House File 814 - Introduced
HOUSE FILE
BY COMMITTEE ON WAYS AND MEANS
(SUCCESSOR TO HF 747)
(SUCCESSOR TO HSB 57)
Passed House, Date Passed Senate, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act modifying provisions applicable to facilities qualifying
2 for wind energy production and renewable energy tax credits
3 and including effective and retroactive applicability
4 provisions.
5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
6 TLSB 1649HZ 83
7 rn/mg/8
PAG LIN
1 1 Section 1. Section 476B.1, subsection 4, paragraph d, Code
1 2 2009, is amended to read as follows:
1 3 d. (1) For applications filed on or after March 1, 2008,
1 4 consists of one or more wind turbines connected to a common
1 5 gathering line which have a combined nameplate capacity of no
1 6 less than two megawatts and no more than thirty megawatts.
1 7 (2) For applications filed on or after July 1, 2009, by a
1 8 private college or university, community college, institution
1 9 under the control of the state board of regents, public or
1 10 accredited nonpublic elementary and secondary school, or
1 11 public hospital as defined in section 249J.3, for the
1 12 applicant's own use of qualified electricity, consists of wind
1 13 turbines with a combined nameplate capacity of three=fourths
1 14 of a megawatt or greater.
1 15 Sec. 2. Section 476B.4, Code 2009, is amended to read as
1 16 follows:
1 17 476B.4 LIMITATIONS LIMITATION.
1 18 1. The wind energy production tax credit shall not be
1 19 allowed for any kilowatt=hour of electricity produced on wind
1 20 energy conversion property for which the owner has claimed or
1 21 otherwise received for that property the benefit of special
1 22 valuation under section 427B.26 or section 441.21, subsection
1 23 8, or the exemption from retail sales tax under section
1 24 422.45, subsection 48, Code Supplement 2003, or section 423.3,
1 25 subsection 54, as applicable.
1 26 2. The wind energy production tax credit shall not be
1 27 allowed for any kilowatt=hour of electricity that is sold to a
1 28 related person. For purpose purposes of this subsection
1 29 section, persons shall be treated as related to each other if
1 30 such persons would be treated as a single employer under the
1 31 regulations prescribed under section 52(b) of the Internal
1 32 Revenue Code. In the case of a corporation that is a member
1 33 of an affiliated group of corporations filing a consolidated
1 34 return, such corporation shall be treated as selling
1 35 electricity to an unrelated person if such electricity is sold
2 1 to such a person by another member of such group.
2 2 Sec. 3. Section 476B.5, subsection 4, Code 2009, is
2 3 amended to read as follows:
2 4 4. The maximum amount of nameplate generating capacity of
2 5 all qualified facilities the board may find eligible under
2 6 this chapter shall not exceed four one hundred fifty megawatts
2 7 of nameplate generating capacity.
2 8 Sec. 4. Section 476B.6, subsection 1, Code 2009, is
2 9 amended to read as follows:
2 10 1. a. If a city or a county in which a qualified facility
2 11 is located has enacted an ordinance under section 427B.26 and
2 12 an owner has filed for and received special valuation pursuant
2 13 to that ordinance, the owner is not required to obtain
2 14 approval from the city council or county board of supervisors
2 15 to apply for the wind energy production tax credit pursuant to
2 16 subsection 2.
2 17 a. b. (1) To be eligible to receive the wind energy
2 18 production tax credit, If neither a city nor a county in which
2 19 a qualified facility is located has enacted an ordinance under
2 20 section 427B.26, or a qualified facility is not eligible for
2 21 special valuation pursuant to an ordinance adopted by a city
2 22 or a county under section 427B.26, the owner must first
2 23 receive approval of the applicable city council or county
2 24 board of supervisors of the city or county in which the
2 25 qualified facility is located in order to be eligible to
2 26 receive the wind energy production tax credit. The
2 27 application for approval may be submitted prior to
2 28 commencement of the construction of the qualified facility but
2 29 shall be submitted no later than the close of the owner's
2 30 first taxable year for which the credit is to be applied for.
2 31 The application must contain the owner's name and address, the
2 32 address of the qualified facility, and the dates of the
2 33 owner's first and last taxable years for which the credit will
2 34 be applied for. Within forty=five days of the receipt of the
2 35 application for approval, the city council or county board of
3 1 supervisors, as applicable, shall either approve or disapprove
3 2 the application. After the forty=five=day limit time period
3 3 has expired, the application is deemed to be approved.
3 4 b. (2) Upon approval of the an application submitted
3 5 pursuant to subparagraph (1), the owner may apply for the tax
3 6 credit as provided in subsection 2. In addition, approval of
3 7 the application submitted pursuant to subparagraph (1) is
3 8 acceptance by the applicant for the assessment of the
3 9 qualified facility for property tax purposes for a period of
3 10 twelve years and approval by the city council or county board
3 11 of supervisors, as applicable, for the payment of the property
3 12 taxes levied on the qualified property to the state. For
3 13 purposes of property taxation, the qualified facility
3 14 receiving approval of an application submitted pursuant to
3 15 subparagraph (1) shall be centrally assessed and shall be
3 16 exempt from any replacement tax under section 437A.6 for the
3 17 period during which the facility is subject to property
3 18 taxation. The property taxes to be paid to the state are
3 19 those property taxes which make up the consolidated tax levied
3 20 on the qualified facility and which are due and payable in the
3 21 twelve=year period beginning with the first fiscal year
3 22 beginning on or after the end of the owner's first taxable
3 23 year for which the credit is applied for. Upon approval of
3 24 the application, the city council or county board of
3 25 supervisors, as applicable, shall notify the county treasurer
3 26 to state designate on the tax statement which lists the taxes
3 27 on the qualified facility that the amount of the property
3 28 taxes shall to be paid to the department. Payment of the
3 29 designated property taxes to the department shall be in the
3 30 same manner as required for the payment of regular property
3 31 taxes and failure to pay designated property taxes to the
3 32 department shall be treated the same as failure to pay
3 33 property taxes to the county treasurer.
3 34 c. Once the owner of the qualified facility receives
3 35 approval under paragraph "a" "b", subsequent approval under
4 1 paragraph "a" "b" is not required for the same qualified
4 2 facility for subsequent taxable years.
4 3 Sec. 5. Section 476C.3, subsection 3, Code 2009, is
4 4 amended to read as follows:
4 5 3. A facility that is not operational within thirty months
4 6 after issuance of an approval for the facility by the board
4 7 shall cease to be an eligible renewable energy facility.
4 8 However, a wind energy conversion facility that is approved as
4 9 eligible under this section but is not operational within
4 10 eighteen months due to the unavailability of necessary
4 11 equipment shall be granted an additional twelve twenty=four
4 12 months to become operational. A facility that is granted and
4 13 thereafter loses approval may reapply to the board for a new
4 14 determination.
4 15 Sec. 6. Section 476C.3, subsection 4, Code 2009, is
4 16 amended to read as follows:
4 17 4. The maximum amount of nameplate generating capacity of
4 18 all wind energy conversion facilities the board may find
4 19 eligible under this chapter shall not exceed one three hundred
4 20 eighty thirty megawatts of nameplate generating capacity. The
4 21 maximum amount of energy production capacity equivalent of all
4 22 other facilities the board may find eligible under this
4 23 chapter shall not exceed a combined output of twenty megawatts
4 24 of nameplate generating capacity and one hundred sixty=seven
4 25 billion British thermal units of heat for a commercial
4 26 purpose. Of the maximum amount of energy production capacity
4 27 equivalent of all other facilities found eligible under this
4 28 chapter, fifty=five billion British thermal units of heat for
4 29 a commercial purpose shall be reserved for an eligible
4 30 facility that is a refuse conversion facility for processed,
4 31 engineered fuel from a multicounty solid waste management
4 32 planning area. The maximum amount of energy production
4 33 capacity the board may find eligible for a single refuse
4 34 conversion facility is fifty=five billion British thermal
4 35 units of heat for a commercial purpose.
5 1 Sec. 7. REFUNDS. Refunds of taxes, interest, or penalties
5 2 which may arise from claims resulting from the amendment of
5 3 section 476B.4 in this Act, for the exemption of sales of wind
5 4 energy conversion property as provided in section 423.3,
5 5 subsection 54, occurring between January 1, 2008, and the
5 6 effective date of this Act, shall be limited to one hundred
5 7 thousand dollars in the aggregate and shall not be allowed
5 8 unless refund claims are filed prior to October 1, 2009,
5 9 notwithstanding any other provision of law. If the amount of
5 10 claims totals more than one hundred thousand dollars in the
5 11 aggregate, the department of revenue shall prorate the one
5 12 hundred thousand dollars among all claimants in relation to
5 13 the amounts of the claimants' valid claims. Claimants shall
5 14 not be entitled to interest on any refunds.
5 15 Sec. 8. RENEWABLE ENERGY TAX CREDIT ELIGIBILITY STUDY.
5 16 The utilities board of the utilities division of the
5 17 department of commerce shall conduct a study to evaluate
5 18 whether procedures applicable to eligible renewable energy
5 19 facilities which have been approved for the renewable energy
5 20 tax credit but are not yet operational pursuant to section
5 21 476C.3, subsection 3, and eligible renewable energy facilities
5 22 which have been placed on a waiting list for approval pursuant
5 23 to section 476C.3, subsection 5, are in need of modification.
5 24 The study shall include a survey of each facility which has
5 25 been approved to determine the extent to which progress has
5 26 been made toward achieving operational status. The study
5 27 shall also include a survey of each facility which has been
5 28 determined eligible and is awaiting approval, to ascertain
5 29 whether the facility continues to seek approval and is
5 30 committed to becoming operational once approval is obtained.
5 31 Based on the results of the surveys, the board shall submit
5 32 recommendations to the general assembly by January 1, 2010,
5 33 regarding whether statutory or procedural modifications are
5 34 necessary to ensure that facilities are being effectively and
5 35 efficiently maintained in an approved or eligible status.
6 1 Sec. 9. EFFECTIVE AND APPLICABILITY DATES. The sections
6 2 of this Act enacting section 476B.1, subsection 4, paragraph
6 3 "d", subparagraph (1), and amending sections 476B.4 and
6 4 476B.6, being deemed of immediate importance, take effect upon
6 5 enactment and apply retroactively to January 1, 2008, for tax
6 6 years beginning on or after that date.
6 7 EXPLANATION
6 8 This bill modifies eligibility requirements applicable to
6 9 the wind energy production tax credit established in Code
6 10 chapter 476B and the renewable energy tax credit established
6 11 in Code chapter 476C.
6 12 With regard to the wind energy production tax credit, the
6 13 bill provides for a maximum combined nameplate capacity
6 14 restriction of no more than 30 megawatts for applicants for
6 15 the credit. The bill also adds to the definition of
6 16 "qualified facility", for applications filed on or after July
6 17 1, 2009, by a private college or university, community
6 18 college, institution under the control of the state board of
6 19 regents, a public or accredited nonpublic primary or secondary
6 20 school, or public hospital as defined in Code section 249J.3,
6 21 for the applicant's own use of qualified electricity a wind
6 22 turbine with a combined nameplate capacity of three=fourths of
6 23 a megawatt or greater.
6 24 The bill deletes a provision which had prevented
6 25 eligibility for the wind energy production tax credit for any
6 26 kilowatt=hour of electricity produced on wind energy
6 27 conversion property for which the owner had claimed or
6 28 received specified special property tax valuation or sales tax
6 29 exemptions, thus preserving credit availability for owners
6 30 having received special valuation or having claimed the sales
6 31 tax exemptions. Because of the retroactivity of the
6 32 elimination of the restriction of the receipt of the tax
6 33 credit to those who have not received the sales tax exemption,
6 34 a provision for refund of sales tax paid is included in the
6 35 bill. These provisions and the provision regarding a maximum
7 1 combined nameplate capacity restriction take effect upon
7 2 enactment and apply retroactively to January 1, 2008, for tax
7 3 years beginning on or after that date.
7 4 The bill changes a provision specifying the maximum amount
7 5 of nameplate generating capacity of all qualifying facilities
7 6 under Code chapter 476B, currently at 450 megawatts of
7 7 nameplate generating capacity, to 150 megawatts.
7 8 With regard to the renewable energy tax credit, the bill
7 9 provides for an extension of time for a wind energy conversion
7 10 facility to become operational following issuance of an
7 11 approval from the current period of 12 additional months to 24
7 12 additional months.
7 13 The bill changes a provision specifying the maximum amount
7 14 of nameplate generating capacity for all eligible wind energy
7 15 conversion facilities under Code chapter 476C, currently at
7 16 180 megawatts of nameplate generating capacity, to 330
7 17 megawatts.
7 18 Additionally, the bill directs the utilities board of the
7 19 utilities division of the department of commerce to conduct a
7 20 study to evaluate whether procedures applicable to eligible
7 21 renewable energy facilities which have been approved for the
7 22 renewable energy tax credit under Code chapter 476C but are
7 23 not yet operational, and facilities which have been placed on
7 24 a waiting list for approval, are in need of modification. The
7 25 board is required to submit recommendations to the general
7 26 assembly by January 1, 2010, regarding whether statutory or
7 27 procedural modifications appear necessary.
7 28 LSB 1649HZ 83
7 29 rn/mg/8