Requires certain motor fuel terminal facilities to be capable of operating its distribution loading racks using an alternate generated power source for a minimum of seventy-two hours

Summary of provisions

Section 1 adds a new paragraph k to section 21 of the executive law to provide the Disaster Preparedness Commission with the authority to require that certain motor fuel terminal facilities and wholesalers be capable of operating its distribution loading racks using an alternate generated power source for a minimum of 72-hours. Such alternate generated power source shall be available for operation within 36-hours of a major disaster, pending a post disaster examination of the equipment-and any necessary repairs.

This section also provides the Disaster Preparedness Commission with the authority to require that certain motor fuel retail outlets be prewired with appropriate wiring, including a transfer switch, necessary for the operation of an alternate generated power source that is capable of operating all fuel pumps, dispensing equipment, life safety systems and payment acceptance systems for a minimum of 72-hours, and which shall be required to have access to an alternate generated power source. Such designated outlets shall be: located within one-half mile of an interstate highway or state or federally designated evacuation route; in locations that due to their topography or distance towards or away from a body of water and under criteria established by the Commission, would remain viable and that could safely operate before, during and after a declaration of an emergency; in locations near transportation hubs and other suitable areas that could be valuable to assist in regional or local rescue and response activities; in other locations that are determined by the Commission to be vital to post disaster rescue and recovery operations.

Section 2 adds a new section 187-s to the tax law to provide a credit against the corporation tax for up to fifty percent of the cost to purchase and install an alternate generated power source by a motor fuel terminal facility, wholesaler or. motor fuel retail outlet, capped at $15,000. The credit would also be available for the costs of materials and labor associated with the installation of appropriate wiring, including a transfer switch, necessary for the operation of an alternate generated power source by a motor fuel retail outlet, capped at $5,000. The credit will be available from January 1, 2014 until January 1, 2018. In order to qualify for the credit, the installation

of appropriate wiring and transfer switches shall be performed by a certified electrical contractor and certified as operational by the local building inspector. Expenditures for interest or other finance charges, as-well as the amount of any federal, state or local grants received by the taxpayer are excluded from the amount eligible for the credit. The amount of any credit will be recaptured if an alternate generated power source is returned or removed from service within one year. Lastly, the amount of any unused credit is not refundable, but can be carried over for up to five additional years.

Section 3 adds a new subdivision 46 to section 210 of the tax law to provide a credit, as described above, against the business franchise tax.

Section 4 adds a new subsection (u) to section 606 of the tax law to provide a credit, as described above, against the personal income tax.

Section 5 adds a new clause (xxxv) to subparagraph (B) of paragraph 1 of subsection (i) of section 606 of the tax law to make conforming changes regarding the above tax credit.

Section 6 provides the effective date.

Justification

Hurricane Sandy left many New York counties devastated and without power for weeks. Due to this, many facilities along the motor fuel supply chain were left without power and were unable to meet the demands of thousands who were in need of gas for their vehicles and home generators. When fuel became available, many gas stations were still unable to provide it to consumers because their facilities were still without power. Consumers were forced to wait for hours in mile long lines in order to get gas from the few stations that were able to get their power restored. This legislation will ensure that this does not occur again.

This legislation mirrors Florida law and proposed legislation in California. Florida and Louisiana are the only states thus far that require terminals and wholesalers to install an alternate generated power source, and that certain service stations to be prewired to be capable of operating an alternate generated power source. This requirement allows for these facilities to remain operable after a major disaster such as Hurricane Sandy. Requiring gas stations to be prewired and have an alternate power source available for use makes sure that residents have access to gasoline, enabling them to be able to leave the impacted area prior to or after the storm hits, as well as to be able to have fuel necessary to power their own home generators. Including a tax credit will provide financial relief to those facilities that are required to install a generator or be prewired, as well as provide a financial incentive to other facilities to be prewired or purchase a generator.

This bill will ensure that facilities along the motor fuel supply chain have the necessary power to continue to operate when there are large power outages due to a major disaster. This will make sure the New York residents will continue to have access to vital fuel to run

their vehicles and own generators, which become crucial during the colder months.

Legislative history

New bill; similar to S.1208-A.

Fiscal implications

To be determined.

Effective date

This act shall take effect immediately; provided that the provisions of section two, three, four and five of this act shall expire and be deemed repealed January 1, 2018.