Relates to applications for certain tax abatements for industrial and construction work on properties in certain cities

Summary of specific provisions

Section 1 of the bill lists legislative findings that electric generating facilities are no longer eligible for as-of-right benefits under the ICAP program resulting in greatly reduced investments in new generating facilities within New York City. In addition, due to a recent Federal Energy Regulatory Commission (FERC) ruling, the exclusion of energy generating facilities from ICAP is likely to result in significant rate increases in New York City beginning in the summer of 2011.

Section 2 would place electric generating facilities as defined by the New York Independent System Operator (NYISO) into the ICAP program and provides a 15 year total tax abatement for these electric generating facilities.

Section 3 of the bill extends the entire ICAP program until March 1, 2015. The current ICAP authorization expired on March 1, 2011.

Section 4 would limit ICAP electric generating facility eligibility to new or improved energy generating facility projects between the enactment date of the bill and April 1, 2015.

Section 5 defines the recording requirements for electric generating facilities that would be eligible and would receive ICAP benefits.

Sections 6,7,8 and 9 of the bill make corresponding amendments to the Administrative Code of the City of New York.

Section 10 gives the bill an immediate effective date and restores ICAP to full force and effect as of April 1, 2011.

Justification

Prior to March 31, 2008, electric generating facilities, transmission equipment and corresponding distribution real property were eligible for full or partial New York City property tax abatements under the Industrial and Commercial Incentive Program. The City requested, and the Legislature enacted, a new major tax abatement program, ICAP, in 2008, that eliminated energy companies from as-of-right tax benefits. Although the City can grant

discretionary benefits to energy companies under ICAP, the inability of electric generating facilities to earn and claim property tax abatements on an as-of-right basis for new investments and job creations is jeopardizing billions of dollars of investments and thousands of jobs that would benefit the citizens of New York.

In addition, removal of energy companies from ICAP has resulted in a FERC ruling that will likely result in a 12% rate increase for the residents and businesses of the City of New York as early as this summer. This bill would make electricity generating plants eligible for ICAP benefits for a 15 year period, satisfying the concern of the FERC board, and alleviating the danger of even higher electricity rates for a market that already must bear some of the highest power costs in the nation. Reinstituting these facilities into ICAP eligibility will also result in improved and cleaner electricity supplies, reliability and affordability for the benefit of all present and future New York residents and businesses.

The bill would also extend all other ICAP provisions for 4 years. The ICAP tax abatement program expired on March 31, 2011. This bill, if enacted, would restore all ICAP benefits until April 1, 2011 for 4 years. Failure to enact this bill will result in Substantially higher taxes for all industrial and commercial companies in New York City who are making investments in plants, equipment and providing new jobs, thus providing a major drag on New York City's economic health.

Prior legislative history

New Bill.

Fiscal implications

None to the State.

Effective date

This act shall take effect immediately and all ICAP provisions shall be deemed to be in full force and effect on and after April 1, 2011.