What's happening
This bill creates a refundable tax credit for rural residents and small businesses that contribute to new broadband network construction in unserved areas.
Why it matters
Reduces the upfront cost burden for rural residents and small businesses. who have to pay out-of-pocket to get broadband access extended to their location, by making their contributions refundable through a tax credit—potentially turning a long-term investment into a more affordable, near-term outlay.
Targets support specifically to truly unserved areas. by requiring careful, rules-based verification (using broadband mapping data) to determine eligibility, thus channeling state resources to places with the greatest need rather than duplicating existing infrastructure.
Limits the credit to low- and middle-income individuals and small businesses. (with an income cap for individuals and a definition for qualifying small businesses), ensuring that the benefit is concentrated on those most likely to face barriers to broadband access and least able to absorb the costs themselves.
Promotes accountability and cost control. by capping qualifying expenses based on average construction costs and requiring provider certification, which helps prevent inflated project costs and ensures public funds are used efficiently.
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Who cares
Headline styles
Tax Credit for Rural Broadband
Plain English, a few words. Used as the page title.
Sponsors
History
- Referred to internet and technology
- Referred to internet and technology
Full text
3 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
917
2025-2026 Regular Sessions
IN SENATE (Prefiled)
January 8, 2025
Introduced by Sens. HELMING, BORRELLO, OBERACKER -- read twice and ordered printed, and when printed to be committed to the Committee on Internet and Technology
AN ACT to amend the state technology law and the tax law, in relation to a refundable tax credit provided to broadband deployment to residences and small businesses located in rural, unserved areas
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Short title. This act shall be known and may be cited as the "credit for rural broadband act".
§ 2. Section 104 of the state technology law is amended by adding a new subdivision 3 to read as follows:
3. The office of information technology services, in conjunction with input from the advisory council, is hereby authorized and directed to promulgate rules and regulations necessary for verifying an "unserved" area under the credit for rural broadband act, using broadband mapping data at the time a project is proposed.
§ 3. Section 210-B of the tax law is amended by adding a new subdivision 61 to read as follows:
61. Credit for rural broadband deployment. (a) Allowance of credit. A qualified taxpayer shall be allowed a credit against the tax imposed by this article equal to any qualified customer contribution in aid of construction resulting from new network construction to deliver broadband service to the individual's residence or place of business located in an unserved area. The credit allowed by this subdivision shall be claimed annually over a five-year period equal to one-fifth of the credit amount. If the credit allowed under this subdivision is greater than the tax due in any taxable year, the amount by which such credit exceeds such tax due is treated as an overpayment of tax to be refunded in
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00707-01-5
accordance with the provisions of section one thousand eighty-six of this chapter.
(b) For purposes of this subdivision, the following definitions shall apply:
(1) "Qualified construction expenses" equal the total cost of construction of new networks in the proposed unserved service area, as certified by the broadband service provider, but not to exceed a reasonable cost based upon the average cost per mile of broadband network construction as determined by the commissioner in consultation with the public service commission and broadband service providers.
(2) "Qualified customer contribution in aid of construction" is determined in accordance with the following formula: (QCE/TC) - (ACM/35) = QC, where QCE equals the qualified construction expenses; ACM equals the average cost of construction per mile in the proposed unserved service area, as certified by the broadband service provider, but not to exceed a reasonable cost based upon the average cost per mile of broadband network construction as determined by the commissioner in consultation with the public service commission and broadband service providers; TC equals the number of residents and small business customers in the proposed unserved service area making a qualified customer contribution in aid to construction and contracting for services over the network; and QC equals the qualified customer contribution in aid of construction.
(3) "Required provider contribution in aid to construction" shall equal the qualified construction expenses, less the sum of all the qualified customer contributions in aid to construction in the proposed unserved service area.
(4) "Broadband service" means Internet access service with transmission speeds that are equal to or greater than combined advertised download speeds of at least 4 Megabits per second (Mbps) and upload speeds of at least 1 Mbps over the provider's network.
(5) "Unserved area" means an area composed of one or more contiguous census blocks where at least ninety percent of households lack access to facilities-based terrestrial broadband service. A household has access to a broadband service if the household can readily subscribe to that service upon request.
(6) "Qualified taxpayer" means a taxpayer which is a small business corporation as defined in paragraph three of subsection (c) of section twelve hundred forty-four of the internal revenue code (without regard to the second sentence of subparagraph (A) thereof) as of the last day of the taxable year.
§ 4. Section 606 of the tax law is amended by adding a new subsection (bbb) to read as follows:
(bbb) Credit for rural broadband deployment. (A) Allowance of credit. A qualified taxpayer shall be allowed a credit against the tax imposed by this article equal to any qualified customer contribution in aid of construction resulting from new network construction to deliver broadband service to the individual's residence or place of business located in an unserved area. The credit allowed by this subsection shall be claimed annually over a five-year period equal to one-fifth of the credit amount. If the credit allowed under this subsection is greater than the tax due in any taxable year, the amount by which such credit exceeds such tax due is treated as an overpayment of tax to be refunded in accordance with the provisions of section one thousand eighty-six of this chapter.
(B) For purposes of this subsection, the following definitions shall apply:
(1) "Qualified construction expenses" equal the total cost of construction of new networks in the proposed unserved service area, as certified by the broadband service provider, but not to exceed a reasonable cost based upon the average cost per mile of broadband network construction as determined by the commissioner in consultation with the public service commission and broadband service providers.
(2) "Qualified customer contribution in aid of construction" is determined in accordance with the following formula: (QCE/TC) - (ACM/35) = QC, where QCE equals the qualified construction expenses; ACM equals the average cost of construction per mile in the proposed unserved service area, as certified by the broadband service provider, but not to exceed a reasonable cost based upon the average cost per mile of broadband network construction as determined by the commissioner in consultation with the public service commission and broadband service providers; TC equals the number of residents and small business customers in the proposed unserved service area making a qualified customer contribution in aid to construction and contracting for services over the network; and QC equals the qualified customer contribution in aid of construction.
(3) "Required provider contribution in aid to construction" shall equal the qualified construction expenses, less the sum of all the qualified customer contributions in aid to construction in the proposed unserved service area.
(4) "Broadband service" means Internet access service with transmission speeds that are equal to or greater than combined advertised download speeds of at least 4 Megabits per second (Mbps) and upload speeds of at least 1 Mbps over the provider's network.
(5) "Unserved area" means an area composed of one or more contiguous census blocks where at least ninety percent of households lack access to facilities-based terrestrial broadband service. A household has access to a broadband service if the household can readily subscribe to that service upon request.
(6) "Qualified taxpayer" means any individual with New York adjusted gross income of two hundred fifty thousand dollars or less.
§ 5. This act shall take effect immediately and shall apply to tax years beginning on or after January 1, 2026.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the state technology law and the tax law, in relation to a refundable tax credit provided to broadband deployment to residences and small businesses located in rural, unserved areas
Purpose
This bill promotes rural broadband deployment by providing residents and small businesses with tax credits for broadband deployment.
Summary of provisions
Section 1: Sites the name of this act as the Credit for Rural Broadband Act
Section 2. of the bill charges the office of information technology services, in conjunction with input from the advisory council, to veri- fying an "unserved" area under the credit for rural broadband act of 2014, using broadband mapping data at the time a project is proposed.
Section 3. of the bill creates a fully refundable broadband deployment tax credit for small businesses' reasonable out of pocket expenses for broadband network construction in their unserved areas, in partnership with a broadband provider. The credit is paid to the customer over a 5 year period.
Section 4 of the bill creates a fully refundable broadband deployment tax credit for residents' reasonable out of pocket expenses for broad- band network construction in their unserved areas, in partnership with a broadband provider. The credit is paid to the customer over a 5 year period.
Section 5. contains the immediate effective date for tax years in 2026 and thereafter.
Justification
Our rural areas in New York pose an extraordinary challenge for broad- band deployment. Geographic isolation, topographic conditions and centu- ries-old settlement patterns leave small pockets of New Yorkers without access to a high-speed broadband connection capable of managing today's bandwidth-intensive applications.
This totally refundable tax credit is a continuation of previous efforts at broadband deployment and has numerous strengths that will enhance broadband deployment to rural, unserved areas. The Rural Broadband Deployment Act will allow residents and small businesses in unserved areas to come together, pool their economic power and select a broadband provider to deploy services to their area. Any eligible out of pocket expenses the resident or small business incurs for the construction of the network, will be eligible for a 100% refundable tax credit, over 5 years. No broadband provider is eligible for the credit and the provider must make a significant contribution to the construction costs.
Strengths include: * Credits are only allowed for deployment in unserved areas so precious tax expenditures will not be used to duplicate existing infrastructure;
* Rural broadband will deploy far more rapidly.
* The program is technology and provider neutral. The local taxpayers decide what technology and provider they wish to select for service (wireline, wireless, etc.) - so all providers and technology types compete on a level playing field;
* The program is a true Public-private partnership. It requires a significant provider contribution in partnership with the public, and only residential and small business customers can receive a Rural Broad- band Deployment tax credit.
* The expense is broadly shared. As a tax credit, the expenditures will come from the State's general fund so no one group of New Yorkers are singled out to bear the burden of deployment, consistent with the ConnectNY approach.
Legislative history
2023-2024: S.4554 referred to Internet and Technology
2021-2022: S.5625 referred to Internet and Technology
Fiscal implications
To be determined.
Effective date
This act shall take effect immediately and be to tax years beginning on or after January 1, 2026.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.