HF 48 (LSB 1049YH (4) 85)

HOUSE FILE 48

BY  T. OLSON

A BILL FOR

An Act relating to property tax valuation and exemption of value added by installation of certain geothermal, solar, and wind energy property.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 427.1, subsection 38, paragraphs a and b, Code 2013, are amended to read as follows:
   a.  The value added by any new or refitted construction or installation of a geothermal heating or cooling system on or after July 1, 2012, on property classified as residential. The exemption shall be allowed for ten consecutive years. The exemption shall apply to any value added by the addition of mechanical, electrical, plumbing, ductwork, or other equipment, labor, and expenses included in or required for the construction or installation of the geothermal system, as well as the proportionate value of any well field associated with the system and attributable to the owner. 
   b.  A person claiming an exemption under this subsection shall obtain the appropriate forms from the assessor. The forms shall be prescribed by the director of revenue. The claim shall be filed no later than February 1 of the first assessment year the exemption is requested and shall contain information pertaining to all costs and other information associated with construction and installation of the system. Once the exemption is allowed, the exemption shall continue to be allowed for ten consecutive years without further filing as long as the property continues to be classified as residential property.
    Sec. 2.  Section 441.21, subsection 8, paragraphs b and c, Code 2013, are amended to read as follows:
   b.  Notwithstanding paragraph “a”, any construction or installation of a solar energy system on property classified as agricultural, residential, commercial, or industrial property shall not increase the actual, assessed, and taxable values of the property for five full assessment years.
   c.  As used in this subsection, “solar energy system” means either of the following:
   (1)  A system of equipment capable of collecting and converting incident solar radiation or wind energy into thermal, mechanical or electrical energy and transforming these forms of energy by a separate apparatus to storage or to a point of use which is constructed or installed after January 1, 1978
 
2008.
   (2)  A system that uses the basic design of the building to maximize solar heat gain during the cold season and to minimize solar heat gain in the hot season and that uses natural means to collect, store, and distribute solar energy which is constructed or installed after January 1, 1981
 
2008.
    Sec. 3.  IMPLEMENTATION OF ACT.  Section 25B.7 shall not apply to this Act.
EXPLANATION
   In 2012, a property tax exemption was enacted for the value added by any new or refitted construction or installation of a geothermal heating or cooling system on or after July 1, 2012, on property classified as residential. The exemption is allowed for 10 consecutive years following application and approval. This bill removes the 10-year limitation on the exemption.
   Current Code section 441.21(8) provides that any construction or installation of a solar energy system on property classified as agricultural, residential, commercial, or industrial property shall not increase the actual, assessed, and taxable values of the property for five full assessment years. The bill removes the five-year limitation and specifies that such added value of solar energy systems constructed or installed after January 1, 2008, is exempt from taxation.
   Code section 441.21(8) defines “solar energy system” to mean either: (1) a system of equipment capable of collecting and converting incident solar radiation or wind energy into thermal, mechanical, or electrical energy and transforming these forms of energy by a separate apparatus to storage or to a point of use or (2) a system that uses the basic design of the building to maximize solar heat gain during the cold season and to minimize solar heat gain in the hot season and that uses natural means to collect, store, and distribute solar energy.
   The bill provides that the provisions in Code section 25B.7, relating to the obligation of the state to reimburse local jurisdictions for property tax credits and exemptions, do not apply to the exemptions in the bill.