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H0408...............................................by REVENUE AND TAXATION
INCOME TAX CREDIT - NO FIELD BURNING - Adds to existing law to establish
agricultural field burning acreage limitations; to provide for field
burning abstention for tax credit qualification; to provide for the
issuance of burn authorizations; to provide for an income tax credit for
certain agricultural field burning abstention; to provide a carryover of
unused credits; to provide for recapture; and to provide for transfers of
credit.
04/10 House intro - 1st rdg - to printing
04/14 Rpt prt - to Rev/Tax
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-seventh Legislature First Regular Session - 2003
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 408
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO AGRICULTURAL FIELD BURNING REDUCTION, FIELD BURNING ABSTENTION AND
3 FIELD BURNING ABSTENTION BASED TAX CREDIT; AMENDING CHAPTER 48, TITLE 22,
4 IDAHO CODE, BY THE ADDITION OF A NEW SECTION 22-4805, IDAHO CODE, TO
5 ESTABLISH CERTAIN AGRICULTURAL FIELD BURNING ACREAGE LIMITATIONS, TO PRO-
6 VIDE FOR FIELD BURNING ABSTENTION FOR TAX CREDIT QUALIFICATION, TO DESIG-
7 NATE A PROCEDURE, TO PROVIDE FOR THE ISSUANCE OF BURN AUTHORIZATIONS, TO
8 ALLOCATE BURN AUTHORIZATIONS, TO PROVIDE OTHER LIMITATIONS AND TO PROVIDE
9 FOR ADOPTION OF RULES; AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE
10 ADDITION OF A NEW SECTION 63-3029K, IDAHO CODE, TO PROVIDE FOR AN INCOME
11 TAX CREDIT FOR CERTAIN AGRICULTURAL FIELD BURNING ABSTENTION, TO PROVIDE
12 PROCEDURES, TO LIMIT THE AMOUNT OF THE CREDIT, TO PROVIDE FOR CLAIMS OF
13 THE CREDIT BY CERTAIN CORPORATE MEMBERS, TO PROVIDE A CARRYOVER OF UNUSED
14 CREDITS, TO PROVIDE FOR RECAPTURE, TO PROVIDE FOR TRANSFERS OF CREDIT AND
15 TO AUTHORIZE THE STATE TAX COMMISSION TO PROMULGATE CERTAIN RULES; DECLAR-
16 ING AN EMERGENCY AND PROVIDING FOR RETROACTIVE APPLICATION.
17 Be It Enacted by the Legislature of the State of Idaho:
18 SECTION 1. That Chapter 48, Title 22, Idaho Code, be, and the same is
19 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
20 ignated as Section 22-4805, Idaho Code, and to read as follows:
21 22-4805. ACREAGE LIMITATIONS -- FIELD BURNING ABSTENTION -- TAX CREDIT
22 QUALIFICATION -- PROCEDURE -- BURN AUTHORIZATIONS. (1) For calendar year 2003,
23 the maximum amount of crop residue acreage to be burned in Kootenai and Bene-
24 wah counties shall not exceed the average amount of acreage registered pursu-
25 ant to subsection (3) of section 22-4803, Idaho Code, for the calendar years
26 2000 through 2002. The maximum amount shall be reduced by ten percent (10%)
27 each year from the previous year thereafter through calendar year 2006. The
28 calculation of maximum acreage and annual percent reductions shall be con-
29 ducted separately for registration processes occurring on separate jurisdic-
30 tional areas within Kootenai and Benewah counties.
31 (2) For each calendar year beginning in 2004 and extending through 2006,
32 those individuals with fields registered pursuant to subsection (3) of section
33 22-4803, Idaho Code, during calendar years 2000 through 2002, that seek to
34 qualify for an agricultural field burning abstention credit pursuant to sec-
35 tion 63-3029K, Idaho Code, shall provide written verified notice to the
36 department, pursuant to rules or policy established by the department for this
37 purpose, that:
38 (a) They shall refrain from registration pursuant to subsection (3) of
39 section 22-4803, Idaho Code, of their previously registered fields for the
40 calendar year and shall designate the previously registered fields that
41 will not be registered;
42 (b) During the calendar year they shall not conduct field burning in
43 those fields designated pursuant to subsection (2)(a) of this section; and
2
1 (c) They seek to have the designated fields included in calculation of
2 the ten percent (10%) field burning reduction acreage as required pursuant
3 to subsection (1) of this section.
4 The department shall maintain the written notices, at a minimum for the
5 duration of the calendar year in which the notices are received. The depart-
6 ment shall establish a means of monitoring and maintaining a record of the
7 order in which the notices are received by the department and shall determine
8 those individuals whose fields, or a portion thereof, constitute the first ten
9 percent (10%) of the total field burning reduction acreage required pursuant
10 to subsection (1) of this section.
11 The department shall issue written notice to all individuals having sub-
12 mitted a notice pursuant to this subsection, indicating whether any portion,
13 to the nearest acre of the individual's designated fields, constitutes a por-
14 tion of the first ten percent (10%) of the total field burning reduction acre-
15 age required pursuant to subsection (1) of this section. The department shall
16 not determine tax credit qualification but shall only provide the individual
17 with notice that certain fields subject to their notification of field burning
18 abstention were or were not included in the first ten percent (10%) field
19 burning reduction acreage.
20 It shall be considered a violation of the provisions of this chapter for
21 any person who has verified field burning abstention pursuant to the provi-
22 sions of this section to conduct field burning in nonregistered, designated
23 fields in conflict with their verification of field burning abstention, and
24 they shall be subject to action by the department for the violation pursuant
25 to the provisions of this chapter and shall also be subject to action by the
26 state tax commission in relation to any associated claimed tax credit.
27 (3) In the event that as of July 1 in any given year total registration
28 pursuant to subsection (3) of section 22-4803, Idaho Code, is less than or
29 equal to the maximum acreage to be burned pursuant to subsection (1) of this
30 section, each person registering shall be issued a burn authorization by the
31 department covering the acreage registered.
32 (4) In the event that as of July 1 in any given year total registration
33 pursuant to subsection (3) of section 22-4803, Idaho Code, is greater than the
34 maximum acreage to be burned pursuant to subsection (1) of this section, the
35 department shall give preference in issuing burn authorizations to those per-
36 sons who were registered pursuant to subsection (3) of section 22-4803, Idaho
37 Code, for the calendar year 2001 or 2002, up to the average amount of acreage
38 for which the person was registered in those years. Any remaining maximum
39 acreage balance shall be allocated to other persons registering on the basis
40 of the date of receipt of the person's complete registration form by the
41 department.
42 (5) In the event that as of July 1 in any given year total registration
43 pursuant to subsection (3) of section 22-4803, Idaho Code, is greater than the
44 maximum acreage to be burned pursuant to subsection (1) of this section when
45 taking into account only registrations submitted by those persons who were
46 registered pursuant to subsection (3) of section 22-4803, Idaho Code, for cal-
47 endar year 2001 or 2002, up to the average amount of acreage for which the
48 person was registered in those years, the department shall by rule or policy
49 assign a priority of authorizations up to full allocation of the maximum
50 amount.
51 (6) Once the maximum acreage amount is fully allocated in burn authoriza-
52 tions issued pursuant to this formula, no additional authorizations shall be
53 issued for that year.
54 (7) Burning authorizations issued under this section shall at all times
55 be limited by and subject to daily burn authorization and other requirements
3
1 or conditions announced or set forth by the DEQ, the department of agriculture
2 or any local authority.
3 (8) The department may adopt rules as necessary to implement this sec-
4 tion.
5 SECTION 2. That Chapter 30, 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 63-3029K, Idaho Code, and to read as follows:
8 63-3029K. INCOME TAX CREDIT -- AGRICULTURAL FIELD BURNING ABSTENTION. (1)
9 Subject to the limitations of this section, for taxable years beginning Janu-
10 ary 1, 2004, there shall be allowed to a taxpayer a nonrefundable credit
11 against taxes imposed by sections 63-3024, 63-3025 and 63-3025A, Idaho Code,
12 for agricultural field burning abstention as herein provided.
13 (2) The credit permitted in subsection (1) of this section shall be
14 allowed on an annual basis to a taxpayer that received verification from the
15 department of agriculture that certain acreage designated by the taxpayer in a
16 notification to the department of agriculture of field burning abstention pur-
17 suant to section 22-4805, Idaho Code, constituted a portion of the first ten
18 percent (10%) field burning reduction acreage required by subsection (1) of
19 section 22-4805, Idaho Code. The acreage that was included in the first ten
20 percent (10%) field burning reduction acreage shall qualify for the tax credit
21 provided in this section. The credit shall be in the amount of one hundred
22 dollars ($100) per qualifying acre, to the nearest acre without proration.
23 (3) The credit allowed by subsection (1) of this section together with
24 any credits carried forward under subsection (5) of this section shall not, in
25 any one (1) taxable year, exceed the amount of tax due under sections 63-3024,
26 63-3025 and 63-3025A, Idaho Code, after allowance for all other credits per-
27 mitted by this chapter.
28 (4) In the case of a group of corporations filing a combined report under
29 subsection (t) of section 63-3027, Idaho Code, credit earned by one (1) member
30 of the group but not used by that member may be used by another member of the
31 group, subject to the provisions of subsection (5) of this section, instead of
32 carried over. For a combined group of corporations, credit carried forward may
33 be claimed by any member of the group unless the member who earned the credit
34 is no longer included in the combined group.
35 (5) If the credit allowed by subsection (1) of this section exceeds the
36 limitation under subsection (3) of this section, the excess amount may be car-
37 ried forward for a period that does not exceed the next ten (10) taxable
38 years.
39 (6) If a taxpayer who has received all or part of the credit permitted by
40 this section fails to continue to qualify for the credit due to a violation of
41 any of the provisions of chapter 48, title 22, Idaho Code, then the state tax
42 commission shall recapture the previously allowed credit. The state tax com-
43 mission may, within the time permitted for adjustment of the return on which
44 the credit was claimed, collect the recaptured credit in the same manner as a
45 deficiency in tax.
46 (7) (a) Subject to the requirements of this subsection, a taxpayer who
47 earns and is entitled to the credit or to an unused portion of the credit
48 allowed by this section may transfer all or a portion of the unused credit
49 to:
50 (i) Another taxpayer required to file a return under this chapter;
51 or
52 (ii) An intermediary for its use or for resale to a taxpayer
53 required to file a return under this chapter.
4
1 In the event of either such a transfer, the transferee may claim the
2 credit on the transferee's income tax return originally filed during the
3 calendar year in which the transfer takes place and, in the case of carry-
4 over of the credit, on the transferee's returns for the number of years of
5 carryover available to the transferor at the time of the transfer unless
6 earlier exhausted.
7 (b) Before completing a transfer under this subsection, the transferor
8 shall notify the state tax commission of its intention to transfer the
9 credit and the identity of the transferee. The state tax commission shall
10 provide the transferor with a written statement of the amount of credit
11 available under this section as then appearing in the state tax
12 commission's records and the number of years the credit may be carried
13 over. The transferee shall attach a copy of the statement to any return in
14 regard to which the transferred credit is claimed.
15 (c) In the event that after the transfer the state tax commission deter-
16 mines that the amount of credit properly available under this section is
17 less than the amount claimed by the transferor of the credit, or that the
18 credit is subject to recapture, the state tax commission shall assess the
19 amount of overstated or recaptured credit as taxes due for the transferor
20 and not the transferee. The assessment shall be made in the manner pro-
21 vided for a deficiency in taxes under this chapter.
22 (8) In addition to other needed rules, the state tax commission may pro-
23 mulgate rules prescribing, in the case of S corporations, partnerships, trusts
24 or estates, a method of attributing the credit under this section to the
25 shareholders, partners or beneficiaries in proportion to their share of the
26 income from the S corporation, partnership, trust or estate.
27 SECTION 3. An emergency existing therefor, which emergency is hereby
28 declared to exist, this act shall be in full force and effect on and after its
29 passage and approval, and retroactively to January 1, 2003.
STATEMENT OF PURPOSE
RS 13283
This legislation would require a ten percent (10%) per year reduction
in the number of acres of grass stubble burned in Kootenai and Benewah
counties for four (4) years resulting in a forty percent (40%)
reduction by the year 2006.
Growers who voluntarily signed up acres not to be burned would receive
a $100.00 per acre tax credit for ten (10) years until the number of
acres required to meet the ten percent (10%) reduction level has been
reached. If the ten percent (10%) reduction has not been reached
voluntarily, additional acres would be required to not be burned
without receiving the tax credit.
FISCAL IMPACT
There is estimated to be 25,000 acres in grass production in Kootenai
and Benewah counties.
Year One 2,500 acres x $100.00 = $ 250,000
Year Two 5,000 acres x $100.00 = $ 500,000
Year Three 7,500 acres x $100.00 = $ 750,000
Year Four 10,000 acres x $100.00 = $ 1,000,000
Year Five 10,000 acres x $100.00 = $ 1,000,000
Year Six 10,000 acres x $100.00 = $ 1,000,000
Year Seven 10,000 acres x $100.00 = $ 1,000,000
Year Eight 10,000 acres x $100.00 = $ 1,000,000
Year Nine 10,000 acres x $100.00 = $ 1,000,000
Year Ten 10,000 acres x $100.00 = $ 1,000,000
Year Eleven 7,500 acres x $100.00 = $ 750,000
Year Twelve 5,000 acres x $100.00 = $ 500,000
Year Thirteen 2,500 acres x $100.00 = $ 250,000
$10,000,000
Contact
Name: Rep. Douglas Jones
Rep. Wayne Meyer
Rep. George Eskridge
Sen. Shawn Keough
Phone: (208-332-1000)
STATEMENT OF PURPOSE/FISCAL NOTE H 408