Is a public university's $5 'vehicle registration fee' -- which the university says isn't a parking fee, but which its own rules describe as buying a parking permit -- subject to sales tax as a charge for parking?

Plain-English summary

SUNY Stony Brook charges students, faculty, and staff a $5 fee to register their vehicles, and had been including that fee in its sales-tax calculation on parking charges. The university asked the Department to confirm the fee isn't actually a parking charge -- arguing it's purely for registration, used to identify vehicle owners in case of issues like leaking gas or lights left on, and to fund the staff who maintain that registration database. Separately, the university sells "upgraded parking privileges" (garage spaces, designated lot spaces) for $100-$250 per year.

The problem for the university's position was its own paperwork: its "Parking Permit Rules and Regulations" repeatedly call the $5 payment the price of a "parking permit," and the rules describe a single registration process that both identifies the vehicle and issues one permit entitling the holder to park in a designated general lot (subject to availability). There was no evidence of two separate fees or two separate permits for registration versus parking -- unlike an earlier ruling for SUNY Binghamton, where registration and parking were shown to be genuinely distinct charges.

New York taxes parking, garaging, and storing services, but exempts certain government/public entities from that tax when they're providing something not ordinarily sold by private persons. The Department found SUNY Stony Brook is an "education corporation" under the Education Law, which doesn't fall within the specific public/municipal/district-corporation carve-out from the parking tax. And because tax applies to the full price of a single unit combining taxable and exempt items, the fact that part of what the $5 arguably covers (identifying vehicle owners) might be non-parking-related doesn't matter -- since the fee as charged buys the parking permit itself, the whole $5 is taxable.

What this means for you

Universities, colleges, and other institutions charging combined vehicle fees

If your registration fee's own governing rules or paperwork describe it as buying a "parking permit" (rather than clearly documenting registration and parking as two separate, independently priced items), expect the whole fee to be treated as taxable parking revenue -- regardless of what you intend the fee to primarily cover.

Institutions wanting registration and parking treated separately

Structure genuinely separate fees and separate permits for registration versus parking privileges if you want only the parking-specific charge taxed -- follow the pattern the Department found sufficient in the SUNY Binghamton ruling, not a single combined fee/permit like Stony Brook's.

Accountants and tax professionals

The key regulatory hook is 20 NYCRR § 527.1(b): when taxable and exempt items are sold as a single unit for one price, tax applies to the entire price. Also note that being a state university doesn't automatically confer the parking-tax carve-out -- that carve-out is limited to specific public/municipal/district-corporation categories under General Construction Law § 66, which an "education corporation" under Education Law § 216-a doesn't fit.

Common questions

Q: Does being a public university automatically exempt parking fees from sales tax?
A: No. SUNY's public-corporation-style exemptions don't cover the parking-services tax specifically, since that tax's carve-out is limited to certain municipal/district-corporation categories that an education corporation doesn't fall within.

Q: What would it take to make a vehicle registration fee genuinely non-taxable?
A: Documenting it as a truly separate charge from parking -- a distinct fee, a distinct permit, and rules that don't describe the registration payment as buying parking access -- as was apparently shown in the SUNY Binghamton ruling.

Q: Can another university rely on this ruling?
A: No. It binds the Department only as to this petitioner and its specific parking rules and fee structure. Another institution with genuinely separate registration and parking fees could get a different result.

Citations and references

Statutes and regulations:

• Tax Law § 1101(b)(3) (definition of "receipts")
• Tax Law § 1105(c)(6) (tax on parking, garaging, or storing motor vehicles; public-corporation carve-out)
• Tax Law § 1116(a)(1) (government exemption for services not ordinarily sold by private persons)
• 20 NYCRR § 527.1(b) (tax on the full price of a single unit combining taxable and exempt items)
• General Construction Law § 66 (definitions of public, municipal, and district corporations)
• Education Law § 216-a, § 352.1, § 360 (State University of New York as an education corporation)

Prior rulings referenced:

• State University of New York at Binghamton, Adv Op Comm T&F, Feb. 2, 1998, TSB-A-98(5)S

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_2000.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a00_4s.pdf

Original ruling text

New York State Department of Taxation and Finance

Office of Tax Policy Analysis
Technical Services Division

TSB-A-00(4)S
Sales Tax
January 28, 2000

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S991013A

On October 13, 1999, the Department of Taxation and Finance received a Petition for
Advisory Opinion from State University of New York at Stony Brook, Nicholls Road, Stony Brook,
New York 11794-1151.
The issue raised by Petitioner, State University of New York at Stony Brook, is whether sales
tax should be imposed upon the vehicle registration fee collected from students, staff and faculty of
Petitioner.
Petitioner submits the following facts as the basis for this Advisory Opinion.
Petitioner has been including vehicle registration fees collected from students, staff and
faculty as part of its sales tax calculation on parking fees. The vehicle registration fee is $5.00.
Petitioner states that the vehicle registration fee is not a parking permit fee and is not for parking
privileges. However, a copy of “Parking Permit Rules and Regulations” submitted by Petitioner
makes numerous references to the fact that the $5.00 fee is paid to obtain a “parking permit.” The
reference to the term “parking permit” is prevalent throughout these parking rules and regulations.
In addition to the registration fee, upgraded parking privileges such as a space in a parking garage
or a specially designated parking space in a lot, may be purchased. The price for the upgraded
parking privileges is $100 to $250.00 per year. Petitioner requires that vehicles be registered so it
may identify and, if necessary, contact the operator for the purpose of reporting damage to vehicles,
lights left on, leaking gas, etc.
Revenue from the vehicle registration fees collected is used to pay for staff to input data
collected concerning the description of the vehicle, the location of the vehicle owner and to maintain
the computer system.
Applicable Law and Regulations
Section 1101(b)(3) of the Tax Law, in defining the term “receipts” for purposes of the sales
tax sets forth, in pertinent part, that receipt means “...the sale price of any property and the charge
for any service taxable under this article...”
Section 1105 of the Tax Law provides, in part:
Section 1105. Imposition of sales tax.–... there is hereby imposed and shall
be paid a tax ... upon:

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TSB-A-00(4)S
Sales Tax
January 28, 2000

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(c) The receipts from every sale, except for resale, of the following services:
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(6) Providing parking, garaging or storing for motor vehicles by persons
operating a garage (other than a garage which is part of premises occupied solely as
a private one or two family dwelling), parking lot or other place of business engaged
in providing parking, garaging or storing for motor vehicles provided, however, this
paragraph shall not apply to such facilities owned and operated by a public
corporation, as defined by section sixty-six of the general construction law, other than
a public benefit corporation, as defined by such section sixty-six, created by interstate
compact or at least half of whose members are appointed by the governor, or any
agency or instrumentality of a municipal corporation or district corporation as
defined by such section sixty-six...
Section 1116 of the Tax Law provides, in part:
Exempt organizations..-(a) Except as otherwise provided in this section, any
sale or amusement charge by or to any of the following or any use or occupancy by
any of the following shall not be subject to the sales and compensating use taxes
imposed by this article:
(1) The state of New York, or any of its agencies, instrumentalities, public
corporations (including a public corporation created pursuant to agreement or
compact with another state or Canada) or political subdivisions where it is the
purchaser, user or consumer, or where it is a vendor of services or property of a kind
not ordinarily sold by private persons....
Section 527.1(b) of the Sales and Use Tax Regulations provides:
Taxable and exempt items sold as a single unit. When tangible personal
property, composed of taxable and exempt items is sold as a single unit, the tax shall
be collected on the total price.
Example: A vendor sells a package containing assorted cheeses, a cheese
board and a knife for $15. He is required to collect tax on $15.
Section 66 of the General Construction Law provides, in part:

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TSB-A-00(4)S
Sales Tax
January 28, 2000

1. A “public corporation” includes a municipal corporation, a district
   corporation, or a public benefit corporation.
2. A “municipal corporation” includes a county, city, town, village and
   school district.
3. A “district corporation” includes any territorial division of the state, other
   than a municipal corporation, heretofore established by law which possesses the
   power to contract indebtedness and levy taxes or benefit assessments upon real estate
   or to require the levy of such taxes or assessments, whether or not such territorial
   division is expressly declared to be a body corporate and politic by the statute
   creating or authorizing the creation of such territorial division.
4. A “public benefit corporation” is a corporation organized to construct or
   operate a public improvement wholly or partly within the state, the profits from
   which inure to the benefit of this or other states, or the people thereof.
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6. An “education corporation” is a corporation as defined in subdivision one
   of section two hundred sixteen-a of the education law.
   Section 216-a of the Education Law provides, in pertinent part:
7. The term “education corporation” as used in this section means a
   corporation (a) chartered or incorporated by the regents or otherwise formed under
   this chapter, or (b) formed by a special act of this state with its principal purpose an
   education purpose and which is a member of the university of the state of New
   York,...
   Section 352.1 of the Education Law provides:
   There is hereby created in the state education department and within the
   university of the state of New York as established under the board of regents a
   corporation to known as the state university of New York which shall be responsible
   for the planning, supervision and administration of facilities and programs in
   accordance with the plan proposed by the state university trustees as approved by the
   regents pursuant to section two hundred thirty-seven of this chapter. The state
   university shall provide for higher education supported in whole or in part with state
   moneys in accordance with the provisions of section three hundred fifty-eight hereof,
   and shall perform such other duties as may be entrusted to it by the provisions of this

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TSB-A-00(4)S
Sales Tax
January 28, 2000

article and any other law. Subject to the terms of any agreement to which it is a
party, such corporation shall have the care, custody, control and management of the
lands, grounds, buildings, facilities and equipment used for the purposes of the state­
operated institutions of the state university, and it shall have power to protect,
preserve and improve the same.
Part 584 of 8 NYCRR contains the regulations of the State University at Stony Brook
governing the use of motor vehicles on the campus of Petitioner (Petitioner’s traffic and parking
regulations). Section 584.1(a) of these regulations provides, in part:
(a) General. Pursuant to Education Law, section 360, State University of
New York is authorized to regulate traffic and parking on the Stony Brook campus.
The State University of New York at Stony Brook provides roads and parking lots
to make university business easier to conduct. Methods of registering vehicles and
regulations governing their use on campus are stated below. The university does not
assume any liability for damage to or loss of private vehicles, their occupants or
contents. Parking of vehicles on campus without campus registration, or without
permission from the university, or in violation of regulations, is not allowed. Drivers
who need vehicles on campus in order to conduct university-related business may
obtain parking permits either at the parking services office or through the offices they
are to visit. Temporary permits are governed by the regulations stated on the permits.
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(3) Registration. (i) Faculty, staff, students and authorized nonstate employees
may register a car for campus use in accordance with the procedures outlined below,
and upon payment of an appropriate registration fee as approved by the chancellor
or designee....
Section 584.1(b) of such regulations provides, in part:
Eligibility. An owner/operator with an unpaid fine or towing fee will not be
permitted to register a motor vehicle for on-campus parking until the indebtedness
is satisfied.
(1) Resident students. Resident students, except freshmen and sophomores,
are eligible to register their motor vehicles for the residence lots. Students are
cautioned that eligibility does not guarantee that a permit will be issued....Students
are cautioned that the issuance of a permit does not guarantee a parking space.

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TSB-A-00(4)S
Sales Tax
January 28, 2000

(2) Commuter students. All commuter students are eligible to register their
motor vehicles for the commuter lots....
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(3) Faculty and staff. Faculty and staff members are eligible to register their
motor vehicles for the faculty/staff lots. Faculty and staff are cautioned that
eligibility does not guarantee a parking space. Registered faculty and staff members
may park their registered vehicles in any of the faculty/staff lots.
Section 584.2(a) of such regulations provides, in part:
Registration. (1) Who must register. Persons associated with the university,
and who park on university property must register their vehicles with the university.
Vehicle registration entitles them to park only in designated parking lots if a space
is available.
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(3) Permits. One permit will be issued when a vehicle is registered. The
permit must be removed if association with the university is terminated or the vehicle
sold. Vehicles are considered registered only when the issued permit is displayed as
required....
Section 584.2(b)(2)(ii) of such regulations provides as follows:
Parking in faculty/staff lots is restricted to holders of faculty/staff permits
from 8 a.m. to 4 p.m., Monday through Friday. After 4 p.m. and until 8 a.m. any
registered car may be parked in these lots. Residence parking lots are restricted to
holders of resident permits from 1 a.m. to 4 p.m. on weekdays....
Opinion
Petitioner is part of the State University of New York, a corporation created in the State
Education Department and within the University of the State of New York, under the Board of
Regents (Education Law, Section 352.1). The governing board of Trustees is empowered to adopt
and enforce campus rules relating to parking, vehicular and pedestrian traffic, and safety; including
provisions for the payment of fees for the registration or parking of vehicles (Education Law, Section
360.1(c)).

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TSB-A-00(4)S
Sales Tax
January 28, 2000

According to the above cited sections of Petitioner’s traffic and parking regulations, when
a person pays to register his or her vehicle with Petitioner, such person is also paying for the
privilege of parking on the campus of Petitioner. This is evidenced by the fact that a single fee is
paid to register a motor vehicle with Petitioner which results in a permit being issued to the owner
of the vehicle which, when properly displayed, confers the right to park in a designated general area
on the premises of Petitioner. The facts of this Petition, as well as Petitioner’s traffic and parking
regulations, do not provide for two separate and distinct fees charged for registration and parking,
or for separate permits issued for registration and parking, as in the case of State University of New
York at Binghamton, Adv Op Comm T&F, February 2, 1998, TSB-A-98(5)S.
Petitioner is an exempt government entity under Section 1116(a)(1) of the Tax Law.
Petitioner’s sales, however, of tangible personal property or services of a kind ordinarily sold by
private persons are subject to sales tax. Petitioner’s parking services are of a kind ordinarily sold
by private persons, and are subject to tax under Section 1105(c)(6) of the Tax Law. Petitioner
appears to be an education corporation under Section 216-a of the Education Law. Accordingly, the
exception from the imposition of the sales tax for public, municipal or district corporations, or
agencies and instrumentalities thereof, as provided in Section 1105(c)(6) does not apply to Petitioner.
Therefore, since Petitioner charges a single fee to cover the vehicle registration and for the
privilege of parking on its premises, such vehicle registration fee is subject to sales tax under Section
1105(c)(6) of the Tax Law. See Section 527.1(b) of the Sales and Use Tax Regulations.

DATED: January 28, 2000

NOTE:

/s/
John W. Bartlett
Deputy Director
Technical Services Division

The opinions expressed in Advisory Opinions are
limited to the facts set forth therein.