2004 Legislation
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HOUSE BILL NO. 788 – Income tax credit/natural resource

HOUSE BILL NO. 788

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Bill Status



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

Bill Text


                                                                        
                                                                        
  ]]]]              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 / Fiscal Impact



                       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