Senate Study Bill 1312 SENATE FILE BY (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON BOLKCOM) Passed Senate, Date Passed House, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act relating to the taxation of persons who are 2 self=generators of electricity solely for their own 3 consumption and including a retroactive applicability date 4 provision. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 TLSB 2671SC 83 7 mg/sc/5 PAG LIN 1 1 Section 1. Section 437A.3, subsection 27, Code 2009, is 1 2 amended to read as follows: 1 3 27. "Self=generator" means a person, other than an 1 4 electric company, natural gas company, electric cooperative, 1 5 or municipal utility, who generates, by means of an on=site 1 6 facility wholly owned by or leased in its entirety to such 1 7 person, electricity solely for its own consumption, or for the 1 8 consumption of any owner, shareholder, member, beneficiary, 1 9 partner, or associate of such person, except for inadvertent 1 10 unscheduled deliveries to the electric utility furnishing 1 11 electric service to that self=generator.A person who 1 12 generates electricity which is consumed by any other person, 1 13 including any owner, shareholder, member, beneficiary, 1 14 partner, or associate of the person who generates electricity, 1 15 is not a self=generator.For purposes of this subsection, 1 16 "on=site facility" means an electric power generating plant 1 17 that is wholly owned by or leased in its entirety to a person 1 18 and used to generate electricity solely for consumption by 1 19 such person or by any owner, shareholder, member, beneficiary, 1 20 partner, or associate of such person on the same parcel of 1 21 land on which such plant is located or on a contiguous parcel 1 22 of land. For purposes of this subsection, "parcel of land" 1 23 includes each separate parcel of land shown on the tax list. 1 24 Sec. 2. RETROACTIVE APPLICABILITY DATE. This Act applies 1 25 retroactively to January 1, 2009, for tax years beginning on 1 26 or after that date. 1 27 EXPLANATION 1 28 Under current law, a self=generator is a person, other than 1 29 utility companies, who generates by means of an on=site 1 30 facility electricity solely for its own purposes. Such a 1 31 person is exempt from payment of any replacement taxes under 1 32 Code chapter 437A and is subject to local property taxes. 1 33 However, if the on=site facility generates electricity that is 1 34 consumed by any other person, even a person related to the 1 35 person owning or leasing the on=site facility, then the 2 1 facility is not considered a self=generator. This means it 2 2 would be subject to the replacement tax and not the local 2 3 property tax. 2 4 This bill strikes the language that provides that the 2 5 on=site facility that generates electricity to other persons 2 6 including those related to the owner of the facility, is not a 2 7 self=generator and includes language that expands the 2 8 definition of self=generator to include those related to the 2 9 owner or lessee of the facility. The result of the bill is 2 10 that the facility that generates electricity for its own 2 11 consumption and which is consumed by a person who is a 2 12 shareholder, member, beneficiary, partner, or associate of the 2 13 owner or lessee of the facility is considered a self=generator 2 14 and is exempt from the replacement tax and subject to the 2 15 local property tax. 2 16 The bill applies retroactively to January 1, 2009, for tax 2 17 years beginning on or after that date. 2 18 LSB 2671SC 83 2 19 mg/sc/5