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H0110aa,aaS.........................................by REVENUE AND TAXATION
ELECTRIC GENERATION - Adds to existing law to provide a sales and use tax
rebate for the sales or use of machinery and equipment used in alternative
methods of generation of electricity; to define terms; and to provide
procedures.
02/04 House intro - 1st rdg - to printing
02/07 Rpt prt - to Rev/Tax
03/10 Rpt out - to Gen Ord
03/14 Rpt out amen - to engros
03/15 Rpt engros - 1st rdg - to 2nd rdg as amen
03/16 2nd rdg - to 3rd rdg as amen
03/17 3rd rdg as amen - PASSED - 63-0-7
AYES -- Anderson, Andrus, Barraclough, Barrett, Bastian, Bayer,
Bedke, Bell, Bilbao, Black, Block, Boe, Bolz, Bradford, Cannon,
Chadderdon, Clark, Collins, Deal, Denney, Edmunson, Ellsworth,
Eskridge, Field(18), Garrett, Hart, Harwood, Henbest, Henderson,
Jaquet, Jones, Kemp, Lake, LeFavour, Loertscher, Martinez, Mathews,
McGeachin, McKague, Miller, Mitchell, Moyle, Nielsen, Nonini,
Pasley-Stuart, Pence, Ring, Ringo, Rusche, Rydalch, Sali, Sayler,
Schaefer, Shepherd(2), Shepherd(8), Shirley, Skippen, Smylie,
Snodgrass, Stevenson, Trail, Wills, Wood
NAYS -- None
Absent and excused -- Crow, Field(23), Raybould, Roberts, Smith(30),
Smith(24), Mr. Speaker
Floor Sponsor - Eskridge
Title apvd - to Senate
03/18 Senate intro - 1st rdg - to Loc Gov
03/22 Rpt out - rec d/p - to 14th Ord
03/23 Rpt out amen - to 1st rdg as amen
03/24 1st rdg - to 2nd rdg as amen
03/25 2nd rdg - to 3rd rdg as amen
03/29 3rd rdg as amen - PASSED - 30-3-2
AYES -- Broadsword, Bunderson, Burkett, Burtenshaw, Cameron, Coiner,
Compton, Corder, Darrington, Davis, Fulcher, Gannon, Geddes, Goedde,
Hill, Kelly, Keough, Langhorst, Little, Lodge, Malepeai, Marley,
McKenzie, Pearce, Richardson, Schroeder, Stennett, Sweet, Werk,
Williams
NAYS -- Andreason, Jorgenson, Stegner
Absent and excused -- Brandt, McGee
Floor Sponsor - Hill
Title apvd - to House
03/30 House concurred in Senate amens - to engros
03/31 Rpt engros - 1st rdg - to 2nd rdg as amen
04/01 2nd rdg - to 3rd rdg as amen
04/04 3rd rdg as amen - PASSED - 65-0-5
AYES -- Anderson, Andrus, Barraclough, Barrett, Bastian, Bayer,
Bedke, Bell, Bilbao, Black, Block, Boe, Bolz, Bradford, Cannon,
Chadderdon, Collins, Deal, Denney, Edmunson, Ellsworth(Ellsworth),
Eskridge, Field(18), Field(23), Garrett, Hart, Harwood, Henbest,
Henderson, Jaquet, Jones, Kemp, Lake, LeFavour, Loertscher, Martinez,
Mathews, McGeachin, McKague, Miller, Mitchell, Moyle, Nielsen,
Nonini, Pasley-Stuart, Pence, Raybould, Ring, Ringo, Rusche, Rydalch,
Sali, Sayler(Callen), Schaefer, Shepherd(2), Shepherd(8), Shirley,
Skippen, Smith(30), Smith(24), Smylie, Snodgrass, Stevenson, Wills,
Mr. Speaker
NAYS -- None
Absent and excused -- Clark, Crow, Roberts, Trail, Wood
Floor Sponsor - Eskridge
Title apvd - To enrol - Rpt enrol - Sp signed
04/05 Pres signed - To Governor
04/12 Governor signed
Session Law Chapter 355
Effective: 04/12/05;
07/01/11 Sunset Clause
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature First Regular Session - 2005
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 110
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO THE SALES AND USE TAX; AMENDING CHAPTER 36, TITLE 63, IDAHO CODE,
3 BY THE ADDITION OF A NEW SECTION 63-3622QQ, IDAHO CODE, TO PROVIDE A SALES
4 AND USE TAX EXEMPTION FOR THE SALES OR USE OF MACHINERY AND EQUIPMENT USED
5 IN ALTERNATIVE METHODS OF GENERATION OF ELECTRICITY AND TO DEFINE TERMS;
6 DECLARING AN EMERGENCY AND PROVIDING A SUNSET DATE.
7 Be It Enacted by the Legislature of the State of Idaho:
8 SECTION 1. That Chapter 36, Title 63, Idaho Code, be, and the same is
9 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
10 ignated as Section 63-3622QQ, Idaho Code, and to read as follows:
11 63-3622QQ. EQUIPMENT USED IN ALTERNATIVE METHOD OF GENERATION OF ELEC-
12 TRICITY. (1) There are exempted from the taxes imposed by this chapter, the
13 sales or use of machinery and equipment used directly in generating electric-
14 ity using fuel cells, low impact hydro, wind, geothermal resources,
15 cogeneration, sun, or landfill gas as the principal source of power, or to
16 sales of or charges made for tangible personal property in respect to install-
17 ing such machinery and equipment, but only if the purchaser develops with such
18 machinery, equipment, and tangible personal property a facility capable of
19 generating not less than five (5) megawatts of electricity and provides the
20 seller with an exemption certificate in a form and manner prescribed by the
21 commission. The seller shall retain a copy of the certificate for the seller's
22 files.
23 (2) For purposes of this section:
24 (a) "Landfill gas" means biomass fuel of the type qualified for federal
25 tax credits under 26 U.S.C. section 29 collected from a landfill.
26 "Landfill" means a landfill as defined in section 39-7403, Idaho Code;
27 (b) "Machinery and equipment" means industrial fixtures, devices, and
28 support facilities that are integral and necessary to the generation of
29 electricity using fuel cells, low impact hydro, wind, geothermal
30 resources, cogeneration, sun, or landfill gas as the principal source of
31 power;
32 (c) "Machinery and equipment" does not include:
33 (i) Hand-powered tools;
34 (ii) Property with a useful life of less than one (1) year;
35 (iii) Repair parts required to restore machinery and equipment to
36 normal working order;
37 (iv) Replacement parts that do not increase productivity, improve
38 efficiency, or extend the useful life of machinery and equipment;
39 (v) Buildings; or
40 (vi) Building fixtures that are not integral and necessary to the
41 generation of electricity that are permanently affixed to and become
42 a physical part of a building;
43 (d) Machinery and equipment is "used directly" in generating electricity
2
1 with fuel cells or by low impact hydro, wind energy, geothermal resources,
2 cogeneration, solar energy or landfill gas power if it provides any part
3 of the process that captures the energy of the fuel cells, low impact
4 hydro, wind, geothermal resources, cogeneration, sun, or landfill gas,
5 converts that energy to electricity, and stores, transforms or transmits
6 that electricity for entry into or operation in parallel with electric
7 transmission and distribution systems;
8 (e) "Fuel cell" means an electrochemical reaction that generates elec-
9 tricity by combining atoms of hydrogen and oxygen in the presence of a
10 catalyst;
11 (f) "Low impact hydro" means an electric generating facility utilizing
12 water for the generation of electricity, housed in existing canals or
13 existing reservoirs and having a power production capacity five (5)
14 megawatts or greater.
15 SECTION 2. An emergency existing therefor, which emergency is hereby
16 declared to exist, this act shall be in full force and effect on and after its
17 passage and approval, and shall be null, void and of no force and effect on
18 and after July 1, 2011.
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature First Regular Session - 2005
Moved by Bunderson
Seconded by Corder
IN THE SENATE
SENATE AMENDMENTS TO H.B. NO. 110, As Amended
1 AMENDMENTS TO SECTION 1
2 On page 1 of the engrossed bill, delete lines 12 through 22 and insert:
3 "TRICITY. (1) Purchasers of machinery and equipment used directly in generat-
4 ing electricity using fuel cells, low impact hydro, wind, geothermal
5 resources, biomass, cogeneration, sun or landfill gas as the principal source
6 of power may qualify for a rebate of sales or use taxes paid on such purchases
7 but only if the purchaser develops with such machinery, equipment, and tangi-
8 ble personal property a facility capable of generating not less than twenty-
9 five (25) kilowatts of electricity.".
10 On page 2, following line 14 insert:
11 "(3) To qualify for the rebate, the taxpayer and his contractors must pay
12 sales and use tax on their purchases of property. Once a public utility, a
13 cooperative, a municipality or the public utilities commission certifies the
14 project will generate at least twenty-five (25) kilowatts of electricity, the
15 taxpayer may file a refund request with the state tax commission. The refund
16 request shall state that the taxpayer will construct or has constructed a
17 project that will generate sufficient kilowatts of electricity at the project
18 site to be eligible for the rebate and that the taxpayer is entitled to
19 receive a rebate of all sales and use taxes paid that qualifies for the rebate
20 created by this section.
21 (4) Upon filing of a written refund claim by the taxpayer entitled to the
22 rebate, and subject to such reasonable documentation and verification as the
23 state tax commission may require, the rebate shall be paid by the state tax
24 commission as a refund allowable under section 63-3626, Idaho Code. A claim
25 for rebate under this section must be filed on or before the last day of the
26 third calendar year following the year in which the taxes sought to be rebated
27 were paid or the right to the rebate is lost.
28 (5) Any rebate paid shall be subject to recapture by the state tax com-
29 mission. In the event the property is not used, stored or otherwise consumed
30 in the process of generating electricity for a period of sixty (60) months,
31 the state tax commission may recapture the tax paid in the same proportion as
32 an amount of credit required to be recaptured under section 63-3029B, Idaho
33 Code.
34 (6) Any recapture amount due under this section shall be a deficiency in
35 tax for the period in which the disqualification first occurs for purposes of
36 section 63-3629, Idaho Code, and may be enforced and collected in the manner
37 provided by the Idaho sales tax act, provided however, that in lieu of the
38 provisions of section 63-3633, Idaho Code, the period of time within which the
39 commission may issue a notice under section 63-3629, Idaho Code, in regard to
40 an amount subject to recapture shall be the later of five (5) years after the
41 end of the taxable year, for income tax purposes, in which the project period
42 ends.".
43 CORRECTION TO TITLE
]]]
2
1 On page 1, delete lines 4 through 6 and insert: "AND USE TAX REBATE FOR
2 THE SALE OR USE OF MACHINERY AND EQUIPMENT USED IN ALTERNATIVE METHODS OF GEN-
3 ERATION OF ELECTRICITY, TO DEFINE TERMS AND TO PROVIDE PROCEDURES; DECLARING
4 AN EMERGENCY AND PROVIDING A SUNSET DATE.".
3
Moved by Roberts
Seconded by Crow
IN THE HOUSE OF REPRESENTATIVES
HOUSE AMENDMENT TO H.B. NO. 110
1 AMENDMENTS TO SECTION 1
2 On page 1 of the printed bill, in line 14, following "resources," insert:
3 "biomass,"; in line 19, delete "five (5) megawatts" and insert: "twenty-five
4 (25) kilowatts"; and in line 30 following "resources," insert: "biomass,".
5 On page 2, in line 1, following "resources," insert: "biomass,"; in line
6 4, following "resources," insert: "biomass,"; in line 13 delete "five (5)";
7 and in line 14, delete "megawatts" and insert: "twenty-five (25) kilowatts".
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature First Regular Session - 2005
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 110, As Amended, As Amended in the Senate
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO THE SALES AND USE TAX; AMENDING CHAPTER 36, TITLE 63, IDAHO CODE,
3 BY THE ADDITION OF A NEW SECTION 63-3622QQ, IDAHO CODE, TO PROVIDE A SALES
4 AND USE TAX REBATE FOR THE SALE OR USE OF MACHINERY AND EQUIPMENT USED IN
5 ALTERNATIVE METHODS OF GENERATION OF ELECTRICITY, TO DEFINE TERMS AND TO
6 PROVIDE PROCEDURES; DECLARING AN EMERGENCY AND PROVIDING A SUNSET DATE.
7 Be It Enacted by the Legislature of the State of Idaho:
8 SECTION 1. That Chapter 36, Title 63, Idaho Code, be, and the same is
9 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
10 ignated as Section 63-3622QQ, Idaho Code, and to read as follows:
11 63-3622QQ. EQUIPMENT USED IN ALTERNATIVE METHOD OF GENERATION OF ELEC-
12 TRICITY. (1) Purchasers of machinery and equipment used directly in generating
13 electricity using fuel cells, low impact hydro, wind, geothermal resources,
14 biomass, cogeneration, sun or landfill gas as the principal source of power
15 may qualify for a rebate of sales or use taxes paid on such purchases but only
16 if the purchaser develops with such machinery, equipment, and tangible per-
17 sonal property a facility capable of generating not less than twenty-five (25)
18 kilowatts of electricity.
19 (2) For purposes of this section:
20 (a) "Landfill gas" means biomass fuel of the type qualified for federal
21 tax credits under 26 U.S.C. section 29 collected from a landfill.
22 "Landfill" means a landfill as defined in section 39-7403, Idaho Code;
23 (b) "Machinery and equipment" means industrial fixtures, devices, and
24 support facilities that are integral and necessary to the generation of
25 electricity using fuel cells, low impact hydro, wind, geothermal
26 resources, biomass, cogeneration, sun, or landfill gas as the principal
27 source of power;
28 (c) "Machinery and equipment" does not include:
29 (i) Hand-powered tools;
30 (ii) Property with a useful life of less than one (1) year;
31 (iii) Repair parts required to restore machinery and equipment to
32 normal working order;
33 (iv) Replacement parts that do not increase productivity, improve
34 efficiency, or extend the useful life of machinery and equipment;
35 (v) Buildings; or
36 (vi) Building fixtures that are not integral and necessary to the
37 generation of electricity that are permanently affixed to and become
38 a physical part of a building;
39 (d) Machinery and equipment is "used directly" in generating electricity
40 with fuel cells or by low impact hydro, wind energy, geothermal resources,
41 biomass, cogeneration, solar energy or landfill gas power if it provides
42 any part of the process that captures the energy of the fuel cells, low
43 impact hydro, wind, geothermal resources, biomass, cogeneration, sun, or
2
1 landfill gas, converts that energy to electricity, and stores, transforms
2 or transmits that electricity for entry into or operation in parallel with
3 electric transmission and distribution systems;
4 (e) "Fuel cell" means an electrochemical reaction that generates elec-
5 tricity by combining atoms of hydrogen and oxygen in the presence of a
6 catalyst;
7 (f) "Low impact hydro" means an electric generating facility utilizing
8 water for the generation of electricity, housed in existing canals or
9 existing reservoirs and having a power production capacity twenty-five
10 (25) kilowatts or greater.
11 (3) To qualify for the rebate, the taxpayer and his contractors must pay
12 sales and use tax on their purchases of property. Once a public utility, a
13 cooperative, a municipality or the public utilities commission certifies the
14 project will generate at least twenty-five (25) kilowatts of electricity, the
15 taxpayer may file a refund request with the state tax commission. The refund
16 request shall state that the taxpayer will construct or has constructed a
17 project that will generate sufficient kilowatts of electricity at the project
18 site to be eligible for the rebate and that the taxpayer is entitled to
19 receive a rebate of all sales and use taxes paid that qualifies for the rebate
20 created by this section.
21 (4) Upon filing of a written refund claim by the taxpayer entitled to the
22 rebate, and subject to such reasonable documentation and verification as the
23 state tax commission may require, the rebate shall be paid by the state tax
24 commission as a refund allowable under section 63-3626, Idaho Code. A claim
25 for rebate under this section must be filed on or before the last day of the
26 third calendar year following the year in which the taxes sought to be rebated
27 were paid or the right to the rebate is lost.
28 (5) Any rebate paid shall be subject to recapture by the state tax com-
29 mission. In the event the property is not used, stored or otherwise consumed
30 in the process of generating electricity for a period of sixty (60) months,
31 the state tax commission may recapture the tax paid in the same proportion as
32 an amount of credit required to be recaptured under section 63-3029B, Idaho
33 Code.
34 (6) Any recapture amount due under this section shall be a deficiency in
35 tax for the period in which the disqualification first occurs for purposes of
36 section 63-3629, Idaho Code, and may be enforced and collected in the manner
37 provided by the Idaho sales tax act, provided however, that in lieu of the
38 provisions of section 63-3633, Idaho Code, the period of time within which the
39 commission may issue a notice under section 63-3629, Idaho Code, in regard to
40 an amount subject to recapture shall be the later of five (5) years after the
41 end of the taxable year, for income tax purposes, in which the project period
42 ends.
43 SECTION 2. An emergency existing therefor, which emergency is hereby
44 declared to exist, this act shall be in full force and effect on and after its
45 passage and approval, and shall be null, void and of no force and effect on
46 and after July 1, 2011.
3
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 110, As Amended
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO THE SALES AND USE TAX; AMENDING CHAPTER 36, TITLE 63, IDAHO CODE,
3 BY THE ADDITION OF A NEW SECTION 63-3622QQ, IDAHO CODE, TO PROVIDE A SALES
4 AND USE TAX EXEMPTION FOR THE SALES OR USE OF MACHINERY AND EQUIPMENT USED
5 IN ALTERNATIVE METHODS OF GENERATION OF ELECTRICITY AND TO DEFINE TERMS;
6 DECLARING AN EMERGENCY AND PROVIDING A SUNSET DATE.
7 Be It Enacted by the Legislature of the State of Idaho:
8 SECTION 1. That Chapter 36, Title 63, Idaho Code, be, and the same is
9 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
10 ignated as Section 63-3622QQ, Idaho Code, and to read as follows:
11 63-3622QQ. EQUIPMENT USED IN ALTERNATIVE METHOD OF GENERATION OF ELEC-
12 TRICITY. (1) There are exempted from the taxes imposed by this chapter, the
13 sales or use of machinery and equipment used directly in generating electric-
14 ity using fuel cells, low impact hydro, wind, geothermal resources, biomass,
15 cogeneration, sun, or landfill gas as the principal source of power, or to
16 sales of or charges made for tangible personal property in respect to install-
17 ing such machinery and equipment, but only if the purchaser develops with such
18 machinery, equipment, and tangible personal property a facility capable of
19 generating not less than twenty-five (25) kilowatts of electricity and pro-
20 vides the seller with an exemption certificate in a form and manner prescribed
21 by the commission. The seller shall retain a copy of the certificate for the
22 seller's files.
23 (2) For purposes of this section:
24 (a) "Landfill gas" means biomass fuel of the type qualified for federal
25 tax credits under 26 U.S.C. section 29 collected from a landfill.
26 "Landfill" means a landfill as defined in section 39-7403, Idaho Code;
27 (b) "Machinery and equipment" means industrial fixtures, devices, and
28 support facilities that are integral and necessary to the generation of
29 electricity using fuel cells, low impact hydro, wind, geothermal
30 resources, biomass, cogeneration, sun, or landfill gas as the principal
31 source of power;
32 (c) "Machinery and equipment" does not include:
33 (i) Hand-powered tools;
34 (ii) Property with a useful life of less than one (1) year;
35 (iii) Repair parts required to restore machinery and equipment to
36 normal working order;
37 (iv) Replacement parts that do not increase productivity, improve
38 efficiency, or extend the useful life of machinery and equipment;
39 (v) Buildings; or
40 (vi) Building fixtures that are not integral and necessary to the
41 generation of electricity that are permanently affixed to and become
42 a physical part of a building;
43 (d) Machinery and equipment is "used directly" in generating electricity
44 with fuel cells or by low impact hydro, wind energy, geothermal resources,
45 biomass, cogeneration, solar energy or landfill gas power if it provides
46 any part of the process that captures the energy of the fuel cells, low
4
1 impact hydro, wind, geothermal resources, biomass, cogeneration, sun, or
2 landfill gas, converts that energy to electricity, and stores, transforms
3 or transmits that electricity for entry into or operation in parallel with
4 electric transmission and distribution systems;
5 (e) "Fuel cell" means an electrochemical reaction that generates elec-
6 tricity by combining atoms of hydrogen and oxygen in the presence of a
7 catalyst;
8 (f) "Low impact hydro" means an electric generating facility utilizing
9 water for the generation of electricity, housed in existing canals or
10 existing reservoirs and having a power production capacity twenty-five
11 (25) kilowatts or greater.
12 SECTION 2. An emergency existing therefor, which emergency is hereby
13 declared to exist, this act shall be in full force and effect on and after its
14 passage and approval, and shall be null, void and of no force and effect on
15 and after July 1, 2011.
Reprint Reprint Reprint Reprint Reprint Reprint
STATEMENT OF PURPOSE
RS 14584
This legislation will provide an exemption to the sales and use
tax for purchases of machinery and equipment used in directly
generating electricity using fuel cells, low impact hydro, wind,
geothermal resources, biomass. co-generation, sun or landfill gas
as the principal source of power. The exemption would be in
effect until July 1, 2011.
FISCAL NOTE
Loss to the state general fund would be $2,125,000 annually.
Contact
Name: Senator Brent Hill,
Rep. George Eskridge
Phone: 332-1000
STATEMENT OF PURPOSE/FISCAL NOTE H 110aa