Sponsor: Koon

Law Section: Public Service Law

Act: AN ACT to amend the public service law, in relation to wireless communications devices; and to amend the tax law, in relation to a surcharge on prepaid wireless communications service

A8830B Actions

Jun 11, 2009 referred to corporations, authorities and commissions
Jun 18, 2009 amend and recommit to corporations, authorities and commissions
Jun 18, 2009 print number 8830a
Jan 6, 2010 referred to corporations, authorities and commissions
Jan 8, 2010 amend and recommit to corporations, authorities and commissions
Jan 8, 2010 print number 8830b
Feb 23, 2010 reported referred to ways and means

A8830B Memo

BILL NUMBER:A8830B 
TITLE OF BILL:  An act to amend the public service law, in relation to
wireless communications devices; and to amend the tax law, in relation
to a surcharge on prepaid wireless communications service
PURPOSE:    This  legislation  will  require  that  all disposable and
pre-paid wireless communication devices sold in the state  be  capable
of  accessing 911 emergency services and enhanced 911 services; and be
capable  of  automatic  location  identification,  regardless  of  the
wireless  communications  service  contract  status on the device. The
legislation also provides for a three percent surcharge on the  retail
purchase  of  any  prepaid  wireless  communications  service,  to  be
collected at the point of sale, for the purposes  of  maintaining  and
enhancing the state's 911 and emergency communications capabilities.
SUMMARY  OF  PROVISIONS:    Section  1. Adds a new section 92-g to the
public service law requiring that all wireless communications  devices
sold  in  New York State must be capable of accessing 911 services and
enhanced 911 services, regardless of whether a  customer  maintains  a
contract for wireless communications on these devices.
Section  2,  Adds a new section 186-g to the tax law defining relevant
terms and; requires that a fee of 3% be affixed to  sales  of  prepaid
wireless  communications  services  and; requires that retailers shall
collect the aforementioned surcharge and remit this surcharge  to  the
commissioner  on  a quarterly basis and; allows retailers to retain an
administrative fee for their collection responsibility  and;  requires
that  the  surcharge  be  disclosed  to  the  consumer on a receipt or
invoice, etc. and;  requires  the  comptroller  to  retain  an  amount
determined  by  the  commissioner  for  refunds and; provides that all
revenue must be transferred exclusively to the New York State wireless
telephone emergency service account. 
Section 3. Provides for an effective date.
JUSTIFICATION:   Currently, the state of New  York  collects  a  $1.20
monthly  fee on postpaid customers' wireless communications contracts.
The income from this fee is used to maintain the 911 system,  allowing
responders  to  identify  and  locate callers in an emergency. The 911
system requires infrastructure enhancement and updates  in  New  York;
without  these  updates, New Yorkers are serviced by a system that has
deficiencies that can cost  lives.  Updating  the  system  must  be  a
priority  for  all  of  us,  and revenue has to be generated for these
updates, especially at a time when resources  are  scarce.  Currently,
prepaid  cellular  services are becoming more prominent nationwide and
are a massive source of revenue for wireless providers. Due  to  holes
in  New  York's tax law, there exists no apparatus to collect 911 fees
from prepaid customers, despite the fact that  they  utilize  the  911
system. Collecting a 3% surcharge on an average $40 per month consumer
expenditure  (as  evidenced  by  a J.D. Powers and Associates Wireless
Prepaid Survey) will provide the 911 system with an average $1.20  per
month  from prepaid services. This funding will provide the 911 system
the income that it needs to improve its infrastructure and save lives.
Additionally,  the  bill  requires  that  all  cellular   devices   be
911-accessible  and  locatable where service is available, so that all
 
New Yorkers have consistent, high-quality, reliable access to the  911
system.
 
LEGISLATIVE HISTORY: This is new legislation.
 
FISCAL  IMPLICATIONS:    There  is no cost to the state; instead, this
legislation will generate new revenues to the state by  ensuring  that
purchasers of prepaid wireless communications services are required to
pay  E-911  surcharges,  similar  to  the  surcharges  associated with
monthly wireless device plans.
 
EFFECTIVE DATE:  This act shall take effect on the ninetieth day after
it shall have become a law; provided that  section  two  of  this  act
shall  take effect on the first day of the second quarterly period, as
described in paragraph (b) of subdivision 2 of section  186-g  of  the
tax  law,  as  added by section two of this act, next commencing after
this act becomes a law.
 

A8830B Text

                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
 
                                        8830--B
                               2009-2010 Regular Sessions
                                  I N  A S S E M B L Y
                                      June 11, 2009
                                      ___________
        Introduced  by  M. of A. KOON, JAFFEE, CASTRO, ESPAILLAT, COOK -- Multi-
         Sponsored by -- M. of A. DelMONTE, GABRYSZAK, MENG, SKARTADOS, TITONE,
         WEISENBERG -- read once and referred to the Committee on Corporations,
         Authorities and Commissions --  committee  discharged,  bill  amended,
         ordered  reprinted  as  amended  and  recommitted to said committee --
         recommitted to the Committee on Corporations, Authorities and  Commis-
         sions  in  accordance  with  Assembly  Rule  3,  sec.  2  -- committee
         discharged, bill amended, ordered reprinted as amended and recommitted
         to said committee
 
       AN ACT to amend the public service law, in relation to wireless communi-
         cations devices; and to amend the tax law, in relation to a  surcharge
         on prepaid wireless communications service
 
         THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
       BLY, DO ENACT AS FOLLOWS:
 
    1    Section 1. The public service law is amended by adding a  new  section
    2  92-g to read as follows:
    3    S  92-G. AUTOMATIC LOCATION IDENTIFICATION AND ACCESS TO 911 EMERGENCY
    4  SERVICES FOR WIRELESS COMMUNICATIONS DEVICES.    ALL  WIRELESS  COMMUNI-
    5  CATION  DEVICES SOLD IN THIS STATE, INCLUDING BUT NOT LIMITED TO DISPOS-
    6  ABLE AND PREPAID DEVICES, SHALL BE CAPABLE OF  ACCESSING  911  EMERGENCY
    7  SERVICES  AND  ENHANCED 911 SERVICES AS DEFINED IN SECTION THREE HUNDRED
    8  ONE OF THE COUNTY LAW, WHERE AVAILABLE, AND SHALL BE CAPABLE OF AUTOMAT-
    9  IC LOCATION IDENTIFICATION,  REGARDLESS  OF  WHETHER  THE  CONSUMER  HAS
   10  ENTERED  INTO  OR  MAINTAINS  A  CONTRACT  FOR  WIRELESS  COMMUNICATIONS
   11  SERVICES FOR SUCH DEVICE.
   12    S 2. The tax law is amended by adding a new section 186-g to  read  as
   13  follows:
   14    S  186-G.  PREPAID WIRELESS COMMUNICATIONS SURCHARGE. 1.  DEFINITIONS.
   15  (A) "CONSUMER" MEANS A PERSON WHO PURCHASES A PREPAID WIRELESS  TELECOM-
   16  MUNICATIONS DEVICE OR SERVICE IN A RETAIL TRANSACTION.
 
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD14159-04-9
 
       A. 8830--B                          2
 
    1    (B)  "WIRELESS  COMMUNICATIONS  DEVICE"  MEANS  ANY  EQUIPMENT USED TO
    2  ACCESS A WIRELESS COMMUNICATIONS SERVICE.
    3    (C)  "PREPAID  WIRELESS  TELECOMMUNICATIONS  SERVICE" MEANS A WIRELESS
    4  TELECOMMUNICATIONS SERVICE WHICH MUST BE PAID FOR IN ADVANCE AND IS SOLD
    5  IN PREDETERMINED UNITS OR DOLLARS OF WHICH THE NUMBER DECLINES WITH  USE
    6  IN A KNOWN AMOUNT, AND SHALL INCLUDE BUT NOT BE LIMITED TO PREPAID CALL-
    7  ING  CARDS  AS DEFINED IN SECTION NINETY-TWO-F OF THE PUBLIC SERVICE LAW
    8  OR ANY OTHER CARD OR SIMILAR ITEM WHICH PERMITS  A  CONSUMER  ADDITIONAL
    9  CALLING TIME ON A PREPAID WIRELESS COMMUNICATIONS DEVICE.
   10    2. (A) A SURCHARGE ON PREPAID WIRELESS COMMUNICATIONS SERVICE PROVIDED
   11  TO  A  RETAIL  CUSTOMER  IS  IMPOSED AT THE RATE OF THREE PERCENT OF THE
   12  PURCHASE PRICE OF EACH WIRELESS COMMUNICATIONS SERVICE. WIRELESS PREPAID
   13  DEVICES AND EQUIPMENT SHALL BE EXCLUDED FROM SUCH SURCHARGE UNLESS  SUCH
   14  DEVICES ARE BUNDLED WITH SERVICE MINUTES.
   15    (B)  EVERY  RETAILER  OF A WIRELESS COMMUNICATIONS SERVICE IN NEW YORK
   16  STATE MUST ACT AS A COLLECTION AGENT FOR THE STATE FOR THE COLLECTION OF
   17  THE SURCHARGE IMPOSED PURSUANT TO PARAGRAPH (A) OF THIS SUBDIVISION. THE
   18  SURCHARGE MUST BE REPORTED AND PAID TO THE COMMISSIONER ON  A  QUARTERLY
   19  BASIS  ON  OR BEFORE THE FIFTEENTH DAY OF THE MONTH FOLLOWING EACH QUAR-
   20  TERLY PERIOD ENDING ON THE LAST DAY OF FEBRUARY, MAY, AUGUST AND  NOVEM-
   21  BER,  RESPECTIVELY.  THE PAYMENTS MUST BE ACCOMPANIED BY A RETURN IN THE
   22  FORM AND CONTAINING THE INFORMATION THE COMMISSIONER MAY PRESCRIBE.
   23    (C) EACH RETAILER IS ENTITLED TO RETAIN, AS AN ADMINISTRATIVE FEE,  AN
   24  AMOUNT EQUAL TO ONE AND ONE-HALF PERCENT OF THE TOTAL COLLECTIONS OF THE
   25  SURCHARGE  IMPOSED BY THIS SECTION, PROVIDED THAT THE RETAILER FILES ANY
   26  REQUIRED RETURN AND REMITS THE SURCHARGE DUE TO THE COMMISSIONER  ON  OR
   27  BEFORE ITS DUE DATE.
   28    (D)  NOTWITHSTANDING  SECTION TWO HUNDRED SEVEN-B OF THIS ARTICLE, THE
   29  SURCHARGE IMPOSED BY THIS SECTION SHALL BE SUBJECT TO THE ADMINISTRATIVE
   30  PROVISIONS OF ARTICLE TWENTY-EIGHT OF THIS CHAPTER.  THE TERM "TAXPAYER"
   31  IN ARTICLE TWENTY-EIGHT OF THIS CHAPTER REFERS TO A RETAILER OF  PREPAID
   32  WIRELESS  COMMUNICATIONS  SERVICE  SUBJECT  TO THIS SECTION AND THE TERM
   33  "TAX" IN ARTICLE TWENTY-EIGHT OF THIS CHAPTER REFERS  TO  THE  SURCHARGE
   34  IMPOSED BY THIS SECTION.
   35    3. THE PREPAID WIRELESS COMMUNICATIONS SURCHARGE SHALL BE COLLECTED BY
   36  THE  SELLER  FROM  THE  CONSUMER WITH RESPECT TO EACH RETAIL TRANSACTION
   37  OCCURRING IN THIS STATE CONSISTENT WITH  ARTICLE  TWENTY-EIGHT  OF  THIS
   38  CHAPTER.  THE  AMOUNT OF THE SURCHARGE SHALL BE EITHER SEPARATELY STATED
   39  ON AN INVOICE, RECEIPT, OR OTHER SIMILAR DOCUMENT THAT  IS  PROVIDED  TO
   40  THE  CONSUMER BY THE SELLER, OR OTHERWISE DISCLOSED TO THE CONSUMER. THE
   41  AMOUNT OF THE SURCHARGE THAT IS COLLECTED BY A SELLER  FROM  A  CONSUMER
   42  PURSUANT TO THIS SECTION, WHETHER OR NOT SUCH AMOUNT IS SEPARATELY STAT-
   43  ED  ON  AN  INVOICE,  RECEIPT, OR OTHER SIMILAR DOCUMENT PROVIDED TO THE
   44  CONSUMER BY THE SELLER, SHALL NOT BE INCLUDED IN THE BASE FOR  MEASURING
   45  ANY  TAX, FEE, SURCHARGE, OR OTHER CHARGE THAT IS IMPOSED BY THIS STATE,
   46  ANY POLITICAL SUBDIVISION OF THIS STATE, OR ANY INTERGOVERNMENTAL  AGEN-
   47  CY.
   48    4.  DEPOSITS OF SURCHARGE MONIES COLLECTED AND RECEIVED. NOTWITHSTAND-
   49  ING ANY PROVISION OF LAW TO THE CONTRARY, ALL SURCHARGE MONIES COLLECTED
   50  AND RECEIVED BY THE COMMISSIONER UNDER THIS SECTION  MUST  BE  DEPOSITED
   51  DAILY  TO  THE  CREDIT  OF THE COMPTROLLER WITH THOSE RESPONSIBLE BANKS,
   52  BANKING HOUSES OR TRUST COMPANIES THE COMPTROLLER MAY  DESIGNATE.  THOSE
   53  DEPOSITS  MUST  BE  KEPT SEPARATE AND APART FROM ALL OTHER MONIES IN THE
   54  POSSESSION OF THE COMPTROLLER. THE  COMPTROLLER  MUST  REQUIRE  ADEQUATE
   55  SECURITY  FROM  ALL SUCH DEPOSITORIES. OF THE TOTAL REVENUE COLLECTED OR
   56  RECEIVED UNDER THIS SECTION, THE COMPTROLLER MUST RETAIN  IN  THE  COMP-
 
       A. 8830--B                          3
 
    1  TROLLER'S HANDS AN AMOUNT DETERMINED BY THE COMMISSIONER TO BE NECESSARY
    2  FOR  REFUNDS  UNDER  THIS SECTION, OUT OF WHICH THE COMPTROLLER WILL PAY
    3  ANY REFUNDS TO WHICH TAXPAYERS ARE ENTITLED UNDER THE PROVISIONS OF THIS
    4  SECTION. THE COMPTROLLER, AFTER RESERVING THE AMOUNT TO PAY REFUNDS, AND
    5  AFTER DEDUCTING THE AMOUNT RETAINED BY WIRELESS COMMUNICATIONS RETAILERS
    6  PURSUANT  TO  PARAGRAPH (C) OF SUBDIVISION TWO OF THIS SECTION, MUST, ON
    7  OR BEFORE THE  TENTH  DAY  OF  EACH  MONTH,  PAY  ALL  SURCHARGE  MONIES
    8  COLLECTED  AND  RECEIVED  UNDER  THIS SECTION AND REMAINING INTO THE NEW
    9  YORK STATE WIRELESS TELEPHONE EMERGENCY SERVICE ACCOUNT OF THE MISCELLA-
   10  NEOUS SPECIAL REVENUE FUND, CREATED PURSUANT TO SECTION  NINETY-SEVEN-QQ
   11  OF THE STATE FINANCE LAW.
   12    S  3.  This  act shall take effect on the ninetieth day after it shall
   13  have become a law; provided that section two  of  this  act  shall  take
   14  effect  on the first day of the second quarterly period, as described in
   15  paragraph (b) of subdivision 2 of section 186-g of the tax law, as added
   16  by section two of this act, next commencing after  this  act  becomes  a
   17  law.