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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