Establishes a real property tax abatement for the owners of land used for replanting or crop expansion of woody biomass for the production of ethanol

Title of bill

An act to amend the agriculture and markets law, in relation to establishing a real property tax abatement for the owners of land used for replanting or crop expansion of woody biomass for the production of ethanol or biodiesel, including willow

Purpose

To encourage greater production of cellulosic ethanol or biodiesel by establishing a real property tax abatement for the owners of land used for replanting or crop expansion of woody biomass for the production of ethanol or biodiesel, including but not limited to willow and grasses.

Summary of provisions

Section 1 adds a new subdivision 8 to section 305 of the agriculture and markets law to exempt from real property tax for three successive years following the date of replanting or crop expansion providing certain conditions are met: a) the land must be part of land used in agricultural production of wood y biomass for the production of ethanol or biodiesel within an agricultural district or must be part of land used in agricultural assessment pursuant to this section or section 306 of this article; b) the land shall not in anyone year exceed 20 percent of the total acreage of such land; c) the land must be maintained as land used in agricultural production of woody biomass for each year the exemption is granted. If the land is within an area which the governor has declared to be a disaster emergency in a year in which such tax exemption is sought and the land meets all other eligibility requirements, the maximum 20 percent total acreage restriction may be exceeded for that year and any remaining successive years.

Justification

In Chapter 62 of the laws of 2006, New York State established a biofuel production credit equal to 15 cents per gallon after the production of the first forty thousand gallons of biofuels. This legislation demonstrated New York State's commitment to mass production of biofuels. The legislation was also intended to support commercialization of new technologies developed at SUNY ESF, Cornell and Clarkson universities for production of cellulosic ethanol using different feedstocks, such as willow, northern hardwoods, and grasses.

Cellulosic ethanol has numerous benefits over ethanol produced from corn or sorghum. First, willows and northern hardwoods are well-suited to the climate of New York State. Therefore, New York State's existing natural resources are uniquely positioned to contribute to increased production of cellulosic ethanol. Second, the u.S. Department of Energy and u.S. Department of Agriculture reported in April 2005 that the united States has the capacity to sustainably produce 1.3 billion tons of biomass each year, which would displace at least 30 percent of current petroleum consumption in the United States. Furthermore, cellulose ethanol produces fewer greenhouse gas emissions than other types of ethanol. For these reasons, New York State should generate additional incentives for production of cellulosic ethanol. This bill would provide an exemption on real property taxes for land used to produce the woody biomass required to make cellulosic ethanol.

Legislative history

A8896A of 2007-2008

Fiscal implications

Undetermined.

Effective date

Immediately, and shall apply to assessment rolls prepared after January