End Sales Tax on School Buses

1 Co-sponsor

• Kevin Thomas

Title of bill

An act to amend the tax law, in relation to exempting from sales and use tax school buses; establishes a green ribbon panel to research greener school buses

Purpose

This legislation would exempt the sale of school buses and parts, equip- ment, lubricants and fuel purchased and used in their operation from taxes imposed by Section 1115 of the tax law.

Summary of provisions

Section 1. adds a new subdivision (11) to Section 1115 of the tax law providing an exemption from sales and use tax the sale of school buses and the parts, equipment, lubricants and fuel purchased and used in their operation.

Section 2. promulgates the Commissioner of Education, in consultation with the Commissioner of Motor Vehicles and the New York State Energy Research and Development Authority, to establish a "Green Ribbon Panel" to research and develop recommendations for upgrading school buses to be greener and cleaner.

Section 3. is the enacting clause

Justification

School buses are and have always been the safest way for children to travel to and from school. In New York State, more than 2.3 million children travel to school every day on a school bus. On average, more than $8,000 of sales tax is charged for each new school bus that is on the road. The cost associated with this tax, as well as the taxes on school bus parts and fuel, is passed along from the transportation providers to school districts. School districts, funded by both local property taxpayers and New York State itself, are bearing the cost of funding its own tax.

New York State has already begun transforming its school bus fleet to incorporate electric and alternative fuel buses which can quickly become cost-prohibitive, with sales tax bills alone accounting for up to $23,000 per vehicle. Eliminating the sales tax on school buses would offset a variety of other financial challenges facing school bus opera- tors, from clean-fuel regulations, wage increases for drivers, rising insurance premiums and the purchasing of additional safety equipment and resources, allowing the New York school community to focus on what's best for our children, including reliable, state-of-the-art transporta- tion that provides all students with safe and efficient access to school.

In addition, the creation of a "Green Ribbon Panel" would examine and research exactly how to reduce school bus emissions and protect our environment. It only makes sense to include representatives from the school bus industry, prominent environmental groups, school personnel and parents of school-aged children on this panel. New York needs to truly examine how we can establish a school bus fleet that will improve air quality and cut emissions in the quickest period of time.

Fiscal implications

To be determined

Local fiscal implications

To be determined

Effective date

This act shall take effect on the first day or a quarterly sales tax period, as set forth in subdivision (b) of section 1136 of the tax law, next succeeding April 1, 2020. Effective immediately, the addition, amendment and/or repeal of any rule or regulation necessary for the implementation of this act on its effective date are a