N.Y. Comp. Codes R. & Regs. tit. 20 § 49.1

Current through Register Vol. 46, No. 45, November 2, 2024

Section 49.1 - Utility rate reduction and credit

Tax Law, § 186-a(8)

(a) Any first class utility (see section 44.2[a] of this Title) that is subject to tax pursuant to section 186-a of the Tax Law shall provide, in addition to any other discount, a three percent reduction in the rate charged for gas, electricity, steam or water sold, or gas, electric, steam or water service rendered, for ultimate consumption or use within an area designated as an economic development zone pursuant to article 18-B of the General Municipal Law by a business that:

(1) has been certified pursuant to article 18-B of the General Municipal Law or has applied for such certification;

(2) is either incorporated or unincorporated;

(3) is not a retail enterprise; and

(4) has claimed an economic development zone wage tax credit under section 210 (19), section 606 (k), section 1456 (e) or section 1511 (g) of the Tax Law, excluding carryovers of such credit, during the previous 15 months as evidenced by a certificate issued by the Commissioner of Taxation and Finance.

(b) The Commissioner of Taxation and Finance shall issue a certificate evidencing that a business has claimed an economic development zone wage tax credit during the previous 15 months. Such certificate shall be valid for a period beginning on the date the economic development zone wage tax credit is claimed (the date the report is filed or if it is filed early, the date the report is due) and ending on a date 15 months after the beginning date.

(c) To obtain the utility rate reduction, a business must give the original of such certificate to the utility. Such business must also certify to the utility, in a written statement sworn to and subscribed before a notary public, that it is not a retail enterprise.

(d) The "first class" utility may apply an amount equal to 97 percent of such rate reductions during the taxable year as a credit against the tax for such year. To evidence its right to claim such credit, the utility must retain each certificate and sworn statement received.

(e) For purposes of this section, the term retail enterprise means a taxpayer which is a registered vendor under article 28 of the Tax Law and is primarily engaged in the retail sale (as such term is defined in section 526.6 of this Title) of tangible personal property. A taxpayer is "primarily engaged" in such activity if more than 50 percent of its receipts are derived from retail sales.

(f) The following example illustrates the computation of the credit:

Utility A sells electricity to Business B, which qualifies to receive the 3 percent rate reduction. Utility A's rates include both a basic commodity charge as well as an additional amount designed to reflect the various gross receipts taxes utility A is required to pay as the result of providing utility services. Business B uses 500 kilowatt hours of electricity in August 1988. Business B's basic commodity charge for the month, including the fuel adjustment, is $69.85. The additional amount designed to reflect the various gross receipts taxes of utility A for providing the utility services is $4.80.

Basic commodity charge	$69.85
Additional amount	4.80
Total charge before rate reduction and sales tax calculation*	$74.65
Rate reduction	3%
Reduction in cost of electricity to Business B	$ 2.24
Credit rate	97%
Credit to be claimed by Utility A	$ 2.17
*Note: This computation is irrelevant to the example and is not detailed.

N.Y. Comp. Codes R. & Regs. Tit. 20 § 49.1