A 986: Provides an exemption for the sale and installation of residential and commercial geothermal heat pump systems equipment.

  
  STATE OF NEW YORK ________________________________________________________________________ 986 2025-2026 Regular Sessions  IN ASSEMBLY (Prefiled) January 8, 2025 ___________ Introduced by M. of A. RIVERA, BARRETT, BRABENEC, BURKE, BURDICK, P. CARROLL, R. CARROLL, DAVILA, DILAN, GALLAGHER, GLICK, HEVESI, JACOBSON, KELLES, LUNSFORD, LUPARDO, MEEKS, MITAYNES, OTIS, PAULIN, SEAWRIGHT, SIMON, STERN, STECK, ROSENTHAL, CONRAD -- read once and referred to the Committee on Ways and Means AN ACT to amend the tax law, in relation to providing an exemption for geothermal heat pump systems equipment The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Subdivision (a) of section 1115 of the tax law is amended 2 by adding a new paragraph 47 to read as follows: 3 (47) Receipts from the retail sale of residential geothermal heat pump 4 systems equipment and of the service of installing such systems shall be 5 exempt from tax under this article. For purposes of this paragraph, 6 "residential geothermal heat pump system equipment" shall mean an 7 arrangement or combination of components installed in and around a resi- 8 dential building that uses the ground or ground water as a thermal ener- 9 gy source or as a thermal energy sink designed to provide and distribute 10 heating, and/or cooling, and/or hot water, also commonly referred to as 11 ground source heat pump systems. Such arrangement or components shall 12 not include any sort of recreational facility or equipment used as a 13 storage medium. 14 § 2. Section 1115 of the tax law is amended by adding a new subdivi- 15 sion (mm) to read as follows: 16 (mm) Receipts from the retail sale of commercial geothermal heat pump 17 systems equipment and of the service of installing such systems shall be 18 exempt from taxes imposed by sections eleven hundred five and eleven 19 hundred ten of this article. For purposes of this subdivision, "commer- 20 cial geothermal heat pump system equipment" shall mean an arrangement or 21 combination of components installed in and around a commercial building EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD01089-01-5 
 A. 986 2 1 that uses the ground or ground water as a thermal energy source or as a 2 thermal energy sink designed to provide and distribute heating, and/or 3 cooling, and/or hot water, also commonly referred to as ground source 4 heat pump systems. Such arrangement or components shall not include any 5 sort of recreational facility or equipment used as a storage medium. 6 § 3. Subparagraph (xiv) of paragraph 4 of subdivision (a) of section 7 1210 of the tax law, as added by section 2 of part WW of chapter 60 of 8 the laws of 2016, is amended and a new subparagraph (xvi) is added to 9 paragraph 4 to read as follows: 10 [(xiv)] (xv) shall omit, unless such city elects otherwise, the 11 exemption for commercial fuel cell electricity generating systems equip- 12 ment and electricity generated by such equipment provided in subdivision 13 (kk) of section eleven hundred fifteen of this chapter[.]; and (xvi) 14 shall omit unless such city elects otherwise, the residential geothermal 15 heat pump systems equipment and installation exemption provided for in 16 paragraph forty-seven of subdivision (a) of section eleven hundred 17 fifteen of this chapter; and shall omit unless such city elects other- 18 wise, the commercial geothermal heat pump systems equipment and instal- 19 lation exemption provided for in subdivision (mm) of section eleven 20 hundred fifteen of this chapter. 21 § 4. Subparagraph (ii) of paragraph 1 of subdivision (a) of section 22 1210 of the tax law, as amended by section 5 of part J of chapter 59 of 23 the laws of 2021, is amended to read as follows: 24 (ii) Any local law, ordinance or resolution enacted by any city, coun- 25 ty or school district, imposing the taxes authorized by this subdivi- 26 sion, shall omit the residential solar energy systems equipment and 27 electricity exemption provided for in subdivision (ee), the commercial 28 solar energy systems equipment and electricity exemption provided for in 29 subdivision (ii), the commercial fuel cell electricity generating 30 systems equipment and electricity generated by such equipment exemption 31 provided for in subdivision (kk), the residential geothermal heat pump 32 systems equipment and installation exemption provided for in paragraph 33 forty-seven of subdivision (a), the commercial geothermal heat pump 34 systems equipment and installation exemption provided for in subdivision 35 (mm) and the clothing and footwear exemption provided for in paragraph 36 thirty of subdivision (a) of section eleven hundred fifteen of this 37 chapter, unless such city, county or school district elects otherwise as 38 to such residential solar energy systems equipment and electricity 39 exemption, such commercial solar energy systems equipment and electric- 40 ity exemption, commercial fuel cell electricity generating systems 41 equipment and electricity generated by such equipment exemption or such 42 clothing and footwear exemption, such residential geothermal heat pump 43 systems equipment and installation exemption, such commercial geothermal 44 heat pump systems equipment and installation exemption or such clothing 45 and footwear exemption. 46 § 5. Paragraph 1 of subdivision (b) of section 1210 of the tax law, as 47 amended by section 6 of part J of chapter 59 of the laws of 2021, is 48 amended to read as follows: 49 (1) Or, one or more of the taxes described in subdivisions (b), (d), 50 (e) and (f) of section eleven hundred five of this chapter, at the same 51 uniform rate, including the transitional provisions in section eleven 52 hundred six of this chapter covering such taxes, but not the taxes 53 described in subdivisions (a) and (c) of section eleven hundred five of 54 this chapter. Provided, further, that where the tax described in subdi- 55 vision (b) of section eleven hundred five of this chapter is imposed, 56 the compensating use taxes described in [clauses] paragraphs (E), (G) 
 A. 986 3 1 and (H) of subdivision (a) of section eleven hundred ten of this chapter 2 shall also be imposed. Provided, further, that where the taxes described 3 in subdivision (b) of section eleven hundred five of this chapter are 4 imposed, such taxes shall omit: (A) the provision for refund or credit 5 contained in subdivision (d) of section eleven hundred nineteen of this 6 chapter with respect to such taxes described in such subdivision (b) of 7 section eleven hundred five unless such city or county elects to provide 8 such provision or, if so elected, to repeal such provision; (B) the 9 exemption provided in paragraph two of subdivision (ee) of section elev- 10 en hundred fifteen of this chapter unless such county or city elects 11 otherwise; (C) the exemption provided in paragraph two of subdivision 12 (ii) of section eleven hundred fifteen of this chapter, unless such 13 county or city elects otherwise; [and] (D) the exemption provided in 14 paragraph two of subdivision (kk) of section eleven hundred fifteen of 15 this chapter, unless such county or city elects otherwise; and provided 16 further that where the tax described in subdivision (f) of such section 17 eleven hundred five is imposed, such tax shall not apply to charges for 18 admission to race tracks and simulcast facilities; (E) the exemption 19 provided in paragraph forty-seven of subdivision (a) of section eleven 20 hundred fifteen of this chapter, unless such county or city elects 21 otherwise; and (F) the exemption provided in subdivision (mm) of section 22 eleven hundred fifteen of this chapter, unless such county or city 23 elects otherwise. 24 § 6. Subdivision (d) of section 1210 of the tax law, as amended by 25 section 4 of part WW of chapter 60 of the laws of 2016, is amended to 26 read as follows: 27 (d) A local law, ordinance or resolution imposing any tax pursuant to 28 this section, increasing or decreasing the rate of such tax, repealing 29 or suspending such tax, exempting from such tax the energy sources and 30 services described in paragraph three of subdivision (a) or of subdivi- 31 sion (b) of this section or changing the rate of tax imposed on such 32 energy sources and services or providing for the credit or refund 33 described in clause six of subdivision (a) of section eleven hundred 34 nineteen of this chapter, or electing or repealing the exemption for 35 residential solar equipment and electricity in subdivision (ee) of 36 section eleven hundred fifteen of this [article] chapter, or the 37 exemption for commercial solar equipment and electricity in subdivision 38 (ii) of section eleven hundred fifteen of this [article] chapter, or 39 electing or repealing the exemption for commercial fuel cell electricity 40 generating systems equipment and electricity generated by such equipment 41 in subdivision (kk) of section eleven hundred fifteen of this [article] 42 chapter, or electing or repealing the exemption for residential geother- 43 mal heat pump systems equipment and installation in paragraph forty-sev- 44 en of subdivision (a) of section eleven hundred fifteen of this chapter 45 or electing or repealing the exemption for commercial geothermal heat 46 pump systems equipment and installation in subdivision (mm) of section 47 eleven hundred fifteen of this chapter must go into effect only on one 48 of the following dates: March first, June first, September first or 49 December first; provided, that a local law, ordinance or resolution 50 providing for the exemption described in paragraph thirty of subdivision 51 (a) of section eleven hundred fifteen of this chapter or repealing any 52 such exemption or a local law, ordinance or resolution providing for a 53 refund or credit described in subdivision (d) of section eleven hundred 54 nineteen of this chapter or repealing such provision so provided must go 55 into effect only on March first. No such local law, ordinance or resol- 56 ution shall be effective unless a certified copy of such law, ordinance 
 A. 986 4 1 or resolution is mailed by registered or certified mail to the commis- 2 sioner at the commissioner's office in Albany at least ninety days prior 3 to the date it is to become effective. However, the commissioner may 4 waive and reduce such ninety-day minimum notice requirement to a mailing 5 of such certified copy by registered or certified mail within a period 6 of not less than thirty days prior to such effective date if the commis- 7 sioner deems such action to be consistent with the commissioner's duties 8 under section twelve hundred fifty of this article and the commissioner 9 acts by resolution. Where the restriction provided for in section twelve 10 hundred twenty-three of this article as to the effective date of a tax 11 and the notice requirement provided for therein are applicable and have 12 not been waived, the restriction and notice requirement in section 13 twelve hundred twenty-three of this article shall also apply. 14 § 7. Subdivision (a) of section 1212 of the tax law, as amended by 15 section 5 of part WW of chapter 60 of the laws of 2016, is amended to 16 read as follows: 17 (a) Any school district which is coterminous with, partly within or 18 wholly within a city having a population of less than one hundred twen- 19 ty-five thousand, is hereby authorized and empowered, by majority vote 20 of the whole number of its school authorities, to impose for school 21 district purposes, within the territorial limits of such school district 22 and without discrimination between residents and nonresidents thereof, 23 the taxes described in subdivision (b) of section eleven hundred five 24 (but excluding the tax on prepaid telephone calling services) and the 25 taxes described in [clauses] paragraphs (E) and (H) of subdivision (a) 26 of section eleven hundred ten, including the transitional provisions in 27 subdivision (b) of section eleven hundred six of this chapter, so far as 28 such provisions can be made applicable to the taxes imposed by such 29 school district and with such limitations and special provisions as are 30 set forth in this article, such taxes to be imposed at the rate of one- 31 half, one, one and one-half, two, two and one-half or three percent 32 which rate shall be uniform for all portions and all types of receipts 33 and uses subject to such taxes. In respect to such taxes, all provisions 34 of the resolution imposing them, except as to rate and except as other- 35 wise provided herein, shall be identical with the corresponding 36 provisions in [such] article twenty-eight of this chapter, including the 37 applicable definition and exemption provisions of such article, so far 38 as the provisions of such article twenty-eight of this chapter can be 39 made applicable to the taxes imposed by such school district and with 40 such limitations and special provisions as are set forth in this arti- 41 cle. The taxes described in subdivision (b) of section eleven hundred 42 five (but excluding the tax on prepaid telephone calling service) and 43 [clauses] paragraphs (E) and (H) of subdivision (a) of section eleven 44 hundred ten, including the transitional provision in subdivision (b) of 45 such section eleven hundred six of this chapter, may not be imposed by 46 such school district unless the resolution imposes such taxes so as to 47 include all portions and all types of receipts and uses subject to tax 48 under such subdivision (but excluding the tax on prepaid telephone call- 49 ing service) and [clauses] paragraphs. Provided, however, that, where a 50 school district imposes such taxes, such taxes shall omit the provision 51 for refund or credit contained in subdivision (d) of section eleven 52 hundred nineteen of this chapter with respect to such taxes described in 53 such subdivision (b) of section eleven hundred five unless such school 54 district elects to provide such provision or, if so elected, to repeal 55 such provision, and shall omit the exemptions provided in paragraph two 56 of subdivision (ee) and paragraph two of subdivision (ii) of section 
 A. 986 5 1 eleven hundred fifteen of this chapter unless such school district 2 elects otherwise, and shall omit the exemption provided in paragraph two 3 of subdivision (kk) of section eleven hundred fifteen of this chapter 4 unless such school district elects otherwise, and shall omit the 5 exemption provided in paragraph forty-seven of subdivision (a) of 6 section eleven hundred fifteen of this chapter unless such school 7 district elects otherwise, and shall omit the exemption provided in 8 subdivision (mm) of section eleven hundred fifteen of this chapter 9 unless such school district elects otherwise. 10 § 8. Section 1224 of the tax law is amended by adding two new subdivi- 11 sions (c-3) and (c-4) to read as follows: 12 (c-3) Notwithstanding any other provision of law: (1) Where a county 13 containing one or more cities with a population of less than one million 14 has elected the exemption for residential geothermal heat pump systems 15 equipment and installation provided in paragraph forty-seven of subdivi- 16 sion (a) of section eleven hundred fifteen of this chapter, a city with- 17 in such county shall have the prior right to impose tax on such exempt 18 equipment and/or installation to the extent of one half of the maximum 19 rates authorized under subdivision (a) of section twelve hundred ten of 20 this article; 21 (2) Where a city of less than one million has elected the exemption 22 for residential geothermal heat pump systems equipment and installation 23 provided in paragraph forty-seven of subdivision (a) of section eleven 24 hundred fifteen of this chapter, the county in which such city is 25 located shall have the prior right to impose tax on such exempt equip- 26 ment and/or installation to the extent of one half of the maximum rates 27 authorized under subdivision (a) of section twelve hundred ten of this 28 article. 29 (c-4) Notwithstanding any other provision of law: (1) Where a county 30 containing one or more cities with a population of less than one million 31 has elected the exemption for commercial geothermal heat pump systems 32 equipment and installation provided in subdivision (mm) of section elev- 33 en hundred fifteen of this chapter, a city within such county shall have 34 the prior right to impose tax on such exempt equipment and/or installa- 35 tion to the extent of one half of the maximum rates authorized under 36 subdivision (a) of section twelve hundred ten of this article; 37 (2) Where a city of less than one million has elected the exemption 38 for commercial geothermal heat pump systems equipment and installation 39 provided in subdivision (mm) of section eleven hundred fifteen of this 40 chapter, the county in which such city is located shall have the prior 41 right to impose tax on such exempt equipment and/or installation to the 42 extent of one half of the maximum rates authorized under subdivision (a) 43 of section twelve hundred ten of this article. 44 § 9. This act shall take effect on the first day of a sales tax quar- 45 terly period, as described in subdivision (b) of section 1136 of the tax 46 law, beginning at least ninety days after the date this act shall have 47 become a law and shall apply to sales made on or after such date.