House File 2561 - Introduced HOUSE FILE 2561 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HSB 704) A BILL FOR An Act relating to the assessment and taxation of wind 1 energy conversion property and including effective date, 2 applicability, and retroactive applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 6194HV (2) 89 md/jh

H.F. 2561 Section 1. Section 427B.26, subsection 1, paragraph b, Code 1 2022, is amended to read as follows: 2 b. If in the opinion of the city council or the county 3 board of supervisors continuation of the special valuation 4 provided under this section ceases to be of benefit to the 5 city or county, the city council or the county board of 6 supervisors may repeal the ordinance authorized by this 7 subsection . Property specially valued under this section prior 8 to repeal of the ordinance shall continue to be valued under 9 this section until the end of the nineteenth assessment year 10 following the assessment year in which the property was first 11 assessed. Following repeal of the ordinance and conclusion of 12 the applicable nineteen-year period, the wind energy conversion 13 property shall be subject to assessment and taxation under 14 chapter 437A, section 441.21, subsection 8, paragraphs “b” , “c” , 15 and “d” , or sections 428.24 through 428.26, 428.28, and 428.29, 16 as applicable. 17 Sec. 2. Section 427B.26, subsection 2, unnumbered paragraph 18 1, Code 2022, is amended to read as follows: 19 In lieu of the valuation and assessment provisions in 20 chapter 437A, section 441.21, subsection 8 , paragraphs “b” , “c” , 21 and “d” , and sections 428.24 through 428.26 , 428.28 , and 428.29 , 22 as applicable, wind energy conversion property which is first 23 assessed for property taxation on or after January 1, 1994, 24 and on or after the effective date of the ordinance enacted 25 pursuant to subsection 1 , shall be valued by the local assessor 26 for property tax purposes as follows: 27 Sec. 3. Section 427B.26, subsections 3 and 4, Code 2022, are 28 amended to read as follows: 29 3. a. The taxpayer shall file with the local assessor by 30 February 1 of the assessment year in which the wind energy 31 conversion property is first assessed for property tax 32 purposes, a declaration of intent to have the property assessed 33 at the value determined under this section in lieu of the 34 valuation and assessment provisions in chapter 437A, section 35 -1- LSB 6194HV (2) 89 md/jh 1/ 3

H.F. 2561 441.21, subsection 8 , paragraphs “b” , “c” , and “d” , and sections 1 428.24 through 428.26 , 428.28 , and 428.29 , as applicable . 2 b. Maintaining, refurbishing, or repowering wind energy 3 conversion property shall not cause the wind energy conversion 4 property to receive a new assessment schedule under subsection 5 2. 6 4. For purposes of this section : 7 a. “Collector substation” means an electrical substation 8 designed to collect energy from multiple electricity-generating 9 sources. 10 a. b. “Net acquisition cost” means the acquired cost of the 11 property including all foundations and installation cost less 12 any excess cost adjustment. However, except in the case of a 13 clerical error, an adjustment shall not be made after the third 14 year the wind energy conversion property is assessed. 15 c. “Repowering” means the removal and replacement of 16 components of wind energy conversion property. 17 b. d. “Wind energy conversion property” means the entire 18 wind plant including , but not limited to , a wind charger, 19 windmill, wind turbine, tower and electrical equipment, pad 20 mount transformers, power lines, and collector substation. 21 Sec. 4. EFFECTIVE DATE. This Act, being deemed of immediate 22 importance, takes effect upon enactment. 23 Sec. 5. RETROACTIVE APPLICABILITY. Except for section 24 427B.26, subsection 3, paragraph “b”, as enacted in this Act, 25 this Act applies retroactively to assessment years beginning on 26 or after January 1, 2022. 27 Sec. 6. APPLICABILITY. Section 427B.26, subsection 3, 28 paragraph “b”, as enacted in this Act, applies to assessment 29 schedules commenced under section 427B.26, subsection 2, on or 30 after the effective date of this Act. 31 EXPLANATION 32 The inclusion of this explanation does not constitute agreement with 33 the explanation’s substance by the members of the general assembly. 34 Code section 427B.26 governs the special valuation of 35 -2- LSB 6194HV (2) 89 md/jh 2/ 3

H.F. 2561 wind energy conversion property for such property covered by 1 an ordinance adopted by a city council or county board of 2 supervisors. 3 This bill specifies that the special valuation provisions 4 authorized by local ordinance, in addition to other provisions 5 identified in Code section 427B.26, are in lieu of the 6 assessment and taxation provisions of Code chapter 437A 7 (electricity replacement tax). 8 If such ordinance is repealed, property specially valued 9 under Code section 427B.26 shall continue to be valued under 10 that Code section until the end of the 19th assessment year 11 following the assessment year in which the property was first 12 assessed. The bill specifies the other provisions of law that 13 govern the assessment and taxation of such property after 14 conclusion of the applicable 19-year period. 15 The bill also provides that maintaining, refurbishing, or 16 repowering wind energy conversion property shall not cause 17 the wind energy conversion property to receive a new special 18 valuation schedule under Code section 427B.26. The bill 19 defines “repowering” and modifies the definition of “wind 20 energy conversion property” to specify that substations that 21 are “collector substations”, as defined in the bill, are wind 22 energy conversion property. The bill also specifies that, for 23 purposes of determining net acquisition cost, except for a 24 clerical error, an adjustment shall not be made after the third 25 year the wind energy conversion property is assessed. 26 The bill takes effect upon enactment and, except for 27 Code section 427B.26(3)(b), as enacted in the bill, applies 28 retroactively to assessment years beginning on or after January 29 1, 2022. Code section 427B.26(3)(b), as enacted in the bill, 30 applies to assessment schedules commenced on or after the 31 effective date of the bill. 32 -3- LSB 6194HV (2) 89 md/jh 3/ 3