven of this title.
   §  11-4003  City  criminal  tax  fraud  in  the fifth degree. A person
 commits city criminal tax fraud in the  fifth  degree  when  he  or  she
 commits  a tax fraud act. City criminal tax fraud in the fifth degree is
 a class A misdemeanor.
   § 11-4004 City criminal tax fraud  in  the  fourth  degree.  A  person
 commits  city  criminal  tax  fraud  in the fourth degree when he or she
 commits a tax fraud act or acts and, with the intent to  evade  any  tax
 due  under  any designated chapter of this title, or to defraud the city
 or the state or any instrumentality of the city or the state, the person
 pays the city or the state or any public office or public officer of the
 city or the state or any instrumentality of the city or  state,  whether
 by  means  of  underpayment or receipt of refund or both, in a period of
 not more than one year in excess of three thousand dollars less than the
 tax liability that is due. City criminal tax fraud in the fourth  degree
 is a class E felony.
   §  11-4005  City  criminal  tax  fraud  in  the third degree. A person
 commits city criminal tax fraud in the  third  degree  when  he  or  she
 commits  a  tax  fraud act or acts and, with the intent to evade any tax
 due under any designated chapter of this title, or to defraud  the  city
 or the state or any instrumentality of the city or the state, the person
 pays the city or the state or any public office or public officer of the
 city  or  the state or any instrumentality of the city or state, whether
 by means of underpayment or receipt of refund or both, in  a  period  of
 not  more  than one year in excess of ten thousand dollars less than the
 tax liability that is due. City criminal tax fraud in the  third  degree
 is a class D felony.
   §  11-4006  City  criminal  tax  fraud  in the second degree. A person
 commits city criminal tax fraud in the second  degree  when  he  or  she
 commits  a  tax  fraud act or acts and, with the intent to evade any tax
 due under any designated chapter of this title, or to defraud  the  city
 or the state or any instrumentality of the city or the state, the person
 pays the city or the state or any public office or public officer of the
 city  or  the state or any instrumentality of the city or state, whether
 by means of underpayment or receipt of refund or both, in  a  period  of
 not more than one year in excess of fifty thousand dollars less than the
 tax  liability that is due. City criminal tax fraud in the second degree
 is a class C felony.
   § 11-4007 City criminal tax  fraud  in  the  first  degree.  A  person
 commits  city  criminal  tax  fraud  in  the first degree when he or she
 commits a tax fraud act or acts and, with the intent to  evade  any  tax
 due  under  any designated chapter of this title, or to defraud the city
 or the state or any instrumentality of the city or the state, the person
 pays the city or the state or any public office or public officer of the
 city or the state or any instrumentality of the city or  state,  whether
 by  means  of  underpayment or receipt of refund or both, in a period of
 not more than one year in excess of one million dollars  less  than  the
 tax  liability  that is due. City criminal tax fraud in the first degree
 is a class B felony.
   § 11-4008 Aggregation. For purposes of this chapter, the payments  due
 and  not  paid  under any designated chapter of this title pursuant to a
 common scheme or plan or due and not  paid,  within  one  year,  may  be
 charged  in  a  single  count, and the amount of underpaid tax liability
 incurred, within one year, may be aggregated in a single count.
 S. 8474                           1137

   § 11-4009 Non-preemption; penal law anticipatory offenses and accesso-
 rial liability apply. (a) Unless expressly stated otherwise, the  penal-
 ties  provided  in this chapter or under any other chapter of this title
 shall not preclude prosecution for any offense under the  penal  law  or
 any other criminal statute.
   (b)  The  offenses  specified  in  title  G  of  the penal law and the
 provisions of article twenty of the penal  law  are  applicable  to  all
 offenses defined in this chapter.
   §  11-4010  Failure to obey subpoenas; false testimony. (a) Any person
 who, being duly subpoenaed, pursuant to chapter five, six, seven, eight,
 nine, eleven, twelve, thirteen, fourteen, fifteen,  twenty-one,  twenty-
 two,  twenty-four,  twenty-five  or  twenty-seven  of  this title or the
 provisions of the civil practice law and rules,  in  connection  with  a
 matter  arising under any of such chapters, to attend as a witness or to
 produce books, accounts, records, memoranda, documents or other  papers,
 (i) fails or refuses to attend without lawful excuse, (ii) refuses to be
 sworn, (iii) refuses to answer any material and proper question, or (iv)
 refuses, after reasonable notice, to produce books, papers and documents
 in  his  or  her possession or under his or her control which constitute
 material and proper evidence shall be guilty of a misdemeanor.
   (b) Any person who shall testify falsely in any material matter  pend-
 ing  before the commissioner of finance with respect to any of the chap-
 ters specified in subdivision (a) of this section shall be guilty of and
 punishable for perjury.
   § 11-4011 Failure to file bond. Any person willfully failing to file a
 bond where such filing is required pursuant to section 11-1203,  11-1304
 or  11-2505  of  this  title  shall  be guilty of a misdemeanor. (a) Any
 person who willfully attempts in any manner to evade or defeat  any  tax
 imposed  by chapter thirteen of this title or payment thereof where such
 tax is unpaid on ten thousand cigarettes or more or has previously  been
 convicted  two or more times of a crime set forth in this chapter relat-
 ing to cigarette taxes; shall be guilty of a class E felony.
   (b) Any person, other than an agent so authorized by the  commissioner
 of  finance,  who  possesses  or  transports for the purpose of sale any
 unstamped or unlawfully stamped packages of cigarettes  subject  to  tax
 under  chapter  thirteen  of this title, or who sells or offers for sale
 unstamped or unlawfully stamped packages of cigarettes in  violation  of
 the  provisions  of  such  chapter shall be guilty of a misdemeanor. Any
 person who violates the provisions  of  this  subdivision  after  having
 previously  been convicted of a violation of this subdivision within the
 preceding five years shall be guilty of a class E felony.
   (c) (1) Any person, other than an agent so authorized by  the  commis-
 sioner of finance, who willfully possesses or transports for the purpose
 of  sale  ten  thousand or more cigarettes subject to the tax imposed by
 chapter thirteen of this title in any unstamped  or  unlawfully  stamped
 packages  or who willfully sells or offers for sale ten thousand or more
 cigarettes in any unstamped or unlawfully stamped packages in  violation
 of such chapter shall be guilty of a class E felony.
   (2)  Any  person, other than an agent appointed by the commissioner of
 finance, who willfully possesses or transports for the purpose  of  sale
 thirty thousand or more cigarettes subject to the tax imposed by chapter
 thirteen  of  this title in any unstamped or unlawfully stamped packages
 or who willfully sells or offers for sale thirty thousand or more  ciga-
 rettes  in  any unstamped or unlawfully stamped packages in violation of
 such chapter shall be guilty of a class D felony.
 S. 8474                           1138
 
   (d) For the purposes of this section, the possession or transportation
 within this city by any person, other than an agent, at any one time  of
 five  thousand  or  more  cigarettes  in unstamped or unlawfully stamped
 packages  shall  be  presumptive  evidence  that  such  cigarettes   are
 possessed  or transported for the purpose of sale and are subject to the
 tax imposed by chapter thirteen of this  title.  With  respect  to  such
 possession or transportation, any provisions of chapter thirteen of this
 title providing for a time period during which a use tax imposed by such
 chapter  may be paid on unstamped cigarettes or unlawfully or improperly
 stamped cigarettes or during which such cigarettes may be returned to an
 agent shall not apply. The possession within this city of more than four
 hundred cigarettes in unstamped or unlawfully stamped  packages  by  any
 person other than an agent at any one time shall be presumptive evidence
 that  such cigarettes are subject to tax as provided by chapter thirteen
 of this title.
   (e) Nothing in this section shall apply to common or contract carriers
 or warehouseman  while  engaged  in  lawfully  transporting  or  storing
 unstamped  packages of cigarettes as merchandise, nor to any employee of
 such carrier or warehouseman acting within the scope of his  employment,
 nor to public officers or employees in the performance of their official
 duties  requiring  possession  or  control  of  unstamped  or unlawfully
 stamped packages of cigarettes, nor to temporary  incidental  possession
 by  employees  or agents of persons lawfully entitled to possession, not
 to persons whose possession is for the purpose of aiding police officers
 in performing their duties.
   (f) Any willful act or omission, other than those described in section
 11-4002 of this chapter or subdivision (a), (b), (c), (d), (e) or (g) of
 this section, by  any  person  which  constitutes  a  violation  of  any
 provision of chapter thirteen of this title or subchapter one of chapter
 two  of  title  twenty  of  the code of the preceding municipality shall
 constitute a misdemeanor.
   (g) Any person who falsely or fraudulently makes, alters  or  counter-
 feits  any  stamp  prescribed  by  the commissioner of finance under the
 provisions of chapter thirteen of this title, or causes or  procures  to
 be  falsely  or  fraudulently  made,  altered  or counterfeited any such
 stamp, or knowingly and willfully utters, purchases, passes  or  tenders
 as true any such false, altered or counterfeited stamp, or knowingly and
 willfully  possess  any  cigarettes  in packages bearing any such false,
 altered or counterfeited stamp, and any person who knowingly  and  will-
 fully  makes,  causes  to  be made, purchases or receives any device for
 forging or counterfeiting any stamp, prescribed by the  commissioner  of
 finance  under  the provisions of chapter thirteen of this title, or who
 knowingly and willfully possesses any such device, shall be guilty of  a
 class  E  felony. For the purposes of this subdivision, the words "stamp
 prescribed by the  commissioner  of  finance"  shall  include  a  stamp,
 impression  or  imprint  made by a metering machine, the design of which
 has been approved by the commissioner  of  finance  and  the  state  tax
 commission.
   §  11-4012.1 Tobacco products tax. (a) Attempt to evade or defeat tax.
 Any person who willfully attempts in any manner to evade or  defeat  any
 tax  imposed by section 11-1302.1 of this chapter or the payment thereof
 shall, in addition to any other penalties provided by law, be guilty  of
 a misdemeanor.
   (b)  Any  willful  act  or omission with respect to the tax imposed by
 section 11-1302.1 of this chapter, with the exception of those described
 in subdivision (a) of this section, by any person  which  constitutes  a
 S. 8474                           1139

 violation  of any provision of chapter thirteen of this title or chapter
 two of title twenty of the code  of  the  preceding  municipality  shall
 constitute a misdemeanor.
   §  11-4014  Tax  on  commercial  motor vehicles and motor vehicles for
 transportation of passengers. (a) Any person who counterfeits or forges,
 or causes or procures to be counterfeited or forged, or aids or  assists
 in  counterfeiting  or  forging,  by  any way, art, or means, any stamp,
 indicia of payment or indicia that no tax is payable authorized by chap-
 ter eight of this title, or who knowingly acquires, possesses,  disposes
 of  or  uses such a counterfeited or forged stamp, indicia of payment or
 indicia that no tax is payable, or who transfers  a  stamp,  indicia  of
 payment  or  indicia that no tax is payable where such a transfer is not
 authorized by such chapter shall be guilty of a misdemeanor.
   (b) The owner or driver of  any  motor  vehicle  subject  to  the  tax
 imposed  by  chapter  eight  who, upon demand, shall fail to exhibit the
 stamp or other indicia of payment of the  tax  to  the  commissioner  of
 finance, his duly authorized agent or employee, or any police officer of
 this  city  or  state, as required by subdivision a of section 11-809 of
 this chapter, shall be guilty of a misdemeanor.
   § 11-4015 Tax on owners of motor vehicles. (a) Any person who counter-
 feits or forges, or causes or procures to be counterfeited or forged, or
 aids or assists in counterfeiting or forging, by any way, art, or means,
 any receipt or other document evidencing payment or exemption  from  the
 tax  imposed  by  chapter  twenty-two  of  this  title, or who knowingly
 acquires, possesses, disposes of or uses such a counterfeited or  forged
 receipt or other document, shall be guilty of a misdemeanor.
   (b)  Any person who uses, operates or parks or permits the use, opera-
 tion or parking upon any public highway or street  of  a  motor  vehicle
 owned  by  him  or  her  or  under  his or her control for which the tax
 imposed by chapter twenty-two of this title has not been paid in accord-
 ance with the provisions of such chapter and the regulations  prescribed
 thereunder  shall  be  guilty of a misdemeanor.  For the purpose of this
 subdivision any person using, operating or parking a motor vehicle shall
 be presumed to be doing so with the permission  of  the  owner  of  such
 motor vehicle.
   (c) To the extent that any other section of this chapter is applicable
 to the tax imposed by chapter twenty-two of this title, any reference in
 such  section to the commissioner of finance shall be deemed a reference
 to the commissioner of motor vehicles or to the commissioner of  finance
 if designated as his or her agent.
   § 11-4016 Hotel room occupancy tax. (a) Any person who willfully fails
 to   file  a  registration  certificate  as  required  pursuant  to  the
 provisions of chapter  twenty-five  of  this  title  and  such  data  in
 connection  therewith  as  the  commissioner of finance by regulation or
 otherwise may require, or willfully fails  to  display  or  surrender  a
 certificate  of  authority  as  required  by chapter twenty-five of this
 title, or willfully assigns or transfers such certificate of  authority,
 shall be guilty of a misdemeanor, provided, however, that the provisions
 of  this subdivision shall not apply to a failure to surrender a certif-
 icate of authority which is required to be  surrendered  where  business
 never commenced.
   (b)  Any  person  who  willfully  fails  to  charge separately the tax
 imposed under chapter twenty-five of this title or  willfully  fails  to
 state  such tax separately on any bill, statement, memorandum or receipt
 issued or employed by such person upon which the tax is required  to  be
 stated  separately  as  provided  in such chapter, or who shall refer or
 S. 8474                           1140
 
 cause reference to be made to this tax in a form or  manner  other  than
 required by such chapter, shall be guilty of a misdemeanor.
   § 11-4017 Violation of secrecy provisions. Any person who violates the
 provisions  of  subdivision  a  of  section  11-1214, subdivision (a) of
 section 11-2415, subdivision a of  section  11-2115,  subdivision  a  of
 section  11-1516,  subdivision  a  of  section  11-818, subdivision a of
 section 11-716, subdivision a of   section  11-2215,  subdivision  a  of
 section  11-1116,  subdivision one of section 11-688, subdivision one of
 section 11-538, subdivision a of section 11-2516, or  subdivision  a  of
 section 11-1414 of this title shall be guilty of a misdemeanor.
   §  11-4018  Other offenses. (a) Any person who willfully fails to keep
 or retain any records required to be kept or retained by chapter  seven,
 twelve, fourteen, twenty-one, twenty-two, twenty-four or twenty-seven of
 this title shall be guilty of a misdemeanor.
   (b) Any person willfully simulating, altering, defacing, destroying or
 removing  any evidence of the filing of a return or the payment of a tax
 provided for in chapter twenty-one of this title shall be  guilty  of  a
 misdemeanor.
   (c) Any person failing to file a certificate of registration or infor-
 mation  registration  certificate  as  required by chapter eight of this
 title shall be guilty of a misdemeanor.
   (d) Any person refusing access to personnel authorized by the  commis-
 sioner  of finance to inspect any vault or any premises concerning which
 a return or information return may be required under chapter twenty-sev-
 en of this title shall be guilty of a misdemeanor.
   § 11-4019 Jurisdiction. For purposes of the taxes imposed  by  chapter
 five  or  six  of  this title, any prosecution under this chapter may be
 conducted in any county where the person against  whom  a  violation  or
 violations  of any of the provisions of this chapter are charged resides
 or has a place of business, or  from  which  such  person  received  any
 income, or in any county in which any such violation is committed.
   (a) Notwithstanding any  other provision of law, the corporation coun-
 sel shall have concurrent jurisdiction with any district attorney in the
 prosecution of any offenses under this chapter.
   (b)  Notwithstanding  any other provision of law, the attorney general
 shall have concurrent jurisdiction with the corporation counsel and with
 any district attorney in the prosecution  of  any  offenses  under  this
 chapter  relating  to the tax imposed by chapter thirteen of this title,
 as well as any offenses arising out of such prosecution.
   § 11-4020 Disposition of fines. All fines levied  under  this  chapter
 shall be paid to the commissioner of finance and deposited in the gener-
 al fund of the city.
   §  11-4021 Seizure and forfeiture of cigarettes. (a) Whenever a police
 officer designated in section 1.20 of the criminal procedure  law  or  a
 peace  officer  designated  in  subdivision five of section 2.10 of such
 law, acting pursuant to his or her special duties,  shall  discover  any
 cigarettes  subject  to  any  tax provided by chapter thirteen   of this
 title, and upon which the tax has  not  been  paid  or  the  stamps  not
 affixed  as  required  by  such  chapter, they are hereby authorized and
 empowered forthwith to seize and take  possession  of  such  cigarettes,
 together  with  any vending machine or receptacle in which they are held
 for sale. Such cigarettes, vending machine or  receptacle  seized  by  a
 police officer or such peace officer shall be turned over to the commis-
 sioner of finance.
   (b) The seized cigarettes and any vending machine or receptacle seized
 therewith, but not the money contained in such vending machine or recep-
 S. 8474                           1141

 tacle  shall  thereupon be forfeited to the city, unless the person from
 whom the seizure is made, or the owner of such seized cigarettes,  vend-
 ing  machine  or  receptacle,  or any other person having an interest in
 such  property,  shall  within  ten  days  of such seizure, apply to the
 commissioner of finance for a hearing to determine the propriety of  the
 seizure,  or  unless the commissioner of finance shall on his or her own
 motion release the seized cigarettes,  vending  machine  or  receptacle.
 After  such hearing the commissioner of finance shall give notice of his
 or her decision to the petitioner.  The  decision  of  the  commissioner
 shall  be  reviewable  for error, illegality, unconstitutionality or any
 other reason whatsoever by a proceeding under article  seventy-eight  of
 the  civil practice law and rules if application therefor is made to the
 supreme court within thirty days after the giving of the notice of  such
 decision.  Such  proceeding  shall  not be instituted unless there shall
 first be filed with the commissioner of finance an  undertaking,  issued
 by  a  surety  company authorized to transact business in New York state
 and approved by the superintendent of insurance of New York state as  to
 solvency  and responsibility, in such amount as a justice of the supreme
 court shall approve, to the effect that if such proceeding be dismissed,
 or the seizure confirmed, the petitioner will pay all costs and  charges
 which may accrue in the prosecution of the proceeding.
   (c)  The  commissioner  of finance may, within a reasonable time after
 the forfeiture to the city of such vending machines or receptacles, upon
 publication of a notice to such effect  for  at  least  five  successive
 days,  in  a  newspaper  published  or circulated in the city, sell such
 forfeited vending machines or receptacles at public  sale  and  pay  the
 proceeds  into  the  treasury  of  the city to the credit of the general
 fund. Such seized vending machines or receptacles may be sold  prior  to
 forfeiture  if  the  owner  of the seized property consents to the sale.
 Notwithstanding any other provision of this section, the commissioner of
 finance may enter into an agreement with the  state  tax  commission  to
 provide  for  the disposition between the city and state of the proceeds
 from any such sale.  The commissioner of finance may also  transfer  any
 seized cigarettes to the state for destruction. All cigarettes forfeited
 to  the  state  shall be destroyed or used for law enforcement purposes,
 except that cigarettes that violate,  or  are  suspected  of  violating,
 federal trademark laws or import laws shall not be used for law enforce-
 ment  purposes. If the commissioner determines the cigarettes may not be
 used for law enforcement purposes, the  commissioner  of  finance  must,
 within  a reasonable time after the forfeiture to the city of such ciga-
 rettes, upon publication of a notice to such effect for  at  least  five
 successive  days,  prior  to  destruction,  in  a newspaper published or
 circulated in the city, destroy such forfeited cigarettes. Such  commis-
 sioner  may,  prior  to  any  destruction of cigarettes, permit the true
 holder of the  trademark  rights  in  the  cigarettes  to  inspect  such
 forfeited  cigarettes  in order to assist in any investigation regarding
 such cigarettes.
   (d) In the alternative, the commissioner  of  finance,  on  reasonable
 notice  by mail or otherwise, may permit the person from whom said ciga-
 rettes were seized to  redeem  the  said  cigarettes,  and  any  vending
 machine  or  receptacle seized therewith, or may permit the owner of any
 such cigarettes, vending machine or receptacle to redeem  the  same,  by
 the  payment  of  the  tax due, plus a penalty of fifty percent thereof,
 plus interest on the amount of tax due for each month or fraction there-
 of after such tax became due, determined without regard to any extension
 of time for filing or paying, at the rate applicable under subdivision d
 S. 8474                           1142
 
 of section 11-1317 of this title and the costs incurred in such proceed-
 ing, which total payment shall not be less than five dollars;  provided,
 however, that such seizure and sale or redemption shall not be deemed to
 relieve  any person from fine or imprisonment provided for in this chap-
 ter for violation of any provisions of this chapter or chapter  thirteen
 of this title.
   (e) In the alternative, the commissioner of finance may dispose of any
 cigarettes  seized  pursuant to this section, except those that violate,
 or are suspected of violating, federal trademark laws or import laws, by
 transferring them to the department of correction for sale to or use  by
 incarcerated individuals in such institutions.
   §  11-4022  Filing  of  documents.  For purposes of the prosecution of
 offenses under the provisions of this title,  reports,  returns,  state-
 ments, other documents or other information required to be filed with or
 delivered  to the commissioner of finance shall include such items which
 under the provisions of this title are required to be recorded or  filed
 with,  served  upon  or  delivered to another person, including, but not
 limited to, a recording officer of any county within the  state,  county
 clerk,  any  other governmental agency or entity, or other entity in its
 capacity as an agent of the commissioner of finance.
   § 11-4023 Authority to seal premises.  (a)  If  any  person  has  been
 finally  determined to have engaged in the acts described in subdivision
 (b) of this section, the commissioner of finance shall be authorized  to
 order:
   (1)  the  sealing  of  any premises operated by such person where such
 acts occurred; and
   (2) the removal, sealing or making inoperable of any devices, items or
 goods used in connection with any of such acts.
   (b) The following acts shall serve as the basis for  a  sealing  order
 pursuant to this section:
   (1)  the  violation  of  subdivision a or b of section 11-1303 of this
 title or section 17-703 or 20-202 of the code of the  preceding  munici-
 pality on at least two occasions within a three-year period; or
   (2)  the  violation of any provision of chapter thirteen of this title
 or any of sections 17-703, 17-703.2, 17-704, 17-705, subdivision a or  b
 of section 17-706, 17-715 or 20-202 of the code of the preceding munici-
 pality on at least three occasions within a three-year period; or
   (3)  the  violation  of any provision of section 10-203 of the code of
 the preceding municipality on at least two occasions within a three-year
 period.
   (c) Orders of the commissioner to seal premises.   (1) Orders  of  the
 commissioner  issued  pursuant  to  this  section shall be posted at the
 premises at which the acts described in subdivision (b) of this  section
 have occurred.
   (2)  Ten  days  after  the  date of such posting, and upon the written
 directive of the commissioner, police  officers  designated  in  section
 1.20  of  the  criminal procedure law and peace officers employed by the
 department of finance, including but not limited to the sheriff,  under-
 sheriff  and deputy sheriffs of the city of New York designated as peace
 officers in subdivision two of section 2.10 of  the  criminal  procedure
 law, are authorized to act upon and enforce such orders.
   (3)  Any  devices,  items  or  goods removed pursuant to this section,
 shall be stored in a garage, pound or other  place  of  safety  and  the
 owner  or  other  person  lawfully  entitled  to  the possession of such
 devices, items or goods may be charged with reasonable costs for removal
 S. 8474                           1143
 
 and storage payable prior to the release of such devices, items or goods
 to such owner or such other person.
   (4)  The  owner  or  other  person  lawfully  entitled  to reclaim the
 devices, items or goods described in paragraph three of this subdivision
 shall reclaim such devices, items or goods. If such owner or such  other
 person  does not reclaim such devices, items or goods within ninety days
 of their removal, such devices, items  or  goods  shall  be  subject  to
 forfeiture  upon  notice  and  judicial determination in accordance with
 provisions of law. Upon forfeiture the department shall, upon  a  public
 notice  of  at  least  five  days, sell such forfeited devices, items or
 goods at public sale. The net proceeds of such sale, after deduction  of
 the lawful expenses incurred, shall be paid into the general fund of the
 city.
   (d) Unsealing of premises. The commissioner shall order that any prem-
 ises  which  are  sealed  pursuant to this section shall be unsealed and
 that any devices, items or goods removed, sealed or otherwise made inop-
 erable pursuant to this section shall  be  released,  unsealed  or  made
 operable upon:
   (1) payment of all outstanding cigarette taxes and civil penalties and
 all reasonable costs for removal and storage; and
   (2) the expiration of a period of time from the date of enforcement of
 the order to be determined by the commissioner not to exceed sixty days.
   (e)  Any  person aggrieved by an order issued pursuant to this section
 may seek judicial review of such order through a proceeding pursuant  to
 article seventy-eight of the civil practice law and rules.
   (f)  Removal  of seal. Any person who removes the seal on any premises
 or removes the seal on or makes operable any  devices,  items  or  goods
 sealed  or  otherwise made inoperable in accordance with an order of the
 commissioner shall be guilty of a misdemeanor.
   § 11-4024 Seizure and forfeiture of taxed and lawfully  stamped  ciga-
 rettes  sold  or  possessed  by  unlicensed retail or wholesale dealers,
 flavored tobacco products, flavored electronic cigarettes  and  flavored
 e-liquid.  (a)  Whenever  a police officer designated in section 1.20 of
 the criminal procedure law or a peace officer employed by the department
 of finance, including but not limited to the  sheriff,  undersheriff  or
 deputy  sheriffs of the city of New York designated as peace officers in
 subdivision two of section 2.10 of the  criminal  procedure  law,  shall
 discover (1) any cigarettes subject to any tax provided by chapter thir-
 teen  of this title, and upon which the tax has been paid and the stamps
 affixed as required by such  chapter,  but  such  cigarettes  are  sold,
 offered  for  sale  or  possessed  by  a  person in violation of section
 11-1303 of this code or section 17-703 or 20-202  of  the  code  of  the
 preceding  municipality,  or  (2)  any  flavored tobacco product that is
 sold, offered for sale or possessed with intent to sell in violation  of
 section  17-715  of the code of the preceding municipality, he or she is
 hereby authorized and empowered forthwith to seize and  take  possession
 of  such cigarettes or flavored tobacco product, together with any vend-
 ing machine or receptacle in which such cigarettes or  flavored  tobacco
 product  are held for sale. Such cigarettes or flavored tobacco product,
 vending machine or receptacle seized by  such  police  officer  or  such
 peace officer shall be turned over to the commissioner of finance.
   (b)  The seized cigarettes or flavored tobacco product and any vending
 machine or receptacle seized therewith, but not the money  contained  in
 such  vending machine or receptacle, shall thereupon be forfeited to the
 city, unless the person from whom the seizure is made, or the  owner  of
 such  seized  cigarettes,  flavored  tobacco product, vending machine or
 S. 8474                           1144
 
 receptacle, or any other person having an  interest  in  such  property,
 shall  within  ten  days  of  such seizure, apply to the commissioner of
 finance for a hearing to determine the  propriety  of  the  seizure,  or
 unless  the  commissioner  of  finance  shall  on  his or her own motion
 release the seized cigarettes, flavored tobacco product, vending machine
 or receptacle. After such hearing the commissioner of finance shall give
 notice of his or her decision to the petitioner.  The  decision  of  the
 commissioner  shall be reviewable for error, illegality, unconstitution-
 ality or any other reason  whatsoever  by  a  proceeding  under  article
 seventy-eight of the civil practice law and rules.
   (c)  The  commissioner  of finance may, within a reasonable time after
 the forfeiture to the city of such vending machine or  receptacle  under
 this  section,  upon publication of a notice to such effect for at least
 five successive days, in a newspaper  published  or  circulated  in  the
 city,  sell  such forfeited vending machine or receptacle at public sale
 and pay the proceeds into the general fund  of  the  city.  Such  seized
 vending  machine  or  receptacle  may be sold prior to forfeiture if the
 owner of the  seized  property  consents  to  the  sale.  Cigarettes  or
 flavored  tobacco product forfeited to the city under this section shall
 be destroyed or used for law enforcement  purposes,  except  that  ciga-
 rettes  that  violate,  or are suspected of violating, federal trademark
 laws or import laws shall not be used for law enforcement  purposes.  If
 the  commissioner determines the cigarettes forfeited under this section
 may not be used  for  law  enforcement  purposes,  the  commissioner  of
 finance  must, within a reasonable time after the forfeiture to the city
 of such cigarettes, upon publication of a notice to such effect  for  at
 least  five  successive  days,  prior  to  destruction,  in  a newspaper
 published or circulated in the city, destroy such forfeited cigarettes.
   (d) In the alternative, the commissioner  of  finance,  on  reasonable
 notice  by  mail or otherwise, may permit the person from whom a seizure
 of cigarettes or flavored tobacco product under this section  was  made,
 to  redeem any vending machine or receptacle seized with such cigarettes
 or flavored tobacco product, or may permit the owner of any such vending
 machine or receptacle to redeem the same, upon the payment of any  civil
 penalty imposed pursuant to chapter seven of title seventeen or subchap-
 ter  one  of  chapter  two  of title twenty of the code of the preceding
 municipality and the costs incurred in such proceeding.
   (e) For purposes of this section, a flavored tobacco product  means  a
 flavored  tobacco  product,  flavored  electronic  cigarette or flavored
 e-liquid.
   § 11-4025 Seizure and forfeiture of untaxed  tobacco  products.    (a)
 Whenever  a  police  officer  designated in section 1.20 of the criminal
 procedure law or a peace officer employed by the department of  finance,
 including  but  not limited to the sheriff, undersheriff or deputy sher-
 iffs of the city designated as peace  officers  in  subdivision  two  of
 section  2.10  of  the  criminal  procedure  law,  discovers any tobacco
 products subject to any tax provided by chapter thirteen of this  title,
 and upon which the tax has not been paid, he or she is hereby authorized
 and  empowered  forthwith  to  seize and take possession of such tobacco
 products, together with any vending machine or receptacle in which  such
 tobacco  products  are  held  for  sale.  Such tobacco products, vending
 machine or receptacle seized by such police officer or such peace  offi-
 cer shall be turned over to the commissioner of finance.
   (b)  The seized tobacco products and any vending machine or receptacle
 seized therewith, but not the money contained in such vending machine or
 receptacle, shall thereupon be forfeited to the city, unless the  person
 S. 8474                           1145
 
 from  whom  the  seizure  is  made,  or the owner of such seized tobacco
 products, vending machine or receptacle, or any other person  having  an
 interest  in such property, shall within ten days of such seizure, apply
 to  the commissioner of finance for a hearing to determine the propriety
 of the seizure, or unless the commissioner of finance shall  on  his  or
 her  own  motion release the seized tobacco products, vending machine or
 receptacle. After such hearing the commissioner of  finance  shall  give
 notice  of  his  or  her decision to the petitioner. The decision of the
 commissioner shall be reviewable for error, illegality,  unconstitution-
 ality  or  any  other  reason  whatsoever  by a proceeding under article
 seventy-eight of the civil practice law and rules.
   (c) The commissioner of finance may, within a  reasonable  time  after
 the  forfeiture  to the city of such vending machine or receptacle under
 this section, upon publication of a notice to such effect for  at  least
 five  successive  days,  in  a  newspaper published or circulated in the
 city, sell such forfeited vending machine or receptacle at  public  sale
 and  pay  the  proceeds  into  the general fund of the city. Such seized
 vending machine or receptacle may be sold prior  to  forfeiture  if  the
 owner  of  the  seized  property  consents to the sale. Tobacco products
 forfeited to the city under this section shall be destroyed or used  for
 law  enforcement purposes, except that tobacco products that violate, or
 are suspected of violating, federal trademark laws or import laws  shall
 not be used for law enforcement purposes. If the commissioner determines
 the  tobacco  products  forfeited under this section may not be used for
 law enforcement purposes, the commissioner of  finance  must,  within  a
 reasonable  time  after  the  forfeiture to the city of such cigarettes,
 upon publication of a notice to such effect for at least five successive
 days, prior to destruction, in a newspaper published  or  circulated  in
 the city, destroy such forfeited tobacco products.
   (d)  In  the  alternative,  the commissioner of finance, on reasonable
 notice by mail or otherwise, may permit the person from whom  a  seizure
 of  tobacco  products under this section was made, to redeem any vending
 machine or receptacle seized with such tobacco products, or  may  permit
 the  owner of any such vending machine or receptacle to redeem the same,
 upon the payment of any civil penalty imposed pursuant to chapter  seven
 of  title  seventeen or subchapter one of chapter two of title twenty of
 the code of the preceding municipality and the costs  incurred  in  such
 proceeding.
   §  11-4026  Seizure  and  forfeiture of taxed tobacco products sold or
 possessed by unlicensed retail or wholesale dealers other than  flavored
 tobacco  products subject to seizure under section 11-4024 of this chap-
 ter.
   (a) Whenever a police officer designated in section 1.20 of the crimi-
 nal procedure law or a peace  officer  employed  by  the  department  of
 finance, including but not limited to the sheriff, undersheriff or depu-
 ty  sheriffs of the city designated as peace officers in subdivision two
 of section 2.10 of the criminal procedure  law,  discovers  any  tobacco
 products,  other  than  flavored  tobacco  products,  subject to any tax
 provided by chapter thirteen of this title, and upon which the  tax  has
 been  paid,  but  such  tobacco  products  are sold, offered for sale or
 possessed by a person in violation of section 11-1303 of  this  code  or
 section  17-703  or 20-202 of the code of the preceding municipality, he
 or she is hereby authorized and empowered forthwith to  seize  and  take
 possession  of  such tobacco products, together with any vending machine
 or receptacle in which such tobacco products are  held  for  sale.  Such
 tobacco  products,  vending  machine or receptacle seized by such police
 S. 8474                           1146
 
 officer or such peace officer shall be turned over to  the  commissioner
 of finance.
   (b)  The seized tobacco products and any vending machine or receptacle
 seized therewith, but not the money contained in such vending machine or
 receptacle, shall thereupon be forfeited to the city, unless the  person
 from  whom  the  seizure  is  made,  or the owner of such seized tobacco
 products, vending machine or receptacle, or any other person  having  an
 interest  in such property, shall within ten days of such seizure, apply
 to the commissioner of finance for a hearing to determine the  propriety
 of  the  seizure,  or unless the commissioner of finance shall on his or
 her own motion release the seized tobacco products, vending  machine  or
 receptacle.  After  such  hearing the commissioner of finance shall give
 notice of his or her decision to the petitioner.  The  decision  of  the
 commissioner  shall be reviewable for error, illegality, unconstitution-
 ality or any other reason  whatsoever  by  a  proceeding  under  article
 seventy-eight of the civil practice law and rules.
   (c)  The  commissioner  of finance may, within a reasonable time after
 the forfeiture to the city of such vending machine or  receptacle  under
 this  section,  upon publication of a notice to such effect for at least
 five successive days, in a newspaper  published  or  circulated  in  the
 city,  sell  such forfeited vending machine or receptacle at public sale
 and pay the proceeds into the general fund  of  the  city.  Such  seized
 vending  machine  or  receptacle  may be sold prior to forfeiture if the
 owner of the seized property consents  to  the  sale.  Tobacco  products
 forfeited  to the city under this section shall be destroyed or used for
 law enforcement purposes, except that tobacco products that violate,  or
 are  suspected of violating, federal trademark laws or import laws shall
 not be used for law enforcement purposes. If the commissioner determines
 the tobacco products forfeited under this section may not  be  used  for
 law  enforcement  purposes,  the  commissioner of finance must, within a
 reasonable time after  the  forfeiture  to  the  city  of  such  tobacco
 products,  upon publication of a notice to such effect for at least five
 successive days, prior to  destruction,  in  a  newspaper  published  or
 circulated in the city, destroy such forfeited tobacco products.
   (d)  In  the  alternative,  the commissioner of finance, on reasonable
 notice by mail or otherwise, may permit the person from whom  a  seizure
 of  tobacco  products under this section was made, to redeem any vending
 machine or receptacle seized with such tobacco products, or  may  permit
 the  owner of any such vending machine or receptacle to redeem the same,
 upon the payment of any civil penalty imposed pursuant to chapter  seven
 of  title  seventeen or subchapter one of chapter two of title twenty of
 the code of the preceding municipality and the costs  incurred  in  such
 proceeding.
                      Title 12 - Personnel and Labor
 §  12-101  Office  of payroll administration.  There shall be within the
 comptroller's office an office of payroll administration which shall:
   1. Support the implementation of  a  computerized  payroll  management
 system;
   2. Maintain the integrity and accuracy of the payroll system;
   3. Develop uniform procedures for payroll processing and development;
   4. Distribute   and   account   for  payroll  and  administer  payroll
 deductions; and
   5. Render services to, and receive information  and  assistance  from,
 public  corporations  upon such terms and conditions as may be agreed to
 by the office and each such corporation.
 S. 8474                           1147
 
   All city agencies shall cooperate with the office as may be  necessary
 and  proper  to  ensure  efficient  operation  of the payroll management
 system.
   §  12-102  Executive director; staff. The comptroller shall appoint an
 executive director of payroll administration.  Within the appropriations
 therefor, the office shall employ such other officers and  employees  as
 may be required to perform its duties.
 
                            Title 13 - Reserved
 
                             Title 14 - Police
 
   §  14-101 Definitions. As used in this title, the following terms have
 the following meanings:
   1. Civil enforcement. The term "civil enforcement" means the  issuance
 of a civil summons.
   2.  Civil  summons.  The  term "civil summons" means a civil notice of
 violation.
   3. Commissioner. The term "commissioner" means the commissioner of the
 department.
   4. Criminal enforcement. The term  "criminal  enforcement"  means  the
 charging of a misdemeanor or violation.
   5.  Criminal  summons. The term "criminal summons" means an appearance
 ticket issued by the department pursuant to article one hundred fifty of
 the criminal procedure law that is an accusatory instrument pursuant  to
 article  one  hundred  of the criminal procedural law, and returnable to
 the criminal court.
   6. Department. The term "department" means the  police  department  of
 the city of New York.
   7.  Desk appearance ticket. The term "desk appearance ticket" means an
 appearance ticket issued by  the  department  pursuant  to  article  one
 hundred  fifty  of  the criminal procedure law that is not an accusatory
 instrument pursuant to article one hundred  of  the  criminal  procedure
 law.
   8.  Specified unlawful act. The term "specified unlawful act" means an
 act that violates any of the  following  provisions:  subdivision  b  of
 section  10-125  of  the code of the preceding municipality, subdivision
 one of section 16-118 of the code of the preceding municipality,  subdi-
 vision  six  of section 16-118 of the code of the preceding municipality
 with respect to the act of public urination, subdivision  a  of  section
 24-218  of the code of the preceding municipality, section 18-146 of the
 code of the preceding municipality, section 18-147 of the  code  of  the
 preceding  municipality,  and rules and regulations of the department of
 parks and recreation described in paragraph nine  of  subdivision  a  of
 section  five hundred thirty-three of the charter of the preceding muni-
 cipality.
   § 14-102 Composition of force. Until otherwise provided by the  mayor,
 upon  the  recommendation  of  the commissioner, the police force in the
 police department, shall consist of the following ranks of  members,  to
 wit:
   1.  Captains  of  police, not exceeding in number one to each fifty of
 the total number of police officers, in addition to the number  detailed
 to act as inspectors;
   2.  Lieutenants  of police, not exceeding four in number to each fifty
 of the total number of police officers;
 S. 8474                           1148
 
   3. Sergeants not exceeding six in number to each  fifty  police  offi-
 cers;
   4.  Surgeons  of  police,  not  exceeding forty in number, one of whom
 shall be chief surgeon;
   5. A veterinarian;
   6. Police officers to the number of seven thousand eight hundred thir-
 ty-nine.
   § 14-103 Detective bureau. a.  The  commissioner  shall  organize  and
 maintain  a  bureau  for detective purposes to be known as the detective
 bureau and shall, from time to time, detail to service in said bureau as
 many members of the force as the commissioner may deem necessary and may
 at any time revoke any such detail.
   b. Of the members of the force so detailed the commissioner may desig-
 nate:  (1) police officers not exceeding two hundred eighty  in  number,
 as  detectives  of  the  first  grade, who while performing duty in such
 bureau and while so designated as detectives of the first  grade,  shall
 be  paid  the  same  salary  as lieutenants; and (2) a certain number of
 police officers, as detectives of the second grade, who while performing
 duty in such bureau and while so designated as detectives of the  second
 grade,  shall be paid the same salary as sergeants; and a certain number
 of police officers as detectives of the third grade, who while  perform-
 ing  duty  in  such  bureau and while so designated as detectives of the
 third grade shall be paid such salary as may be determined by the mayor.
 Any person who has received permanent appointment as  a  police  officer
 and  is temporarily assigned to perform the duties of a detective shall,
 whenever  such  assignment  exceeds  eighteen  months  in  duration,  be
 appointed as a detective and receive the compensation ordinarily paid to
 a detective performing such duties.
   c.  The commissioner may designate lieutenants as commanders of detec-
 tive squads, and sergeants as supervisors of detective squads, who while
 performing duty in such bureau and while so designated as commanders  of
 detective  squads  or supervisors of detective squads shall be paid such
 salary as may be determined by the mayor.
   d. Any member of the force detailed to such bureau while  so  detailed
 shall  retain  his  or  her  rank in the force and shall be eligible for
 promotion the same as if serving in the uniformed force,  and  the  time
 during  which  he  or  she  serves  in  such  bureau shall count for all
 purposes as if served in his or her  rank  or  grade  in  the  uniformed
 force.
   e.  The commissioner may at his or her pleasure revoke any designation
 made pursuant to the provision of this section after complying with  the
 provisions of section seventy-five of the civil service law.
   § 14-104 Juvenile bureau. a. There shall be a bureau in the department
 organized  and  maintained  for  the prevention of crime and delinquency
 among minors and for the performance of such other duties as the commis-
 sioner may assign thereto.
   b. Any member of the force assigned  to  such  juvenile  bureau  shall
 retain  his  or  her rank and pay in the force and shall be eligible for
 promotion as if serving in the uniformed force and the  time  served  in
 such bureau shall count for all purposes as if served in his or her rank
 or grade in the uniformed force of the department.
   § 14-105 Bureau of taxis, limousines and liveries.  The purpose of the
 bureau  of  taxis,  limousines  and  liveries  shall be the continuance,
 further development  and  improvement  of  taxi,  limousine  and  livery
 service in the city of Staten Island.
 S. 8474                           1149
 
   It  shall  be  the  further  purpose of the bureau, consonant with the
 promotion and protection of the public comfort and convenience to  adopt
 and  establish  an  overall public transportation policy governing taxi,
 coach, limousine and wheelchair accessible van services as it relates to
 the  overall  public  transportation network of the city; to require the
 filing of rates, standards of service, standards of insurance and  mini-
 mum coverage; standards for driver safety; standards for equipment safe-
 ty and design; standards for noise and air pollution control; and to set
 standards and criteria for the licensing of vehicles, drivers and chauf-
 feurs, owners and operators engaged in such services.
   § 14-106 Jurisdiction, powers and duties of the bureau.  1. The juris-
 diction,  powers  and  duties of the bureau shall include the regulation
 and supervision of  the  business  and  industry  of  transportation  of
 persons by licensed vehicles for hire in the city.
   2. Such regulations and supervision shall extend to:
   (a) The supervision of rates to be charged and collected.
   (b)  The  regulation  and  supervision  of standards and conditions of
 service.
   (c) The revocation and suspension of licenses for vehicles, other than
 licenses issued pursuant to state law, provided, however,  that  taxicab
 licenses  represented  by  medallions  heretofore  issued  shall  in all
 respects remain valid in accordance with their  terms  and  transferable
 according to law.
   3.  The  bureau or an administrative tribunal which may be established
 by the police  commissioner  to  adjudicate  charges  of  violations  of
 provisions of the administrative code, rules and regulations promulgated
 thereunder  and  public  complaints  of  discrimination or overcharging,
 shall have the power to enforce its decisions and orders imposing  civil
 penalties,  not  to exceed ten thousand dollars for each respondent, for
 violations relating to unlicensed vehicles for hire and unlicensed driv-
 ers of vehicles for hire and for violations relating to the operation of
 commuter van services without authorization and the operation  of  unli-
 censed commuter vans and unlicensed drivers of commuter vans pursuant to
 provisions of the administrative code.
   Before a judgment based upon a default may be so entered the bureau or
 administrative  tribunal  shall  have  first  notified the respondent by
 first class mail in such form as  the  bureau  may  direct  (a)  of  the
 default  and  order and the penalty imposed; (b) that a judgment will be
 entered in the civil court of the city; and (c) that entry of such judg-
 ment may be avoided by requesting a stay of default for good  cause  and
 either  requesting a hearing or entering a plea pursuant to the rules of
 the bureau or administrative tribunal within thirty days of the  mailing
 of such notice.
 
                  Title 15 - Fire Prevention and Control
 
   §  15-101  Definitions;  bureaus,  divisions  and  offices. 1. For the
 purposes of this title the following  terms  shall  have  the  following
 meanings:
   (a) "Commissioner" shall mean the fire commissioner.
   (b) "Department" shall mean the fire department.
   2.  In  addition  to  such other bureaus, divisions and offices as the
 commissioner may organize pursuant to section eleven hundred two of  the
 charter of the preceding municipality, there shall be in the department:
 S. 8474                           1150
 
   (a)  A  fire bureau in the charge of the chief of the department which
 shall have charge of the extinguishment of fires and the  necessary  and
 incidental protection of life and property in connection therewith.
   In  such  bureau  there  shall be a bureau of fire prevention and such
 bureau shall be in the charge of a member of the uniformed force of  the
 department,  of  a  rank  above that of captain, to be designated by the
 commissioner. Such bureau shall perform  the  duties  and  exercise  the
 powers  of  the commissioner in relation to (1) combustibles, chemicals,
 explosives,  flammables,  or  other  dangerous   substances,   articles,
 compounds  or mixtures, (2) the prevention of fires or danger to life or
 property therefrom, excluding provisions relating to  structural  condi-
 tions  and (3) protection against fire and panic, obstruction of aisles,
 passageways and means of egress,  standees,  fire  protection  and  fire
 extinguishing  appliances,  and  fire  prevention  in licensed places of
 assembly. In the performance of their official duties, the uniformed and
 civilian members of the bureau of fire prevention shall have the  powers
 and  perform  the  duties  of  peace  officers,  but their power to make
 arrests and serve process in criminal actions  shall  be  restricted  to
 cases arising under laws relating to (1) the manufacture, storage, sale,
 transportation or use of combustibles, chemicals, explosives, flammables
 or  other  dangerous substances, articles, compounds or mixtures and the
 control of fire hazards, (2) the prevention of fires or danger  to  life
 or  property  therefrom,  excluding  provisions  relating  to structural
 conditions and (3) fire perils.
   (b) A chief and deputy chief fire marshal, appointed  by  the  commis-
 sioner, who shall be members of the department.
   3.  Notwithstanding any inconsistent provision of any general, special
 or local law, or rule or regulation, a chief of the department shall not
 serve in any other capacity to the department during his or her term  of
 office  of  chief.  Any  person violating the provisions of this section
 shall be deemed to have vacated the office of chief so held.
   § 15-102 Commissioner.  The head of the fire department shall  be  the
 commissioner.   The mayor may designate the chief of the fire department
 to serve as commissioner, and shall exercise the powers  and  duties  of
 commissioner  and  shall  receive  the salary of the commissioner. While
 serving as commissioner, the chief shall forfeit  none  of  his  or  her
 pension  rights  and  privileges  as  chief  or his or her civil service
 status.
   The commissioner may appoint deputies, one of whom may perform all the
 duties and exercise all the powers of the commissioner  except  appoint-
 ment  or  promotion,  detail or dismissal of any member of the uniformed
 force when authorized by instrument  in  writing  to  be  filed  in  the
 offices of the mayor and the comptroller.
   The  commissioner  shall  be the treasurer of the department and shall
 file in the office of the comptroller a bond for the  faithful  perform-
 ance of his or her duties as treasurer.
   § 15-103 Powers.  The commissioner shall have sole and exclusive power
 and perform all duties for the government, discipline, management, main-
 tenance  and direction of the fire department and the premises and prop-
 erty,  however  the  commissioner  shall  provide  written  notice  with
 supporting documentation at least forty-five days prior to the permanent
 closing  of any firehouse or permanent removal or relocation of any fire
 fighting unit to the council members whose districts are served by  such
 facility  and  to  the  clerk of the council. The term "permanent" shall
 mean a time period in excess of six months.
 S. 8474                           1151
 
   The department shall have the sole and exclusive power  and  authority
 to extinguish fires at any place within the jurisdiction of the city and
 still  have  power  and authority to extinguish fires upon any vessel in
 the port of New York or upon any dock, wharf, pier, warehouse  or  other
 structure bordering or adjacent to such port.
   The  commissioner  shall have sole and exclusive jurisdiction over the
 approval of the installation of all containers for combustibles,  chemi-
 cals,  explosives,  inflammable  or  other  dangerous substances, except
 storage tanks for oilburning equipment.
   The commissioner shall have the sole and exclusive power to  designate
 and  fix  the  location  of  all  fire alarm telegraph, signal and alarm
 stations in the city and to control the same  for  the  purpose  of  the
 department; except the commissioner shall give forty-five days notice to
 council  members whose districts are served by such equipment and to the
 city clerk in the case of removal.
   § 15-104 Enforcement of fire laws. 1. The commissioner shall have  the
 power  and it shall be his or her duty to enforce all laws and the rules
 and regulations with respect to:
   (a) the manufacture, storage, sale, transportation or use of combusti-
 bles, chemicals or dangerous substances;
   (b) investigation of the cause and origin of fires and suppression  of
 arson; and
   (c) the prevention of fires or danger to life or property.
   2. The commissioner shall have the power to cause any building, struc-
 ture,  tunnel, vessel or premises to be inspected for fire hazards by an
 officer or employee of the department; and to inspect and test any auto-
 matic or other fire alarm system or fire extinguishing equipment.
   3. The commissioner shall have the power and it shall be  his  or  her
 duty  to order in writing the remedying of any condition in violation of
 any regulation which he or she is empowered to enforce. The commissioner
 may take proceedings for the enforcement of any order of the commission-
 er which is not complied with within the time fixed  in  the  order  for
 such  compliance  to  be enforced. Every order, requirement, decision or
 determination of the commissioner shall be in writing.
   4. The commissioner and his or her deputies and such other officers or
 employees of the department as are authorized by  the  commissioner  may
 without  fee  or  hindrance  enter  and inspect all buildings, premises,
 vessels, structures and all underground passages of every  sort  in  the
 city or in the port of New York for compliance with provisions of law or
 rules and regulations enforced by the department.  Any refusal to permit
 such  entry  or inspection shall be triable by a judge and punishable by
 not more than thirty days imprisonment or by a fine  of  not  more  than
 fifty dollars, or both.
   §  15-105 Other officer.  No member of the uniformed force of the fire
 department shall accept any additional place of public  trust  or  civil
 emolument.
   The chief of the fire department shall not serve in any other capacity
 to the department during his or her term of office or shall be deemed to
 have vacated the office of chief.
 
                           Title 16 - Sanitation
                                 Chapter 1
                                  GENERAL
 
   §  16-101  Definitions.  When  used  in this title the following terms
 shall have the following meanings:
 S. 8474                           1152
 
   1. "Department" shall mean the department of sanitation.
   2. "Commissioner" shall mean the commissioner of sanitation.
   3.  "Street"  includes  street,  avenue,  road,  alley, lane, highway,
 boulevard, concourse, driveway, culvert and crosswalk, and  every  class
 of  road,  square and place, and all parkways and through vehicular park
 drives except a road within any park or a wharf, pier, bulkhead, or slip
 by law committed to the custody, and control of the department of  ports
 and terminals.
   §  16-102 Commissioner. The head of the sanitation department shall be
 the commissioner.
   § 16-103 Powers and duties of the commissioner.  1.  The  commissioner
 shall  have charge and control of and be responsible for all those func-
 tions and operations of the city relating  to  the  cleanliness  of  the
 streets  and  the  disposal of waste, including, without limitation, the
 following:
   (a) the sweeping, cleaning, sprinkling, flushing, washing and  sanding
 of the streets;
   (b)  the  removal and disposition of ashes, street sweepings, garbage,
 refuse, rubbish and waste;
   (c) the removal of ice and snow from the streets;
   (d) the removal of encumbrances from the streets and  the  storage  or
 disposal  of  such  encumbrances,  except  that the mayor may provide by
 regulation that the removal and storage of household  effects  or  other
 chattels shall be a responsibility of the department of general services
 and contracting;
   (e)  plans,  design,  construction,  operation,  repair,  maintenance,
 enlargement and regulation of the use  of  incinerators,  landfills  and
 other plants, facilities and equipment; and
   (f) recovery and reuse of recyclable material.
   2.  The  commissioner  may  adopt  regulations  specifying the kind of
 ashes, garbage, refuse, rubbish or other material or substance that will
 be collected by the city, the time when it will  be  collected  and  the
 place at which it shall be deposited for collection.
   3.  The  regulations  shall  be enforced by order of the commissioner.
 Such order shall be addressed to the owner or owners, lessees  or  occu-
 pants  of  the building, structure, enclosure, vessel, place or premises
 affected thereby.  It shall not be necessary to designate such owner  or
 owners,  lessees  or  occupants  by  name, however the premises shall be
 designated in the address so that it may be readily identified.
   § 16-104 Duties and obligations of property owner.  The owner  of  any
 property  shall  keep  any  vacant  lot  or lots in a clean and sanitary
 manner and free of debris and other litter at the owner's expense.    In
 the  event  that  an  owner  of  property  fails  to  comply  with these
 provisions, or rules and regulations, the  department  may  provide  for
 cleaning of a vacant lot at the expense of the property owner.
 
                                 Chapter 2
                           SOLID WASTE RECYCLING
 
   §  16-301  Short  title.  Sections 16-301 through 16-324 of this title
 shall be known and may be cited as the "City of Staten Island  Recycling
 Law".
   § 16-302 Declaration of policy. It is hereby declared to be the public
 policy  of  the  city  to  reduce environmental pollution and dangers to
 health, to decrease the demand for scarce landfill  space,  to  minimize
 the  size  and  cost  of  the proposed resource recovery program, and to
 S. 8474                           1153
 
 encourage the conservation of valuable natural resources and energy.  It
 is  the policy of the city to promote the recovery of materials from the
 city of Staten Island solid waste stream for the  purpose  of  recycling
 such  materials  and  returning them to the economy. This title shall be
 liberally construed in order to effectuate the  purposes  set  forth  in
 this section.
   § 16-303 Definitions. When used in this title:
   1.  "Architectural  paint"  means  interior and exterior architectural
 coatings, including paints and stains purchased for commercial or  resi-
 dential  use,  but does not include architectural coatings purchased for
 industrial use or for use in the manufacture of products.
   2. "Organic waste" means any material found in the waste  stream  that
 can  be  broken  down into, or otherwise become part of, usable compost,
 such as food scraps, soiled paper, and plant trimmings. As determined by
 the commissioner, such term may also  include  disposable  plastic  food
 service ware and bags that meet the ASTM International standard specifi-
 cations  for  compostable  plastics,  but  shall not include liquids and
 textiles.
   3. "Department-managed solid waste" means all  solid  waste  that  the
 department and its contractors collect, all solid waste that the depart-
 ment receives for free disposal, all solid waste collected for recycling
 or reuse through special events or programs promoted, operated or funded
 by  the  department, and all solid waste diverted from collection by the
 department that is accepted through  non-department  infrastructure  for
 recycling  or reuse and counted towards the department's recycling goals
 as set forth in subdivision a of section 16-305 of this chapter.
   4. "Household" means a single dwelling or a residential unit within  a
 multiple  dwelling,  hotel,  motel,  campsite, ranger station, public or
 private recreation area, or other residence.
   5. "Household and institutional compostable waste" means any composta-
 ble waste, excluding yard waste, in or otherwise destined for any  waste
 stream collected by the department.
   6. "Household hazardous waste" means:
   a. any household waste that is ignitable, corrosive, reactive or toxic
 and  that,  but  for its point of generation, would be a hazardous waste
 under part three hundred seventy-one of title six of the New York  code,
 rules and regulations, as may be amended from time to time, and includes
 all  pesticides, as defined in article thirty-three of the environmental
 conservation law, and hazardous waste, as defined in section 27-0901  of
 the  environmental  conservation  law,  as such laws may be amended from
 time to time; and
   b. any other household waste  that  the  commissioner  determines,  by
 rule, to be hazardous and require special handling.
   7. "Post-collection separation" means the dividing of solid waste into
 some or all of its component parts after the point of collection.
   8.  "Post-consumer material" means those products generated by a busi-
 ness or a consumer which have served their intended end uses, and  which
 have  been  separated  or  diverted from solid waste for the purposes of
 collection, recycling and disposition.
   9. "Private carter" means  any  person  required  to  be  licensed  or
 permitted  pursuant to chapter one of title sixteen-A of the code of the
 preceding municipality.
   10.  "Publicly accessible textile drop-off  bin"  means  any  enclosed
 container that allows for members of the public to deposit textiles into
 such  container  for  reuse  or recycling in accordance with the textile
 S. 8474                           1154
 
 reuse and recycling program established  by  section  16-310.1  of  this
 chapter.
   11.  "Recyclable  materials"  means solid waste that may be separated,
 collected, processed, marketed and returned to the economy in  the  form
 of  raw paper, plastic, yard waste and any other solid waste required to
 be recycled or composted pursuant to this chapter, solid waste collected
 for recycling or reuse through  special  events  or  programs  promoted,
 operated  or  funded by the department, and solid waste accepted through
 non-department infrastructure for recycling or reuse.
   12. "Recycled" or "recycling" means any process  by  which  recyclable
 materials  are separated, collected, processed, marketed and returned to
 the economy in the form of raw materials or products.
   13. "Recycling center" means any facility operated to  facilitate  the
 separation,  collection, processing or marketing of recyclable materials
 for reuse or sale.
   14. "Recycling district" means any borough or smaller geographic  area
 the  commissioner deems appropriate for the purpose of implementing this
 chapter.
   15. "Rigid plastic container" means any  plastic  container  having  a
 semi-flexible  or  inflexible  finite  shape  or form that is capable of
 maintaining its shape while holding other products and  is  designed  to
 hold  food,  beverages,  and consumer household products, including, but
 not limited to, the following  types  of  containers:  plastic  bottles,
 plastic  jugs,  plastic tubs, plastic trays, plastic cups, plastic buck-
 ets, plastic crates and plastic flower pots, and any other rigid plastic
 material that the commissioner may designate by rule, but not  including
 containers made of polystyrene foam.
   16.  "Solid waste" means all putrescible and non-putrescible materials
 or substances, except as described in paragraph c of  this  subdivision,
 that  are discarded or rejected as being spent, useless, worthless or in
 excess to the owners at the time of such discard or rejection, including
 but not limited to, garbage, refuse, industrial  and  commercial  waste,
 rubbish,  tires, ashes, contained gaseous material, incinerator residue,
 construction and demolition debris, discarded automobiles and offal.
   a. A material is discarded if it is abandoned by being:
   i. disposed of;
   ii. burned or incinerated, including being burned as a  fuel  for  the
 purpose of recovering useable energy; or
   iii.  accumulated,  stored,  or physically, chemically or biologically
 treated, other than burned or incinerated, instead of  or  before  being
 disposed of.
   b. A material is disposed of if it is discharged, deposited, injected,
 dumped,  spilled, leaked, or placed into or on any land or water so that
 such material or any constituent thereof may enter the environment or be
 emitted into the air or discharged into groundwater or surface water.
   c. The following are not solid waste for the purpose of this chapter:
   i. domestic sewage;
   ii. any mixture of  domestic  sewage  and  other  wastes  that  passes
 through  a  sewer  system to a publicly owned treatment works for treat-
 ment, except (A) any material that is introduced  into  such  system  in
 order  to  avoid the provisions of this chapter or the state regulations
 promulgated to regulate solid waste management facilities pursuant to  6
 NYCRR part 360 or (B) food waste;
   iii.  industrial  wastewater  discharges  that are actual point source
 discharges subject to permits under article seventeen  of  the  environ-
 mental  conservation  law;  industrial  wastewaters while they are being
 S. 8474                           1155
 
 collected, stored, or treated before  discharge  and  sludges  that  are
 generated by industrial wastewater treatment are solid wastes;
   iv. irrigation return flows;
   v.  radioactive materials that are source, special nuclear, or by-pro-
 duct material as defined by the Atomic Energy Act of 1954,  as  amended,
 42 U.S.C. § 2011 et seq.;
   vi.  materials  subject  to  in-situ  mining  techniques which are not
 removed from the ground as part of the extraction process;
   vii. hazardous waste as defined in section  27-0901  of  the  environ-
 mental conservation law; and
   viii.  regulated  medical waste or other medical waste as described in
 section 16-120.1 of this title.
   17. "Source separation" means the dividing of solid waste into some or
 all of its component parts at the point of generation.
   18. "Yard waste" means leaves, grass  clippings,  garden  debris,  and
 vegetative residue that is recognizable as part of a plant or vegetable,
 small or chipped branches, and similar material.
 
                                 Chapter 3
                        CITYWIDE RECYCLING PROGRAM
 
   §  16-305  Recycling  of  department-managed  solid  waste.  1. a. The
 following recycling percentage goals are established for  the  recycling
 of department-managed solid waste:
   i.  by July first, two thousand eleven, sixteen percent of department-
 managed solid waste;
   ii. by July first, two thousand thirteen, nineteen percent of  depart-
 ment-managed solid waste;
   iii.  by  July  first,  two  thousand  fourteen, twenty-one percent of
 department-managed solid waste;
   iv. by July  first,  two  thousand  sixteen,  twenty-four  percent  of
 department-managed solid waste;
   v.  by  July  first,  two  thousand  eighteen, twenty-seven percent of
 department-managed solid waste;
   vi. by July first, two thousand nineteen, thirty  percent  of  depart-
 ment-managed solid waste; and
   vii.  by  July  first,  two  thousand  twenty, thirty-three percent of
 department-managed solid waste.
   b. In addition, the following  recycling  goals  are  established  for
 curbside and containerized waste collected by the department:
   i. By July first, two thousand eleven, sixteen percent of curbside and
 containerized waste collected by the department;
   ii. By July first, two thousand thirteen, eighteen percent of curbside
 and containerized waste collected by the department;
   iii.  By  July first, two thousand fourteen, nineteen percent of curb-
 side and containerized waste collected by the department;
   iv. By July first, two thousand sixteen, twenty-one percent  of  curb-
 side and containerized waste collected by the department;
   v. By July first, two thousand eighteen, twenty-three percent of curb-
 side and containerized waste collected by the department;
   vi. By July first, two thousand nineteen, twenty-four percent of curb-
 side and containerized waste collected by the department; and
   vii.  By July first, two thousand twenty, twenty-five percent of curb-
 side and containerized waste collected by the department.
   2. The commissioner shall adopt and  implement  rules  designating  at
 least  six  recyclable  materials,  including  plastics  to  the  extent
 S. 8474                           1156
 
 required in subdivision three of this section  and  yard  waste  to  the
 extent  required  in section 16-308 of this chapter and organic waste to
 the extent required in section 16-308.1 of this  chapter,  contained  in
 department-managed  solid waste and requiring households to source sepa-
 rate such designated materials.
   3. a. Prior to commencing delivery  of  department-managed  recyclable
 materials  to  the designated recycling processing facility at the South
 Brooklyn Marine Terminal, the commissioner shall designate as recyclable
 materials, and require the source separation of, rigid plastic  contain-
 ers.
   b.  If the commissioner, in his or her discretion, determines that the
 cost to the city of recycling rigid plastic containers  required  to  be
 designated  as  recyclable  materials  pursuant  to  paragraph a of this
 subdivision is not reasonable in comparison with the cost  of  recycling
 only  metal,  glass  and  plastic and have been designated as recyclable
 materials, the commissioner shall within ten business  days  notify  and
 provide  documentation to the council of the factors relied upon to make
 such determination and shall not be required to designate any such rigid
 plastic containers as recyclable materials.
   c. If the commissioner determines that the cost to the city of recycl-
 ing rigid plastic containers is not reasonable in  comparison  with  the
 cost  of  recycling  only metal, glass and plastic that have been desig-
 nated as recyclable materials, the commissioner shall annually  reevalu-
 ate the cost to the city of designating such rigid plastic containers as
 recyclable  materials, and shall annually make a new determination as to
 whether the cost of designating such containers as recyclable  materials
 is reasonable in comparison with the cost of recycling only metal, glass
 and  plastic that have been designated as recyclable materials and shall
 report such evaluations to  the  council.    The  department  shall  not
 promulgate  rules  designating  rigid  plastic  containers as recyclable
 materials, and need not conduct outreach or education  relating  thereto
 if, pursuant to paragraph b of this subdivision, the commissioner deter-
 mines that the cost to the city of recycling rigid plastic containers is
 not  reasonable  in  comparison  with  the cost of recycling only metal,
 glass and plastic that have been designated as recyclable materials.
   d. Immediately following the promulgation of rules  designating  rigid
 plastic  containers as recyclable materials, the department shall under-
 take outreach and education, in cooperation with  any  other  agency  or
 entity  designated for that purpose by the commissioner, to inform resi-
 dents of such new designation and to provide instruction  on  compliance
 with  the  requirements  of  this  subdivision and the rules promulgated
 pursuant thereto.
   4. The commissioner  shall  adopt  and  implement  rules  establishing
 procedures  requiring  the  placement of the designated materials at the
 curbside, in specialized containers, or in any other manner the  commis-
 sioner  determines,  to facilitate the collection of such materials in a
 manner that enables them to be recycled. Under  such  rules,  no  person
 shall  be  liable for incorrectly placing a non-designated rigid plastic
 container in the recycling stream.
   5. Where the department provides solid waste collection services to  a
 building containing at least four and no more than eight dwelling units,
 the  commissioner  shall  adopt and implement rules requiring the owner,
 net lessee or person in charge of such building to:
   a. provide for the residents, where  practicable,  a  designated  area
 and,  where  appropriate,  containers in which to store the source sepa-
 S. 8474                           1157
 
 rated or other designated recyclable materials to be  collected  by  the
 department; and
   b.  inform  all  residents of the requirements of this chapter and the
 rules  promulgated  pursuant  thereto  by,   at   a   minimum,   posting
 instructions  on  source  separation in or near the designated recycling
 area and making available to each resident at the inception of a  lease,
 where applicable, a department-issued guide to recycling, which shall be
 made  available  to  the  owner,  net lessee or person in charge of such
 building by the department pursuant to section 16-315 of this chapter in
 print form or on the department's website, or in  an  alternative  guide
 containing  similar  information to the guide required by section 16-315
 of this chapter.
   If reasonably accessible space for the storage of source separated  or
 other designated recyclable materials is not available in such building,
 and  such  space  is available behind the building's property line, such
 space behind the property line may be designated as  the  area  for  the
 storage of source separated or other designated recyclable materials. If
 no such space is available, the owner, net lessee or person in charge of
 such building shall post instructions on recycling and source separation
 in  or  near  a  designated area that is visible to all residents in the
 building.
   With respect to solid waste generated by households in  the  aforesaid
 buildings,  the  obligations of an owner, net lessee or person in charge
 of such building under this chapter shall be limited to those set  forth
 in  this  subdivision and subdivisions four and seven of this section or
 rules promulgated pursuant to such subdivisions.
   6. Where the department provides solid waste collection services to  a
 building  containing nine or more dwelling units, the commissioner shall
 adopt and implement rules requiring the owner, net lessee or  person  in
 charge of such building to:
   a. provide for the residents a designated area and, where appropriate,
 containers  in  which  to store the source separated or other designated
 recyclable materials to be collected by the department;
   b. inform all residents of the requirements of this  chapter  and  the
 rules   promulgated   pursuant   thereto   by,  at  a  minimum,  posting
 instructions on source separation in or near  the  designated  recycling
 area, and making available to each resident at the inception of a lease,
 a department-issued guide to recycling, which shall be made available to
 the  owner,  net  lessee  or  person  in  charge of such building by the
 department pursuant to section 16-315 of this chapter in print  form  or
 on the department's website, or in an alternative guide containing simi-
 lar information to the guide required by section 16-315 of this chapter;
 and
   c.  remove  non-designated materials from the containers of designated
 source separated recyclable materials before such containers are  placed
 at  the curbside for collection and ensure that the designated materials
 are placed at the curbside in the manner prescribed by the department.
   With respect to solid waste generated by households in  the  aforesaid
 buildings,  the  obligations of an owner, net lessee or person in charge
 of such building under this chapter shall be limited to those set  forth
 in  this  subdivision and subdivisions four and seven of this section or
 rules promulgated pursuant to such subdivisions.
   7. The commissioner shall adopt and implement rules for  any  building
 containing four or more dwelling units in which the amount of designated
 materials  placed out for collection is significantly less than what can
 reasonably be expected from such building.  These  rules  shall  require
 S. 8474                           1158
 
 residential  generators,  including  tenants,  owners,  net  lessees  or
 persons in charge of such building to use transparent bags or such other
 means of disposal the commissioner deems appropriate to dispose of solid
 waste  other  than  the designated recyclable materials. Upon request of
 the owner, net lessee or person in charge of such building, and  if  the
 commissioner  determines that such owner, net lessee or person in charge
 of such building has complied with this subdivision, subdivision four of
 this section and, as applicable, subdivision five or subdivision six  of
 this section or rules promulgated pursuant to such subdivisions and that
 the  amount  of  designated  materials placed out for collection remains
 significantly less than what can reasonably be expected from such build-
 ing, the department may develop a schedule to conduct random inspections
 to facilitate compliance with the provisions of this chapter by  tenants
 of  such building, provided that lawful inspections may occur at reason-
 able times without notice to ensure compliance by  the  tenants,  owner,
 net lessee or person in charge of such building.
   8.  a.  In  calculating the extent to which the department has met the
 recycling percentage goals set forth in paragraph a of  subdivision  one
 of  this  section,  the department shall include in its calculations all
 curbside and institutional recycling it  collects,  including  materials
 collected from households, schools, not-for-profit institutions and city
 agencies,  and  all recyclable materials collected as part of the public
 space recycling program pursuant to section 16-310 of this chapter,  and
 may  include  yard  waste  collected  pursuant to section 16-308 of this
 chapter and any other material collected for composting pursuant to this
 chapter, Christmas trees collected pursuant to section  16-309  of  this
 chapter,  clothing and textiles donated or collected pursuant to section
 16-310.1 of this chapter, household hazardous waste diverted pursuant to
 section 16-310.3  of  this  chapter,  rechargeable  batteries  collected
 pursuant  to  chapter  four of title eleven of the code of the preceding
 municipality, beverage containers returned within the city  pursuant  to
 title ten of article twenty-seven of the environmental conservation law,
 electronic  waste  collected  within the city or otherwise diverted from
 the city's waste stream, including  such  waste  collected  or  diverted
 pursuant  to  title  twenty-six  of article twenty-seven of the environ-
 mental conservation law, and plastic bags collected within the  city  or
 otherwise  diverted from the city's waste stream, including such plastic
 bags collected or diverted pursuant to  title  twenty-seven  of  article
 twenty-seven  of  the  environmental  conservation  law. Only recyclable
 materials specifically enumerated in this paragraph shall be counted for
 purposes of calculating the extent to which the department has  met  the
 recycling  percentage  goals set forth in paragraph a of subdivision one
 of this section.
   b. In calculating the extent to which the department has met the recy-
 cling percentage goals set forth in paragraph b of  subdivision  one  of
 this section, the department shall include in its calculations all curb-
 side  and  institutional  recycling  it  collects,  including  materials
 collected from households, schools, not-for-profit institutions and city
 agencies, and all recyclable materials collected as part of  the  public
 space recycling program pursuant to section 16-310 of this chapter.
   c. In calculating the extent to which the department has met the recy-
 cling  percentage  goals  set forth in paragraphs a and b of subdivision
 one of this section, the department shall not include recycling of aban-
 doned vehicles or recycling from lot cleaning  operations,  asphalt  and
 mill  tailings,  construction  and demolition debris or other commercial
 recycling programs. The commissioner shall not designate any such  mate-
 S. 8474                           1159
 
 rials  as recyclable materials under this section for purposes of calcu-
 lating the extent  to  which  the  department  has  met  such  recycling
 percentage goals.
   d.  In  calculating  the percent of the department-managed solid waste
 stream recycled in connection with the percentage  goals  set  forth  in
 paragraph  a  of  subdivision  one of this section, the department shall
 ensure that any quantity of material counted as recycled must  be  fully
 included in the calculation of the city's total department-managed solid
 waste stream.
   e.  All  data used to make calculations pursuant to paragraphs a and b
 of this subdivision shall be made available on the department's  website
 in  raw  form disaggregated by material type and using a non-proprietary
 format on a monthly basis, or, if such data  is  not  generated  by  the
 department,  within one month from the date that the department receives
 reports of such information.
   9. In the event that  the  department  does  not  meet  any  recycling
 percentage  goal  set  forth  in paragraphs a or b of subdivision one of
 this section by the dates specified therein, the department shall, with-
 in sixty days of the  date  for  meeting  such  goal,  expand  recycling
 outreach  and  education  and shall take such other appropriate measures
 including, but not limited to, directing such outreach and education  to
 the  neighborhoods  and community districts in which recycling diversion
 rates fall below the median city recycling diversion rate and consulting
 with the council to explore additional measures to  meet  the  recycling
 percentage  goals  set forth in such subdivision. In expanding recycling
 outreach and education, the department may work with other  agencies  or
 entities designated for that purpose by the commissioner.
   10.  In the event that the department is unable to achieve two consec-
 utive recycling percentage goals set forth in  paragraphs  a  and  b  of
 subdivision one of this section by the dates specified therein, in addi-
 tion  to  the  requirements  of  subdivision  nine  of this section, the
 commissioner shall retain a special advisor, who shall  be  selected  by
 the  mayor  and  the  speaker,  provided  that the commissioner need not
 retain such special advisor more than once every three years. Within one
 hundred twenty days of such  retention,  such  adviser  shall  submit  a
 report  to  the  mayor and council recommending additional measures that
 may be taken by the city following such report in  order  to  meet  such
 recycling percentage goals.
   §  16-305.1  Weekly collection of designated recyclable materials.  1.
 Weekly collection of designated recyclable materials shall be maintained
 in all local service delivery districts.
   2. Effective July first, two thousand nine,  and  notwithstanding  any
 inconsistent  provision of this chapter, the department shall be author-
 ized, by written order of the commissioner, to  implement  and  maintain
 alternate  week  collection  of  designated  recyclable materials in all
 local service delivery districts, provided that the department  may,  by
 written  order of the commissioner, provide for more frequent collection
 of designated recyclable materials in designated local service  delivery
 districts.  Any  such  written  order  of  the commissioner implementing
 alternate week collection shall expire no later than March thirty-first,
 two thousand ten.
   3. For purposes of  this  section  "designated  recyclable  materials"
 shall  mean  solid waste that has been designated by the commissioner as
 recyclable pursuant  to  section  16-305,  section  16-307,  or  section
 16-308.1 of this chapter.
 S. 8474                           1160
 
   4. Nothing in this section shall be construed to require collection of
 designated recyclable materials in such parts of the city or during such
 times of the year that such materials are not otherwise collected.
   §  16-306  Private  carter-collected  waste. 1. The commissioner shall
 adopt and implement rules designating recyclable materials that  consti-
 tute  in the aggregate at least one-half of all solid waste collected by
 private carters, and additional materials if the commissioner determines
 that economic markets exist for them. Pursuant  to  subdivision  two  of
 this section, such rules shall require generators of private carter-col-
 lected  waste to source separate some or all of the designated materials
 and to arrange for lawful collection for recycling, reuse  or  sale  for
 reuse  by  private carters or persons other than private carters of such
 source separated materials. With regard to designated materials that are
 not required by such rules to be source separated, generators of private
 carter-collected waste may source separate  these  designated  materials
 and, in any event, shall arrange for their lawful collection for recycl-
 ing,  reuse  or  sale for reuse by private carters or persons other than
 private carters. If a generator of private  carter-collected  waste  has
 source  separated  the designated materials in accordance with the rules
 and arranged for the lawful collection for recycling, reuse or sale  for
 reuse  by  private carters or persons other than private carters of such
 source separated materials and, with regard to designated materials that
 are not required by such rules to  be  source  separated,  arranged  for
 lawful  collection  for  recycling,  reuse  or sale for reuse by private
 carters or persons other than private carters,  such  arrangement  shall
 constitute  an affirmative defense to any proceeding brought against the
 generator pursuant to section 16-324 of this title.
   2. (a) The rules promulgated  pursuant  to  subdivision  one  of  this
 section  shall  require that generators of waste collected by businesses
 required to be licensed pursuant to section 16-505 of the  code  of  the
 preceding  municipality source separate the designated materials in such
 manner and to such extent as the commissioner determines to be necessary
 to minimize contamination and maximize the marketability of such materi-
 als. However, in promulgating such  rules  the  commissioner  shall  not
 require  source  separation  of  a  material unless the commissioner has
 determined that an economic market exists for  such  material.  For  the
 purpose  of this section, the term "economic market" refers to instances
 in which the full avoided costs of proper collection, transportation and
 disposal of source separated materials are equal to or greater than  the
 cost  of  collection, transportation and sale of said materials less the
 amount received from the sale of said materials.
   (b) (i) Any designated carter that collects  source  separated  desig-
 nated  materials  in a commercial waste zone pursuant to section 16-1002
 of the  code  of  the  preceding  municipality  shall  provide  for  the
 collection  of, and ensure the continued separation of, designated mate-
 rials that have been source separated, provide for the separation of all
 other designated materials, and provide for recycling of all the  desig-
 nated  materials  in accordance with the rules of the department and the
 terms of any agreement entered into pursuant to section 16-1002  of  the
 code of the preceding municipality under which such designated carter is
 providing such service.
   (ii)  Any  person  registered  by the business integrity commission to
 remove, collect, or dispose of trade waste generated in  the  course  of
 operation of such person's business pursuant to subdivision b of section
 16-505  of  the code of the preceding municipality shall provide for the
 collection of, and ensure the continued separation of, designated  mate-
 S. 8474                           1161
 
 rials that have been source separated, provide for the separation of all
 other  designated materials, and provide for recycling of all the desig-
 nated materials in accordance with the rules promulgated by the business
 integrity  commission pursuant to this section and subject to the penal-
 ties provided in subdivision a of section 16-515  of  the  code  of  the
 preceding municipality.
   (c)  The  commissioner and the chair of the business integrity commis-
 sion shall have the authority to issue  notices  of  violation  for  any
 violation  of  any  rules  promulgated pursuant to this section and such
 notices of violation shall be returnable in a civil  action  brought  in
 the  name  of  the  commissioner  or the chair of the business integrity
 commission before the environmental control board which shall  impose  a
 penalty not to exceed ten thousand dollars for each such violation.
   3.  The  department  shall complete a study of commercial recycling in
 the city no later than January first, two thousand twelve. Such  commer-
 cial  recycling  study  shall  focus  on  the putrescible portion of the
 commercial waste stream, and shall include, but need not be limited  to,
 the following: (a) an integration of all data on commercial waste in the
 city  collected  and transported through transfer stations and recycling
 processors; (b) an  assessment  of  current  practices,  operations  and
 compliance  with  applicable  local  laws and rules, consistent with the
 scope of study set forth in the two thousand six Solid Waste  Management
 Plan;  (c)  estimates of waste composition and recycling diversion rates
 from research conducted with  respect  to  other  jurisdictions;  (d)  a
 computer-based  model  to  measure  the  amount and composition of waste
 generated by different commercial sectors; (e) recommendations of  meth-
 ods  to  encourage waste prevention, reuse, recycling and composting for
 each of the commercial sectors studied, including any recommended chang-
 es to applicable law; and (f) an assessment of  the  efficiency  of  the
 transportation  of  commercial  waste  within  the commercial system by,
 among other things, mapping and monitoring routes along which commercial
 waste and recycling trucks travel, including long-haul  carriers  within
 and  outside  the city. Following completion of the commercial recycling
 study, the commissioner shall determine whether any  additional  studies
 are  necessary in order to improve commercial recycling practices in the
 city and shall promptly report such determination to the mayor  and  the
 council.
   4. Notwithstanding any other provision of law, nothing in this section
 shall  be  construed to (a) supersede, amend or eliminate any obligation
 of an awardee or designated carter, as such terms are defined in section
 16-1000 of the code of the preceding municipality, to meet the  require-
 ments  set  forth  in  any applicable agreement entered into pursuant to
 section 16-1002 of the code of the preceding municipality, or (b) other-
 wise amend or supersede any term of such agreement.
   § 16-306.1 Organic waste. 1. When used  in  this  section  or  section
 16-324 of this chapter:
   a. "Arena" means an establishment or facility that hosts live sporting
 or entertainment events.
   b. "Capacity" means the combined capacity of facilities that are capa-
 ble  of  accepting  and  processing,  consistent  with the terms of this
 section and exceeding a nominal amount, organic  waste  expected  to  be
 generated by and collected from designated covered establishments.
   c.  "Catering  establishment"  means  any  room, place or space in the
 city, which is used, leased or hired out for  the  business  of  serving
 food or beverages for a particular function, occasion or event, to which
 S. 8474                           1162
 
 the public is not invited or admitted and wherein music or entertainment
 is permitted.
   d. "Covered establishment" means:
   (i)  any  location at which a food manufacturer has a floor area of at
 least twenty-five thousand square feet;
   (ii) any location at which a food wholesaler has a floor  area  of  at
 least twenty thousand square feet;
   (iii) any location at which a retail food store has a floor area of at
 least ten thousand square feet, or any retail food store that is part of
 a  chain  of three or more retail food stores that have a combined floor
 area space of at least ten thousand square feet and that  operate  under
 common  ownership  or control and receive waste collection from the same
 private carter;
   (iv) arenas or stadiums having a seating capacity of at least  fifteen
 thousand persons;
   (v)  any  food service establishment that is part of a chain of two or
 more food service establishments that have a combined floor area  of  at
 least  eight  thousand  square  feet  and that: (1) operate under common
 ownership or control; (2)  are  individually  franchised  outlets  of  a
 parent  business;  or  (3)  do  business  under the same corporate name,
 provided that the requirements of subparagraph (i)  of  paragraph  a  of
 subdivision  three  of  this  section  shall  not apply to any such food
 service establishment when the building or premises in which  such  food
 service  establishment is located is in compliance with such requirement
 pursuant to paragraph h of this definition;
   (vi) any location at which a food service establishment  has  a  floor
 area  of at least seven thousand square feet, provided that the require-
 ments of subparagraph (i) of paragraph a of subdivision  three  of  this
 section  shall not apply to any such location when the building or prem-
 ises containing such location is in  compliance  with  such  requirement
 pursuant to paragraph g of this subdivision;
   (vii)  any  building  or  premises  where  food service establishments
 having a total combined floor area of at  least  eight  thousand  square
 feet are located and where the owner of the building or premises, or its
 agent,  arranges  or  contracts with a private carter for the removal of
 waste from food service establishments having no less than  eight  thou-
 sand  square  feet  of such building or premises, provided that any such
 food service  establishments  shall  comply  with  the  requirements  of
 subparagraphs  (ii),  (iii) and (iv) of paragraph a of subdivision three
 of this section, but such requirements shall not apply to the  owner  or
 agent of any such building or premises;
   (viii)  any  location  at which a food preparation establishment has a
 floor area of at least six thousand square feet;
   (ix) any catering establishment that is required to  provide  for  the
 removal of waste pursuant to section 16-116 of the code of the preceding
 municipality  whenever  the  anticipated  attendance  for any particular
 event is greater than one hundred persons;
   (x) any food service establishments located within and providing  food
 to one or more hotels totaling at least one hundred sleeping rooms; and
   (xi) sponsors of a temporary public event.
   e.  "Designated  area"  means  within a one hundred mile radius of the
 city.
   f. "Food manufacturer"  means  any  establishment  that  processes  or
 fabricates  food  products  from  raw materials for commercial purposes,
 provided that it shall not include any establishment engaged  solely  in
 the warehousing, distribution or retail sale of product.
 S. 8474                           1163
 
   g. "Food preparation establishment" means a business that is primarily
 engaged  in providing food or food services for a temporary, fixed time,
 or based on contractual arrangements for a specified period of  time  at
 locations other than such establishment's permanent place of business.
   h.  "Food service establishment" means any premises or part of a prem-
 ises that is required to provide for the removal of  waste  pursuant  to
 section  16-116  of the code of the preceding municipality where food is
 provided directly to the consumer, whether such food is provided free of
 charge or sold, and whether consumption occurs on or off  the  premises.
 Food  service  establishment shall include, but not be limited to, full-
 service restaurants, fast food restaurants, cafes, delicatessens, coffee
 shops, and business, institutional or government agency cafeterias,  but
 shall  not  include  retail food stores, convenience stores, pharmacies,
 and mobile food vending units, as such term is defined in section  89.03
 of  the  health  code. Food service establishment shall also not include
 any premises or place of business where the sole or  primary  source  of
 food  is  a  refreshment  counter where the available food is limited to
 items such as beverages, prepackaged items, and snacks.
   i. "Food wholesaler" means any establishment primarily engaged in  the
 wholesale  distribution of groceries and related products including, but
 not limited to, packaged frozen food, dairy products, poultry  products,
 confectioneries,  fish  and seafood, meat products, and fresh fruits and
 vegetables but shall not apply to establishments that handle  only  pre-
 packaged, non-perishable foods.
   j. "Hotel" shall have the same meaning as set forth in section 27-2004
 of the housing maintenance code.
   k.  "In  vessel  composting" means a process in which organic waste is
 enclosed in a drum, silo, bin, tunnel, reactor, or other  container  for
 the purpose of producing compost, maintained under controlled conditions
 of   temperature   and   moisture  and  where  air-borne  emissions  are
 controlled.
   l. "Organic waste" shall have the same meaning as set forth in section
 16-303 of this title, except that for purposes of this section,  organic
 waste shall not include food that is donated to a third party, food that
 is  sold to farmers for feedstock, and meat by-products that are sold to
 a rendering company.
   m. "Private carter" means a business licensed by the business integri-
 ty commission pursuant to title sixteen-A of the code of  the  preceding
 municipality.
   n. "Retail food store" means any establishment or section of an estab-
 lishment  where  food  and  food  products  offered  to the consumer are
 intended for off-premises consumption,  but  shall  exclude  convenience
 stores,  pharmacies,  greenmarkets  or farmers' markets and food service
 establishments.
   o. "Sponsor of a temporary public event" means  the  applicant  for  a
 street  activity  permit  pursuant  to chapter one of title fifty of the
 rules of the city of New York,  or  any  successor  provision,  for  any
 activity  on  a  public street, street curb lane, sidewalk or pedestrian
 island or plaza with an anticipated  attendance  of  greater  than  five
 hundred  persons  per  day  where  the  activity  will interfere with or
 obstruct the regular use of the  location  by  pedestrian  or  vehicular
 traffic.  Such term shall not include activities conducted pursuant to a
 valid film permit, demonstrations, parades or block parties.
   p. "Stadium" means an establishment or facility that hosts live sport-
 ing or entertainment events.
 S. 8474                           1164
 
   2. The commissioner shall, on a regular basis and no less than annual-
 ly, evaluate the capacity of all facilities within the  designated  area
 and the cost of processing organic waste by composting, aerobic or anae-
 robic  digestion,  or  any other method of processing organic waste that
 the  department  approves  by  rule. If the commissioner determines that
 there is sufficient capacity and that the  cost  of  processing  organic
 waste  consistent  with  this  section  is  competitive with the cost of
 disposing of organic waste by landfill or incineration, he or she  shall
 designate  by  rule  all  covered  establishments or a subset of covered
 establishments, based on any criteria,  among  such  covered  establish-
 ments,  that  generate a quantity of organic waste that would not exceed
 the evaluated capacity. All such designated covered establishments shall
 comply with the requirements of subdivision three of this section begin-
 ning no later than six months following such designation.  In  addition,
 the  commissioner shall include in his or her evaluation the capacity of
 any facilities outside of the designated area that have arrangements  or
 contracts  with transfer stations or private carters to accept and proc-
 ess organic waste generated by and  collected  from  covered  establish-
 ments.
   3. a. Each designated covered establishment shall:
   (i)  either  (1)  ensure collection by a private carter of all organic
 waste generated by such establishment for purposes of composting,  aero-
 bic  or  anaerobic  digestion, or any other method of processing organic
 waste that the department approves by rule, (2) transport its own organ-
 ic waste to a facility that provides for composting, aerobic or  anaero-
 bic  digestion, or any other method of processing organic waste that the
 department approves by rule, provided  that  the  covered  establishment
 first obtains a registration issued by the business integrity commission
 pursuant to subdivision b of section 16-505 of the code of the preceding
 municipality,  or  (3) provide for on-site in vessel composting, aerobic
 or anaerobic digestion, or any other method of processing organic  waste
 that  the  department  approves  by  rule for some or all of the organic
 waste it generates on its premises, provided that it  arranges  for  the
 collection  or transport of the remainder of such organic waste, if any,
 in accordance with clause one or two of this subparagraph;
   (ii) post a sign, which  shall  be  in  addition  to  any  other  sign
 required  to  be  posted  pursuant to this code, that states clearly and
 legibly the trade or business name, address, and  telephone  number  of,
 and  the day and time of pickup by, the private carter that collects the
 covered establishment's organic waste, that such  covered  establishment
 transports  its  own  organic  waste, or that such covered establishment
 provides for on-site processing for all of the organic waste  it  gener-
 ates on its premises, provided that:
   (1)  such  sign  shall  be  prominently  displayed by affixing it to a
 window near the principal entrance to the covered establishment so as to
 be easily visible from outside the building or, if this is not possible,
 prominently displayed inside the covered establishment near the  princi-
 pal entrance;
   (2)  catering  establishments shall not be required to display on such
 sign the day and time of the pickup by the private carter that  collects
 the establishment's organic waste; and
   (3)  this  paragraph  shall  not apply to sponsors of temporary public
 events;
   (iii) provide separate bins for the disposal of organic waste  in  any
 area where such organic waste is generated and disposed of; and
 S. 8474                           1165
 
   (iv) post instructions on the proper separation of organic waste where
 such instructions will be visible to persons who are disposing of organ-
 ic waste, provided that this subparagraph shall not apply to sponsors of
 temporary public events.
   b.  Any  covered  establishment  that arranges for the collection by a
 private carter of its organic waste pursuant to this  subdivision  shall
 not commingle such organic waste with other designated and non-designat-
 ed  recyclable  material  or  solid  waste, and shall place such organic
 waste out for collection by a private carter in a container or  contain-
 ers  that  (i)  has  a  lid and a latch that keeps the lid closed and is
 resistant to tampering by rodents or other wildlife, (ii) has the capac-
 ity that meets the disposal needs of the covered establishment  and  its
 private  carter,  (iii)  is compatible with the private carter's hauling
 collection practices, and (iv) is closed and latched at the time  it  is
 placed out for collection.
   4.  Any  private  carter  that collects source separated organic waste
 shall either:
   a. deliver collected organic waste to  a  transfer  station  that  has
 represented  that  it  will deliver such organic waste to a facility for
 purposes of composting, aerobic or anaerobic  digestion,  or  any  other
 method of processing organic waste that the department approves by rule;
 or
   b.  deliver  such organic waste directly to a facility for purposes of
 composting, aerobic or anaerobic digestion, or any other method of proc-
 essing organic waste that the department approves by rule.
   5. Any transfer station that receives source separated  organic  waste
 pursuant  to  this  section shall deliver or have delivered such organic
 waste directly to a facility that accepts organic waste for purposes  of
 composting, aerobic or anaerobic digestion, or any other method of proc-
 essing organic waste that the department approves by rule. This subdivi-
 sion  shall  not  apply  to waste that cannot be processed at an organic
 waste processing facility.
   6. The provisions of this section relating to private carters shall be
 enforced by the business integrity commission and  the  department.  The
 provisions  of  this section relating to covered establishments shall be
 enforced by the department, the department of health and mental hygiene,
 and the department of consumer and worker protection.
   7. The department, the business integrity commission,  the  department
 of health and mental hygiene, and the department of consumer affairs may
 promulgate any rules necessary to implement this section, including, but
 not  limited to, rules establishing reporting requirements sufficient to
 demonstrate compliance with this chapter.
   8. Any person who owns or operates two or fewer  food  service  estab-
 lishments may request, and the commissioner shall grant, a waiver of the
 requirements of this section if: a. no single food service establishment
 has  a  floor  area  of at least seven thousand square feet; b. the food
 service establishment  or  establishments  are  individually  franchised
 outlets of a parent business covered by paragraph d of the definition of
 "covered  establishment"  set  forth in subdivision one of this section;
 and c. the owner or operator establishes that such food  service  estab-
 lishment  or  establishments  do  not  receive  private carting services
 through a general carting agreement between  a  parent  business  and  a
 private  carter.  Such waiver shall be valid for twelve months and shall
 be renewable upon application to the commissioner via  the  department's
 website.
 S. 8474                           1166
 
   § 16-307 City agency waste. 1. The commissioner shall adopt, amend and
 implement  rules, as necessary, governing the source separation or post-
 collection separation, collection, processing, marketing,  and  sale  of
 designated  recyclable  materials  including, but not limited to, desig-
 nated  metal,  glass, plastic and paper generated by any agency, as such
 term is defined in section 1-112 of the code of  the  preceding  munici-
 pality.
   2.  Every agency shall, no later than July first, two thousand eleven,
 prepare and submit to the commissioner for approval, a waste prevention,
 reuse and recycling plan. Such plan shall provide for the  source  sepa-
 ration  of  designated  metal,  glass, plastic and paper, and such other
 designated recyclable materials as the commissioner  deems  appropriate,
 in   all  offices  and  buildings  occupied  by  agencies  that  receive
 collection service from the department and, to the  extent  practicable,
 in  those  that  receive  private  carter  collection.  Such plans shall
 provide for the source separation of designated recyclable materials  in
 the  lobbies  of  such  offices  or  buildings  that  receive department
 collection, unless the placement of bins for the  source  separation  of
 designated  recyclable  materials  would  be  in  violation of any other
 provision of law, and, to the extent practicable, in the lobbies of such
 offices or buildings that receive private carter collection. Each agency
 shall designate a lead recycling or sustainability coordinator to  over-
 see  implementation of such plans. If an agency has offices in more than
 one city-owned building, then such agency shall designate one  assistant
 coordinator  for  each building in which such agency has offices, except
 the building in which the lead coordinator has his  or  her  office,  to
 assist the agency's lead coordinator.
   3. On or before July first, two thousand twelve and annually thereaft-
 er,  every  lead  recycling or sustainability coordinator shall submit a
 report to the head of his or her respective agency and  to  the  commis-
 sioner,  summarizing  actions  taken  to implement the waste prevention,
 reuse and recycling plan for the previous twelve-month reporting period,
 proposed actions to be taken to implement  such  plan,  and  updates  or
 changes  to  any information included in such plan. The department shall
 consolidate the information contained in all reports  prepared  pursuant
 to this subdivision as part of the department's annual zero waste report
 required  pursuant  to  subdivision b of section 16-316.5 of the code of
 the preceding municipality.
   § 16-307.1 School recycling. 1. The chancellor of  the  department  of
 education  shall  designate a sustainability director for the department
 of education, who shall be responsible for (a) setting policies,  guide-
 lines  and  goals to promote waste prevention, reuse and recycling prac-
 tices,  and  (b)  coordinating  the  department  of  education's   waste
 prevention, reuse and recycling program in all school buildings, charter
 school  locations,  office buildings, and any other facilities under the
 jurisdiction of the department  of  education  that  receive  department
 collection service.
   2. The chancellor of the department of education shall promulgate such
 rules  as may be necessary to require that each school building, charter
 school location, office building,  and  any  other  facility  under  the
 jurisdiction  of  the  department  of education that receives department
 collection service, develop a site-specific waste prevention, reuse  and
 recycling  plan.  Each  such plan shall be implemented by January first,
 two thousand eleven. Such plan shall include, at a minimum,  a  require-
 ment  that  each  classroom maintain a separate receptacle, container or
 bin for the collection of designated recyclable  paper,  and  that  such
 S. 8474                           1167
 
 receptacle,  container or bin be appropriately labeled or decorated with
 recycling information. Such plan shall also provide that separate recep-
 tacles, containers or bins for the collection of designated metal, glass
 and  plastic be appropriately labeled or decorated with recycling infor-
 mation and be placed as close as practicable to school entrances, unless
 the placement of such bins would be in violation of any other  provision
 of  law,  and  in  locations within schools where food and beverages are
 routinely consumed.
   3. The principal of each school under the jurisdiction of the  depart-
 ment  of  education shall designate a sustainability coordinator for his
 or her school who shall be  responsible  for  implementing  his  or  her
 school's  waste  prevention,  reuse and recycling plan. The principal or
 the sustainability coordinator shall complete, and submit to the depart-
 ment of education sustainability director  and  to  the  chancellor,  an
 annual   survey  regarding  such  school's  compliance  with  its  waste
 prevention, reuse and recycling plan.
   4. The chancellor shall submit a report to the commissioner by January
 first of each year regarding compliance with the  requirements  of  this
 section for the preceding July first through June thirtieth. The depart-
 ment  shall  include the chancellor's report as part of the department's
 annual zero waste report required pursuant to subdivision b  of  section
 16-316.5 of the code of the preceding municipality.
   5.  The  department  shall distribute a model school waste prevention,
 reuse and recycling plan to all primary and secondary schools not  under
 the  jurisdiction of the department of education that receive department
 collection service. All such primary and secondary schools shall  desig-
 nate  a  sustainability  coordinator for each such school, and develop a
 site-specific waste prevention, reuse and recycling plan. Each such plan
 shall be implemented by January first, two thousand  eleven.  Such  plan
 shall include, at a minimum, a requirement that each room used primarily
 as  a  classroom for students between kindergarten and the twelfth grade
 maintain a separate receptacle, container or bin for the  collection  of
 designated  recyclable paper, and that such receptacle, container or bin
 be appropriately labeled or decorated with recycling  information.  Such
 plan  shall  also  provide that separate receptacles, containers or bins
 for the collection of designated metal, glass and plastic  be  appropri-
 ately  labeled  or decorated with recycling information and be placed as
 close as practicable to school entrances, unless the placement  of  such
 bins  would  be  in  violation  of any other provision of law. Such bins
 shall also be placed in centralized locations within such schools  where
 food  and  beverages are routinely consumed, other than classrooms, such
 as cafeterias and lunchrooms, or, if such school lacks  a  cafeteria  or
 lunchroom,  in  a  location  readily  accessible to all students in such
 school.
   § 16-307.2 City agency food waste prevention  plans.  1.  Definitions.
 As  used  in  this section, the following terms have the following mean-
 ings:
   a. Covered agency. The term "covered agency" means an agency that  has
 entered  into  at  least  one food purchase contract within the previous
 twelve months.
   b. Food purchase contract. The term "food  purchase  contract"  means:
 (i) a contract entered into by an agency in excess of the small purchase
 limits  established  by  the  procurement  policy  board,  the principal
 purpose of which is to provide food, provided that such contract author-
 izes purchases only by the agency that entered into  such  contract,  or
 S. 8474                           1168
 
 (ii)  a  purchase  order for food the value of which exceeds one hundred
 thousand dollars, made by an agency against an existing contract.
   c.  Surplus  food.  The  term  "surplus  food" means any food obtained
 through a food purchase contract that is not used for  the  purpose  for
 which it was purchased and that would otherwise be discarded.
   2.  Agency  food waste prevention plan. Every covered agency shall, no
 later than October first, two thousand twenty-one, prepare and submit to
 the commissioner for approval, a food waste prevention plan. Any  agency
 that  becomes a covered agency after October first, two thousand twenty-
 one shall prepare and submit to the commissioner for  approval,  a  food
 waste  prevention  plan within ninety days of becoming a covered agency.
 The commissioner shall submit each approved agency food waste prevention
 plan to the speaker of the council not later than seven days after  such
 approval.  Such  plan  shall conform to all applicable provisions of law
 and, at a minimum:
   a. Establish guidelines for how to identify surplus food that  may  be
 safely donated;
   b.  Identify  methods  to reduce the amount of surplus food, including
 the utilization of the food donation web  portal  described  in  section
 16-497 of the code of the preceding municipality, when appropriate;
   c.  Set  forth  procedures for the safe, efficient donation of surplus
 food; and
   d. Include any other provisions necessary to facilitate the  reduction
 of surplus food and the donation of surplus food.
   3.  Food  waste  prevention  coordinator. Upon approval of an agency's
 food waste prevention plan by  the  commissioner,  each  covered  agency
 shall  designate  a  coordinator  to  oversee implementation of the plan
 required by subdivision two of this section.
   4. Report. a. On or before January first, two thousand twenty-two, and
 annually thereafter for the previous twelve-month reporting period, each
 covered agency shall submit a report to the  commissioner.  Such  report
 shall include, at a minimum:
   i. A summary of the actions taken to implement the agency's food waste
 prevention plan;
   ii.  Any  proposed  additional  actions  to be taken to implement such
 plan; and
   iii. Any updates or changes to any information included in such plan.
   b. The department shall consolidate the information contained  in  all
 reports  prepared pursuant to this subdivision and include such informa-
 tion as part of the  department's  annual  zero  waste  report  required
 pursuant to subdivision b of section 16-316.5 of the code of the preced-
 ing municipality.
   § 16-307.3 School food waste. 1. Definitions. As used in this section,
 the following terms have the following meanings:
   a.  Chancellor. The term "chancellor" means the chancellor of the city
 school district of the city of New York.
   b. Food purchase contract. The term "food purchase contract" means any
 purchase order or contract entered into by the department of  education,
 the  principal  purpose  of  which  is to provide food, and the value of
 which exceeds one hundred thousand dollars.
   c. School. The term  "school"  means  a  school  of  the  city  school
 district of the city of New York.
   d.  Surplus  food.  The  term  "surplus  food" means any food obtained
 through a food purchase contract that is not used for  the  purpose  for
 which it was purchased and that would otherwise be discarded.
 S. 8474                           1169
 
   2.  Food waste prevention plan. No later than October first, two thou-
 sand twenty-one, the chancellor shall prepare and submit to the  commis-
 sioner  a  food  waste  prevention  plan. Preparation of such food waste
 prevention plan shall provide school sustainability coordinators  desig-
 nated  pursuant to subdivision three of section 16-307.1 of this chapter
 an opportunity to offer ideas concerning food waste  prevention.    Such
 plan  shall conform to all applicable provisions of law and include, but
 need not be limited to, the following information:
   a. Guidelines for how to identify surplus  food  that  may  be  safely
 donated;
   b.  Any  methods the chancellor has identified to reduce the amount of
 surplus food in schools;
   c. Any procedures the chancellor has identified that would  allow  the
 department  of  education  or a school to donate surplus food safely and
 efficiently; and
   d. Any barriers the chancellor has identified that would  prevent  the
 safe and efficient donation of surplus food.
   3.  Review  by  commissioner.  The  commissioner shall review the plan
 required pursuant to subdivision two of this section within ninety  days
 of  its  submission  and shall submit recommendations on the plan to the
 chancellor. The commissioner shall simultaneously submit a copy  of  the
 chancellor's  plan and the commissioner's recommendations to the speaker
 of the council.
   4. Report. On or before February first, two thousand  twenty-two,  the
 chancellor  shall submit a report to the commissioner. Such report shall
 include, at a minimum:
   a. A summary of actions taken to implement the food  waste  prevention
 plan;
   b.  A  summary  of  actions  that  the chancellor proposes be taken to
 implement such plan; and
   c. Any updates or changes to any information included in such plan.
   § 16-308 Organic waste. 1. The  commissioner  shall  provide  for  the
 source  separation,  collection and composting of yard waste, unless the
 generator otherwise provides for recycling or storage for composting  or
 mulching. In addition, the commissioner shall provide for the collection
 and  composting of yard waste generated and source separated at residen-
 tial properties owned or operated by the New York city housing  authori-
 ty.  There  shall  be  operated by or on behalf of the department one or
 more yard waste composting facilities through which the department shall
 compost yard waste collected by or delivered to the department  pursuant
 to  this section. In order to comply with this provision, the department
 may utilize the services of privately-owned or operated facilities.  The
 department  shall also work in consultation with the composting facility
 siting task force established  by  the  two  thousand  six  solid  waste
 management  plan  to  identify  additional  locations to site yard waste
 composting facilities with the goal of establishing at  least  one  such
 composting  facility  in each borough where the department conducts yard
 waste composting collection.
   2. Any city agency, or person under contract with a city agency,  that
 generates a substantial amount of yard waste shall, in coordination with
 the  department,  provide  for  the  source  separation,  collection and
 composting of such yard waste. Unless otherwise  provided  by  law,  the
 department shall accept for composting any city agency yard waste source
 separated for department collection pursuant to this subdivision.
   3. No landfill, waste transfer station, intermodal facility, incinera-
 tor or resource recovery facility owned, operated or used by the depart-
 S. 8474                           1170
 
 ment  shall  accept  truck  loads  of department-managed waste primarily
 composed of yard waste for final disposal, except  that  composted  yard
 waste may be used as part of the final vegetative cover for a department
 landfill.
   4.  All  city agencies responsible for the maintenance of public lands
 shall to the maximum extent practicable and feasible give preference  to
 the  use  of compost materials derived from the city's yard waste in all
 land maintenance activities.
   5. Generators of yard waste, except those  identified  in  subdivision
 seven  of  this section, shall separate, tie, bundle, or place into bags
 or receptacles, in accordance with rules promulgated by the  commission-
 er,  any yard waste set out for collection by the department pursuant to
 subdivision two of this section. The commissioner shall notify all resi-
 dents in districts that receive yard waste collection by the  department
 of such pre-collection procedures, and undertake any other action neces-
 sary to effectuate the purposes of this subdivision.
   6.  No  person  engaged  in a business that generates yard waste shall
 leave such yard waste for collection by the department, or disperse such
 yard waste in or about the curb or street. Any person engaged in a busi-
 ness that generates yard waste shall be required to collect and  dispose
 of  such yard waste at a permitted composting facility; provided, howev-
 er, that if the department, by written order of the commissioner, deter-
 mines that there is insufficient capacity at permitted composting facil-
 ities within the city, then such yard waste may be disposed  of  at  any
 appropriately permitted solid waste management facility.
   7. Each permitted composting facility within the city, including those
 operated by city agencies, shall annually report to the commissioner the
 amount  of yard waste and any other organic waste collected and disposed
 of by weight at such composting facility.  All  such  reports  shall  be
 submitted  prior  to  February  first  of  each  calendar year and shall
 contain the amount collected and disposed of for the  previous  calendar
 year.  The department shall consolidate the information contained in all
 reports prepared pursuant to this subdivision and include such  informa-
 tion  as  part  of  the  department's  annual zero waste report required
 pursuant to subdivision b of section 16-316.5 of the code of the preced-
 ing municipality.
   8. No person residing in a  district  where  the  department  provides
 residential yard waste composting collection pursuant to subdivision two
 of  this  section  shall dispose of grass clippings as regular waste for
 collection by the department during the period of time when the  depart-
 ment  conducts  such composting collection. The department shall conduct
 outreach and education to inform residents within such districts of  the
 dates  when  it will conduct yard waste composting collection. No person
 residing in a district where the department  provides  residential  yard
 waste composting collection shall be held liable for a violation of this
 subdivision  during the first year the department provides such residen-
 tial yard waste composting collection.
   §  16-308.1  Curbside  organics  collection.  1.  Organics  collection
 program.  The  department  shall establish a mandatory citywide curbside
 organics collection program  for  the  diversion  of  organic  waste  in
 accordance  with  this  section. Such program shall be implemented by no
 later than:
   a. October second, two thousand twenty-three, for residential  proper-
 ties  in  no less than thirty sanitation districts, as determined by the
 commissioner by rule.
 S. 8474                           1171

   b. October seventh, two thousand twenty-four, for residential  proper-
 ties in all remaining sanitation districts.
   2.  Implementation  plan. No later than July first, two thousand twen-
 ty-three, the department shall develop, submit to the mayor and  speaker
 of the council, and post on the department's website a curbside organics
 collection  implementation  plan.  Such  plan  shall include information
 related to, at minimum:
   a. How the department will implement such program;
   b. The education and outreach program required pursuant to subdivision
 five of this section; and
   c. How the department will distribute necessary  materials,  including
 rodent-proof  organics collection bins, at no cost to residential build-
 ing owners, and a timeline for such distribution.
   3. End use of collected organic waste. In the next solid waste manage-
 ment plan prepared pursuant to  section  27-0107  of  the  environmental
 conservation law and presented to the council pursuant to section 16-140
 of  the  code of the preceding municipality following the effective date
 of this section, the department shall include a  plan  to  maximize  the
 usable  composting  of organic waste collected pursuant to this section.
 Such plan for the usable composting of organic waste shall describe  the
 amount  of  organic waste collected and sent to composting facilities to
 be processed into usable compost pursuant to this section.
   4. Reporting. The department shall report by weight the  total  amount
 of  organic  waste diverted pursuant to this section during the previous
 year,  disaggregated  by  sanitation  district.  Such  report  shall  be
 included  as  part of the department's annual zero waste report required
 pursuant to section 16-316.5 of the code of the preceding municipality.
   5. Education and outreach. The department shall  develop  an  outreach
 and  education  program to educate residents, building owners, and staff
 of residential buildings on the  curbside  organics  collection  program
 established  pursuant  to this section. Materials used for such outreach
 and education program shall be  available  in  all  designated  citywide
 languages,  as  defined  in section 23-1101 of the code of the preceding
 municipality, and any additional languages as determined by the  depart-
 ment  in  consultation with local community organizations. No later than
 two  months  prior  to  the  implementation  of  the  curbside  organics
 collection  program  for residential properties in a sanitation district
 pursuant to subdivision  one  of  this  section,  the  department  shall
 distribute  such  materials to residents, building owners, and community
 based organizations in such district. Such materials shall also be  made
 available on the department's website. Such materials shall include:
   a.  A  detailed explanation of organic waste and the benefits of curb-
 side organics collection;
   b. Information on how the curbside organics collection program will be
 implemented and instructions for how to properly source separate organic
 waste; and
   c. Any other information as determined by the commissioner.
   6. Rules. The commissioner shall adopt and implement rules  as  neces-
 sary to effectuate this section. Such rules may include, but need not be
 limited  to,  the  designation of organic waste as a recyclable material
 pursuant to subdivision two of section 16-305 of  this  chapter,  proce-
 dures  requiring  the  placement  of  organic  waste at the curbside, in
 specialized containers or in another manner determined  by  the  commis-
 sioner pursuant to subdivision four of such section, and the implementa-
 tion  and  enforcement  of  this  section  and  such  rules in buildings
 S. 8474                           1172
 
 containing four or more dwelling units pursuant  to  subdivisions  five,
 six and seven of section 16-305 of this chapter.
   7.  Penalty.  A  residential  building owner who violates this section
 shall be liable for a civil penalty as set forth in  section  16-324  of
 this  title, except that prior to April first, two thousand twenty-five,
 a residential building owner who violates this section shall be issued a
 written warning that a violation has been observed, provided that  noth-
 ing in this subdivision shall preclude the department from enforcing any
 rules  relating to yard waste separation promulgated pursuant to section
 16-308 of this chapter.
   § 16-308.2 Organic waste drop off sites. 1. Definitions.  As  used  in
 this section, the following terms have the following meanings:
   a.  Community  partner.  The term "community partner" means a not-for-
 profit organization, community garden or other similar organization that
 operates or makes available to the public  an  organic  waste  drop  off
 site.
   b.  Community  scale  composting  facility.  The term "community scale
 composting facility" means a physical location operated  by  a  not-for-
 profit  organization  that engages in composting, through a registration
 or agreement with the department, but that is not of sufficient size  so
 as  to be required to obtain a permit for the operation of such facility
 from the New York state department of environmental conservation.
   c. Organic waste drop off site. The term "organic waste drop off site"
 means a physical location for  the  collection  of  organic  waste  from
 members of the public.
   2.  Except  as provided in subdivision three of this section, no later
 than April first, two thousand twenty-four, the department, in consulta-
 tion with community partners, shall ensure  that  no  less  than  thirty
 organic  waste drop off sites are established and operational throughout
 the city, provided that no less than three such sites are established in
 each borough. Each such site shall have a minimum of twenty hours avail-
 able per week for individuals to drop off  organic  waste,  except  that
 organic  waste  drop  off  sites operated by community partners shall be
 open for a minimum of five hours per week, and each such  organic  waste
 drop  off  site  shall  be  located  in a geographic area that is easily
 accessible, including for persons with disabilities, and in close  prox-
 imity to public transportation, provided, however, an organic waste drop
 off  site  operated by a community partner may be operated on a seasonal
 basis.
   3. For the purposes of subdivision two of  this  section,  an  organic
 waste  drop  off  site may be a community scale composting facility or a
 drop off site operated by the department, including co-location  with  a
 recycling center, as required pursuant to section 16-310.3 of this chap-
 ter.
   4.  No  later than January first, two thousand twenty-six, the depart-
 ment shall review the requirements of subdivision two  of  this  section
 and  submit to the mayor and the speaker of the council a recommendation
 as to whether such drop off sites should be continued.
   5. Site information. The department shall post on its website informa-
 tion about each organic waste drop off site established pursuant to this
 section. Such  information  shall  include  each  such  site's  address,
 contact  information,  hours  of  operation and services provided. Where
 applicable, such information shall also be clearly posted in a  publicly
 visible location at the entrance to each such site.
   6.  Education  and  outreach. The department, in consultation with any
 agency or office designated by the mayor, shall develop an education and
 S. 8474                           1173
 
 outreach program to inform residents about the organic  waste  drop  off
 sites  and community scale composting facilities established pursuant to
 this section. Such education and outreach shall include the  information
 set  forth  in  subdivision  five  of  this  section. Any educational or
 outreach materials developed pursuant to this section, as  well  as  any
 other  educational  materials  on  recycling that the commissioner deems
 relevant, shall be available in all designated  citywide  languages,  as
 defined  in  section  23-1101 of the code of the preceding municipality,
 and supplied to each organic waste drop off site. The  department  shall
 also  perform  outreach  to  community partners and other not-for-profit
 organizations to provide them with information on  how  the  public  can
 engage  in opportunities to work with the department to open and operate
 organic waste drop off sites and community scale composting facilities.
   7. Reporting. The department shall report annually on the operation of
 organic waste drop off sites. Such report shall be included as  part  of
 the  department's  annual zero waste report required pursuant to section
 16-316.5 of the code of the preceding municipality.  Such  report  shall
 include,  at  a  minimum,  the  following  information, disaggregated by
 organic waste drop off site where feasible:
   a. The total amount of material collected at such site;
   b. The number of individuals who used such site during  the  reporting
 period;
   c. The number of full-time and part-time staff members working at such
 site, if any; and
   d.  Where  the  organic  waste  collected  at  such site was processed
 following collection.
   § 16-309 Christmas trees.  The commissioner shall establish and imple-
 ment a curbside collection system for Christmas trees during  a  minimum
 of  two  weeks in January of each year and provide for the composting or
 recycling of the Christmas trees the department collects or receives for
 disposal.
   § 16-310 Public space recycling. 1. The department  shall  expand  its
 public  space recycling program by increasing the number of public space
 recycling receptacles for the collection of recyclable materials includ-
 ing, but not limited to, metal, glass, plastic and paper  designated  as
 recyclable  materials  by  the commissioner, to a cumulative total of at
 least five hundred public space recycling receptacles, and to a  cumula-
 tive  total of at least one thousand public space recycling receptacles,
 at public locations in the city, which shall be in or near public parks,
 transit hubs, or commercial locations with high-pedestrian  traffic.  As
 part  of such expansion, the department shall place public space recycl-
 ing receptacles in  all  business  improvement  districts  that  provide
 public  litter  basket  maintenance.  Whenever practicable, public space
 recycling receptacles placed pursuant to this section  shall  be  placed
 adjacent to public litter baskets.
   2.  Notwithstanding the provisions of subdivision one of this section,
 the department shall not be required to expand the public space  recycl-
 ing  program beyond existing or newly-established collection routes that
 can be efficiently serviced by the department.  The  commissioner  shall
 have  the  authority  to  remove  any  public space recycling receptacle
 placed pursuant to this section, provided that the  department  replaces
 any  such  public  space  recycling  receptacle,  within  thirty days of
 removal, with additional public space recycling receptacles at the  same
 or in a different location on a one-to-one basis.
   3. No person responsible for removing or transporting recyclable mate-
 rials  placed in public space recycling receptacles shall commingle such
 S. 8474                           1174
 
 recyclable materials with non-recyclable materials or otherwise  improp-
 erly dispose of such recyclable materials.
   4.  The department shall report the total number of public space recy-
 cling receptacles added during the  relevant  reporting  year,  and  the
 locations  in  which  they were placed. Such report shall be included as
 part of the department's annual zero waste report required  pursuant  to
 subdivision  b  of section 16-316.5 of the code of the preceding munici-
 pality.
   5. The department may enter into sponsorship or partnership agreements
 with entities such as for-profit  and  not-for-profit  corporations  and
 district  management associations established in accordance with section
 25-414 of the code of the preceding municipality to further the goals of
 this chapter.
   § 16-310.1 Textile reuse and recycling program. 1. On or before  Janu-
 ary  first,  two thousand eleven, the department shall establish a city-
 wide textile reuse and recycling  program  that  shall,  at  a  minimum,
 provide  for  the  recovery  of  textiles by placing department-approved
 publicly accessible textile drop-off bins at  appropriate  locations  on
 city  property  or property maintained by the city and organizing public
 textile reuse and recycling  sites  throughout  the  city  that  provide
 convenient  drop-off  locations for all city residents. In addition, the
 commissioner shall explore  opportunities  to  work  cooperatively  with
 private  entities,  including, but not limited to, not-for-profit corpo-
 rations and  religious  institutions,  to  promote  expanded  siting  of
 publicly accessible textile drop-off bins on private property throughout
 the  city.  The  department shall consider using department personnel or
 facilities in order to implement the provisions of this section.
   2. No publicly accessible textile drop-off bin placed pursuant to this
 section shall be placed on city property or property maintained  by  the
 city, or on a public sidewalk or roadway, unless otherwise authorized by
 the city. No publicly accessible textile drop-off bin shall be placed on
 private property without the written permission of the property owner or
 the property owner's authorized agent. The owner or other person respon-
 sible  for each such bin shall report at least every three months to the
 department the amount of textiles collected in such bin by weight.  Each
 publicly accessible textile drop-off bin shall  prominently  display  on
 the  front  and on at least one other side of the bin, the name, address
 and telephone number of the owner or other person  responsible  for  the
 bin.  This  information  shall be printed in characters that are plainly
 visible. In no event shall a post office box be considered an acceptable
 address for purposes of this subdivision.
   3. The department shall  report  by  weight  the  amount  of  textiles
 collected  in  publicly accessible textile drop-off bins located on city
 property or property maintained by  the  city,  through  public  textile
 reuse  and  recycling  sites pursuant to subdivision one of this section
 and in publicly accessible textile drop-off bins maintained  on  private
 property.    Such  report  shall be included as part of the department's
 annual zero waste report required pursuant to subdivision b  of  section
 16-316.5 of the code of the preceding municipality.
   § 16-310.2 Paint stewardship program. 1. The commissioner shall estab-
 lish  a voluntary paint stewardship program under which manufacturers of
 architectural paint, in cooperation with distributors  of  architectural
 paint  and retail establishments that sell, or offer for sale, architec-
 tural paint in the city, may establish a collection or other reclamation
 system to collect architectural paint from consumers for reuse,  recycl-
 ing or environmentally sound disposal.
 S. 8474                           1175
 
   2.  The  commissioner  shall provide assistance or guidance to partic-
 ipating  architectural  paint  manufacturers,  distributors  and  retail
 establishments  in  developing and implementing strategies to reduce the
 quantity of architectural paint in the waste stream, promote  the  reuse
 of architectural paint that would otherwise be discarded and disseminate
 information  regarding options to recycle architectural paint including,
 but not limited to, posting information regarding  the  voluntary  paint
 stewardship program on the department's website.
   §  16-310.3  Community  recycling.  1. Community recycling centers. No
 later than December thirty-first, two thousand twenty-four, the  depart-
 ment  shall  ensure  that  at  least two community recycling centers are
 established and operational in each borough. Each such center  shall  be
 available  for  drop offs at least twenty-four hours per week, including
 weekends. Such centers shall be located in  geographic  areas  that  are
 easily accessible, including for persons with disabilities, and shall be
 in  close proximity to public transportation and public housing develop-
 ments, where practicable. Any organic waste drop off site  provided  for
 by local law may be co-located within such a center.
   2.  Community recycling events. No later than September thirtieth, two
 thousand twenty-three, and annually  thereafter,  the  department  shall
 host  no  less  than  one  community  recycling  event in each community
 district.  Each such event shall be located in a geographic area that is
 easily accessible, including for persons with disabilities, and in close
 proximity to public  transportation  and  public  housing  developments,
 where  practicable.  Such events may be co-located with other sanitation
 services. Community recycling events required by this subdivision  shall
 be in addition to any recycling event operated by an entity or organiza-
 tion  other than the department, provided that any recycling event oper-
 ated pursuant to a contract with the department shall be  considered  to
 be hosted by the department for purposes of this section.
   3.  Materials collected. Each community recycling center and community
 recycling event shall accept, to the extent practicable, inorganic mate-
 rial that is not collected through regular curbside collection but  that
 can  be  recycled  or reused. One community recycling center per borough
 shall also accept hazardous material, as practicable and as  defined  by
 the department, that should not be disposed of as curbside waste.
   4.  Community  recycling  center and event information. The department
 shall make available on the department's website, and distribute to each
 local community board, the following  information  about  the  community
 recycling  centers  and  community  recycling  events  required  by this
 section:
   a. Location, including street address and borough;
   b. Contact information;
   c. Hours of operation; and
   d. Services provided.
   5. Education and outreach. The department, in  consultation  with  any
 agency  identified by the mayor, shall develop an outreach and education
 program to inform residents about community recycling centers and commu-
 nity recycling events, including their locations,  contact  information,
 hours of operation, and the services they provide.
   6.  Reporting.  The  department shall report annually on the operation
 community recycling centers  and  community  recycling  events  required
 pursuant  to  this section. Such report shall be included as part of the
 department's annual waste diversion report required pursuant to  section
 16-316.5  of  the  code of the preceding municipality. Such report shall
 include, but need not be limited to, the following  information,  disag-
 S. 8474                           1176
 
 gregated  by  community  recycling center and community recycling event,
 where feasible:
   a. The number of individuals utilizing such centers and events;
   b. The material collected at each such center and event, disaggregated
 by material type;
   c. The number of full-time and part-time staff persons working at each
 such center and event;
   d. Where each type of material collected is sent; and
   e. A description of the education programs offered to the public.
   §  16-311.  Recycling  outreach and education. 1. The department shall
 provide instruction and materials for residential building  owners,  net
 lessees  or persons in charge of such buildings, and their employees and
 residents, in order to improve compliance with the  provisions  of  this
 chapter.
   2. The commissioner shall establish a recycling education program that
 shall  include recycling instructional workshops, training curricula and
 other relevant materials for residential building owners, net lessees or
 persons in charge of such buildings, and their employees and  residents,
 including  an internet-based recycling tutorial. Such program shall also
 provide instructional workshops, training curricula, and other  relevant
 material  to employees of city agencies, including a leaf and yard waste
 training program for  employees  of  any  such  agencies  that  generate
 significant  leaf and yard waste. The commissioner may utilize a private
 entity or not-for-profit corporation to assist with the establishment or
 performance of such program.
   § 16-312  Processing  recyclable  materials.  The  commissioner  shall
 establish   procedures and standards for processing recyclable materials
 designated pursuant to section 16-305 of this chapter in city  owned  or
 operated  recycling centers, city owned or operated transfer stations or
 any city owned or operated facility that  renders  recyclable  materials
 suitable  for reuse or marketing and sale.  The commissioner shall annu-
 ally review such procedures and standards and make any changes necessary
 to conform to the requirements of the marketplace.
   § 16-313 Marketing recyclable materials. The department  shall  estab-
 lish procedures, standards and strategies to market the recyclable mate-
 rials  designated  pursuant to section 16-305 of this chapter, including
 but not limited to maintaining a list of prospective buyers,  establish-
 ing  contact  with  prospective  buyers,  entering  into  contracts with
 buyers, and reviewing and making any necessary changes in collecting  or
 processing the materials to improve their marketability.
   §  16-314 Recycling program revisions. The commissioner shall annually
 review the recycling program and all rules promulgated  thereunder,  and
 shall make the necessary revisions to improve the efficiency of collect-
 ing,  processing,  marketing and selling the materials recycled pursuant
 to this  title.  These  revisions  may  include  designating  additional
 recyclable materials. The commissioner shall not delete designated mate-
 rials without designating additional materials so that the total quanti-
 ty,  by  weight, of all designated recyclable materials collected, proc-
 essed, marketed and sold does not decrease.
   Where the commissioner determines that it is appropriate to  delete  a
 designated  material,  the  department  shall  provide  notice  of  such
 deletion to the mayor and the council, including  the  reason  for  such
 deletion, and shall provide any relevant data supporting such decision.
   §  16-315  Notice,  education and research programs. 1. In addition to
 the notice requirements of this code, within thirty days of  the  effec-
 tive  date  of  any  rules  promulgated  pursuant  to this title, and as
 S. 8474                           1177
 
 frequently thereafter as the commissioner deems necessary,  the  depart-
 ment  shall  notify  all  persons  occupying residential, commercial and
 industrial premises affected by the rules, of the  requirements  of  the
 rules,  by  posting  notices  containing recycling information in public
 places where such notices are customarily placed and, in the commission-
 er's discretion, employing any other means of notification deemed neces-
 sary and appropriate.
   2.   The commissioner shall  compile  relevant  recycling,  reuse  and
 composting information, including material available on the department's
 website,  to create and make available a guide to the city's residential
 recycling program. Such guide shall, at a minimum, summarize and explain
 the laws and rules governing curbside  recycling,  list  the  collection
 locations  and  collection  dates  for non-curbside collected recyclable
 materials such as household hazardous waste and  textiles,  and  provide
 detailed  information  and  instructions on how to recycle any materials
 not collected by the department for  which  non-city  or  non-department
 recycling  programs exist.   Such guide shall be made available to resi-
 dential building owners, or the net lessees or persons in charge of such
 buildings,  community  boards,  not-for-profit   organizations,   public
 schools,  and  other  relevant  agencies and entities, and shall also be
 made available on the department website.  The commissioner shall update
 the recycling guide biennially, or as necessary,  based  on  changes  to
 recycling laws, rules or other relevant information to be included ther-
 ein.
   3.  The department shall develop and implement an educational program,
 in conjunction with the department of education, private schools,  labor
 organizations,  businesses, neighborhood organizations, and other inter-
 ested and affected parties,  and  using  flyers,  print  and  electronic
 advertising,  public  events,  promotional  activities,  public  service
 announcements, and such other techniques as the commissioner  determines
 to  be  useful, to assure the greatest possible level of compliance with
 the provisions of this title. The educational  program  shall  encourage
 waste  reduction,  the  reuse  of  materials, the purchase of recyclable
 products, and participation in city and private recycling activities.
   4. The department shall perform such research and  development  activ-
 ities,  in  cooperation with other city agencies, and public and private
 institutions, as the commissioner determines to be helpful in implement-
 ing the city's recycling program. Such research shall include,  but  not
 be  limited  to,  investigation  into  the  use of cooperative marketing
 programs, material recovery facilities, recycling as an economic  devel-
 opment  tool,  export  promotion,  tax credits and exemptions for market
 promotion.
 
                                 Chapter 5
                         RECYCLING ADVISORY BOARDS
 
   § 16-317 Citizens' solid waste advisory boards; membership. Within six
 months of the effective date of this title, the city shall  establish  a
 citizens' solid waste advisory board (the "citizens' board"), consisting
 of  no  fewer  than  twenty  members  who  for  the  first term shall be
 comprised of the members of the city's citizens' advisory  committee  on
 resource  recovery  and other persons appointed jointly by the mayor and
 the council members. For each subsequent  term,  all  members  shall  be
 appointed  jointly  by the mayor and the council members. The membership
 of the citizens'  board  shall  represent  community  boards,  recycling
 industries,  carting industries, environmental organizations, government
 S. 8474                           1178
 
 agencies, labor organizations, business organizations, property  owners,
 tenant  organizations  and members of the general public.  Members shall
 serve for a term of one year without compensation  and  shall  designate
 one member to serve as chairperson and one as vice-chairperson.
   §  16-318  Functions  of  the citizens' board. 1. The department shall
 submit to the mayor the portion of the biennial  report  addressing  the
 city's  recycling  program  that  is prepared pursuant to the city's two
 thousand  six  solid  waste  management  plan,  simultaneous  with   the
 submission of such report to the mayor and the council.  The mayor shall
 distribute  copies  of  the plans to each member of the citizens' board.
 Within ninety days thereafter, the  citizens'  board  shall  review  the
 plans,  conduct a public hearing on the plans and make written recommen-
 dations to the mayor, the department and the council with respect to the
 recycling program. The citizens' board shall also  annually  advise  the
 mayor  and the department with respect to the development, promotion and
 operation of the recycling program and pursuant to this  function  shall
 formulate and recommend:
   (a) annual recycling goals equal to or greater than those set forth in
 section  16-305  of  this title and the methods proposed to achieve such
 goals;
   (b) means  to  encourage  community  participation  in  the  recycling
 program; and
   (c) means to promote the recycling program and educate the public with
 regard to the program.
   2. The citizens' board shall assume all the responsibilities and func-
 tions of the city's citizens' advisory committee on resource recovery.
   § 16-319 Citywide recycling advisory board; membership. There shall be
 a citywide recycling advisory board (the "citywide board") consisting of
 at  least  one  representative  from  each citizen's board, five members
 appointed by the council, and five members appointed by the  mayor.  The
 membership of the citywide board shall represent community boards, recy-
 cling   industries,  carting  industries,  environmental  organizations,
 government agencies, labor organizations, business  organizations,  real
 property owners, tenant organizations and members of the general public.
 Members  shall  serve  for  a  term of one year without compensation and
 shall designate one member to serve as  chairperson  and  one  as  vice-
 chairperson.
   §  16-320  Functions  of  the citywide board. The citywide board shall
 meet at least four times a year to discuss  citywide  recycling  issues,
 including  but not limited to budgetary issues. The citywide board shall
 annually review the department's recycling program and make  recommenda-
 tions to the mayor and the council concerning improvements to and chang-
 es in the program.
   §  16-321  Disclosure requirements. 1. Whenever a person, other than a
 public servant, appointed to any advisory board created pursuant to this
 chapter, engages in  any  business  dealings  with  the  department,  or
 engages  in business dealings with any other agency that relate to proc-
 essing or disposal of solid waste or of waste described in paragraph (c)
 of subdivision fifteen of section 16-303 of this title or to  recycling,
 or  has  an interest in a firm that is engaged in such business dealings
 with the department or with such other agency, such person shall,  prior
 to  appointment,  disclose  the  nature of such business dealings to the
 commissioner and to the body or officer  appointing  such  person,  and,
 after  appointment, disclose the nature of such business dealings to the
 commissioner and to all other members of such board; provided that  such
 person need not disclose the amount of such business dealings.
 S. 8474                           1179
 
   2. When used in this section:
   (a)  "Advisory committee" means a committee, council, board or similar
 entity that is constituted to provide advice or recommendations  to  the
 city  and which has no authority to take a final action on behalf of the
 city, to take any action that would have  the  effect  of  conditioning,
 limiting  or  requiring any final action by any other agency, or to take
 any action that is authorized by law.
   (b) "Agency" means a city, county, borough or other office,  position,
 administration, department, division, bureau, board, commission, author-
 ity,  corporation, advisory committee or other agency of government, the
 expenses of which are paid in whole or in part from the  city  treasury,
 and  shall  include  but  not be limited to, the council, the offices of
 each elected official, the department  of  education,  community  school
 boards, community boards, the financial services corporation, the health
 and  hospitals  corporation  and the public development corporation, but
 shall not include any court or any corporation or institution  maintain-
 ing  or operating a public library, museum, botanical garden, arboretum,
 tomb, memorial building, aquarium, zoological garden or similar  facili-
 ty.
   (c)  "Blind trust" means a trust in which a candidate for any advisory
 board created pursuant to this chapter or a member of such board, or the
 spouse or unemancipated child of such candidate or member, has a benefi-
 cial interest, the holdings and sources of income of which  such  candi-
 date  or  member  and  such spouse and unemancipated child have no know-
 ledge, and the trustee of which shall  have  independent  authority  and
 discretion.
   (d)  "Business  dealings"  means  any  transaction involving the sale,
 purchase, rental, disposition or exchange  of  any  goods,  services  or
 property,  and  any  performance of or litigation with respect to any of
 the foregoing, but shall not include any transaction involving the resi-
 dence of any candidate for any advisory board created pursuant  to  this
 chapter or of any member of such board, or any ministerial matter.
   (e)  "City"  means the city of Staten Island and includes an agency of
 the city.
   (f) "Elected official" means a person holding office as  mayor,  comp-
 troller, public advocate, borough president or member of the council.
   (g)  "Firm"  means  a sole proprietorship, joint venture, partnership,
 corporation or any other form of enterprise, but  shall  not  include  a
 public benefit corporation or local development corporation.
   (h)  "Interest"  means  an  ownership interest in a firm or a position
 with a firm.
   (i) "Ministerial matter" means an administrative act that  is  carried
 out  in  a  prescribed  manner  and  which  does not involve substantial
 personal discretion.
   (j) "Ownership interest" means an interest in a firm that is held by a
 candidate for any advisory board created pursuant to this chapter, or by
 a member of such board, or by the spouse, domestic partner, or unemanci-
 pated child of such candidate or member, which exceeds five  percent  of
 the  firm  or  an  investment of twenty-five thousand dollars in cash or
 other form of commitment, whichever is less, or five percent or  twenty-
 five thousand dollars of the firm's indebtedness, whichever is less, and
 any  lesser  interest  in  a firm when such candidate or member, or such
 spouse, domestic partner, or unemancipated child,  exercises  managerial
 control or responsibility regarding any such firm, but shall not include
 interests held in any pension plan, deferred compensation plan or mutual
 fund,  the  investments of which are not controlled by such candidate or
 S. 8474                           1180
 
 member, or by such spouse, domestic partner, or unemancipated child,  or
 in any blind trust that holds or acquires an ownership interest.
   (k)  "Position" means a position in a firm, such as an officer, direc-
 tor, trustee, employee or any management position, or  as  an  attorney,
 agent,  broker  or  consultant to the firm, which does not constitute an
 ownership interest in the firm.
   (l) "Public servant" means all officials, officers  and  employees  of
 the  city, including members of community boards and members of advisory
 committees, except unpaid members of advisory committees  shall  not  be
 public servants.
   (m)  "Spouse"  means a husband or wife of a candidate for any advisory
 board created pursuant to this chapter or of a member of such board  who
 is not legally separated from such candidate or member.
   (n)  "Unemancipated  child" means any son, daughter, step-son or step-
 daughter who is under the age of eighteen, unmarried and living  in  the
 household of a candidate for any advisory board created pursuant to this
 chapter or of the member of such board.
 
                                 Chapter 7
             REGULATIONS SUBMITTED TO COUNCIL AND ENFORCEMENT
 
   § 16-323 Rules submitted to council.  Rules adopted by the commission-
 er pursuant to this chapter shall become effective only after filing and
 publication  as  prescribed  by chapter forty-five of the charter of the
 preceding municipality. In addition, notwithstanding the  provisions  of
 chapter forty-five of such charter, prior to adoption by the commission-
 er  of  a  final  rule pursuant to subdivision e of section one thousand
 forty-three  of  such  charter,  and  after  consideration  of  relevant
 comments  presented  pursuant  to  subdivision  d  of  such section, the
 commissioner shall submit to the council the  text  of  the  final  rule
 proposed  to  be  published  in  the city record. The council shall have
 thirty days from the date of such submission to comment upon such  text.
 The  final  rule  may include revisions in response to comments from the
 council and shall not be published in the city record before  the  thir-
 ty-first  day  after  such submission, unless the speaker of the council
 authorizes earlier publication.
   § 16-324 Enforcement. 1. Subject to the provisions of subdivision  two
 of  this  section,  any person who violates this chapter, except section
 16-306.1 of this title, subdivision seven  of  section  16-308  of  this
 title,  section  16-310.1 of this title or section 16-329 of the code of
 the preceding municipality, or any rule  promulgated  pursuant  thereto,
 shall  be  liable  for  a  civil  penalty  recoverable in a civil action
 brought in the name of the commissioner or in  a  proceeding  returnable
 before the environmental control board, as follows:
   a.  For  residential  buildings  containing  fewer  than nine dwelling
 units, the civil penalty shall be in an amount  of  twenty-five  dollars
 for  the first violation, fifty dollars for the second violation commit-
 ted on a different day within a period of twelve months, and one hundred
 dollars for the third and  each  subsequent  violation  committed  on  a
 different  day within a period of twelve months, provided that the court
 before which such civil action is brought or such board  may  waive  the
 penalty for the first violation upon a showing of good cause.
   b.  For  residential  buildings containing nine or more dwelling units
 and commercial, manufacturing or industrial buildings, the civil penalty
 shall be in an amount of one hundred dollars for  the  first  violation,
 two  hundred  dollars  for the second violation committed on a different
 S. 8474                           1181
 
 day within a period of twelve months, and four hundred dollars  for  the
 third  and each subsequent violation committed on a different day within
 a period of twelve months, provided that the  court  before  which  such
 civil  action  is  brought  or  such board may waive the penalty for the
 first violation upon a showing of good cause. The owner, net  lessee  or
 person  in  charge  of any residential building of nine or more dwelling
 units or a commercial, manufacturing or industrial building with respect
 to which four or more violations were committed on different days within
 a period of six months shall be classified as a persistent violator.
   c. For persistent violators only, each  container  or  bag  containing
 solid  waste  that  has  not  been  source  separated  or placed out for
 collection in accordance with the rules promulgated by the  commissioner
 pursuant to this chapter shall constitute a separate violation, provided
 that  no more than twenty separate violations are issued on a per bag or
 per container basis during any twenty-four hour period.  Before  issuing
 any  such  notices of violation to a persistent violator on a per bag or
 per container basis, the commissioner shall give such violator a reason-
 able opportunity to correct the condition constituting the violation.
   d. There shall be a rebuttable presumption that the number of dwelling
 units designated on a  notice  of  violation  issued  pursuant  to  this
 section  reflects the number of dwelling units in the residential build-
 ing for which the notice of violation was issued. Where such presumption
 is rebutted, the number of dwelling units on such  notice  of  violation
 shall  be deemed modified accordingly, and in no event shall such notice
 of violation be dismissed solely on the ground that the number of dwell-
 ing units on the original notice of violation was incorrectly stated.
   e. The commissioner or the commissioner's designee shall  establish  a
 recycling training program for owners or employees of residential build-
 ings  of nine or more dwelling units for which at least three notices of
 violation for failing to properly source separate designated  recyclable
 material  have  been  issued  within a twelve-month period and which the
 commissioner determines to be in  need  of  recycling  training.    Such
 training program shall require the building owner, or an employee who is
 primarily  responsible for waste disposal or janitorial services for any
 such building, to attend a training program established by  the  commis-
 sioner  or  the  commissioner's  designee  designed to improve recycling
 practices at such building and a fee may be  imposed  on  any  owner  or
 employee  who  participates  in  such  training  program.  Such training
 program may be held in any location designated by  the  commissioner  or
 the  commissioner's  designee,  including, in order to facilitate tenant
 participation, at such building.
   2. Any person who violates subdivision seven of section 16-308 of this
 title or any rules promulgated pursuant thereto shall be  liable  for  a
 civil  penalty  in the amount of two hundred fifty dollars for the first
 violation, five hundred dollars for the second violation committed with-
 in a twelve-month period, and one thousand dollars  for  the  third  and
 each subsequent violation committed within a twelve-month period.
   3.  Any  owner  or  other person responsible for a publicly accessible
 textile drop-off bin who violates subdivision two of section 16-310.1 of
 this title shall be liable as follows:
   a. In the event that a publicly accessible  textile  drop-off  bin  is
 impermissibly  placed  on  city  property, or property maintained by the
 city, or on any public sidewalk or roadway, the owner  of  the  publicly
 accessible  textile drop-off bin, if the address of such owner is ascer-
 tainable, shall be notified by the department by certified mail,  return
 receipt  requested,  that  such publicly accessible textile drop-off bin
 S. 8474                           1182
 
 must be removed within thirty days from the mailing of  such  notice.  A
 copy  of such notice, regardless of whether the address of such owner or
 other responsible person is ascertainable, shall also be affixed to  the
 publicly  accessible  textile drop-off bin. This notice shall state that
 if the address of the owner or other responsible person  is  not  ascer-
 tainable  and  notice  is  not  mailed  by the department, such publicly
 accessible textile drop-off bin shall be removed within thirty days from
 the affixing of such notice. This notice shall also state that the fail-
 ure to remove the publicly accessible textile drop-off  bin  within  the
 designated  time  period  will result in the removal and disposal of the
 publicly accessible textile drop-off bin by the department. This  notice
 shall  also  state that if the owner or other responsible person objects
 to removal on the grounds that the publicly accessible textile  drop-off
 bin  is  not on city property, or property maintained by the city, or on
 any public sidewalk or roadway, such owner or other  responsible  person
 may send written objection to the department at the address indicated on
 the notice within twenty days from the mailing of such notice or, if the
 address  of  such owner or other responsible person is not ascertainable
 and notice is not mailed by the department, within twenty days from  the
 affixing of such notice, with proof that the publicly accessible textile
 drop-off  bin  is  not  on  city property, or property maintained by the
 city, or on any public sidewalk or  roadway.  Proof  that  the  publicly
 accessible  textile  drop-off  bin  is not on city property, or property
 maintained by the city, or on  any  public  sidewalk  or  roadway  shall
 include,  but  not be limited to, a survey of the property prepared by a
 licensed surveyor that is certified by the record owner of such  proper-
 ty.
   b.  Any  owner or other person responsible for an impermissibly placed
 publicly accessible textile drop-off bin that fails  to  respond  within
 twenty days of receipt of such notice under paragraph a of this subdivi-
 sion  or  otherwise  fails  to  establish  that  the publicly accessible
 textile drop-off bin is not on city property, or property maintained  by
 the  city,  or on any public sidewalk or roadway pursuant to paragraph a
 of this subdivision, shall be liable for a civil penalty in  the  amount
 of  one  hundred  dollars, recoverable in a proceeding returnable before
 the environmental control board.
   4. Any notice of violation or notice of hearing for a violation issued
 to the owner, net lessee or person in charge of a premises or to a  food
 service  establishment,  mobile food commissary, store, or manufacturer,
 as those terms are defined in section 16-329 of the code of the  preced-
 ing municipality, at which or by whom a violation of this chapter or any
 rule promulgated pursuant thereto is alleged to have occurred or to have
 been committed shall be served by delivering a copy of the notice there-
 of at the address maintained in the records of the department of housing
 preservation  and development, the department of finance, or the depart-
 ment of health and mental hygiene. The notice of violation or notice  of
 hearing  may be served by regular mail or in accordance with section one
 thousand forty-nine-a of the charter of the preceding  municipality  or,
 if  such  notice  is  served  by an agency other than the department, in
 accordance with the rules of such agency.
   5. a. Any covered establishment that violates section 16-306.1 of this
 title or rules of the department, the department of  health  and  mental
 hygiene, or the department of consumer and worker protection promulgated
 pursuant  thereto  shall  be liable for a civil penalty recoverable in a
 civil action brought in the name of the commissioner or the commissioner
 of health and mental hygiene, or the commissioner of consumer and worker
 S. 8474                           1183
 
 protection, or in a proceeding returnable  before  any  tribunal  estab-
 lished  within  the  office of administrative trials and hearings in the
 amount of two hundred  fifty  dollars  for  the  first  violation,  five
 hundred  dollars  for  the second violation committed on a different day
 within a period of twelve months, and one thousand dollars for the third
 and each subsequent violation committed on different days within a peri-
 od of twelve months, except  that  the  department,  the  department  of
 health  and  mental  hygiene,  and the department of consumer and worker
 protection shall not issue a notice of  violation,  but  shall  issue  a
 warning,  for  any  violation by a designated covered establishment that
 occurs during the first twelve months after the commissioner  designates
 such  covered  establishment  pursuant  to  subdivision  two  of section
 16-306.1 of this title.
   b. Any transfer station that violates section 16-306.1 of  this  title
 or  rules of the department promulgated pursuant thereto shall be liable
 for a civil penalty recoverable in a civil action brought in the name of
 the commissioner or in a proceeding returnable before the  environmental
 control  board  in the amount of two hundred fifty dollars for the first
 violation, five hundred dollars for the second violation committed on  a
 different day within a period of twelve months, and one thousand dollars
 for  the third and each subsequent violation committed on different days
 within a period of twelve months, except that the department  shall  not
 issue  a  notice  of  violation,  but  shall  issue  a  warning, for any
 violation by a designated covered establishment that occurs  during  the
 first  twelve  months  after  the  commissioner  designates such covered
 establishment pursuant to subdivision two of section  16-306.1  of  this
 title.
   c.  Any private carter that violates section 16-306.1 of this title or
 rules of the business integrity commission promulgated pursuant  thereto
 shall  be  liable  for  a  civil  penalty  recoverable in a civil action
 brought in the name of the chair of the business  integrity  commission,
 or  in  a  proceeding  brought  by  the  chair of the business integrity
 commission held in accordance with title sixteen-A of the  code  of  the
 preceding  municipality, except that the chair of the business integrity
 commission shall not issue a notice of  violation,  but  shall  issue  a
 warning,  for  any  violation by a designated covered establishment that
 occurs during the first twelve months after the commissioner  designates
 such  covered  establishment  pursuant  to  subdivision  two  of section
 16-306.1 of this title.
   6. Any person who violates section 16-329 of the code of the preceding
 municipality or any rule promulgated pursuant thereto  shall  be  liable
 for a civil penalty recoverable in a civil action brought in the name of
 the  commissioner,  the commissioner of health and mental hygiene or the
 commissioner of consumer and  worker  protection,  or  in  a  proceeding
 before  the  environmental  control  board,  or any tribunal established
 within the office of administrative trials and hearings in the amount of
 one hundred fifty dollars for the first  violation,  two  hundred  fifty
 dollars  for  the second violation committed on a different day within a
 period of twelve months, and five hundred dollars for the third and each
 subsequent violation committed on different  days  within  a  period  of
 twelve months.

                            Title  17 - Health
 
   § 17-101 Definitions. As used in this title:
   1. "Board" shall mean the board of health.
 S. 8474                           1184
 
   2. "Commissioner" means the commissioner of the department of health.
   3. "Department" means the department of health.
   4. "Health code" means the health code of the city of Staten Island.
   §  17-102  Department; commissioner. 1. There shall be a department of
 health, the head of which shall be the commissioner of health.
   2. The commissioner, with concurrence of  the  board  of  health,  may
 adopt  a  seal  for use in the authentication of the orders, proceedings
 and commissions of the department.
   3. The commissioner shall be appointed by the mayor  and  shall  be  a
 doctor  of  medicine and a holder of a degree of master of public health
 or a degree of master of business administration with  concentration  in
 the  health  field  or  a degree of master of public administration with
 concentration in the health field or the equivalent of any  one  of  the
 specified  foregoing  degrees  received from a college or university and
 have had at least five years' experience  either  in  public  health  or
 administration  or  in  college  or university public health teaching or
 both.
   § 17-103 Board of health.  1. There shall be in the department a board
 of health, the chair of which shall be the commissioner.  In addition to
 the chairperson the board shall also consist of  four  members,  two  of
 whom  shall be doctors of medicine who shall each have had not less than
 ten years' experience in any or all of the following: clinical medicine,
 public health administration or  college  or  university  public  health
 teaching. The other two members need not be physicians.
   2.  The  four  members  other than the chairperson shall serve without
 compensation and shall be appointed by the mayor, each  for  a  term  of
 eight  years. In the case of a vacancy, the mayor shall appoint a member
 to serve for the unexpired term.
   3. The commissioner shall designate employees  of  the  department  as
 necessary  to  service the board including an employee designated by the
 commissioner to serve as the secretary of the board.
   4. A member of the board of health,  other  than  the  chair,  may  be
 removed by the mayor on proof of official misconduct or of negligence in
 official  duties  or  of conduct in any manner connected with his or her
 official duties, or of mental or physical inability to  perform  his  or
 her  duties.  Prior  to removal of a board member for any of the reasons
 stated above, the member shall be given a copy of  the  charges  against
 him  or  her  and shall be entitled to a hearing before the mayor and to
 assistance of counsel at such hearing.
   § 17-104 Powers and duties  of  commissioner.    1.  The  commissioner
 shall:
   (a)  have  all  the  powers  and duties vested in him or her or in the
 department by this title, except for those vested by law in the board of
 health or the chief medical examiner.
   (b) prepare and submit to appropriate governmental  authorities  short
 term,  intermediate  and  long range plans and programs designed to meet
 the needs of the city including the needs for construction and operation
 of medical and health care facilities, except that the commissioner  may
 not construct or operate a new medical facility until the health systems
 agency  having jurisdiction over that institution has received a copy of
 the application filed with the commissioner,  in  the  case  of  private
 institutions,  or  all  information  in  form  and  detail as the health
 systems agency shall require, in the case of institutions of the city of
 Staten Island, and it shall have given the commissioner a written  deci-
 sion of approval or disapproval; and
 S. 8474                           1185
 
   (c)  not be considered bound by the decision given as described above,
 but he or she shall not approve any construction, addition or  modifica-
 tion  contrary  to  the  health  systems  agency without first holding a
 public hearing.
   2.  In  reaching  decisions pursuant to this section, the commissioner
 and the health systems agency shall consider:
   (a) the public need for the existence of the new  institution  or  the
 construction, addition or modification of an existing institution at the
 time and place and under the circumstances proposed;
   (b)  the  character,  competence  and standing in the community of the
 owners and licensees, in the case of private institutions;
   (c) the financial resources of the  institution  and  its  sources  of
 future revenue;
   (d)   the fitness and adequacy of the premises, and equipment, person-
 nel and standards of care to be used in the operation  of  the  proposed
 institution; and
   (e)  such other matters as each of them considers pertinent.
   3.  The  commissioner  may  compel  the attendance of witnesses in any
 matter or proceeding before the commissioner.
   4. The commissioner may assess any penalty prescribed for a  violation
 of  or a failure to comply with any provision of this title or any other
 lawful notice, order or regulation pursuant thereto, which  penalty  may
 be  assessed, although not to exceed one thousand dollars, after a hear-
 ing or an opportunity to be heard.
   § 17-105 Functions, powers and duties of the department.    Except  as
 otherwise  provided  by  law,  the department shall have jurisdiction to
 regulate all matters affecting health in the city  and  to  perform  all
 those  functions and operations performed by the city that relate to the
 health of the people of the city including,  but  not  limited  to,  the
 following:
   1.    enforce  all  provisions of law applicable in the area under the
 jurisdiction of the department for the preservation of human  life;  the
 care,  promotion  and  protection  of health and to the necessary health
 supervision of the purity and wholesomeness of  the  water  supply.  The
 department shall also maintain and operate office health centers, health
 stations  or other facilities which may be required for the preservation
 of health and the care of the sick;
   2.  exercise its functions, powers and duties in  the  area  extending
 over  the  city, the waters adjacent thereto, within the jurisdiction of
 the city and within the quarantine limits established by law;
   3.   receive  and  expend  funds  made  available  for  public  health
 purposes;
   4.  supervise and control the registration of births, fetal deaths and
 deaths;
   5.  engage in and promote health research for the purpose of improving
 the  quality of medical and health care. In conducting such research the
 department  may  conduct  medical  audits,  receive  reports  on   forms
 prescribed by the department and any information received by the depart-
 ment  with  regard to such research shall be kept strictly confidential,
 used solely for medical or  scientific  research  purposes  or  for  the
 improvement of the quality of medical care;
   6.  supervise  the  reporting  and control of communicable and chronic
 diseases and conditions hazardous  to  life  and  health;  and  exercise
 control  over  and  supervise  the  abatement of nuisances affecting the
 public health;
 S. 8474                           1186
 
   7.  produce, standardize and distribute certain diagnostic,  preventa-
 tive  and  therapeutic  products and conduct laboratory examinations for
 the diagnosis, prevention and control of disease;
   8.    promote  or  provide  education in the prevention and control of
 disease;
   9.  promote or provide diagnostic and therapeutic services for  mater-
 nity  and  child  health, family planning, communicable disease, medical
 rehabilitation, narcotics addiction and other  diseases  and  conditions
 affecting public health;
   10.   promote and provide medical and health services for school chil-
 dren and the ambulant sick and needy persons of the city;
   11.  promote and provide medical and health services for the incarcer-
 ated individuals of prisons maintained and operated by the city;
   12.  maintain and operate public health centers and clinics  as  shall
 be established in the department;
   13.  prior  to  the  sale,  closing, abandonment or transfer of a city
 hospital, hold a public hearing regarding  such  proposal;  and  publish
 notice  of such hearing in such daily newspaper published in the city as
 selected by the commissioner, such publication to take  place  not  less
 than  ten days nor more than thirty days prior to the date fixed for the
 hearing;
   14.  analyze and monitor hospitals, clinics, nursing homes  and  homes
 for  the  aged,  and  analyze, evaluate, supervise and regulate clinical
 laboratories, blood  banks  and  related  facilities  providing  medical
 services;
   15.  supervise and regulate the public health aspects of water supply,
 sewage disposal and water pollution;
   16.    supervise  and  regulate  the  public  health  aspects  of  the
 production,  processing  and  distribution  of  milk,  cream  and   milk
 products;
   17.   supervise and regulate the public health aspects of the food and
 drug supply of the city and other  businesses  or  activities  affecting
 public health in the city;
   18.    supervise  and  regulate  the public health aspects of ionizing
 radiation, handling and disposal of radioactive wastes  and  the  activ-
 ities within the city affecting radioactive materials, excluding special
 nuclear materials in quantities sufficient to form a critical mass; and
   19. supervise and regulate the removal, transportation and disposal of
 human remains.
   §  17-106  Chief medical examiner. 1. There shall be in the department
 an independent office of chief medical examiner, the head of which shall
 be the chief medical examiner.
   2. The chief medical examiner shall be appointed by the mayor from the
 classified civil service and shall be a doctor of medicine and a skilled
 pathologist and microscopist. The mayor may  remove  the  chief  medical
 examiner upon filing in the office of the personnel director and serving
 upon  the  examiner his or her reasons therefor and allowing the officer
 an opportunity of making a public explanation.
   3. The commissioner, with respect to the office of chief medical exam-
 iner, shall exercise certain powers and duties pursuant to this section,
 but he or she shall not interfere with performance by the chief  medical
 examiner or his or her office.
   4. The chief medical examiner may appoint and remove such deputy chief
 medical  examiners,  assistant medical examiners, junior medical examin-
 ers, medical investigators, scientific experts  and  other  officers  or
 employees as may be provided for in the budget.
 S. 8474                           1187
 
   All  assistant,  associate,  deputy and junior medical examiners shall
 possess the same basic qualifications as the chief medical examiner. The
 medical investigators shall be  physicians  duly  licensed  to  practice
 medicine in the state of New York.
   5.  The  office of chief medical examiner shall be kept open every day
 in the year, including Sundays and all legal holidays, and a clerk shall
 be in attendance at all times during the day and night.
   6. The chief and all deputy chief,  associate,  assistant  and  junior
 medical examiners and all investigators may administer oaths, take affi-
 davits, proofs and examinations.
   7. The chief medical examiner shall have such powers and duties as may
 be provided by law with respect to bodies of persons dying from criminal
 violence, casualty, suicide, suddenly when in apparent good health, when
 unattended  by  a physician, in a correctional facility or in any suspi-
 cious or unusual manner or where an application is made for a permit for
 cremation of the body.
   8. The chief medical examiner shall keep full and complete records. He
 or she shall promptly deliver, to the district attorney, copies  of  all
 records  relating  to  every death in which, in the opinion of the chief
 medical examiner, there is any indication of criminality.  Such  records
 shall not be open to public inspection.
   §  17-107  Health  code. 1.   The health code which is in force in the
 preceding municipality on the date  and  time  which  this  title  takes
 effect  and all existing provisions of the health code, including penal-
 ties affixed for violations, shall continue to be binding  and  in  full
 force, except as amended from time to time.
   2. The board of health may add to, alter, amend or replace any part of
 the  health code, and may provide for the enforcement of the health code
 or any orders made by the commissioner.    The  board  of  health  shall
 prescribe in the health code all matters and subjects to which the power
 and authority of the department extends.
   3. Any violation of the health code shall be treated and punished as a
 misdemeanor.
   §  17-108  Temporary  hospitals  during epidemic. The board of health,
 during prevalence of an epidemic or in the presence of great  and  immi-
 nent peril to the public health, may take possession of any buildings in
 the  city  for temporary hospitals and shall pay a just compensation for
 any private property so taken. Such temporary hospitals shall  be  under
 the control of the commissioner.
   §  17-109  Permits.   The board of health may grant, suspend or revoke
 permits for businesses and other matters in respect to any subject dealt
 with in the health code or regulated by the department and the board may
 prescribe reasonable fees for the issuance of said permits.
   § 17-110 Declaration of imminent peril.  In the presence of great  and
 imminent  peril  to  public  health, the board of health shall take such
 measures and order the department of health to do such acts beyond those
 duly provided for, in  the  interests  of  preservation  of  the  public
 health.    No  expenditure  shall  be  incurred  in the exercise of such
 extraordinary power, unless provision is made therefor in the budget  or
 unless  such  expenditures  are  financed  pursuant to section 107.00 or
 section 29.00 of the local finance law.  Such peril shall exist when and
 for such period of time as the board of health and the mayor declare.
   § 17-111 Right of entry. The commissioner and his or her officers may,
 pursuant to a search warrant when required by law,  enter,  examine  and
 inspect all vessels, premises, grounds, structures, buildings and under-
 S. 8474                           1188
 
 ground  passages  for  compliance with the provisions of law enforced by
 the department.
   §  17-112  Acceptance  of  private funds.   No grants, gifts, devises,
 legacies or bequests made to the city shall be accepted except with  the
 approval of the commissioner.
 
                             Title 18 - Parks
 
   § 18-101 Definitions. As used in this title:
   1.  "Commissioner"  shall  mean  the commissioner of the department of
 parks, recreation and cultural affairs.
   2. "Department" shall mean the department  of  parks,  recreation  and
 cultural affairs.
   §  18-102  Commissioner.   The head of the department of parks, recre-
 ation and cultural affairs shall be the commissioner.
   § 18-103 Powers and duties of commissioner. Except with respect to the
 functions of the board of education, the  commissioner  shall  have  the
 power and it shall be his or her duty:
   1. With respect to parks:
   (a)  to  manage and care for all parks, squares and public places, the
 sidewalks immediately adjoining the same and all playgrounds, playground
 fixtures and other recreation properties, except those within the juris-
 diction of the board of education;
   (b) to prepare for the establishment and improvement of a park  system
 for  the  city  with  regard  to  proper connections with the systems of
 federal, state and county parks and recreation areas  in  the  city  and
 counties adjacent to the city; and
   (c)  to  maintain the beauty and utility of all parks, squares, public
 places, playgrounds and other recreational properties.
   2. With respect to recreation:
   (a) to plan, acquire, construct, improve and merge facilities for  the
 recreation of the public;
   (b)  to  plan,  develop, conduct and supervise recreation programs for
 the public;
   (c)  to review and coordinate recreation activities and  programs  and
 facilities  conducted  by  agencies of the city and the budget estimates
 submitted by such other agencies  for  such  activities  and  make  such
 recommendations to the mayor; and
   (d)  to  undertake, subject to the approval of the mayor, and to enter
 into arrangements with other agencies of  the  city,  state  or  federal
 government and to recommend to the mayor such arrangements with private,
 voluntary  or  commercial agencies, subject to the law, for the perform-
 ance of any recreation functions conferred upon the department.
   3. With respect to cultural affairs:
   (a) to plan, acquire, design, construct, improve and manage facilities
 for the conduct of cultural activities by the city and,  to  the  extent
 possible,  to  use the resources of other agencies to perform design and
 planning functions subject to the approval of such agencies;
   (b) to plan, develop, conduct and supervise such cultural  activities;
 and
   (c)  to  foster  coordination  among city, state and federal agencies,
 other organizations and institutions with respect to cultural activities
 in the city.
   § 18-201 Art commission. There shall be an art commission. All members
 of the commission shall serve  without  compensation.  The  mayor  shall
 appoint and fill vacancies. The chairperson shall be the commissioner of
 S. 8474                           1189

 parks,  recreation  and youth services. The commissioner shall accede to
 the rights, powers and duties within the city of Staten  Island  of  the
 preceding arts commission of the city of New York.
 
                         Title 19 - Transportation
 
   §  19-102  Commissioner. There shall be a department of transportation
 the head of which shall be the commissioner of transportation.
   § 19-103 Powers and duties of  commissioner.  The  commissioner  shall
 have  control  over  and  be responsible for all the functions and oper-
 ations of the city relating to transportation including, without limita-
 tion, parking and traffic operations, highway  operations,  ferries  and
 related facilities and mass transportation facilities.
   §  19-104  Parking  and  traffic operations. 1. The commissioner shall
 make rules and regulations for the conduct of vehicular  and  pedestrian
 traffic  in  the streets, squares, avenues, highways and parkways of the
 city. Violation of such rules shall be a traffic infraction triable by a
 judge in criminal court and also may be  adjudicated  pursuant  to  this
 title or pursuant to articles two-A and two-B of the vehicle and traffic
 law.
   2.  In  an emergency, the police commissioner may suspend for a period
 of forty-eight hours the provision of any rule or  procedure  and  shall
 immediately notify the commissioner of such suspension.
   3. In order to expedite the movement of traffic or to safeguard pedes-
 trians or property, a police officer may order a person to disregard any
 traffic signal or any regulation.
   4.  The  commissioner shall establish, determine, control, install and
 maintain the type, design, size and  location  of  any  and  all  signs,
 signals and other devices indicating street names and other public plac-
 es,  and  for  guiding,  directing or otherwise regulating vehicular and
 pedestrian traffic.
   5. The commissioner shall make recommendations to the mayor as to  the
 design  and  location of lighting devices, poles and fixtures, including
 intensity of illumination of streets and highways.
   6. The commissioner shall prepare and submit to the mayor a  proposed,
 comprehensive  city  traffic plan and the commissioner shall collect and
 compile traffic data, prepare engineering studies and surveys in  regard
 to  vehicular  and pedestrian traffic and submit detailed reports to the
 mayor regarding such data. The commissioner shall  also  have  authority
 to:  (a)  submit  to  the  mayor  from  time to time recommendations and
 proposals for consideration by the mayor  and  other  city  agencies  in
 regard  to    methods  of  ameliorating adverse traffic conditions which
 cannot be remedied by traffic  regulations;  (b)  amend  existing  regu-
 lations and rules of any city agency which may affect traffic conditions
 in  the city;   (c) propose legislation which may be necessary to imple-
 ment such  proposals;    and  (d)  recommend  improvements  of  existing
 streets,  locations  of  new  streets, highways, parking garages, public
 parking areas, offstreet loading facilities and other related matters.
   7. The commissioner shall coordinate efforts of and  consider  reports
 of  public  and  private  agencies and civic groups with regard to their
 suggestions on traffic control  in  the  city.  The  commissioner  shall
 prepare  analyses  of traffic accidents with a view to determining their
 causes and means for prevention and shall carry  on  educational  activ-
 ities for the purpose of promoting traffic safety in the city.
   8.  The commissioner shall establish parking meter zones for on-street
 and off-street parking; determine type, size  and  location  of  parking
 S. 8474                           1190
 
 meters;  and  fix  the  fees for parking in public parking areas, except
 that parking meter zones for both on-street and off-street parking shall
 not apply to vehicles operated by disabled  persons  displaying  special
 vehicle identification cards issued by the commissioner.
   9.  The  commissioner  shall  collect  fees,  fines  and penalties for
 violation of parking rules and shall keep all monies in a  special  fund
 to  be  known  as  the  "traffic improvement fund". The revenues in this
 special fund shall be used, upon  authorization  by  the  council    for
 payment  of  all  costs  of purchase, rental, engineering, installation,
 operation, maintenance and repair of parking meters, the  collection  of
 coins, the enforcement of rules pertaining to parking, the collection of
 fines  and penalties for rules violations or the payment of interest on,
 amortization of, or payment of any indebtedness contracted by  the  city
 in connection with the installation and operation of parking meters. Any
 revenues  remaining after such payments are made shall be used for capi-
 tal and other expenditures to ameliorate traffic conditions of the city.
   10. The commissioner, in conjunction with the commissioner of finance,
 may enter into agreements with not more than two financing  agencies  to
 provide  for  the acceptance by the city of credit cards as an alternate
 means of payment of fines or fees incurred due to violation of any  law,
 rule or regulation with regard to parking of a vehicle.
   11.  The  commissioner  shall  have  the  power, concurrently with the
 police department, to enforce laws, rules and regulations with regard to
 all movement and  conduct  of  vehicular  and  pedestrian  traffic.  The
 commissioner  may  employ, hire and retain officers or employees for the
 purpose of enforcing laws, rules and regulations with regard to regulat-
 ing and controlling vehicular parking and  movement  of  pedestrian  and
 vehicular  traffic.  Such officers or agents are authorized to issue and
 serve tickets, summonses and complaints for traffic infractions.
   12. The commissioner shall issue, upon application, a special  vehicle
 identification  permit  to  a  Staten  Island  resident certified by the
 department of health as suffering from a permanent disability  seriously
 impairing mobility, non-residents similarly certified may obtain vehicle
 identification  for  purposes  of transportation to a school or place of
 employment in city. All applicants for such permit must possess an oper-
 ator's or chauffeur's license with any restrictions  indicating  special
 restrictions,  devices  or equipment required for operation of the vehi-
 cle.
   § 19-105 Highway operations.  The commissioner shall have  charge  and
 control of the following functions relating to the construction, mainte-
 nance  and  repair of public roads, streets, highways, parkways, bridges
 and tunnels: (i) regulating, grading, curbing, flagging and guttering of
 streets, including marginal streets, and the laying of crosswalks;  (ii)
 designing,  constructing,  resurfacing  and  repairing all public roads,
 streets, highways and parkways;  (iii)  the  relaying  of  all  pavement
 removed  for  any cause; (iv) the filling of sunken lots, fencing vacant
 lots, digging down of lots and the licensing of vaults under  sidewalks;
 (v) regulation of the use and transmission of gas, electricity, pneumat-
 ic power and steam for all purposes in, upon, across, over and under all
 streets,  roads, avenues, parks and all public places; regulation of the
 construction of electric mains, conduits, conductors and subways in  any
 streets,  roads,  avenues,  parks  or  public places and the issuance of
 permits to builders and others to use or open a street; and to open  the
 same  for  the  purpose  of  carrying  on  the business of transmitting,
 conducting, using and selling gas,  electricity  or  steam  or  for  the
 service of pneumatic tubes, provided, however, this section is not to be
 S. 8474                           1191

 seen as to grant permission to open or use the streets except by persons
 or  corporations  otherwise  duly  authorized  to carry on such business
 specified above; (vi) construction, alteration and  maintenance  of  all
 bridges  and  tunnels.  The  commissioner shall issue a report to mayor,
 city council and city residents about the condition of the  bridges  and
 tunnels  operated  and maintained by the department with such report due
 on March first, as of December thirty-first of preceding calendar  year.
 The report shall include a description of all capital and revenue budget
 funds  appropriated  for  rehabilitation  and maintenance of bridges and
 tunnels as well as the program developed by  the  commissioner  for  the
 maintenance  of  all  bridges  and tunnels in the city of Staten Island;
 (vii) removal of encroachments on public roads,  streets,  highways  and
 parkways, with the exception of weed removal, grass cutting and clipping
 and other horticultural operations which are to be executed by the parks
 department,  and  de-icing and snow removal operations are to be carried
 out by the department of sanitation; (viii) clearing, grubbing, grading,
 filling or excavating of vacant lots and other land areas; (ix)  instal-
 lation  of metal chain link fences or barriers on overpasses, footbridg-
 es, bridges or walkways; and (x) designing, constructing and maintaining
 a lighting system for streets, highways, parks and public places in  the
 city.
   §  19-106 Ferries and related facilities. The commissioner shall main-
 tain and operate the ferries of the  city.  The  commissioner  shall  be
 responsible  for designing, constructing, maintaining or controlling all
 ferry boats, ferry houses, ferry  terminals  and  equipment;  all  wharf
 property  and roads or streets adjacent to such wharves, ferry houses or
 terminals, including parking sites and related facilities.  The  commis-
 sioner shall have charge and control of all marine operations within the
 city and the power to regulate public and private ferry operations orig-
 inating  or  terminating  in  the city. The commissioner shall establish
 tours of ferry facilities and their related operations as well as  tours
 of the New York harbor at fees to be established by the commissioner and
 may  publicize and advertise the same. The commissioner shall construct,
 operate and maintain marinas and public boat launching ramps and related
 ferry facilities and collect fees for the use of such  facilities.  Fees
 collected  are  to  be deposited in a special fund for continued mainte-
 nance, operation or reconstruction of public marine facilities.
   § 19-107 Mass  transportation  facilities.    The  commissioner  shall
 prepare   or   review   plans   and   recommendations  for  the  nature,
 construction, location, operation  and  financing  of  roads,  highways,
 bridges,  tunnels, railroads or other facilities for mass transportation
 for use, in whole or in part, within the city, whether or not the  funds
 provided  for  such  facilities  are derived from the city treasury. The
 commissioner shall develop and coordinate planning and  programming  for
 all  forms  of  mass transportation within Staten Island, whether or not
 transportation is within  the  sole  operating  jurisdiction  of  Staten
 Island.  The  commissioner  shall make recommendations to the mayor, the
 Metropolitan Transportation Authority or any of  its  subsidiaries,  the
 Port  Authority  of  New  York  and New Jersey and other city, state and
 federal agencies concerning the mass transit needs of the city of Staten
 Island.
   § 19-108 Duties and obligations of a property  owner  with  regard  to
 sidewalks,  fencing  or  filling  of  vacant lots or cutting down raised
 lots. The owner of any property, at his or her own cost shall:
 S. 8474                           1192
 
   1. Install, reconstruct, repave and repair the sidewalk in front of or
 abutting such property, to include intersection quadrant in the case  of
 corner property; and
   2.  Fence any vacant lot comprising all or part of his or her property
 and fill any sunken lots on such property or cut down any raised lot  or
 lots  comprising all or part of the property whenever the transportation
 department shall so order. In the event a property owner fails to comply
 with such order or the provisions of this  section,  the  transportation
 department may have the work performed at the expense of the owner.
   §  19-109 Right of entry. The commissioner may enter public or private
 property for the purpose of making surveys, borings  or  other  investi-
 gations  necessary  for the performance of department duties. Refusal to
 permit such entry shall be triable by the judge in a criminal  court  of
 Staten Island.
 
                        Title 20 - Consumer Affairs
 
   § 20-102 Definitions. Wherever used in this title:
   1.  "Commissioner"  shall mean the commissioner of consumer and worker
 protection.
   2. "Department" shall mean  the  department  of  consumer  and  worker
 protection.
   3. "License" shall mean an authorization by the department of consumer
 and  worker  protection to carry on various activities within its juris-
 diction, which may take the form of  a  license,  permit,  registration,
 certification  or such other form as is designated under law, regulation
 or rule.
   4. "Organization" shall mean a  business  entity,  including  but  not
 limited to a corporation, trust, estate, partnership, cooperative, asso-
 ciation, firm, club or society.
   5. "Person" shall mean a natural person or an organization.
   6.  "Trade  name"  shall mean that name under which an organization or
 person solicits, engages in, conducts or transacts a business or  activ-
 ity.
   §  20-103  Powers of the commissioner. 1. The commissioner shall plan,
 make recommendations, conduct research and develop programs for consumer
 and worker education and protection, facilitate the exchange of informa-
 tion in consultation with agencies, federal and state officials, commer-
 cial interests, private groups and coordinate the  consumer  and  worker
 protection activities of other city agencies.
   2. The commissioner shall enforce all laws in relations to weights and
 measures.
   3.  The  commissioner  shall have control of granting, issuing, trans-
 ferring, renewing, revoking, suspending and cancelling of  all  licenses
 and  permits,  except  in  the  cases  with respect to which any of said
 powers are conferred on other persons  or  agency  by  laws,  and  shall
 collect all fees for licenses.
   All  licenses  or permits in effect on the date of establishment shall
 be continued until their date of expiration  or  sixty  days,  whichever
 shall  be  longer.  Any  license  or permit expiring within a thirty-day
 period prior to the date of establishment shall be continued for a peri-
 od of sixty days.
   A licensee or permittee must notify and register with  the  department
 if  the  license or permit is to extend beyond sixty days of the date of
 establishment.
 S. 8474                           1193
 
   4. The commissioner shall enforce all laws relating to advertising and
 offering for sale and the sale of  all  commodities,  goods,  wares  and
 services;  in  addition  he or she shall receive complaints and initiate
 his or her own investigations and  take  appropriate  action,  including
 referral to a federal or state agency.
   5.  The  commissioner  shall  be authorized to hold public and private
 hearings, administer oaths, take  testimony,  serve  subpoenas,  receive
 evidence,  and  to  receive,  administer, pay over and distribute monies
 collected in and as a result of actions brought for violations  of  laws
 relating to deceptive or unconscionable trade practices.
 
                         Title 21 - Human Services
 
   §  21-102  Commissioner. There shall be a department of human services
 the head of which shall be the commissioner of human services.
   § 21-103 Powers and duties.  The commissioner shall  have  the  powers
 and  perform  the  duties  of a commissioner of human services under the
 social services law, provided that no form of outdoor  relief  shall  be
 dispensed  by  the  city except under the provisions of a state or local
 law which shall specifically provide the method, manner  and  conditions
 of dispensing the same.
   § 21-104 Public institutions under the commissioner.  The commissioner
 shall  control, maintain and operate such institutions as are now or may
 be put under his or her control.
   § 21-202 Division for the aging. There shall be within the  department
 a division for the aging.
   § 21-203 Power and duties. It shall be the power and duty of the divi-
 sion for the aging:
   1. to stimulate community interest in the problems of the aging;
   2.   to promote public awareness of resources available for the aging,
 and to refer the public to appropriate departments and agencies  of  the
 city, state and federal governments for advice, assistance and available
 services in connection with particular problems;
   3.    to cooperate with and assist local neighborhoods in the develop-
 ment of programs and the establishment of local offices;
   4.  to disburse available city, state and federal  funds  to  programs
 throughout  the  city  and,  when  practical, coordinate such funds with
 available funding from the private sector;
   5.  to promulgate rules and regulations for the operation  of  facili-
 ties, services and programs under its jurisdiction; and
   6.   to maintain, operate and control such programs and facilities, as
 may be necessary or required for the proper administration of the  divi-
 sion.
   §  21-301.  Division  for youth services. 1. There shall be within the
 department a division for youth services.
   2. With respect to youth services the commissioner shall have all  the
 powers and duties of a youth bureau as such bureau is described in arti-
 cle  nineteen-A  of  the  executive  law  and shall in addition have the
 following powers and duties:
   (a) to disburse available city, state and federal, and private-sector,
 when applicable, funds to programs for youth throughout the city;
   (b) to maintain, operate and control such youth programs  and  facili-
 ties as necessary; and
   (c)  to  promulgate rules and regulations for the operation of facili-
 ties, services and programs within the department's jurisdiction.
 S. 8474                           1194
 
   § 21-402 Division of homeless services.   There shall  be  within  the
 department a division of homeless services.
   §  21-403  Powers and duties; director. 1. The head of the division of
 homeless services shall be the director. The  director  shall  have  the
 powers  and perform the duties of a commissioner of human services under
 the social services law for the purpose of fulfilling his or her respon-
 sibilities.
   2. The director, in the performance of his or her functions, shall:
   (a) be responsible for transitional housing and services  provided  by
 the  city  for eligible homeless families and individuals.  The director
 shall encourage the participation of  and  receive  proposals  from  the
 public  and  private sectors for the development of transitional housing
 and services for homeless families and individuals.  In performing  such
 duties,  the  director may develop and issue requests for such proposals
 and  evaluate  responses  thereto,  negotiate,  award,  and   administer
 contracts,   loans   or  other  agreements,  and  obtain  all  necessary
 approvals.  For-profit and not-for-profit entities shall be eligible  to
 submit  proposals,  bid on contracts and other agreements, and apply for
 grants and loans;
   (b) plan and implement a redesign and restructuring of the system  for
 the provision of transitional housing and services for homeless families
 and individuals;
   (c) in consultation with other appropriate governmental agencies, plan
 housing for homeless families and individuals;
   (d)  develop  programs designed to improve access of homeless families
 and individuals to existing housing;
   (e) maintain, repair  and  rehabilitate  transitional  housing  owned,
 operated or managed by the division;
   (f)  establish performance criteria, goals and objectives with respect
 to contract providers and monitor and evaluate such performance; and
   (g) in consultation  with  other  appropriate  governmental  agencies,
 develop  and  operate  outreach programs to identify and assist families
 and individuals who are homeless and living in public spaces and partic-
 ipate in the development of prevention programs to assist  families  and
 individuals who are in imminent danger of becoming homeless.
   3.    In  addition,  the  director is authorized, in consultation with
 appropriate agencies, to provide any other  services  he  or  she  deems
 necessary to implement and effectuate the provisions of this title.
 
                      Title 22 - Economic Development
 
   § 22-102 Commissioner. The head of the department shall be the commis-
 sioner of economic development.
   § 22-103 Powers and duties of the commissioner. The commissioner shall
 have  charge  and  control  of  and be responsible for all functions and
 operations of the city relating to business  and  economic  development,
 the  enhancement  of  economic development and financial opportunity for
 minority and women owned business enterprises and ensuring equal employ-
 ment opportunity by city contractors.
   1.  Such powers and functions shall include, without  limitation,  the
 following:
   (a)   to  establish  business,  industrial  and  commercial  policies,
 programs and projects which affect the business, industrial,  commercial
 or economic well-being, development, growth and expansion of the econom-
 ic life of the city;
 S. 8474                           1195
 
   (b)  to  serve  as  liaison for the city with local development corpo-
 rations,  other  not-for-profit  corporations  and  all  other  entities
 involved in economic development within the city;
   (c)  to  study,  organize, promote, coordinate and carry out within or
 without the city, activities, projects and programs designed to  encour-
 age, stimulate and foster the well-being, development, growth and expan-
 sion  of business, industry and commerce in the city, and to enhance and
 protect the economic life of the city;
   (d) to assist, encourage and  promote  broadened  employee  ownership,
 particularly  through  the  use  of  employee  stock ownership plans and
 producer cooperatives,  by  conducting  research,  outreach  and  public
 information  programs  regarding  such ownership; by providing technical
 assistance to employee groups exploring employee buyouts, and by  ensur-
 ing  that  firms  applying  for  financial  assistance  from  any entity
 involved with economic  development  in  the  city  shall  be  correctly
 advised  as  to  the  potential  advantages of forming an employee stock
 ownership plan;
   (e) to serve as a clearinghouse in connection with efforts  to  devise
 solutions  for  problems affecting business, industry or commerce in the
 city;
   (f) to promote and encourage the location and development  of  markets
 for city products;
   (g) to promote and encourage the location and development of new busi-
 ness  and industry in the city, as well as the maintenance and expansion
 of existing business and industry in the city;
   (h) to promote, coordinate  and  implement  activities,  projects  and
 programs designed to attract foreign direct investment and promote over-
 seas  sales  by firms in the city, and to otherwise encourage and stimu-
 late the development of international business, commerce  and  trade  in
 the city;
   (i) to administer and promote development of foreign trade zones with-
 in the city;
   (j)  to  study conditions affecting business, industry and commerce in
 the city, and collect, disseminate and make studies with regard  to  the
 information collected;
   (k)  to  maintain  a  business  information service in order to assist
 business and industry in the city and to  encourage  businesses  outside
 the city to patronize the industrial establishments of the city;
   (l)  to  make  recommendations  to  the  mayor concerning steps deemed
 advisable for the promotion and advancement of  business  prosperity  in
 the city;
   (m)  to publicize the economic advantages and other factors which make
 the city a desirable location for businesses;
   (n) to collect, compile and distribute information  dealing  with  the
 facilities,  advantages  and  attractions  of  the city and historic and
 scenic points and places of interest therein;
   (o) to plan and conduct informational programs and publicity  designed
 to  attract tourists, vacationers, visitors and other interested persons
 to the city and its attractions;
   (p) to encourage and  cooperate  with  public  and  private  agencies,
 organizations and groups to publicize the business and commercial advan-
 tages of the city;
   (q)  to  cooperate  with  and  assist any corporation, organization or
 agency, public or private, the objectives of which include the  advance-
 ment  of  business, industry prosperity, expansion of existing business,
 S. 8474                           1196
 
 the creation of new job opportunities and provide support for  any  such
 efforts or purposes; and
   (r)  to  issue  permits for the taking of motion pictures, and for the
 taking of photographs and for the use or operation of television cameras
 or other transmitting television equipment in, on or about city  proper-
 ty, streets, parks, piers, wharves, docks, bridges or tunnels.
   2.  The  commissioner  shall  have  the power and duty to exercise the
 functions of  the  city  relating  to  the  development,  redevelopment,
 construction,  operation,  maintenance,  management  and  regulation  of
 public markets, wharf property, waterfront property and airports  within
 the city, including, without limitation, the following:
   (a)  to  have charge and control of the public markets of the city, to
 fix fees for services, licenses and privileges in connection  therewith,
 to rent space and enter into leases therefor, and to regulate all facil-
 ities  in  use  as  public  markets  for  the  public health, safety and
 welfare;
   (b) to have charge and control of wharf property and waterfront  prop-
 erty  owned  by the city and of the building, repairing, altering, main-
 taining, strengthening, protecting, cleaning, dredging and deepening  of
 such  property;  provided that the commissioner may designate parcels of
 waterfront property to be managed pursuant to this paragraph and  leased
 pursuant  to  paragraph  (g) of this subdivision, by the commissioner of
 general services and contracting, provided, any such designation  to  be
 made in writing and with approval of the mayor;
   (c)  to  have  power to enforce with respect to public markets, water-
 front property and any structures thereon under  its  jurisdiction,  the
 labor  law  and  other such laws, rules or regulations as may govern any
 such activities undertaken, as described in paragraph (b) of this subdi-
 vision, and to establish and amend fees to be charged for  the  issuance
 of such permits or certificates of completion;
   (d)  to  have power to regulate waterfront property and any structures
 on any waterfront property used in conjunction with commerce or  naviga-
 tion;
   (e) to have power to regulate the use of marginal streets so that they
 may be used to best advantage in connection with waterfront property and
 to  regulate  by license or otherwise the transfer of goods and merchan-
 dise upon, over or under such streets;
   (f) to lease, subject to council approval, any wharf property  belong-
 ing  to  the  city for purposes of commerce or in furtherance of naviga-
 tion;
   (g) to grant temporary permits, terminable at will, for a  period  not
 exceeding  three  years  for  purposes of commerce or navigation and not
 exceeding one year for other purposes;
   (h) to set aside by order any wharf property owned by the city,  which
 has not been leased, for general wharfage purposes or for a special kind
 of commerce and to revoke or modify such order at any time;
   (i)  to  regulate the charges for wharfage, cranage and dockage of all
 vessels or floating structures using any wharf property, such  rates  to
 be fixed by rules of the commissioner;
   (j) to sell, subject to the approval of the council, buildings, struc-
 tures and other improvements on market property to a person leasing such
 property;
   (k)  to  manage  and promote the economic development of all airports,
 airplane landing sites, seaplane bases and heliports owned by  the  city
 and  to  lease such property, provided that no such lease may be author-
 ized by the commissioner until a public hearing has been held and  after
 S. 8474                           1197
 
 publication  of notice in a newspaper of general circulation in the city
 at least thirty days prior to such hearing;
   (l)  to  have  charge and control of the regulation for the health and
 safety of the general public at all airports,  airplane  landing  sites,
 seaplane bases, heliports, marginal streets and parking facilities owned
 by the city;
   (m)  to establish, amend and enforce rules for the proper care and use
 of all public markets, wharf  property,  airports,  heliports,  airplane
 landing sites or seaplane bases; the violation or failure to comply with
 any  such  enforcement  order  shall  be  triable  in criminal court and
 punishable by not more than thirty days' imprisonment or a fine  of  not
 less  than  one  hundred dollars nor more than five thousand dollars, or
 both;
   (n) to have the  exclusive  power  to  regulate  all  privately  owned
 airports,  airplane  landing  sites,  seaplane  bases and heliports, the
 operations out of and into such bases, as well as the control of  ground
 effect craft;
   (o) to promote and encourage the expansion and development of the city
 as  a center for intrastate, interstate and international freight trans-
 portation; and
   (p) to administer and enforce the provisions of the joining resolution
 of the city in respect to any and all structures on waterfront  property
 used  in connection with the furtherance of waterfront commerce on navi-
 gation.
   3.  With respect to energy matters, the commissioner  shall  have  the
 power and duty:
   (a)  to  plan, formulate, coordinate and advance energy policy for the
 city;
   (b) to analyze the energy and fuel needs of the city with  respect  to
 all types of energy, to prepare intermediate and long-range plans, goals
 and  programs  designed  to  meet such needs and to establish priorities
 among them;
   (c) to develop,  implement  and  manage  energy-related  programs  for
 economic development and other purposes, including the administration of
 the  public utility service and to exercise all of the functions, powers
 and duties of such public utility service; and
   (d) to perform such other  responsibilities  with  respect  to  energy
 matters,  including  responsibilities  delegated  elsewhere  by the city
 charter, as the mayor shall direct.
   § 22-104 Waterfront plans. 1. No marginal street bulkhead line,  pier-
 head  line  or  other  similar line demarcating the extent of waterfront
 development may be delineated, established or changed by the commission-
 er except in accordance with the provisions of  the  city  charter.  The
 commissioner may apply to the department of city planning to incorporate
 such existing plans for the waterfront into the city map pursuant to the
 procedure for review and approval of a change to the city map.
   2.  The  commissioner may widen, open, construct, abandon or close any
 marginal street or avenue included in such waterfront  plans  and  shall
 maintain  the  widened portion of such street and the widened portion of
 such street shall not be a  public  street.  Before  acting  under  this
 subdivision,  the  commissioner shall make a report to the department of
 city planning including a map showing the proposed changes, but  if  the
 department  or, upon appeal of the action of the department, the appeals
 board does not approve such proposal then it must  be  approved  by  the
 council or the commissioner shall not proceed.
 S. 8474                           1198
 
   §  22-201  Division  of  economic  and financial opportunity. 1. There
 shall be a division of economic and  financial  opportunity  within  the
 department.
   2.  The  purpose  of  the  division shall be to enhance the ability of
 minority and women  owned  business  enterprises  to  compete  for  city
 contracts,  to  enhance city agencies' awareness of such enterprises and
 to ensure their participation in the city procurement process.
   3. In addition to the other purposes of this section, the division  of
 economic  and  financial  opportunity shall also administer any programs
 for small or locally-owned business enterprise programs as may be estab-
 lished by law.
   § 22-301 Division of labor services. 1. There shall be a  division  of
 labor services within the department and the commissioner shall adminis-
 ter  the  provisions  of  this section and enforce a citywide program to
 ensure that city contractors and subcontractors take appropriate  action
 to  ensure  that  women  and  minority  group members are afforded equal
 employment opportunities,  and  that  all  persons  are  protected  from
 discrimination  prohibited  under  the  provisions of federal, state and
 local laws regarding recruitment, employment, job assignment, promotion,
 upgrading, transfer, layoff, termination or rates of compensation.
   2. The commissioner shall also monitor compliance by contractors  with
 state and federal prevailing wage requirements.
   § 22-401 The city of Staten Island public utility service. The commis-
 sioner  or his or her designee shall serve as the director of the public
 utility service established by provisions of the code of  the  preceding
 municipality.
   § 22-402 Authorization for public utility service. Pursuant to article
 fourteen-A  of  the general municipal law, the city hereby establishes a
 public utility service, as such term is defined in section three hundred
 sixty of such article, which  is  authorized  to  establish,  construct,
 lease, purchase, own, acquire, use or operate facilities within or with-
 out the territorial limits of the city, for the purpose of furnishing to
 itself  or  for  compensation  to its inhabitants any service similar to
 that furnished by any public utility company specified in  article  four
 of  the public service law. For such purpose the city may purchase elec-
 trical and other forms of energy from the state, or from any state agen-
 cy, or other municipal corporation, or from any private or public corpo-
 ration, and  may  sell  or  distribute  such  power  to  itself  and  to
 residential,  commercial, industrial and other customers. The city shall
 possess any and all powers granted to a public utility service  pursuant
 to  article fourteen-A of the general municipal law and any other appli-
 cable provision of law.
   § 22-403   Acquisition  of  energy  and  facilities.  The  city  shall
 contract  for  or  otherwise  purchase or acquire hydroelectric or other
 forms of energy as shall be available from the power  authority  of  the
 state  of  New  York,  the  state, any state agency, any other municipal
 corporation, or any private or public corporation, and shall arrange  to
 use,  lease  or  acquire  the  transmission, substation and distribution
 facilities necessary to furnish such power to the city and, for  compen-
 sation,  to  residential,  commercial,  industrial  and other customers;
 provided, however, that the city will not acquire or build any  electric
 or gas transmission or distribution facilities which are parallel to, or
 duplicative  of  electric or gas transmission or distribution facilities
 of any utility companies within the city, nor take any action to  impair
 any agreements, franchises, rights or obligations of any utility company
 within  the  city  including,  to  provide  safe, adequate and efficient
 S. 8474                           1199
 
 service to conduct its business in the city and to  protect  its  assets
 unless so authorized by further local law and public referendum.
   §  22-404 Distribution and sale of energy. The city shall arrange with
 any utility companies for the distribution of energy  through  the  use,
 lease,  or  acquisition  of  transmission,  substation  and distribution
 facilities within the service areas  of  such  companies  and  for  such
 companies  to  act  on  behalf of the city for collection of charges for
 such energy within such service areas, or for the sale of energy to such
 companies for resale to customers  within  the  service  areas  of  such
 companies.
   §  22-405  Rates. The fixing of rates for furnishing hydroelectric and
 other forms of energy to residential, commercial, industrial  and  other
 customers shall include consideration of (1) the actual cost to the city
 for  the  purchase,  distribution  and  delivery  of such energy to such
 customers, (2) the actual expenses necessary for administration  of  the
 public utility service, including expenses for research and development,
 and  (3) any other costs or charges allowed under law, including but not
 limited to, losses of tax revenues resulting from the operation  of  the
 public  utility service. Such rates shall be computed to provide revenue
 in an amount not less than that necessary to recover  fully  such  costs
 and  expenses. Such rates shall be subject to approval of the city coun-
 cil.
   § 22-406 Municipal energy fund. Revenues received from  the  operation
 of  the  public utility service shall be paid into a fund to be known as
 the municipal energy fund.  The revenues paid into such fund  shall  not
 be revenues of the city, and payments from such fund shall be made with-
 out appropriation and shall not be included in the expense budget of the
 city. Nothing in this section shall prohibit the city from appropriating
 expense  or capital funds in connection with the public utility service,
 nor shall payments from the municipal energy fund to the general fund be
 prohibited.
   § 22-501 Bureau of ports and trade. There shall be a bureau  of  ports
 and trade within the department of economic development.
   § 22-502 Definitions. As used in this title:
   1.  "Director"  shall  mean  the  director  of the bureau of ports and
 trade.
   2. "Bureau" shall mean the bureau of ports and trade.
   § 22-503 Director. The head of the bureau shall  be  the  director  of
 ports and trade.
   §  22-504  Powers  and duties of the director. The director shall have
 the power and duty to:
   1. exercise the powers of a commissioner of public markets and a  city
 department of public markets under the agriculture and markets law;
   2.  have charge and control of the wharf property and waterfront prop-
 erty owned by the city to the extent permitted by state law;
   3. have power to regulate waterfront property and  the  structures  on
 the property such as wharves, piers, docks and bulkheads;
   4.  (a)  have  power to enforce, on waterfront property, the labor law
 and other such laws, rules and regulations as may govern dredging, fill-
 ing, removal, safety, maintenance, sanitary conditions, use and occupan-
 cy of such structures on  waterfront  property;  (b)  issue  permits  or
 certificates  of  completion  in reference thereto; and (c) establish or
 amend fees to be charged for the issuance of such permits with such fees
 to be established by rules of the director;
 S. 8474                           1200
 
   5. have power to regulate the use of marginal  streets  in  connection
 with  wharf property and to regulate by license any transfer of goods or
 merchandise on, over or under such marginal streets;
   6. enforce provisions of the zoning resolutions of the city in respect
 to  structures  used  in conjunction with waterfront commerce or naviga-
 tion;
   7. lease, subject to approval of or authorization by the city council,
 any wharf property belonging to the  city  for  purposes  of  waterfront
 commerce or in furtherance of navigation; leases shall be for such terms
 and contain such conditions as provided by law and leases may be sold at
 public auction;
   8.  grant  temporary  permits  to  use  and  occupy any wharf property
 belonging to the city, such permits not to exceed one year and to termi-
 nate at will;
   9. set aside by order any wharf property belonging to the city,  which
 has  not yet been leased, for any special kind of commerce, any class of
 vessel or for general wharfage purposes;
   10. regulate charges for wharfage, cranage and dockage of all  vessels
 or floating structures using any wharf property;
   11.  establish,  amend and enforce all necessary rules for proper care
 of all public markets, wharf property,  waterfront  property,  airports,
 airplane landing sites, seaplane bases and heliports owned by the city;
   12. sell, subject to approval of or authorization by the city council,
 buildings, structures and other improvements on market property or wharf
 property;
   13.  manage  and  promote  the  economic  development of all airports,
 airplane landing sites, seaplane bases and heliports owned by the city;
   14. have charge and control of the regulation for the health and safe-
 ty of the general public at all airports, airplane landing sites,  seap-
 lane bases, heliports, marginal streets and parking facilities appurten-
 ant thereto owned by city;
   15.  have  power  to  regulate  all privately owned airports, airplane
 landing sites and seaplane bases;
   16.  promote,  coordinate  and  implement  projects,  activities   and
 programs  designed  to attract foreign investment and overseas sales and
 to otherwise encourage the development, growth and expansion of interna-
 tional business, commerce and trade in the city; and
   17. administer and promote development of foreign trade zones  in  the
 city.
   §  22-505  Waterfront  plans. All plans for the waterfront of the city
 are continued in effect and may be changed by the director  pursuant  to
 the  procedure provided in this section.
   The  procedure  for review and approval of any change to the plans for
 the water front shall be the same as in the case of a change to the city
 map and the director may apply to the department  of  city  planning  to
 incorporate  plans  for  the  waterfront  pursuant  to the procedure for
 review and approval of a change to the city map.
   The director may widen, open, construct, abandon or close any marginal
 street or avenue included in any plans  for  changes  and  the  director
 shall  also  maintain such widened portion of such streets. The director
 may proceed with any proposed changes only if  the  department  of  city
 planning  approves  the change; however, if the department of city plan-
 ning does not approve, the director may  not  proceed  unless  the  city
 council authorizes, by a two-thirds vote, the director to proceed.
   The  department  of  city  planning shall act on such proposed changes
 within six weeks from the time of filing with  the  department  of  city
 S. 8474                           1201
 
 planning  and  if it does not act within the six weeks, the director may
 proceed with the changes.
 
                            Title 23 - Reserved
                    Title 24 - Environmental Protection
 
   § 24-101 Definitions. As used in this title:
   1.  "Commissioner"  shall  mean  the commissioner of the department of
 environmental protection.
   2. "Department" shall mean the department of environmental protection.
   § 24-102 Commissioner. 1. The head of the department of  environmental
 protection shall be the commissioner of environmental protection.
   2.  The  commissioner shall have the control of and be responsible for
 all those functions and operations of the city relating to (a) provision
 of adequate water supply; (b) disposal of sewage; (c) prevention of air,
 water and  noise  pollution;  (d)  response  to  emergencies  caused  by
 releases  or  threatened  releases  of  hazardous  substances;  and  (e)
 collection and management of information concerning the amount, location
 and nature of hazardous substances.
   § 24-103 Powers and duties of commissioner. The powers and  duties  of
 the commissioner shall include, without limitation, the following:
   1. Water resources control. (a) The commissioner shall have charge and
 control, including the power to examine, of (i) all structures and prop-
 erty connected with the supply and distribution of water for public use,
 including  all fire hydrants and water meters; (ii) furnishing the water
 supply and maintaining its quality, including ample  reserve  contingen-
 cies  for  future demand; and (iii) making and enforcing rules and regu-
 lations governing and restricting use of water supply.
   (b) The commissioner may  examine  any  sources  of  water  supply  of
 private  companies  supplying  any  portion of the city and may exercise
 superintendence, regulation and control in respect thereof.
   (c) The commissioner shall regulate and control emissions  into  water
 of  harmful or objectionable substances,  contaminants or pollutants and
 shall enforce all laws and regulations with respect to such emissions.
   (d) The commissioner may make investigations and studies as  necessary
 for  purpose  of enforcement, control or elimination of pollution of the
 waters and, for such purpose, may compel witnesses and take their testi-
 mony under oath.
   2. Sewage control. The commissioner shall have charge and control over
 location, construction, alteration, repair, maintenance and operation of
 all public and private sewers, intercepting sewers, disposal plants  and
 drainage systems.
   The  commissioner  may adopt regulations with regard to the  discharge
 of sewage, refuse, factory waste and trade waste into the public  sewers
 for  such  discharge.  The  commissioner  may also restrict, regulate or
 prohibit the use of public sewers for such discharge and  may  prescribe
 civil penalties for the violation thereof.
   3.  Air resources control. The commissioner shall regulate and control
 the emission into the open air of harmful or  objectionable  substances,
 including  but not limited to, smoke, soot, dust, fumes, ash, gas vapors
 and any products of combustion resulting from any  fuel  burning  equip-
 ment.
   The  commissioner  shall  enforce all laws, rules and regulations with
 respect to such emissions. The commissioner  shall  make  investigations
 and  studies  as necessary for controlling and eliminating air pollution
 and may compel witnesses and take their testimony under oath.
 S. 8474                           1202
 
   4. Noise pollution control. The commissioner shall enforce  all  laws,
 rules  and  regulations  to  eliminate noise pollution. The commissioner
 shall make investigations, compel witnesses  and  take  their  testimony
 under oath for such purposes.
   The commissioner shall also undertake studies to determine permissible
 sound levels and shall correct problems related to noise control.
   5. Environmental consequences. The commissioner may review and comment
 upon  the  environmental  consequences  of any activity that may have an
 impact on the physical aspects of the environment and may be responsible
 for investigating, evaluating and reporting such activities  related  to
 fuel  supply  and  demand,  alternative  sources  of energy and resource
 recovery.
   6. Energy. The commissioner shall have the power and duty of formulat-
 ing an energy policy for the city.
   The commissioner shall analyze the needs of the city  with  regard  to
 all  kinds  of  energy  and  fuel  needs. The commissioner shall prepare
 intermediate and long range plans,  goals  and  programs  to  meet  such
 needs.  The  commissioner  shall also study, organize, promote and carry
 out activities and  programs  designed  to  encourage  fuel  and  energy
 conservation.
   7.  Emergency response. The commissioner shall (a) respond to emergen-
 cies caused by releases of hazardous substances  into  the  environment;
 (b)  take  measures  to  protect  the  public health or welfare; and (c)
 recover costs of such response measures from the responsible persons.
   8. Community right-to-know.  The commissioner shall (a) have the power
 to collect, compile and manage  information  concerning  the  nature  of
 hazardous  substances present in the city, and (b) make such information
 available to the public and to city personnel responsible for responding
 to hazardous substance emergencies.
   § 24-104 Environmental control board. 1. There  shall  be  within  the
 department  an  environmental  control  board,  the chairperson of which
 shall be the commissioner,  consisting  of  the  commissioners  of  such
 departments as the mayor and council shall determine.
   2. The environmental control board may adopt and amend regulations not
 inconsistent  with  any  provision  of law with regard to (a) regulating
 emissions or pollutants into the air or waters from any  land  or  water
 sources,   and   (b)  regulating  or  prohibiting  the  installation  or
 construction of any equipment giving forth such emissions or pollutants.
   3. The board, concurrent with the jurisdiction of the criminal  courts
 of the city, shall enforce the provisions of the city charter, this code
 and  the code of the preceding municipality which relate to (a) cleanli-
 ness of the streets; (b) disposal of wastes; (c) provision of  adequate,
 pure  supply of water; (d) prevention of air, water and noise pollution;
 (e) regulation of street peddling; (f) prevention of fire and danger  to
 life  as  designated  by  the  fire  commissioner;  (g) construction and
 inspection of structures of the  city for sanitary  conditions,  safety,
 occupancy  and  as designated by the buildings and real property commis-
 sioner; (h) response to  emergencies  caused  by  release  of  hazardous
 substances;  and (i) reporting of all information with regard to amount,
 labeling and location of all hazardous substances.
   4. The board shall have concurrent  jurisdiction  with  the  board  of
 health  to  enforce  provisions  of  the  health code which the board of
 health shall designate.
   § 24-105 Proceedings for violations. The environmental  control  board
 shall  conduct  proceedings  for  the  adjudication of violations of the
 laws, rules and regulations enforced by the board.
 S. 8474                           1203
 
   The form and wording of notices of violation shall  be  prescribed  by
 the  board.  Notices  shall  contain  information   advising the persons
 charged with the manner and the time in which such person has  to  admit
 or  deny the charges. The notice shall also contain a warning that fail-
 ure to plead in the time stated may result in a default decision entered
 against  such  person, or failure to plead may be deemed an admission of
 liability and shall be grounds for imposing a maximum penalty.
   A judgment entered by the board pursuant to this section shall  remain
 in full force and effect for eight years.
   The  board  may not enter any final decision or order pursuant to this
 section unless the notice of violation shall have  been  served  in  the
 manner as is prescribed for service of process by the civil practice law
 and rules, with certain exceptions.
 
                            Title 25 - Reserved
        Title 26 - Housing, Buildings, Construction and Maintenance
 
   § 26-101 Definitions. As used in this title:
   1.  "Commissioner"  shall  mean  the commissioner of the department of
 buildings and real property.
   2. "Department" shall mean the department of buildings and real  prop-
 erty.
   3.  "Class"  refers to the classification of buildings in the building
 code or other applicable laws and shall also refer to the terms  "class"
 or "kinds" as used in the multiple dwelling law.
   4.  "Division"  shall  mean  the  division of housing preservation and
 development.
   § 26-102 Commissioner. The head of the department shall be the commis-
 sioner of buildings and real property.
   § 26-103 Department functions.  The  department  shall  enforce,  with
 respect  to  buildings  and structures, the building code, zoning resol-
 utions, multiple dwelling law, labor law and  other regulations that may
 govern the construction, alteration, maintenance, use, occupancy,  safe-
 ty,  sanitary conditions or inspection of buildings or structures in the
 city.
   The department shall perform the  functions  of  the  city  of  Staten
 Island relating to:
   1. necessary legal action regarding designation of unsafe buildings or
 structures and the removal or remedy thereof by demolition or sealing;
   2. the shoring of unsafe buildings or structures;
   3.  testing  and  approval  of  all power-operated cranes, derricks or
 other hoisting equipment used to raise and lower articles on the outside
 of buildings, not to include cranes  and  derricks  used  in  industrial
 plants or yards;
   4.  location,  construction,  alteration  and removal of signs, either
 illuminated or non-illuminated, attached to the exterior of  any  build-
 ings;
   5.  all  surface  and  sub-surface  construction  within the curbline,
 driveways and entrances thereto and the issuance of permits in reference
 thereto;
   6. regulation, testing and inspection of gas and electricity used  for
 light,  heat  or  power purposes and all electric, gas and steam meters,
 electric wires and lights furnished for the city; and
   7. regulation, inspection and testing of  wiring  and  appliances  for
 light,  heat  and  power in or on any building or structure in the city,
 except that the jurisdiction of  the  department  shall  not  extend  to
 S. 8474                           1204

 waterfront  property;  which  property and structures shall be under the
 jurisdiction of the department of ports and trade.
   §  26-104  Powers  and  duties. 1. There shall be a main office of the
 department.
   2. Persons appointed as inspectors to perform functions of the depart-
 ment shall have such qualifications as prescribed by  the  commissioner;
 however, such qualifications shall include:
   (a)  a  minimum  of  five  years  experience working at a construction
 trade;
   (b) a license as a professional engineer or architect issued  pursuant
 to the education law;
   (c)  a  minimum  of  three  years experience working at a construction
 trade and a minimum of two  years  formal  training  in  a  construction
 program in a college, technical college or trade school; or
   (d)  a minimum of two years experience working at a construction trade
 or a minimum two years formal education in a construction program  in  a
 college,  trade or technical school and a minimum of three years partic-
 ipation in an apprentice inspection program approved by the commissioner
 and personnel director.
   3. The commissioner shall have the following powers and  duties,  with
 respect to buildings and structures:
   (a) to examine, approve or disapprove construction or alteration plans
 for  any  building  or  structure  and  to direct the inspection of such
 building or structure;
   (b) to require that the construction or alteration  of  any  building,
 including the installation or alteration of any service equipment there-
 in,  shall  be in accordance with the provisions of laws and regulations
 applicable thereto; and
   (c) to issue certificates of occupancy for any building  or  structure
 in the city, provided that:
   (i)  no  building or structure may be occupied or used until a certif-
 icate of occupancy has been issued;
   (ii) if a building or structure for which a certificate  of  occupancy
 has  not  previously  been required or issued shall be altered in such a
 way as to now require a certificate, the building may not  be  used  for
 any purpose until such certificate is issued;
   (iii)  no  buildings  altered  or  converted from one class to another
 shall be occupied until a certificate has been  issued;  and,  in  cases
 where  the  alteration  did  not  necessitate  the total vacating of the
 building, the certificate must be  issued  within  thirty  days  of  the
 completion of such work or the occupancy of the building may not contin-
 ue;
   (iv)  the  certificate  of  occupancy of a building or structure shall
 certify that such structure conforms to requirements of all laws,  rules
 and  regulations  applicable  thereto.    Every certificate of occupancy
 shall be binding and remain binding and conclusive upon all agencies and
 officers of the city, unless vacated or modified by a court of competent
 jurisdiction or a board of appeals, and upon the department of labor  of
 the state of New York;
   (v)  the  commissioner  may issue a temporary certificate of occupancy
 for any part of a building, provided that such temporary use or occupan-
 cy does not jeopardize life or property;
   (vi) the commissioner may, in specific cases, permit  experimental  or
 demonstration  construction  to  obtain  knowledge  and information; the
 commissioner may also submit reports on results thereof to  the  depart-
 ment of buildings and real property; and
 S. 8474                           1205

   (vii)  the  commissioner  shall  have  the  power  and duty to conduct
 inquiries to assist him or her in his or  her  department  duties  where
 public  safety  is  involved  and he or she shall have subpoena power to
 compel witnesses, administer oaths,  and  compel  production  of  books,
 papers and documents.
   All  certificates  of occupancy in effect on the date of establishment
 are continued.
   § 26-105 Appeals. Appeals may be  taken  from  the  decisions  of  the
 commissioner  to  a three person board of appeals to be appointed by the
 mayor; one of whom shall be an architect and one  of  whom  shall  be  a
 professional engineer.
   §  26-106  Inspection. The commissioner, or any officer of the depart-
 ment authorized in writing by the commissioner, may  enter  and  inspect
 any  building,  structure,  enclosure,  premises  or any part thereof or
 anything attached thereto.
   Any refusal to permit such entry or inspection shall be a  misdemeanor
 triable  in  criminal court and punishable, upon conviction, of not more
 than thirty days imprisonment, a fine  of  not  more  than  one  hundred
 dollars, or both.
   § 26-107 Public buildings and facilities. The department shall:
   1.  have  charge and control over the plans and specifications for and
 the construction of all buildings and facilities paid for in whole or in
 part from the city treasury;
   2. manage, alter,  rejoin,  operate,  maintain  and  clean  buildings,
 facilities  and  offices  leased or occupied for public use by more than
 one city agency whose management, alteration, repair, operation, mainte-
 nance or cleaning is paid for in whole or in part from the  city  treas-
 ury, and as directed by the mayor, to perform services in space occupied
 for public use by a single city agency;
   3.  except for the provisions of title five of the code of the preced-
 ing municipality,  employ,  when  in  the  commissioner's  opinion  such
 services  are  necessary  or desirable, qualified consultants in private
 practice to aid the commissioner in carrying out his or her  duties  and
 responsibilities  with  respect  to public buildings or facilities; such
 consulting or advisory services shall be performed under the supervision
 of the commissioner;
   4. consult with the agencies for whose use the buildings or structures
 are intended in preparing and considering plans and  specifications  and
 in  carrying  out  such  plans  and  specifications, and to consider any
 recommendations made by such agency.
   Notwithstanding the provisions of this section, the  exercise  of  the
 powers  and duties set forth herein shall be subject to the jurisdiction
 of any city agency performing urban renewal and public and publicly-aid-
 ed housing functions to the extent, and in such areas,  as  directed  by
 the mayor;
   5.  exercise  and  perform  such  other  powers  and  duties as may be
 prescribed by law or delegated to him or her in relation  to  laboratory
 testing of commodities and construction materials.
   § 26-108 Real property. The department, with respect to real property,
 shall have power to:
   1. purchase, lease, condemn or otherwise acquire real property for the
 city,  subject  to  the joint approval or authorization of the mayor and
 the council, and to sell, lease, exchange or otherwise dispose  of  real
 property  of the city, subject to the joint approval or authorization of
 the mayor and the council;
 S. 8474                           1206
 
   2. assign and reallocate to city  agencies  space  and  real  property
 owned  or  leased by the city, to establish comprehensive and continuing
 programs and standards for utilization of space owned or leased  by  the
 city and to conduct surveys of space utilization;
   3.  manage all real property of the city not used for public purposes,
 including real property required for a  public  purpose  and  not  being
 currently  utilized  for  such purpose, except wharf property; provided,
 that the commissioner shall be responsible for the  management,  leasing
 or  permitting of any parcels of wharf property and water front property
 as provided in any designation made  by  the  commissioner  of  economic
 development;
   4.  exercise  and  perform  such  other  powers  and  duties as may be
 prescribed by law or delegated to the commissioner in  relation  to  the
 acquisition,  disposition, management, site selection, assignment, demo-
 lition or other treatment of real property of the city;
   5. employ, where desirable, managing agents to manage city  properties
 and collect rents and pay bills; and
   6.  keep, maintain and annually update a master list of leases wherein
 the city or its agencies is a tenant.
   § 26-109 Building code. The building code which is  in  force  in  the
 preceding municipality on the date and time when this title takes effect
 and  all  existing  provisions of the building code, including penalties
 affixed for violations, shall continue to be binding and in full  force,
 except as amended from time to time by the city of Staten Island.
   A copy of such code shall be on file in the office of the city clerk.
   § 26-201 Division of housing preservation and development. There shall
 be a division of housing preservation and development within the depart-
 ment.
   §  26-202  Powers  and  duties of the division. The division is vested
 with:
   1. all functions of the city relating to the  rehabilitation,  mainte-
 nance, alteration and improvement of residential buildings and privately
 owned  housing,  pursuant  to  various  articles  of the private housing
 finance law;  acting as liaison with the New  York  city  rehabilitation
 mortgage  insurance  corporation;  the execution of emergency repairs to
 and the sealing, removal and demolition  of  buildings,  structures  and
 private  housing and the enforcement of the applicable provisions of the
 multiple dwelling law or others laws relating to the  maintenance,  use,
 occupancy,  safety  or sanitary condition of any building which is occu-
 pied, or intended to be occupied,  as  a  home,  residence  or  dwelling
 place;
   2.  functions  and duties with respect to the relocation of tenants of
 real property and the selection of tenants for publicly owned or public-
 ly aided housing;
   3. all functions and duties of the city as related to slum  clearance,
 slum  prevention and urban renewal, neighborhood conservation, rehabili-
 tation and prevention of blighted, deteriorated or unsanitary areas, and
 public housing, including regulation of  rents  in  housing  built  with
 state or local financing; and
   4. functions, rights and powers granted to or delegated to the housing
 and  redevelopment board, the housing and development administration and
 the New York city housing authority.
   § 26-203 Housing  preservation  and  development;  commissioner.  With
 respect  to matters of housing preservation and development. The commis-
 sioner shall:
 S. 8474                           1207
 
   1. have the power to establish and  administer  programs  designed  to
 encourage the rehabilitation and preservation of existing housing;
   2.  administer  laws  authorizing  tax  exemption or tax abatement and
 process applications for such  abatements  and  exemptions  pursuant  to
 provisions of this code;
   3.  manage  and superintend all real property acquired by the city for
 housing and urban renewal purposes;
   4. represent the city in carrying out the provisions  of  the  private
 housing  finance law and act as the "supervising agency" pursuant to the
 private housing finance law;
   5. represent the city in carrying out the provisions  of  the  general
 municipal law, including acquiring, leasing or disposing of real proper-
 ty;
   6.  undertake  projects and exercise rights, powers, and privileges of
 the applicable public housing law;
   7. impose and collect charges  and  fees  for  financing,  regulation,
 supervision  and  audit of municipality-aided projects and loan programs
 administered by the commissioner, with such moneys to be set aside in an
 account for administrative expenses for the department;
   8. acquire real property on behalf of other city agencies;
   9. sell, lease, exchange or dispose of residential  real  property  of
 the  city,  provided  that  no such sale shall be authorized without the
 mayor's and council's approval and until a public hearing has been  held
 and public notice given;
   10.  manage  and superintend all residential real property of the city
 not used for public purposes. The provisions of this subdivision are not
 applicable to wharf property, real property under  jurisdiction  of  the
 Metropolitan  Transportation  Authority  or  the jurisdiction of the New
 York city housing authority or the jurisdiction of the Triborough Bridge
 and Tunnel Authority;
   11. manage, demolish, seal or otherwise treat residential real proper-
 ty as necessary; and
   12. employ professional community and other personnel to manage  resi-
 dential real property.
   §  26-204  Inspection. 1. Inspections. A housing maintenance inspector
 shall have such  qualifications  as  prescribed  by  the  department  of
 personnel after consultation with the commissioner.
   2.  Entry. The commissioner or any inspector may enter and inspect any
 building, structure,  enclosure,  premises,  or  any  part  thereof  and
 refusal  to  permit  such  inspection  shall be a misdemeanor triable in
 criminal court, punishable by not more than thirty days imprisonment  or
 a fine of not more than one hundred dollars or both.
   §  26-205 Acquisitions of real property. No purchase, lease, condemna-
 tion or acquisition of real property shall be  authorized  until  (i)  a
 public  hearing  has  been  held,  and  (ii)  the  department shall have
 received the joint approval or authorization of the mayor and the  coun-
 cil.
   In  the  case of acquisition by purchase or condemnation, a hearing as
 described above shall not be required if a  public  hearing  is  already
 being  held with respect to such purchase pursuant to any other require-
 ment of law.
 
                   Title 27 - Health and Mental Hygiene

   § 27-101 Definitions. As used in this title:
 S. 8474                           1208
 
   1. "Commissioner" shall mean the commissioner  of  the  department  of
 health and mental hygiene.
   2.  "Department"  shall  mean  the  department  of  health  and mental
 hygiene.
   § 27-102 Powers and duties of  commissioner.  The  commissioner  shall
 have  the  powers  and  duties of the department which shall include but
 shall not be limited to:
   1. Determining the needs of the mentally disabled in the  city,  which
 determination  shall  include  the  review  and evaluation of all mental
 hygiene services and facilities within the commissioner's jurisdiction;
   2. Engaging in short-range, intermediate-range and  long-range  mental
 hygiene planning;
   3.  Developing  and  submitting to the mayor and council a program for
 the delivery of services for  the  developmentally  disabled,  including
 construction and operation of facilities;
   4.  Arranging  with  the  approval  of the mayor, for the rendition of
 services and operation of facilities by other agencies of the city;
   5. Within the amounts appropriated therefor, entering  into  contracts
 for the rendition or operation of services and facilities on a per capi-
 ta basis or otherwise;
   6.  Within  the amounts appropriated therefor, executing such programs
 and maintaining such facilities as may be authorized under  such  appro-
 priations;
   7.  Using  the  services and facilities of public or private voluntary
 institutions  whenever  practical,  and  encouraging  all  providers  of
 services  to  cooperate  with  or participate in the program, whether by
 contract or otherwise;
   8. Implementing and administering an inclusive citywide planning proc-
 ess for the delivery  of  services  for  the  developmentally  disabled;
 consistent  with  applicable law, standards and procedures for community
 participation at the local community level;
   9. Encouraging the development  and  expansion  of  programs  for  the
 prevention,  diagnosis, care, treatment, social and vocational rehabili-
 tation, special education and training of the  developmentally  disabled
 and for public education or developmental disability;
   10.  Establishing  coordination and cooperation among all providers of
 services, coordinating the department's program with the program of  the
 state department of mental hygiene so that there is a continuity of care
 among  all  providers  of  services;  and seeking to cooperate by mutual
 agreement with the state department of mental hygiene and  their  repre-
 sentatives  in  preadmission  screening  and  in  post-hospital  care of
 persons suffering from developmental disability;
   11. Making policy and planning for, monitoring, evaluating  and  exer-
 cising  general  supervision  over  all  services and facilities for the
 developmentally disabled within  the  commissioner's  jurisdiction;  and
 exercising  general  supervisory  authority  through the promulgation of
 appropriate standards consistent with  accepted  professional  practices
 for care and treatment of patients;
   12. To the extent necessary, when not inconsistent with any other law,
 arranging  for  the  visitation,  inspection  and  investigation  of all
 providers of services, by the department or otherwise;
   13. Conducting such inquiries as may  be  useful,  including  investi-
 gations into individual patient care, in performing the functions of the
 department  and  for  such  purpose the commissioner shall have subpoena
 power to compel the attendance of witnesses, to administer oaths and  to
 compel the production of books, papers and documents and consistent with
 S. 8474                           1209
 
 the  provisions  of  the  mental hygiene law, having access to otherwise
 confidential patient records, provided  such  information  is  requested
 pursuant  to the functions, powers and duties conferred upon the commis-
 sioner by law;
   14.  Submitting  all  materials required by the mental hygiene law for
 purposes of state reimbursement;
   15. Serving as a member of such state or federally authorized  commit-
 tees  as may be appropriate to the discharge of the commissioner's func-
 tions;
   16. Performing such other acts as may be necessary and proper to carry
 out the provisions of this title and the purposes of the mental  hygiene
 law;
   17.  Develop,  promote,  provide,  coordinate  and  evaluate addiction
 programs for the prevention of addiction, treatment  and  rehabilitation
 for  persons addicted to narcotics and other dangerous drugs, including,
 but not limited to, the following functions:
   (a) participate in cooperative efforts of federal, state, regional and
 city agencies and programs dealing with the  problems  of  addiction  to
 narcotics and other dangerous drugs;
   (b)  evaluate  present  and  proposed  research designs, demonstration
 projects, treatment and service programs and other requests  related  to
 such  prevention and care, before public funds are made available there-
 for;
   (c) promote or provide research and demonstration projects designed to
 obtain information relating to  the  prevention  of  addiction  and  the
 related  treatment  provided  to  drug  addicts  by  public or voluntary
 private agencies supported by city funds;
   (d) promote or  provide  an  educational  and  prevention  program  to
 acquaint the public with the problems of addiction;
   (e)  promote  or  provide  treatment  agents  for  persons addicted to
 narcotics, including, but not limited to, drug free programs, chemother-
 apeutic programs and a school based drug prevention program;
   (f) annually report to the city council, by  March  first  as  of  the
 preceding  December  thirty-first,  on  all treatment agents promoted or
 provided during the year and proposed to be provided or promoted  during
 the current year, with particular attention given to the balance between
 the treatment agents and their relative effectiveness; and
   (g)  promote  or  provide  training  programs for persons in public or
 voluntary private agencies and institutions engaged in  the  prevention,
 treatment and rehabilitation of persons addicted to narcotics.
   §  27-103 Functions of the department. Except as otherwise provided by
 this title and law, the department shall perform all those functions and
 operations that relate to health and mental hygiene related needs of the
 people of the city.
   § 27-104 Construction clause. The provisions of this  title  shall  be
 carried  out  subject  to  and in conjunction with the provisions of the
 mental hygiene law.
   § 15-001. The sum of six million  dollars  ($6,000,000),  or  so  much
 thereof as may be necessary, is hereby appropriated as an advance out of
 any  moneys  in  the  general fund to the credit of the local assistance
 account not otherwise appropriated and shall be made immediately  avail-
 able, for the expenses of the city of Staten Island, in carrying out the
 provisions  of this act relating to the transition government and estab-
 lishment of such city. Notwithstanding any provision of law such  moneys
 shall be payable on the audit and warrant of the comptroller on vouchers
 certified  or  approved  in  the  manner prescribed by law. Such advance
 S. 8474                           1210
 
 shall be repaid from funds which shall be withheld by  the  state  comp-
 troller  in  equal payments over a period of five years out of the first
 moneys available for the next succeeding payments of  state  aid  appor-
 tioned to the city of Staten Island as per capita aid for the support of
 local government pursuant to section 54 of the state finance law.
   §  15-002.  The  sum  of  one million dollars ($1,000,000), or so much
 thereof as may be necessary, is hereby appropriated as an advance out of
 any moneys in the general fund to the credit  of  the  local  assistance
 account  not otherwise appropriated and shall be made immediately avail-
 able, for the expenses of the city school district of the city of Staten
 Island, in carrying out the provisions  of  this  act  relating  to  the
 establishment of the city school district of such city.  Notwithstanding
 any  provision  of  law  such  moneys  shall be payable on the audit and
 warrant of the comptroller on vouchers  certified  or  approved  in  the
 manner  prescribed by law. Such advance shall be repaid from funds which
 shall be withheld by the state comptroller  in  equal  payments  over  a
 period  of  five  years  out  of the first moneys available for the next
 succeeding payments of education aid apportioned to the city  of  Staten
 Island as aid for the support of education.
   § 16-001. Severability. The provisions of this act shall be severable,
 and  if the application of any clause, sentence, paragraph, subdivision,
 section or part of this act to  any  person  or  circumstance  shall  be
 adjudged  by  any  court  of  competent jurisdiction to be invalid, such
 judgment shall not necessarily affect, impair or invalidate the applica-
 tion of any such clause, sentence, paragraph, subdivision, section, part
 of this act or remainder thereof, as the  case  may  be,  to  any  other
 person  or  circumstance,  but shall be confined in its operation to the
 clause,  sentence,  paragraph,  subdivision,  section  or  part  thereof
 directly  involved  in the controversy in which such judgment shall have
 been rendered.
   § 17-001. This act shall take effect immediately;  provided,  however,
 that:
   (a) the provisions of sections 7-009, 7-010, 13-001, 15-001 and 15-002
 of  this  act  shall take effect on the first of January next succeeding
 the date on which it shall have become a law;
   (b) the provisions of sections  7-001  through  7-008,  8-001  through
 8-024,  9-001 through 9-012, 9-050 through 9-053, 10-001 through 10-008,
 11-001, 12-001 through 12-020 and 14-001 of this act shall  take  effect
 on  the  first  of  July  in the second year next succeeding the date on
 which it shall have become a law;
   (b-1) the amendments made to subdivisions 8 and 14 of section 2554  of
 the education law by sections 4-007 and 4-008 of this act, respectively,
 shall   take effect upon the revival of such subdivisions as provided in
 section 34 of chapter 91 of the laws of 2002, as amended;
   (c) provided that the amendments to paragraphs  (a),  (b),  (c),  (d),
 (e),  and (f) of subdivision 2 of section 209 of the social services law
 made by section 8-021 of this act shall take effect on the same date and
 same manner as section 2 of part Z of chapter 56 of the  laws  of  2023,
 takes effect;
   (d) the amendments to the second undesignated paragraph of subdivision
 4  of section 246 of the executive law made by section 8-004 of this act
 shall be subject to the  expiration  and  reversion  of  such  paragraph
 pursuant to subdivision (aa) of section 427 of chapter 55 of the laws of
 1992,  as amended, when upon such date the provisions of section 8-004-a
 of this act shall take effect; and
 S. 8474                           1211
 
   (e) provided that the amendments made to sections 257-c, 262, 266  and
 267  of the executive law made by sections 8-007, 8-008, 8-009 and 8-010
 of this act shall not affect the expiration or repeal of  such  sections
 and shall be deemed expired and repealed therewith.