§ 135 — Premium credits for safety investment

§ 135. Premium credits for safety investment. 1. An employer insured\nby a licensed insurer or the state insurance fund for workers'\ncompensation insurance may apply for a credit against the premiums for\nsuch coverage provided such employer is not currently receiving any\nstatutory safety incentive or sanction authorized under this chapter for\namounts invested by such employer in the creation of a safer work\nenvironment which meets the requirements of this section. The credit may\nbe applied for a renewable period not to exceed three years. For any one\nyear, the credit shall equal, if actuarially appropriate, an amount up\nto five percent of the total amount invested as calculated under the\nprovisions of this section but shall not exceed fifteen percent of such\nemployer's annual earned premium for that year in accordance with\nworkers' compensation rating board manual rates. An employer applying\nfor such credit must provide evidence required by rules or regulations\npromulgated by the superintendent of financial services that the\ninvestment would result in a safer work environment, with such evidence\nto include a written opinion by a certified safety professional, a\ncertified industrial hygienist or a licensed professional engineer\ndescribing the items included in the investment and an analysis of how\nthey will substantially enhance the safety of the work environment.\n 2. It shall be the sole responsibility of the superintendent of\nfinancial services, with the assistance of a committee, to determine\nwhether an employer who has made an application is eligible for a\npremium credit and the extent of any such credit, and to otherwise\nassist in the administration of the premium credit program, including\nthe promulgation of department of financial services rules and\nregulations for the implementation of the program.\n In addition to the superintendent of financial services, the committee\nshall consist of:\n (a) a representative from the department of labor;\n (b) a representative from the department of economic development;\n (c) a representative from the state insurance fund;\n (d) an individual with an actuarial background and experience in the\nfield of workers' compensation;\n (e) an individual with a background in safety engineering appointed by\nthe governor upon recommendation by the New York State American\nFederation of Labor-Congress of Industrial Organizations;\n (f) an individual with a background in safety engineering appointed by\nthe governor upon recommendation of the Business Council of the State of\nNew York;\n (g) an individual with a background in safety engineering appointed by\nthe governor upon recommendation of the insurance industry; and\n (h) an additional member of the committee with respect to any given\napplication for a premium credit shall be the current insurer of the\napplicant.\n All departments, divisions, boards, offices, and public corporations\nof the state, and the workers' compensation rating board, shall provide\nsuch data, information or other assistance as the committee may require\nto fulfill its purposes.\n The committee shall serve at the pleasure of the governor and shall\nreceive no compensation except for reasonable and necessary expenses\nincurred in the course of performing the official duties of the\ncommittee. Such expenses shall be paid from application fees paid in\naccordance with rules and regulations promulgated by the superintendent\nof financial services.\n 3. Premium credit calculations with respect to investments for safety\nshall be based only upon tangible personal property and other tangible\nproperty, including buildings and structural components of buildings\nwhich make for a safer work environment, which are depreciable pursuant\nto section one hundred sixty-seven of the internal revenue code, have a\nuseful life of four years or more, are acquired by purchase as defined\nin section one hundred seventy-nine(d) of the internal revenue code,\nhave a situs in this state and are:\n (a) principally used by the premium payer in the production of goods\nby manufacturing, processing, assembling, refining, mining, extracting,\nfarming, agriculture, horticulture, floriculture, viticulture or\ncommercial fishing,\n (b) industrial waste treatment facilities or air pollution control\nfacilities, used in the premium payer's trade or business, or\n (c) research and development property.\n For purposes of this section, the term "goods" shall not include\nelectricity.\n 4. For purposes of this section, the following definitions shall\napply:\n (a) Manufacturing shall mean the process of working raw materials into\nwares suitable for use or which gives new shapes, new quality or new\ncombinations to matter which already has gone through some artificial\nprocess by the use of machinery, tools, appliances and other similar\nequipment. Property used in the sale of goods at retail or the\nproduction of goods shall include machinery, equipment or other tangible\nproperty which is principally used in the repair and service of other\nmachinery, equipment or other tangible property used principally in the\nproduction of goods and shall include all facilities used in the\nproduction operation, including storage of material to be used in\nproduction and of the products that are produced.\n (b) Research and development property shall mean property which is\nused for purposes of research and development in the experimental or\nlaboratory sense. Such purposes shall not be deemed to include the\nordinary testing or inspection of materials or products for quality\ncontrol, efficiency surveys, management studies, consumer surveys,\nadvertising, promotions, or research in connection with literary,\nhistorical or similar projects.\n (c) Industrial waste treatment facilities shall mean property\nconstituting facilities for the treatment, neutralization or\nstabilization of industrial waste and other wastes (as the terms\n"industrial waste" and "other wastes" are defined in section 17-0105 of\nthe environmental conservation law) from a point immediately preceding\nthe point of such treatment, neutralization or stabilization to the\npoint of disposal, including the necessary pumping and transmitting\nfacilities, but excluding such facilities installed for the primary\npurpose of salvaging materials which are usable in the manufacturing\nprocess or are marketable.\n (d) Air pollution control facilities shall mean property constituting\nfacilities which remove, reduce, or render less noxious air contaminants\nemitted from an air contamination source (as the terms "air contaminant"\nand "air contamination source" are defined in section 19-0107 of the\nenvironmental conservation law) from a point immediately preceding the\npoint of such removal, reduction or rendering to the point of discharge\nof air meeting emission standards as established by the department of\nenvironmental conservation, but excluding such facilities installed for\nthe primary purpose of salvaging materials which are usable in the\nmanufacturing process or are marketable and excluding those facilities\nwhich rely for the efficacy on dilution, dispersion or assimilation of\nair contaminants in the ambient air after emission. Such term shall\nfurther include flue gas desulfurization equipment and attendant sludge\ndisposal facilities, fluidized bed boilers, precombustion coal cleaning\nfacilities or other facilities that conform with this section and which\ncomply with the provisions of the state acid deposition control act set\nforth in title nine of article nineteen of the environmental\nconservation law.\n 5. A premium credit under this section shall be allowed with respect\nto industrial waste treatment facilities and air pollution control\nfacilities only on condition that such facilities have been certified by\nthe state commissioner of environmental conservation or his or her\ndesignated representative, pursuant to subdivision one of section\n17-0707 or subdivision one of section 19-0309 of the environmental\nconservation law, as complying with applicable provisions of the\nenvironmental conservation law, the public health law and the state\nsanitary code and codes, rules, regulations, permits or orders issued\npursuant thereto.\n 6. Tangible personal property and other tangible property, including\nbuildings and structural components of buildings, which an employer\nleases to any other person or corporation are not to be considered as\ninvestments for safety in premium credit calculations. For purposes of\nthe preceding sentence, any contract or agreement to lease or rent or\nfor a license to use such property shall be considered a lease.\nProvided, however, in determining whether an employer shall be allowed a\ncredit under this section with respect to such property, any election\nmade with respect to such property pursuant to the provisions of\nparagraph eight of subsection (f) of section one hundred sixty-eight of\nthe internal revenue code, as such paragraph was in effect for\nagreements entered into prior to January first, nineteen hundred\neighty-four, shall be disregarded.\n 7. Subject to the limitations provided in subdivision one of this\nsection, the amount of a premium credit shall be a percent of the\ninvestment credit base. The investment credit base is the cost or other\nbasis for federal income tax purposes of tangible personal property and\nother tangible property, including buildings and structural components\nof buildings, as described in subdivision three of this section. The\namount of the percent to be applied against such investment credit base\nshall be based upon the useful life of such tangible personal property\nand other tangible property, and the extent to which the investment\nwould result in a safer work environment and upon such other actuarially\nappropriate evidence offered by the applicant that the investment would\nresult in a safer work environment. The superintendent of financial\nservices shall promulgate rules and regulations determining how the\npercentage to be applied against the investment credit base shall be\ncalculated.\n 8. The superintendent of financial services shall promulgate rules and\nregulations for the purpose of determining how to calculate the period\nduring which an applicant may receive a premium credit.\n 9. In the event an employer which applied for and received a premium\ncredit pursuant to this section moves or relocates its business outside\nof this state during the period in which it receives the benefits of\nsuch credit, such employer shall be responsible for repaying to the\ninsurer the entire amount of such credit already received.\n 10. An employer who is obligated to but does not comply with the\nrequirements of section one hundred thirty-four of this article is not\neligible to apply for premium credits under this section.\n 11. An employer shall be eligible for a credit against premiums for\nworkers' compensation insurance coverage in an amount up to five percent\nof such premiums for such other safety measures that may be implemented\nby an employer and which meet the standard for such premium credit as\nestablished by the superintendent. Such safety measures shall not\ninclude those measures provided for in this section of this article, or\napply to such industries provided for in this section.\n