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H0542...............................................by REVENUE AND TAXATION OPERATING PROPERTY - TAX ASSESSMENT - Amends existing law to provide that on and after January 1, 2004, any newly installed or constructed equipment located within a city corporate limit or within five miles of a city corporate limit and used for and in conjunction with the thermal generation of electricity shall be apportioned based on physical location for operating property purposes; and to provide that newly installed or constructed equipment used for and in conjunction with the thermal generation of electricity equipment shall not include the remodeling, retrofitting, rehabilitation, refurbishing or modification of an existing electrical generation facility or integration or transformation facilities such as substations or transmission lines. 01/26 House intro - 1st rdg - to printing 01/27 Rpt prt - to Rev/Tax 02/05 Rpt out - rec d/p - to 2nd rdg 02/06 2nd rdg - to 3rd rdg 02/10 3rd rdg - PASSED - 55-7-8 AYES -- Andersen, Barraclough, Barrett, Bauer, Bayer, Bedke, Bell, Block, Boe, Bolz, Bradford, Campbell, Cannon, Clark, Collins, Crow, Cuddy, Deal, Denney, Eberle, Edmunson, Ellsworth, Eskridge, Field(18), Field(23), Harwood, Jones, Kellogg, Kulczyk, Lake, Langford, Martinez, McGeachin, McKague, Meyer, Mitchell, Moyle, Naccarato, Nielsen, Raybould, Ridinger, Ring, Ringo, Schaefer, Shepherd, Shirley, Skippen, Smith(30), Smylie, Snodgrass, Stevenson, Trail, Wills, Wood, Mr. Speaker NAYS -- Douglas, Henbest, Jaquet, Langhorst, Pasley-Stuart, Robison, Sayler Absent and excused -- Black, Gagner, Garrett, Miller, Roberts, Rydalch, Sali, Smith(24) Floor Sponsor - Eskridge Title apvd - to Senate 02/11 Senate intro - 1st rdg - to Loc Gov 02/24 Rpt out - rec d/p - to 2nd rdg 02/25 2nd rdg - to 3rd rdg 03/10 3rd rdg - PASSED - 34-0-1 AYES -- Andreason(Andreason), Bailey, Bunderson, Burkett, Burtenshaw, Calabretta, Cameron, Compton, Darrington, Davis, Gannon, Geddes, Goedde, Hill, Ingram, Kennedy, Keough, Little, Lodge, Malepeai, Marley, McKenzie, McWilliams, Noble, Noh, Pearce, Richardson, Schroeder, Sorensen, Stegner, Stennett, Sweet, Werk, Williams NAYS -- None Absent and excused -- Brandt Floor Sponsor - Compton Title apvd - to House 03/11 To enrol 03/12 Rpt enrol - Sp signed 03/15 Pres signed 03/16 To Governor 03/19 Governor signed Session Law Chapter 105 Effective: 01/01/04
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-seventh Legislature Second Regular Session - 2004 IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 542 BY REVENUE AND TAXATION COMMITTEE 1 AN ACT 2 RELATING TO ASSESSMENT AND TAXATION OF OPERATING PROPERTY; AMENDING SECTION 3 63-405, IDAHO CODE, TO PROVIDE THAT ON AND AFTER JANUARY 1, 2004, ANY 4 NEWLY INSTALLED OR CONSTRUCTED EQUIPMENT LOCATED WITHIN A CITY CORPORATE 5 LIMIT OR WITHIN FIVE MILES OF A CITY CORPORATE LIMIT AND USED FOR AND IN 6 CONJUNCTION WITH THE THERMAL GENERATION OF ELECTRICITY SHALL BE APPOR- 7 TIONED BASED ON PHYSICAL LOCATION AND TO PROVIDE THAT NEWLY INSTALLED OR 8 CONSTRUCTED EQUIPMENT USED FOR AND IN CONJUNCTION WITH THE THERMAL GENERA- 9 TION OF ELECTRICITY SHALL NOT INCLUDE THE REMODELING, RETROFITTING, REHA- 10 BILITATION, REFURBISHING OR MODIFICATION OF AN EXISTING ELECTRICAL GENERA- 11 TION FACILITY, OR INTEGRATION OR TRANSFORMATION FACILITIES SUCH AS SUBSTA- 12 TIONS OR TRANSMISSION LINES; DECLARING AN EMERGENCY AND PROVIDING RETROAC- 13 TIVE APPLICATION. 14 Be It Enacted by the Legislature of the State of Idaho: 15 SECTION 1. That Section 63-405, Idaho Code, be, and the same is hereby 16 amended to read as follows: 17 63-405. ASSESSMENT OF OPERATING PROPERTY. (1) The state tax commission 18 must assess all operating property at a meeting of the commission convening on 19 the second Monday of August in each year, and must complete the assessment of 20 such property on the fourth Monday in August. 21 (2) The state tax commission shall determine the system value and calcu- 22 late the allocation and apportionment of the system value for all operating 23 property and specifically determine: 24 (a) The number of miles and the value per mile of each railroad in the 25 state and for each taxing district in which such railroad may exist. 26 (b) The number of miles and the value per mile of each telephone corpora- 27 tion in the state and for each taxing district in which such telephone 28 corporation may exist. 29 (c) The number of miles and the value per mile of each pipeline in the 30 state and for each taxing district in which such pipeline may exist. 31 (d) The number of miles and the value per mile of each water company 32 under the jurisdiction of the public utilities commission in the state, 33 and for each taxing district in which such water company may exist. The 34 value per mile of any line included in this subsection, except railroads, 35 shall be determined by dividing the total value of such line within the 36 state by the number of miles of such line within the state. The value per 37 mile of railroad line shall be determined by apportionment of the total 38 value of line within the state. The apportionment shall be based twenty 39 percent (20%) on the ratio of line miles in the state to line miles in the 40 county; forty percent (40%) on the ratio of net ton miles in the state to 41 net ton miles in the county; and forty percent (40%) on the ratio of sta- 42 tion revenues in the state to station revenues in the county. All operat- 43 ing property of railroads shall be apportioned to the counties as part of 2 1 the railroad line in the county. The apportionment for taxing districts 2 shall be the same as the apportionment among counties. 3 (e) The system value, the number of miles and the value per mile of each 4 electric current transmission line and each electric current distribution 5 line in each county separately, and for each taxing district within said 6 county in which such transmission and distribution lines may exist. The 7 value per mile of any line included in this subsection shall be deter- 8 mined by dividing the apportioned value of such line within each county by 9 the number of miles of such line within said county. 10 (f) The system value of private railcar fleets entering or standing in 11 Idaho in the year preceding the constituted lien as provided in section 12 63-411(3), Idaho Code. 13 (g) The system value and calculate the allocation and apportionment of 14 the system value for all other operating property. 15 (3) On and after January 1, 2004, any newly installed or constructed 16 equipment located within a city corporate limit or within five (5) miles of a 17 city corporate limit and used for and in conjunction with the thermal genera- 18 tion of electricity shall be apportioned based on physical location. For pur- 19 poses of this subsection newly installed or constructed equipment used for and 20 in conjunction with the thermal generation of electricity shall not include 21 the remodeling, retrofitting, rehabilitation, refurbishing or modification of 22 an existing electrical generation facility, or integration or transformation 23 facilities such as substations or transmission lines. 24 (4) If the value of property of any company assessable under this section 25 is of such a nature that it cannot reasonably be apportioned on the basis of 26 rail, wire, pipeline mileage, such as microwave and radio relay stations, the 27 tax commission may adopt such other method or basis of apportionment to the 28 county and taxing districts in which the property is situate as may be feasi- 29 ble and proper. 30 SECTION 2. An emergency existing therefor, which emergency is hereby 31 declared to exist, this act shall be in full force and effect on and after its 32 passage and approval, and retroactively to January 1, 2004.
STATEMENT OF PURPOSE RS 13772 The purpose of this legislation is to provide an incentive to locate thermal power plants owned by electric utilities close to electric load. This legislation gives an incentive to cities to permit a power plant to locate within or near a city, by providing that the property taxes from such a plant are "apportioned based on the physical location of the plant." Currently utility owned generating assets are centrally assessed and the property values are then apportioned throughout the utility service area based on the situs of the utility's transmission wire miles. FISCAL IMPACT This legislation will have no fiscal impact on the state. The legislation will change the apportionment or allocation of property taxes from an electric generating plant as among a multitude of taxing districts with a generalized net effect of taxing districts with nexus to the plant receiving more property tax revenues and taxing districts without plant nexus but with utility transmission nexus, receiving less. Contact Name: Rep. John A."Bert" Stevenson 332-1000 Rep. George Eskridge 332-1000 Rep. Charles D. Cuddy 332-1000 Sen. Brent Hill 332-1000 Ken Harward, Association of Idaho Cities 344-8594 Neil Colwell, Avist Corporation 343-3821 Ron Williams, Attorney at Law 344-6633 STATEMENT OF PURPOSE/FISCAL NOTE H 542