Bill Text: NY S05864 | 2019-2020 | General Assembly | Amended


Bill Title: Provides a television writers' and directors' fees and salaries credit; provides that to be eligible the writer or director is a minority group member, or a woman, and provides, further, that any writer or director who is a profit participant in the qualified production shall not be eligible.

Spectrum: Partisan Bill (Democrat 14-0)

Status: (Engrossed) 2019-06-20 - returned to senate [S05864 Detail]

Download: New_York-2019-S05864-Amended.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                         5864--A

                               2019-2020 Regular Sessions

                    IN SENATE

                                      May 15, 2019
                                       ___________

        Introduced by Sens. JACKSON, RAMOS, BAILEY, BENJAMIN, BIAGGI, GOUNARDES,
          KAPLAN,  KENNEDY,  MAY, MYRIE, PERSAUD, SALAZAR, SANDERS, SEPULVEDA --
          read twice and ordered printed, and when printed to  be  committed  to
          the Committee on Investigations and Government Operations -- committee
          discharged, bill amended, ordered reprinted as amended and recommitted
          to said committee

        AN  ACT  to  amend the tax law, in relation to a television writers' and
          directors' fees and salaries credit

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section 1. The tax law is amended by adding a new section 24-b to read
     2  as follows:
     3    §  24-b.  Television writers' and directors' fees and salaries credit.
     4  (a)(1) A taxpayer which is a qualified film  production  company,  or  a
     5  qualified  independent  film  production  company,  or  which  is a sole
     6  proprietor of or a member of a partnership which  is  a  qualified  film
     7  production  company  or a qualified independent film production company,
     8  and which is subject to tax under articles nine-A or twenty-two of  this
     9  chapter,  shall  be  allowed  a credit against such tax, pursuant to the
    10  provisions referenced in subdivision (c) of this section, to be computed
    11  as hereinafter provided.
    12    (2) The amount of the credit shall be the product (or pro  rata  share
    13  of  the  product,  in  the  case of a member of a partnership) of thirty
    14  percent and the qualified television writers' and  directors'  fees  and
    15  salaries  costs  paid or incurred in the production of a qualified film,
    16  provided that: (i) the credit amount shall  not  exceed  fifty  thousand
    17  dollars  for qualified television writers' and directors' fees and sala-
    18  ries claimed for such expenses incurred for the employment  of  any  one
    19  specific  writer  or  director for the production of a single television
    20  pilot or a single episode of a television series, and  (ii)  the  credit
    21  amount shall not exceed one hundred fifty thousand dollars for qualified
    22  television  writers'  and  directors' fees and salaries claimed for such
    23  expenses incurred for the employment  of  any  one  specific  writer  or

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD10593-04-9

        S. 5864--A                          2

     1  director.  The credit shall be allowed for the taxable year in which the
     2  production of such qualified film is completed.
     3    (3)  No qualified television writers' and directors' fees and salaries
     4  used by a taxpayer either as the basis for the allowance of  the  credit
     5  provided  for pursuant to this section or used in the calculation of the
     6  credit provided pursuant to this section shall be used by such  taxpayer
     7  to claim any other credit allowed pursuant to this chapter.
     8    (b)  Definitions.  As  used in this section, the following terms shall
     9  have the following meanings:
    10    (1) "Qualified film production company" is a corporation, partnership,
    11  limited partnership, or other entity or individual which or who is prin-
    12  cipally engaged in the production of a qualified film and  controls  the
    13  qualified film during production.
    14    (2)  "Qualified independent film production company" is a corporation,
    15  partnership, limited partnership, or other entity or individual, that or
    16  who (i) is principally engaged in the production  of  a  qualified  film
    17  with  a  maximum  budget  of  fifteen million dollars, (ii) controls the
    18  qualified film during production, and (iii) either  is  not  a  publicly
    19  traded  entity, or no more than five percent of the beneficial ownership
    20  of which is owned, directly or indirectly, by a publicly traded entity.
    21    (3) "Qualified film" means a television film, television pilot  and/or
    22  each  episode  of a television series, regardless of the medium by means
    23  of which the film, pilot or episode is created or conveyed.
    24    (4) "Qualified television writers' and directors' fees  and  salaries"
    25  means: (i) salaries or fees paid to a writer or director who receives an
    26  on-air  credit; (ii) for a non-credited writer, up to seventy-five thou-
    27  sand dollars in salaries or fees per series of episodes.  Provided  that
    28  in  each  case,  such  writer or director is a minority group member, as
    29  defined in subdivision eight of section three hundred ten of the  execu-
    30  tive  law, or a woman, and provided, further, that salaries or fees paid
    31  to any writer or director who is a profit participant in  the  qualified
    32  film shall not be eligible.
    33    (5)  "Writer"  means  a person who is: (i) engaged by a qualified film
    34  production company or a qualified independent film production company to
    35  write literary material (including making changes or revisions in liter-
    36  ary material), when the company has the right by contract to direct  the
    37  performance  of  personal services in writing or preparing such material
    38  or in making  revisions,  modifications  or  changes  therein;  or  (ii)
    39  engaged  by  the  company  and  who  performs services (at the company's
    40  direction or with its consent) in writing  or  preparing  such  literary
    41  material  or making revisions, modifications, or changes in such materi-
    42  al; and (iii) who reports to work regularly in a writers room located in
    43  the state.
    44    (6) "Literary material" shall be deemed to  include  stories,  adapta-
    45  tions,  treatments,  original treatments, scenarios, continuities, tele-
    46  plays, screenplays, dialogue, scripts, sketches, plots, outlines, narra-
    47  tive synopses, routines, narrations, and formats.
    48    (7) "Writers room" means a room or  physical  location  where  writers
    49  employed by a qualified film production company or qualified independent
    50  film production company write or revise literary materials utilized in a
    51  qualified film.
    52    (8)  "Director" means an individual employed or retained to direct the
    53  production, as the word "direct" is commonly used in the motion  picture
    54  industry,  and  who  would  be  classified as a director under the basic
    55  agreement in place between the Association of Motion Picture  and  Tele-

        S. 5864--A                          3

     1  vision  Producers and the Director's Guild of America and who is a resi-
     2  dent of New York.
     3    (9)  "Profit  participant"  is  an individual who has negotiated for a
     4  percentage of profits generated by  a  qualified  film.  Profit  partic-
     5  ipation  does  not include monies contractually required by collectively
     6  bargained agreements for reuse of a qualified film  on  different  plat-
     7  forms over time.
     8    (c)  Cross-references.  For  application of the credit provided for in
     9  this section, see the following provisions of this chapter:
    10    (1) article 9-A: section 210-B: subdivision 54.
    11    (2) article 22: section 606: subsection (v).
    12    (d) Notwithstanding any provision of this chapter, (1)  employees  and
    13  officers  of  the  department of economic development and the department
    14  shall be allowed and are directed  to  share  and  exchange  information
    15  regarding  the credits applied for, allowed, or claimed pursuant to this
    16  section and taxpayers who are applying for credits or who  are  claiming
    17  credits, including information contained in or derived from credit claim
    18  forms  submitted  to  the  department and applications for certification
    19  submitted to the department of economic development, and (2) the commis-
    20  sioner and the commissioner of the department  of  economic  development
    21  may release the names and addresses of any taxpayer claiming this credit
    22  and  the amount of the credit earned by the taxpayer. Provided, however,
    23  if a taxpayer claims this credit because it is a  member  of  a  limited
    24  liability  company  or  a  partner  in a partnership, only the amount of
    25  credit earned by the entity and not the amount of credit claimed by  the
    26  taxpayer may be released.
    27    (e) Maximum amount of credits. (1) The aggregate amount of tax credits
    28  allowed  under  this  section,  subdivision  fifty-four  of  section two
    29  hundred ten-B and subsection (v) of section  six  hundred  six  of  this
    30  chapter  in any calendar year shall be five million dollars. Such aggre-
    31  gate amount of credits shall be allocated by the department of  economic
    32  development  among taxpayers in order of priority based upon the date of
    33  filing an application for allocation of television writers'  and  direc-
    34  tors' fees and salaries credit with such department. If the total amount
    35  of  allocated  credits  applied  for  in any particular year exceeds the
    36  aggregate amount of  tax  credits  allowed  for  such  year  under  this
    37  section,  such excess shall be treated as having been applied for on the
    38  first day of the subsequent year.
    39    (2) The commissioner of economic development,  after  consulting  with
    40  the  commissioner, shall promulgate regulations by October thirty-first,
    41  two thousand nineteen to establish procedures for the allocation of  tax
    42  credits  as  required by subdivision (a) of this section. Such rules and
    43  regulations shall include provisions describing the application process,
    44  the due dates for such applications, the standards which shall  be  used
    45  to evaluate the applications, the documentation that will be provided to
    46  taxpayers  to  substantiate  to the department the amount of tax credits
    47  allocated to such taxpayers, and such other provisions as deemed  neces-
    48  sary  and  appropriate.  Notwithstanding  any  other  provisions  to the
    49  contrary in the state administrative procedure act, such rules and regu-
    50  lations may be adopted on an emergency basis if necessary to  meet  such
    51  October thirty-first, two thousand nineteen deadline.
    52    (f)  The department of economic development shall submit to the gover-
    53  nor, the temporary president of the  senate,  and  the  speaker  of  the
    54  assembly,  an  annual  report  to be submitted on February first of each
    55  year evaluating the effectiveness of the television writers' and  direc-
    56  tors' fees and salaries tax credit provided by this section in stimulat-

        S. 5864--A                          4

     1  ing  the  growth  of  diversity  in the film industry in the state. Such
     2  report shall include, but need not be limited to, the number  of  quali-
     3  fied   film  production  companies  and/or  qualified  independent  film
     4  production companies which received a television writers' and directors'
     5  fees  and  salaries credit, the credit amounts claimed by each qualified
     6  film production company and/or  qualified  independent  film  production
     7  company,  as  well  as  the  impact on employment and the economy of the
     8  state. Such report shall be based on data available from the application
     9  filed with the department of  economic  development  for  allocation  of
    10  television  writers' and directors' fees and salaries credits.  Notwith-
    11  standing any provision of law to the contrary, the information contained
    12  in the report shall be public information. The report may  also  include
    13  any  recommendations  of changes in the calculation or administration of
    14  the credit, and any other recommendation  of  the  commissioner  of  the
    15  department  of  economic  development regarding continuing modification,
    16  repeal of such act, and such other information regarding the act as  the
    17  commissioner  of  the department of economic development may feel useful
    18  and appropriate.
    19    § 2. Section 210-B of the tax law is amended by adding a new  subdivi-
    20  sion 54 to read as follows:
    21    54.  Television writers' and directors' fees and salaries credit.  (a)
    22  Allowance of credit. A taxpayer who  is  eligible  pursuant  to  section
    23  twenty-four-b  of  this chapter shall be allowed a credit to be computed
    24  as provided in such section against the tax imposed by this article.
    25    (b) Application of credit. The credit allowed under  this  subdivision
    26  for  any taxable year shall not reduce the tax due for such year to less
    27  than the amount prescribed  in  paragraph  (d)  of  subdivision  one  of
    28  section  two hundred ten of this article. Provided, however, that if the
    29  amount of the credit allowable under this subdivision  for  any  taxable
    30  year  reduces  the  tax to such amount or if the taxpayer otherwise pays
    31  tax based on the fixed dollar minimum amount, the excess shall be treat-
    32  ed as an overpayment of tax to be credited  or  refunded  in  accordance
    33  with  the provisions of section one thousand eighty-six of this chapter.
    34  Provided, further, the provisions of subsection (c) of section one thou-
    35  sand eighty-eight of this chapter notwithstanding, no interest shall  be
    36  paid thereon.
    37    §  3. Section 606 of the tax law is amended by adding a new subsection
    38  (v) to read as follows:
    39    (v) Television writers' and directors' fees and salaries credit.   (1)
    40  Allowance  of  credit.  A  taxpayer  who is eligible pursuant to section
    41  twenty-four-b of this chapter shall be allowed a credit to  be  computed
    42  as provided in such section against the tax imposed by this article.
    43    (2) Application of credit. If the amount of the credit allowable under
    44  this subsection for any taxable year exceeds the taxpayer's tax for such
    45  year, the excess shall be treated as an overpayment of tax to be credit-
    46  ed  or  refunded  as  provided in section six hundred eighty-six of this
    47  article, provided, however, that no interest shall be paid thereon.
    48    § 4. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
    49  of  the  tax  law  is  amended  by  adding a new clause (xlv) to read as
    50  follows:

    51  (xlv) Television writers'             Amount of credit for the sum of
    52  and directors' fees and salaries      qualified television writers' and
    53  credit under subsection (v)           directors' salaries credit
    54                                        under subdivision fifty-four of
    55                                        section two hundred ten-B

        S. 5864--A                          5

     1    § 5. Paragraph 4 of subdivision (e) of section 24 of the tax  law,  as
     2  amended  by  section 2 of part SSS of chapter 59 of the laws of 2019, is
     3  amended to read as follows:
     4    (4) Additional pool 2 - The aggregate amount of tax credits allowed in
     5  subdivision (a) of this section shall be increased by an additional four
     6  hundred twenty million dollars in each year starting in two thousand ten
     7  through two thousand twenty-four provided however, seven million dollars
     8  of  the  annual  allocation shall be available for the empire state film
     9  post production credit pursuant to section thirty-one of this article in
    10  two thousand thirteen  and  two  thousand  fourteen  [and],  twenty-five
    11  million  dollars  of  the  annual  allocation shall be available for the
    12  empire state film post production credit pursuant to section  thirty-one
    13  of  this  article  in each year starting in two thousand fifteen through
    14  two thousand twenty-four and five million dollars of  the  annual  allo-
    15  cation  shall  be  made available for the television writers' and direc-
    16  tors' fees and salaries credit pursuant to section twenty-four-b of this
    17  article in each year starting in two thousand twenty through  two  thou-
    18  sand  twenty-four.  This  amount  shall  be  allocated by the governor's
    19  office for motion picture and television development among taxpayers  in
    20  accordance  with subdivision (a) of this section. If the commissioner of
    21  economic development determines that the aggregate amount of tax credits
    22  available from additional pool 2 for the empire  state  film  production
    23  tax credit have been previously allocated, and determines that the pend-
    24  ing applications from eligible applicants for the empire state film post
    25  production  tax credit pursuant to section thirty-one of this article is
    26  insufficient to utilize the balance of  unallocated  empire  state  film
    27  post  production  tax  credits from such pool, the remainder, after such
    28  pending applications are considered, shall be made available  for  allo-
    29  cation  in  the  empire  state film tax credit pursuant to this section,
    30  subdivision twenty of section two hundred ten-B and subsection  (gg)  of
    31  section  six  hundred  six of this chapter. Also, if the commissioner of
    32  economic development determines that the aggregate amount of tax credits
    33  available from  additional  pool  2  for  the  empire  state  film  post
    34  production  tax  credit  have  been previously allocated, and determines
    35  that the pending applications from eligible applicants  for  the  empire
    36  state  film  production  tax credit pursuant to this section is insuffi-
    37  cient to utilize the balance of unallocated film production tax  credits
    38  from  such  pool,  then all or part of the remainder, after such pending
    39  applications are considered, shall be made available for allocation  for
    40  the  empire  state film post production credit pursuant to this section,
    41  subdivision thirty-two of section two hundred ten-B and subsection  (qq)
    42  of  section  six  hundred six of this chapter. The governor's office for
    43  motion picture and television development must notify taxpayers of their
    44  allocation year and include the allocation year on  the  certificate  of
    45  tax  credit.  Taxpayers eligible to claim a credit must report the allo-
    46  cation year directly on their empire state film  production  credit  tax
    47  form for each year a credit is claimed and include a copy of the certif-
    48  icate  with  their  tax  return.  In  the  case of a qualified film that
    49  receives funds from additional pool 2, no empire state  film  production
    50  credit  shall  be  claimed  before  the  later  of  the taxable year the
    51  production of the qualified film is complete, or the taxable year  imme-
    52  diately  following the allocation year for which the film has been allo-
    53  cated credit by the governor's office for motion picture and  television
    54  development.
    55    §  6. This act shall take effect immediately, and shall apply to taxa-
    56  ble years beginning on or after January 1, 2020.
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