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H0788...............................................by REVENUE AND TAXATION INCOME TAX CREDITS - Adds to existing law to provide an income tax credit for eligible expenditures relating to certain natural resource plans and certain species management or recovery plans; and to provide for review and approval of qualified expenditures before a tax credit shall be approved. 02/27 House intro - 1st rdg - to printing 03/01 Rpt prt - to Rev/Tax
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-seventh Legislature Second Regular Session - 2004 IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 788 BY REVENUE AND TAXATION COMMITTEE 1 AN ACT 2 RELATING TO TAX CREDITS; AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE 3 ADDITION OF A NEW SECTION 63-3029H, IDAHO CODE, TO DEFINE TERMS, TO PRO- 4 VIDE AN INCOME TAX CREDIT FOR ELIGIBLE EXPENDITURES RELATING TO CERTAIN 5 NATURAL RESOURCE PLANS AND RELATING TO CERTAIN SPECIES MANAGEMENT OR 6 RECOVERY PLANS, AND TO PROVIDE FOR REVIEW AND APPROVAL OF QUALIFIED EXPEN- 7 DITURES BEFORE A TAX CREDIT SHALL BE APPROVED; PROVIDING AN EFFECTIVE DATE 8 AND PROVIDING FOR RETROACTIVE APPLICATION. 9 Be It Enacted by the Legislature of the State of Idaho: 10 SECTION 1 That Chapter 30, Title 63, Idaho Code, be, and the same is 11 hereby amended by the addition thereto of a NEW SECTION, to be known and des- 12 ignated as Section 63-3029H, Idaho Code, and to read as follows: 13 63-3029H. INCOME TAX CREDITS. (1) Definitions. As used in this section: 14 (a) "Best management practices" or "BMP" or "BMPs" means practices, tech- 15 niques, or measures developed or identified by the designated agency and 16 identified in the state water quality management plan which are determined 17 to be a cost-effective and practical means of preventing or reducing pol- 18 lutants generated from nonpoint sources to a level compatible with water 19 quality goals. 20 (b) "Conservation practices" means practices, techniques, or measures 21 developed or identified by a state or federal agency or tribal government 22 which are determined to be a cost-effective and practical means of pre- 23 venting or reducing pollutants generated from nonpoint sources to a level 24 compatible with natural resource goals. 25 (c) "National handbook of conservation practices" means the most recent 26 version of the USDA natural resource conservation services handbook con- 27 taining approved conservation practices, which contains information on why 28 and where a practice is applied, and sets forth the minimum quality crite- 29 ria that must be met during the application of a practice in order for it 30 to achieve its intended purpose or purposes. 31 (d) "Owner" or "landowner" means the party or parties having the fee 32 interest in real property except, where the real property is subject to a 33 real estate sales contract, "owner" means the contract vendee under a 34 recorded contract. 35 (e) "Soil conservation commission" or "commission" means the agency cre- 36 ated in section 22-2718, Idaho Code. 37 (f) "Soil conservation districts" are legal subdivisions of Idaho state 38 government, responsible under chapter 27, title 22, Idaho Code, for soil, 39 water, and related resource conservation work within their boundaries. 40 (2) Eligibility for income tax credits. Any owner of real property who 41 undertakes actions approved pursuant to: 42 (a) A plan to enhance, conserve, or protect natural resources approved by 43 the soil conservation commission, a local soil conservation district, the 2 1 natural resources conservation service, the department of lands, tribal 2 government, the department of fish and game, the department of agricul- 3 ture, the department of transportation, the department of environmental 4 quality, or other state or federal agencies capable of and having author- 5 ity to provide technical assistance to owners of real property; or 6 (b) A plan for the management or recovery of a species listed as 7 "endangered," "threatened," or a "candidate," for such listing as set 8 forth in the federal endangered species act, and approved as provided in 9 the regulations adopted pursuant to the federal endangered species act, or 10 state listed sensitive species. 11 (3) Expenditures qualifying for income tax credits. Expenditures that are 12 eligible for income tax credits as set forth in this section shall include, 13 but not be limited to, those in the following categories: 14 (a) Best management practices found in the agriculture pollution abate- 15 ment plan; 16 (b) Conservation practices identified in the national handbook of conser- 17 vation practices; 18 (c) Removal of barriers to fish passage and installation of devices to 19 prevent fish from entering into areas where their ability to survive is 20 limited; 21 (d) Establishment of vegetation designed to improve habitat or food 22 sources for "endangered," "threatened," or "candidate" species, or state 23 listed sensitive species; or 24 (e) Other improvements or modifications made in order to comply with any 25 action required by a plan as provided in subsection (2) of this section. 26 The state tax commission, in cooperation with the soil conservation commission 27 and other appropriate federal or state agencies, shall promulgate rules defin- 28 ing the specific expenditures eligible for the income tax credits for each of 29 the categories described in this section. 30 (4) Calculation and application of income tax credits. For those expendi- 31 tures eligible for income tax credits as described in this section, the credit 32 shall be equal to one-half (1/2) of the eligible expenditures made during the 33 course of the taxable year. This amount may be applied as a credit to each 34 person's total income tax liability. In no case shall the sum of these credits 35 exceed two thousand dollars ($2,000) for a single taxable year per person and 36 in no event shall labor be included in determining the amount of the tax 37 credit. In the event of transfer of title to lands where income tax credits 38 have been taken, the application of the annual credits from previous expendi- 39 tures shall cease, and the new owner of the land shall not be eligible to 40 receive any income tax credits that are based upon the expenditures made by 41 any previous landowner. In no case shall the credit allowed under this section 42 exceed the income tax liability of the claimant. For purposes of this section, 43 a husband and wife filing a single return shall be deemed a single person. 44 (5) Review and approval of qualified expenditures. All projects and 45 expenditures which may be eligible for tax credits as set forth in this sec- 46 tion shall be reviewed by the designated agency as defined in chapter 36, 47 title 39, Idaho Code, and which are appropriate to the nature of the project 48 and expenditures for which approval is sought for the income tax credit pro- 49 vided in this section. That agency will recommend approval or disapproval of 50 the tax credits described in this section and forward their recommendations to 51 the soil conservation commission. The soil conservation commission shall have 52 the authority, by majority vote, to approve or disapprove all applications for 53 tax credits as described in this section. In approving an application for a 54 tax credit, the soil conservation commission shall strive to assure a reason- 55 able distribution of approved credits throughout the state and among the par- 3 1 ties that are eligible for the tax credits described in this section. In no 2 case shall the soil conservation commission approve, during a year, tax cre- 3 dits which exceed two hundred fifty thousand dollars ($250,000) in total. The 4 soil conservation commission shall transmit its minutes and approvals to the 5 state tax commission. The soil conservation commission shall notify each owner 6 of real property in writing whether the owner has been approved, or disap- 7 proved for an income tax credit pursuant to this section. 8 SECTION 2. An emergency existing therefor, which emergency is hereby 9 declared to exist, this act shall be in full force and effect on and after its 10 passage and approval, and retroactively to January 1, 2004.
STATEMENT OF PURPOSE RS 13867 This legislation creates a new section in Title 63 Idaho Code 63- 3029H0, to provide an income tax credit for eligible expenditures to landowners implementing best management practices to improve natural resources for water quality, threatened and endangered species. This legislation provides for review and approval of qualified expenditures before a tax credit is approved. FISCAL IMPACT Up to $250,000 in state tax credits may be approved annually. Contact Name: Rep. Tim Ridinger, Sen. Clint Stennett Phone: 332-1000 David Ferguson, Soil Conservation Commission Phone: 332-8656 STATEMENT OF PURPOSE/FISCAL NOTE H 788