HOUSE BILL NO. 189

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Bill Status



H0189...............................................by REVENUE AND TAXATION
WIND ENERGY - Amends and adds to existing law relating to producers of
electricity by means of wind energy to provide for a wind energy tax; to
provide for the filing of operator's statements by producers of electricity
by means of wind energy; to provide for the computation, allotment and
apportionment of tax due from producers of electricity by means of wind
energy by the State Tax Commission and to require certain notifications; to
authorize county treasurers to collect specified taxes from producers of
electricity by means of wind energy; to provide for tax liens on property
of producers of electricity by means of wind energy; to provide for the
assessment of nonoperating property of producers of electricity by means of
wind energy; and to provide an exemption from taxation for certain
operating property of producers of electricity by means of wind energy.
                                                                        
02/13    House intro - 1st rdg - to printing
02/14    Rpt prt - to Rev/Tax
02/16    Rpt out - rec d/p - to 2nd rdg
02/19    2nd rdg - to 3rd rdg
02/22    3rd rdg - PASSED - 69-0-1
      AYES -- Anderson, Andrus, Barrett, Bayer, Bedke, Bell, Bilbao, Black,
      Block, Bock, Boe, Bolz, Brackett, Bradford, Chadderdon, Chavez, Chew,
      Clark, Collins, Crane, Durst, Edmunson, Eskridge, Hagedorn, Hart,
      Harwood, Henbest, Henderson, Jaquet, Killen, King, Kren, Labrador,
      Lake, LeFavour, Loertscher, Luker, Marriott, Mathews, McGeachin,
      Mortimer, Moyle, Nielsen, Nonini, Pasley-Stuart, Patrick, Pence,
      Raybould, Ring, Ringo, Roberts, Ruchti, Rusche, Sayler, Schaefer,
      Shepherd(2), Shepherd(8), Shirley, Shively, Smith(30), Smith(24),
      Snodgrass, Stevenson, Thayn, Trail, Vander Woude, Wood(27), Wood(35),
      Mr. Speaker
      NAYS -- None
      Absent and excused -- Wills
    Floor Sponsor - Eskridge
    Title apvd - to Senate
02/23    Senate intro - 1st rdg - to Loc Gov
03/07    Rpt out - rec d/p - to 2nd rdg
03/08    2nd rdg - to 3rd rdg
03/13    3rd rdg - PASSED - 30-0-3, 2 Excused from voting
      AYES -- Andreason, Bastian, Bilyeu, Broadsword, Burkett, Cameron,
      Coiner, Corder, Darrington, Davis, Fulcher, Gannon, Goedde, Hammond,
      Heinrich, Hill, Jorgenson, Kelly, Keough, Langhorst, Little, McGee,
      McKague, McKenzie, Pearce, Richardson, Schroeder, Stegner, Stennett,
      Werk
      NAYS -- None
      Absent and excused -- Geddes, Lodge, Malepeai
      Excused from voting -- Bair, Siddoway
    Floor Sponsor - McKenzie
    Title apvd - to House
03/14    To enrol
03/15    Rpt enrol - Sp signed - Pres signed
03/16    To Governor
03/21    Governor signed
         Session Law Chapter 143
         Effective: 01/01/07

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-ninth Legislature                   First Regular Session - 2007
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                     HOUSE BILL NO. 189
                                                                        
                             BY REVENUE AND TAXATION COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY; AMENDING SECTION
  3        63-3501, IDAHO CODE, TO REVISE DEFINITIONS, TO PROVIDE CORRECT TERMINOLOGY
  4        AND TO MAKE A TECHNICAL CORRECTION; AMENDING CHAPTER 35, TITLE  63,  IDAHO
  5        CODE,  BY  THE  ADDITION OF A NEW SECTION 63-3502B, IDAHO CODE, TO PROVIDE
  6        FOR A WIND ENERGY TAX; AMENDING CHAPTER 35, TITLE 63, IDAHO CODE,  BY  THE
  7        ADDITION  OF A NEW SECTION 63-3503B, IDAHO CODE, TO PROVIDE FOR THE FILING
  8        OF OPERATORS' STATEMENTS BY PRODUCERS OF  ELECTRICITY  BY  MEANS  OF  WIND
  9        ENERGY, TO PROVIDE FOR THE COMPUTATION, ALLOTMENT AND APPORTIONMENT OF TAX
 10        DUE FROM PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY BY THE STATE TAX
 11        COMMISSION AND TO REQUIRE CERTAIN NOTIFICATIONS; AMENDING SECTION 63-3504,
 12        IDAHO CODE, TO AUTHORIZE COUNTY TREASURERS TO COLLECT SPECIFIED TAXES FROM
 13        PRODUCERS  OF  ELECTRICITY BY MEANS OF WIND ENERGY AND TO MAKE A TECHNICAL
 14        CORRECTION; AMENDING SECTION 63-3505, IDAHO CODE, TO PROVIDE FOR TAX LIENS
 15        ON PROPERTY OF PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY,  TO  PRO-
 16        VIDE CORRECT TERMINOLOGY AND TO MAKE A TECHNICAL CORRECTION; AMENDING SEC-
 17        TION  63-3506,  IDAHO  CODE, TO PROVIDE FOR THE ASSESSMENT OF NONOPERATING
 18        PROPERTY OF PRODUCERS OF ELECTRICITY BY MEANS  OF  WIND  ENERGY;  AMENDING
 19        CHAPTER  6,  TITLE  63,  IDAHO  CODE,  BY  THE  ADDITION  OF A NEW SECTION
 20        63-602JJ, IDAHO CODE, TO PROVIDE AN EXEMPTION FROM  TAXATION  FOR  CERTAIN
 21        OPERATING  PROPERTY  OF  PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY;
 22        DECLARING AN EMERGENCY AND PROVIDING RETROACTIVE APPLICATION.
                                                                        
 23    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 24        SECTION 1.  That Section 63-3501, Idaho Code, be, and the same  is  hereby
 25    amended to read as follows:
                                                                        
 26        63-3501.  DEFINITIONS. For the purposes of this act chapter:
 27        (a)  The  term  "cooperative  electrical association" means any nonprofit,
 28    cooperative association organized  and  maintained  by  its  members,  whether
 29    incorporated  or unincorporated, for the purpose of transmitting, distributing
 30    or delivering electric power to its members.
 31        (b)  The term "cooperative natural gas association"  means  any  nonprofit
 32    cooperative  association  organized  and  maintained  by  its members, whether
 33    incorporated or unincorporated, for the purpose of transmitting,  distributing
 34    or delivering natural gas to its members.
 35        (c)  The term "cost of power" means the cost of power purchases and gener-
 36    ation  included  in reports to, and in accordance with applicable requirements
 37    of, the rural electrification  administration,  United  States  department  of
 38    agriculture,  by  cooperative electrical associations which are borrowers from
 39    the rural electrification administration, and for cooperative electrical asso-
 40    ciations which are not borrowers from the  rural  electrification  administra-
 41    tion, such costs which could have been included by such cooperative electrical
 42    associations using equivalent reporting and accounting requirements. The state
 43    tax commission shall prescribe necessary rules and regulations for the purpose
                                                                        
                                       2
                                                                        
  1    of providing a uniform method of reporting cost of power purchases and genera-
  2    tion by cooperative electrical associations, consistent with the reporting and
  3    accounting requirements of the rural electrification administration.
  4        (d)  The  term  "cost  of  gas" means the cost of natural gas purchased by
  5    cooperative natural gas associations from wholesale or other suppliers of nat-
  6    ural gas for delivery to members of the cooperative natural gas association.
  7        (e)  The term "gross electrical earnings" means the gross  receipts  of  a
  8    cooperative electrical association from the distribution, delivery and sale of
  9    electric  power  within the state of Idaho, but shall not include any earnings
 10    or receipts from the distribution, delivery or sale of electric power consumed
 11    in pumping water for irrigation or  drainage  purposes  within  the  state  of
 12    Idaho,  upon  the land of such consumer and for the use and benefit of his own
 13    land, and where such consumer has received  from  the  association  a  refund,
 14    rebate, or credit of three and one-half percent (3 1/2%) of the cost to him of
 15    the electric power so used and consumed.
 16        (f)  The  term  "gross natural gas earnings" means the gross receipts of a
 17    cooperative natural gas association from the distribution, delivery  and  sale
 18    of natural gas within the state of Idaho.
 19        (g)  The  term  "gross wind energy earnings" means the gross receipts of a
 20    wind energy generator from the distribution, delivery and sale to  a  customer
 21    for  the  direct use or resale of electrical energy generated, manufactured or
 22    produced by means of wind energy within the state of Idaho.
 23        (h)  The term "operating property" means and  includes  all  real  estate,
 24    fixtures  or  personal property owned, controlled, operated or managed by such
 25    electrical or natural gas association, or producer of electricity by means  of
 26    wind  energy, excluding entities that are regulated by the Idaho public utili-
 27    ties commission as to price, in connection with or to facilitate  the  genera-
 28    tion, transmission, distribution, delivery, or measuring of electric power, or
 29    natural gas, or electrical energy generated, manufactured or produced by means
 30    of  wind  energy,  excluding  entities  that are regulated by the Idaho public
 31    utilities commission as to price, and all conduits, ducts, or  other  devices,
 32    materials,  apparatus  or property for containing, holding or carrying conduc-
 33    tors used or to be used for the transmission,  distribution  and  delivery  of
 34    electric  power, and natural gas, or electrical energy generated, manufactured
 35    or produced by means of wind energy, excluding entities that are regulated  by
 36    the  Idaho  public  utilities  commission  as to price, including construction
 37    tools, materials and supplies.
 38        (hi)  The term "nonoperating property" means all other property,  real  or
 39    personal, owned, controlled or managed by such electrical or natural gas asso-
 40    ciation.
 41        (ij)  The  term  "taxing unit" shall include any of the following that had
 42    property taxes levied in the prior year: the separate taxing districts of  the
 43    county as well as the county itself and any such taxing district's fund having
 44    a different geographical boundary than such taxing district itself.
 45        (jk)  The  term "tax levy" means the total tax levies fixed by each taxing
 46    district, as defined herein, in the prior calendar year. next preceding.
 47        (kl)  The term "WPPSS 4 and 5 costs" means, for a  cooperative  electrical
 48    association  which  is  a participant under the Washington public power supply
 49    system nuclear projects numbers 4 and 5 participants'  agreement,  dated  July
 50    14,  1976,  all of its costs in connection with Washington public power supply
 51    system nuclear projects numbers 4 and 5.
 52        (lm)  The term "weighted wire mileage factor"  means  a  figure  which  is
 53    arrived  at  by  multiplying the tax levy of each taxing unit by the number of
 54    wire miles of transmission and distribution lines of such cooperative electri-
 55    cal association situated in such taxing unit.
                                                                        
                                       3
                                                                        
  1        (mn)  The term "gas line mileage factor" means a figure which  is  arrived
  2    at  by  multiplying the tax levy of each taxing unit by the number of miles of
  3    natural gas transmission and distribution lines of  such  cooperative  natural
  4    gas association situated in such taxing unit.
                                                                        
  5        SECTION  2.  That  Chapter  35,  Title 63, Idaho Code, be, and the same is
  6    hereby amended by the addition thereto of a NEW SECTION, to be known and  des-
  7    ignated as Section 63-3502B, Idaho Code, and to read as follows:
                                                                        
  8        63-3502B.  LEVY  OF  TAX ON WIND ENERGY ELECTRICAL PRODUCTION. There shall
  9    be levied against every producer of electricity by means of wind energy a wind
 10    energy tax equal to three percent (3%) of such producer's  gross  wind  energy
 11    earnings.  This  wind  energy  tax  shall be in lieu of all other taxes on the
 12    operating property, as defined in section 63-3501(h), Idaho Code, of such wind
 13    energy producer.
                                                                        
 14        SECTION 3.  That Chapter 35, Title 63, Idaho Code, be,  and  the  same  is
 15    hereby  amended by the addition thereto of a NEW SECTION, to be known and des-
 16    ignated as Section 63-3503B, Idaho Code, and to read as follows:
                                                                        
 17        63-3503B.  FILING OPERATORS' STATEMENTS -- ALLOTMENT AND APPORTIONMENT  OF
 18    TAX  DUE  FROM  PRODUCERS  OF ELECTRICITY BY MEANS OF WIND ENERGY BY STATE TAX
 19    COMMISSION. Every producer of electricity by means  of  wind  energy  in  this
 20    state  shall  file  with  the  state  tax  commission of the state of Idaho an
 21    operator's statement in the manner as provided for in  section  63-404,  Idaho
 22    Code, and shall include thereon a statement of the prior calendar year's gross
 23    wind  energy  earnings. Upon examining and verifying said statement, the state
 24    tax commission shall compute the amount of the wind energy tax  based  on  the
 25    gross wind energy earnings and shall allot to each county in which the operat-
 26    ing  property  of  such  producer is situate that proportion of the total wind
 27    energy tax of such producer shown to be due as the same  proportion  that  the
 28    total  original cost of operating property situate in such county bears to the
 29    total original cost of operating property of such producer for the wind energy
 30    project. The state tax commission shall then, for each county,  apportion  the
 31    wind  energy  tax  so  allotted  to such county among the several taxing units
 32    thereof within which any operating property of such producer  is  situate,  by
 33    apportioning  to  each such taxing unit that proportion of the wind energy tax
 34    so allotted to such county. For such apportionment, the state  tax  commission
 35    shall  calculate  the weighted original cost which shall be the product of the
 36    original cost of such operating property within such taxing  unit  times  such
 37    taxing unit's property tax levy for the prior year and the weighted apportion-
 38    ment  rate  which  shall be the ratio of the wind energy tax, allotted to such
 39    county, to the aggregate weighted original cost  for  all  such  taxing  units
 40    within  which  the  operating property is located and then shall calculate the
 41    apportionment of the wind energy tax for each such taxing unit to be equal  to
 42    the  product  of  the  weighted original cost times the weighted apportionment
 43    rate. The state tax commission shall,  on  or  before  the  second  Monday  in
 44    August,  notify  the  state  superintendent  of public instruction, the county
 45    auditor, and the county treasurer of such allotment and apportionment and  the
 46    amounts  thereof.  On or before the third Monday in August, the county auditor
 47    shall notify the appropriate taxing units of the amount  of  wind  energy  tax
 48    being apportioned.
                                                                        
 49        SECTION  4.  That  Section 63-3504, Idaho Code, be, and the same is hereby
 50    amended to read as follows:
                                                                        
                                       4
                                                                        
  1        63-3504.  COLLECTION BY COUNTY TREASURER -- PENALTY AND  INTEREST  IMPOSED
  2    WHEN  DELINQUENT. Upon receipt of the notification of the allotment and appor-
  3    tionment of such taxes by the state tax commission by  the  county  treasurer,
  4    said  county  treasurer  shall,  not later than June 15th of each year, notify
  5    each cooperative electrical association, and each natural gas cooperative, and
  6    producer of electricity by means of wind energy, of the amount of taxes  owed,
  7    and  the  apportionment  thereof  to the county and to the several taxing dis-
  8    tricts in the county and such tax shall be due and payable not later than July
  9    1, following and, upon the payment thereof, the  county  treasurer  shall  pay
 10    over  to each taxing district its apportionment as herein determined. Any such
 11    taxes not paid by July 1, as aforesaid, shall become delinquent and a  penalty
 12    of  five  percent (5%) thereof shall be imposed, together with interest at the
 13    rate of one percent (1%) per month from July 1 until paid.
                                                                        
 14        SECTION 5.  That Section 63-3505, Idaho Code, be, and the same  is  hereby
 15    amended to read as follows:
                                                                        
 16        63-3505.  TAXES  A LIEN ON PROPERTY OF ASSOCIATION OR PRODUCER UNTIL PAID.
 17    All taxes due and payable under this act chapter shall be a lien on all  prop-
 18    erty, real and personal, of the electrical, or natural gas association, or the
 19    producer  of  electricity  by means of wind energy, owing the same, as of June
 20    15th of each year and shall be discharged only by the payment thereof. In  any
 21    action  to enforce payment of any delinquent taxes due under this act chapter,
 22    the county prosecuting such action shall be entitled to  a  judgment  for  the
 23    reasonable  costs  of  prosecuting  such action, as well as for the delinquent
 24    taxes, penalty and interest.
                                                                        
 25        SECTION 6.  That Section 63-3506, Idaho Code, be, and the same  is  hereby
 26    amended to read as follows:
                                                                        
 27        63-3506.  ASSESSMENT   OF   NONOPERATING   PROPERTY   BY   ASSESSOR.   The
 28    nonoperating   property   of   any   cooperative  electrical  or  natural  gas
 29    association, or producer of electricity by means  of  wind  energy,  shall  be
 30    assessed  by  the county assessor of the county wherein such property is situ-
 31    ate, and taxes levied against the same shall be a lien, and shall be  due  and
 32    payable, in the same manner as are any other taxes on property.
                                                                        
 33        SECTION  7.  That  Chapter  6,  Title  63, Idaho Code, be, and the same is
 34    hereby amended by the addition thereto of a NEW SECTION, to be known and  des-
 35    ignated as Section 63-602JJ, Idaho Code, and to read as follows:
                                                                        
 36        63-602JJ.  PROPERTY  EXEMPT FROM TAXATION -- CERTAIN OPERATING PROPERTY OF
 37    PRODUCER OF ELECTRICITY BY MEANS OF WIND ENERGY.  The  following  property  is
 38    exempt  from taxation: operating property of producers of electricity by means
 39    of wind energy exclusively used to produce electricity by means of wind energy
 40    on which the tax on gross wind energy earnings will be paid.
                                                                        
 41        SECTION 8.  An emergency existing  therefor,  which  emergency  is  hereby
 42    declared to exist, this act shall be in full force and effect on and after its
 43    passage and approval, and retroactively to January 1, 2007.

Statement of Purpose / Fiscal Impact


                         STATEMENT OF PURPOSE
           
                               RS 16923
  
  
  
The purpose of this proposed legislation is to change the method 
of taxation on producers of wind energy from a property tax to a 
tax on production.  The legislation also provides for the filing 
of operators' statements and provides for the computation, 
allotment and apportionment of tax due from producers of wind energy.  
The legislation  details how the distribution of taxes paid by producers 
of wind energy will be  accomplished and to provide tax liens on property 
of producers of wind energy.  The proposed legislation also  provides 
for the assessment of nonoperating property of producers of wind energy 
and provides for this act to be retroactive to January 1, 2007 after its 
passage and approval.   
  
  
  
  
                        FISCAL NOTE
  
  
  
No fiscal impact to the general fund.
  
  
  
  
CONTACT:
Rep. George Eskridge              
Phone 208-322-1000
Dar Olberding, Ridgeline Energy
Phone 208-761-6012                     
Stan Boyd, Ridgeline Energy            
Phone 208-344-2271           
                
                

STATEMENT OF  PURPOSE / FISCAL NOTE                             H 189