Senate File 216 - Introduced SENATE FILE BY COMMITTEE ON ENVIRONMENT AND ENERGY INDEPENDENCE (SUCCESSOR TO SF 79) Passed Senate, Date Passed House, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act modifying wind energy production tax credit eligibility 2 requirements, providing for a refund of sales and use taxes, 3 and including effective and retroactive applicability date 4 provisions. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 TLSB 1671SV 83 7 rn/mg:sc/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. 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 Sec. 2. Section 476B.4, Code 2009, is amended to read as 1 8 follows: 1 9 476B.4LIMITATIONSLIMITATION. 1 101. The wind energy production tax credit shall not be 1 11 allowed for any kilowatt=hour of electricity produced on wind 1 12 energy conversion property for which the owner has claimed or 1 13 otherwise received for that property the benefit of special 1 14 valuation under section 427B.26 or section 441.21, subsection 1 15 8, or the exemption from retail sales tax under section 1 16 422.45, subsection 48, Code Supplement 2003, or section 423.3, 1 17 subsection 54, as applicable.1 182.The wind energy production tax credit shall not be 1 19 allowed for any kilowatt=hour of electricity that is sold to a 1 20 related person. Forpurposepurposes of thissubsection1 21 section, persons shall be treated as related to each other if 1 22 such persons would be treated as a single employer under the 1 23 regulations prescribed under section 52(b) of the Internal 1 24 Revenue Code. In the case of a corporation that is a member 1 25 of an affiliated group of corporations filing a consolidated 1 26 return, such corporation shall be treated as selling 1 27 electricity to an unrelated person if such electricity is sold 1 28 to such a person by another member of such group. 1 29 Sec. 3. Section 476B.6, subsection 1, Code 2009, is 1 30 amended to read as follows: 1 31 1. a. If a city or a county in which a qualified facility 1 32 is located has enacted an ordinance under section 427B.26 and 1 33 an owner has filed for and received special valuation pursuant 1 34 to that ordinance, the owner is not required to obtain 1 35 approval from the city council or county board of supervisors 2 1 to apply for the wind energy production tax credit pursuant to 2 2 subsection 2. 2 3a.b. (1)To be eligible to receive the wind energy 2 4 production tax credit,If neither a city nor a county in which 2 5 a qualified facility is located has enacted an ordinance under 2 6 section 427B.26, or a qualified facility is not eligible for 2 7 special valuation pursuant to an ordinance adopted by a city 2 8 or a county under section 427B.26, the owner mustfirst2 9 receive approval of the applicable city council or county 2 10 board of supervisors of the city or county in which the 2 11 qualified facility is located in order to be eligible to 2 12 receive the wind energy production tax credit. The 2 13 application for approval may be submitted prior to 2 14 commencement of the construction of the qualified facility but 2 15 shall be submitted no later than the close of the owner's 2 16 first taxable year for which the credit is to be applied for. 2 17 The application must contain the owner's name and address, the 2 18 address of the qualified facility, and the dates of the 2 19 owner's first and last taxable years for which the credit will 2 20 be applied for. Within forty=five days of the receipt of the 2 21 application for approval, the city council or county board of 2 22 supervisors, as applicable, shall either approve or disapprove 2 23 the application. After the forty=five=daylimittime period 2 24 has expired, the application is deemed to be approved. 2 25b.(2) Upon approval ofthean application submitted 2 26 pursuant to subparagraph (1), the owner may apply for the tax 2 27 credit as provided in subsection 2. In addition, approval of 2 28 the application submitted pursuant to subparagraph (1) is 2 29 acceptance by the applicant for the assessment of the 2 30 qualified facility for property tax purposes for a period of 2 31 twelve years and approval by the city council or county board 2 32 of supervisors, as applicable, for the payment of the property 2 33 taxes levied on the qualified property to the state. For 2 34 purposes of property taxation, the qualified facility 2 35 receiving approval of an application submitted pursuant to 3 1 subparagraph (1) shall be centrally assessed and shall be 3 2 exempt from any replacement tax under section 437A.6 for the 3 3 period during which the facility is subject to property 3 4 taxation. The property taxes to be paid to the state are 3 5 those property taxes which make up the consolidated tax levied 3 6 on the qualified facility and which are due and payable in the 3 7 twelve=year period beginning with the first fiscal year 3 8 beginning on or after the end of the owner's first taxable 3 9 year for which the credit is applied for. Upon approval of 3 10 the application, the city council or county board of 3 11 supervisors, as applicable, shall notify the county treasurer 3 12 tostatedesignate on the tax statement which lists the taxes 3 13 on the qualified facilitythatthe amount of the property 3 14 taxesshallto be paid to the department. Payment of the 3 15 designated property taxes to the department shall be in the 3 16 same manner as required for the payment of regular property 3 17 taxes and failure to pay designated property taxes to the 3 18 department shall be treated the same as failure to pay 3 19 property taxes to the county treasurer. 3 20 c. Once the owner of the qualified facility receives 3 21 approval under paragraph"a""b", subsequent approval under 3 22 paragraph"a""b" is not required for the same qualified 3 23 facility for subsequent taxable years. 3 24 Sec. 4. REFUNDS. Refunds of taxes, interest, or penalties 3 25 which may arise from claims resulting from the amendment of 3 26 section 476B.4 in this Act, for the exemption of sales of wind 3 27 energy conversion property as provided in section 423.3, 3 28 subsection 54, occurring between January 1, 2008, and the 3 29 effective date of this Act, shall not be allowed unless refund 3 30 claims are filed prior to October 1, 2009, notwithstanding any 3 31 other provision of law. Claimants shall not be entitled to 3 32 interest on any refunds. 3 33 Sec. 5. EFFECTIVE AND APPLICABILITY DATES. This Act, 3 34 being deemed of immediate importance, takes effect upon 3 35 enactment and applies retroactively to January 1, 2008, for 4 1 tax years beginning on or after that date. 4 2 EXPLANATION 4 3 This bill modifies eligibility requirements applicable to 4 4 the wind energy production tax credit established in Code 4 5 chapter 476B. 4 6 The bill provides for a maximum combined nameplate capacity 4 7 restriction of no more than 30 megawatts for wind energy 4 8 production facilities applying for the wind energy production 4 9 tax credit. 4 10 The bill deletes a provision which had prevented 4 11 eligibility for the wind energy production tax credit for any 4 12 kilowatt=hour of electricity produced on wind energy 4 13 conversion property for which the owner had claimed or 4 14 received specified special property tax valuation or sales tax 4 15 exemptions, thus preserving credit availability for owners 4 16 having received special valuation or having claimed the sales 4 17 tax exemption. Because of the retroactivity of the 4 18 elimination of the restriction of the receipt of the tax 4 19 credit to those who have not received the sales tax exemption, 4 20 a provision for refund of sales tax paid is included in the 4 21 bill. 4 22 The bill takes effect upon enactment and applies 4 23 retroactively to January 1, 2008, for tax years beginning on 4 24 or after that date. 4 25 LSB 1671SV 83 4 26 rn/mg:sc/8