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H0189...............................................by REVENUE AND TAXATION
WIND ENERGY - Amends and adds to existing law relating to producers of
electricity by means of wind energy to provide for a wind energy tax; to
provide for the filing of operator's statements by producers of electricity
by means of wind energy; to provide for the computation, allotment and
apportionment of tax due from producers of electricity by means of wind
energy by the State Tax Commission and to require certain notifications; to
authorize county treasurers to collect specified taxes from producers of
electricity by means of wind energy; to provide for tax liens on property
of producers of electricity by means of wind energy; to provide for the
assessment of nonoperating property of producers of electricity by means of
wind energy; and to provide an exemption from taxation for certain
operating property of producers of electricity by means of wind energy.
02/13 House intro - 1st rdg - to printing
02/14 Rpt prt - to Rev/Tax
02/16 Rpt out - rec d/p - to 2nd rdg
02/19 2nd rdg - to 3rd rdg
02/22 3rd rdg - PASSED - 69-0-1
AYES -- Anderson, Andrus, Barrett, Bayer, Bedke, Bell, Bilbao, Black,
Block, Bock, Boe, Bolz, Brackett, Bradford, Chadderdon, Chavez, Chew,
Clark, Collins, Crane, Durst, Edmunson, Eskridge, Hagedorn, Hart,
Harwood, Henbest, Henderson, Jaquet, Killen, King, Kren, Labrador,
Lake, LeFavour, Loertscher, Luker, Marriott, Mathews, McGeachin,
Mortimer, Moyle, Nielsen, Nonini, Pasley-Stuart, Patrick, Pence,
Raybould, Ring, Ringo, Roberts, Ruchti, Rusche, Sayler, Schaefer,
Shepherd(2), Shepherd(8), Shirley, Shively, Smith(30), Smith(24),
Snodgrass, Stevenson, Thayn, Trail, Vander Woude, Wood(27), Wood(35),
Mr. Speaker
NAYS -- None
Absent and excused -- Wills
Floor Sponsor - Eskridge
Title apvd - to Senate
02/23 Senate intro - 1st rdg - to Loc Gov
03/07 Rpt out - rec d/p - to 2nd rdg
03/08 2nd rdg - to 3rd rdg
03/13 3rd rdg - PASSED - 30-0-3, 2 Excused from voting
AYES -- Andreason, Bastian, Bilyeu, Broadsword, Burkett, Cameron,
Coiner, Corder, Darrington, Davis, Fulcher, Gannon, Goedde, Hammond,
Heinrich, Hill, Jorgenson, Kelly, Keough, Langhorst, Little, McGee,
McKague, McKenzie, Pearce, Richardson, Schroeder, Stegner, Stennett,
Werk
NAYS -- None
Absent and excused -- Geddes, Lodge, Malepeai
Excused from voting -- Bair, Siddoway
Floor Sponsor - McKenzie
Title apvd - to House
03/14 To enrol
03/15 Rpt enrol - Sp signed - Pres signed
03/16 To Governor
03/21 Governor signed
Session Law Chapter 143
Effective: 01/01/07
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-ninth Legislature First Regular Session - 2007
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 189
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY; AMENDING SECTION
3 63-3501, IDAHO CODE, TO REVISE DEFINITIONS, TO PROVIDE CORRECT TERMINOLOGY
4 AND TO MAKE A TECHNICAL CORRECTION; AMENDING CHAPTER 35, TITLE 63, IDAHO
5 CODE, BY THE ADDITION OF A NEW SECTION 63-3502B, IDAHO CODE, TO PROVIDE
6 FOR A WIND ENERGY TAX; AMENDING CHAPTER 35, TITLE 63, IDAHO CODE, BY THE
7 ADDITION OF A NEW SECTION 63-3503B, IDAHO CODE, TO PROVIDE FOR THE FILING
8 OF OPERATORS' STATEMENTS BY PRODUCERS OF ELECTRICITY BY MEANS OF WIND
9 ENERGY, TO PROVIDE FOR THE COMPUTATION, ALLOTMENT AND APPORTIONMENT OF TAX
10 DUE FROM PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY BY THE STATE TAX
11 COMMISSION AND TO REQUIRE CERTAIN NOTIFICATIONS; AMENDING SECTION 63-3504,
12 IDAHO CODE, TO AUTHORIZE COUNTY TREASURERS TO COLLECT SPECIFIED TAXES FROM
13 PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY AND TO MAKE A TECHNICAL
14 CORRECTION; AMENDING SECTION 63-3505, IDAHO CODE, TO PROVIDE FOR TAX LIENS
15 ON PROPERTY OF PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY, TO PRO-
16 VIDE CORRECT TERMINOLOGY AND TO MAKE A TECHNICAL CORRECTION; AMENDING SEC-
17 TION 63-3506, IDAHO CODE, TO PROVIDE FOR THE ASSESSMENT OF NONOPERATING
18 PROPERTY OF PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY; AMENDING
19 CHAPTER 6, TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION
20 63-602JJ, IDAHO CODE, TO PROVIDE AN EXEMPTION FROM TAXATION FOR CERTAIN
21 OPERATING PROPERTY OF PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY;
22 DECLARING AN EMERGENCY AND PROVIDING RETROACTIVE APPLICATION.
23 Be It Enacted by the Legislature of the State of Idaho:
24 SECTION 1. That Section 63-3501, Idaho Code, be, and the same is hereby
25 amended to read as follows:
26 63-3501. DEFINITIONS. For the purposes of this act chapter:
27 (a) The term "cooperative electrical association" means any nonprofit,
28 cooperative association organized and maintained by its members, whether
29 incorporated or unincorporated, for the purpose of transmitting, distributing
30 or delivering electric power to its members.
31 (b) The term "cooperative natural gas association" means any nonprofit
32 cooperative association organized and maintained by its members, whether
33 incorporated or unincorporated, for the purpose of transmitting, distributing
34 or delivering natural gas to its members.
35 (c) The term "cost of power" means the cost of power purchases and gener-
36 ation included in reports to, and in accordance with applicable requirements
37 of, the rural electrification administration, United States department of
38 agriculture, by cooperative electrical associations which are borrowers from
39 the rural electrification administration, and for cooperative electrical asso-
40 ciations which are not borrowers from the rural electrification administra-
41 tion, such costs which could have been included by such cooperative electrical
42 associations using equivalent reporting and accounting requirements. The state
43 tax commission shall prescribe necessary rules and regulations for the purpose
2
1 of providing a uniform method of reporting cost of power purchases and genera-
2 tion by cooperative electrical associations, consistent with the reporting and
3 accounting requirements of the rural electrification administration.
4 (d) The term "cost of gas" means the cost of natural gas purchased by
5 cooperative natural gas associations from wholesale or other suppliers of nat-
6 ural gas for delivery to members of the cooperative natural gas association.
7 (e) The term "gross electrical earnings" means the gross receipts of a
8 cooperative electrical association from the distribution, delivery and sale of
9 electric power within the state of Idaho, but shall not include any earnings
10 or receipts from the distribution, delivery or sale of electric power consumed
11 in pumping water for irrigation or drainage purposes within the state of
12 Idaho, upon the land of such consumer and for the use and benefit of his own
13 land, and where such consumer has received from the association a refund,
14 rebate, or credit of three and one-half percent (3 1/2%) of the cost to him of
15 the electric power so used and consumed.
16 (f) The term "gross natural gas earnings" means the gross receipts of a
17 cooperative natural gas association from the distribution, delivery and sale
18 of natural gas within the state of Idaho.
19 (g) The term "gross wind energy earnings" means the gross receipts of a
20 wind energy generator from the distribution, delivery and sale to a customer
21 for the direct use or resale of electrical energy generated, manufactured or
22 produced by means of wind energy within the state of Idaho.
23 (h) The term "operating property" means and includes all real estate,
24 fixtures or personal property owned, controlled, operated or managed by such
25 electrical or natural gas association, or producer of electricity by means of
26 wind energy, excluding entities that are regulated by the Idaho public utili-
27 ties commission as to price, in connection with or to facilitate the genera-
28 tion, transmission, distribution, delivery, or measuring of electric power, or
29 natural gas, or electrical energy generated, manufactured or produced by means
30 of wind energy, excluding entities that are regulated by the Idaho public
31 utilities commission as to price, and all conduits, ducts, or other devices,
32 materials, apparatus or property for containing, holding or carrying conduc-
33 tors used or to be used for the transmission, distribution and delivery of
34 electric power, and natural gas, or electrical energy generated, manufactured
35 or produced by means of wind energy, excluding entities that are regulated by
36 the Idaho public utilities commission as to price, including construction
37 tools, materials and supplies.
38 (hi) The term "nonoperating property" means all other property, real or
39 personal, owned, controlled or managed by such electrical or natural gas asso-
40 ciation.
41 (ij) The term "taxing unit" shall include any of the following that had
42 property taxes levied in the prior year: the separate taxing districts of the
43 county as well as the county itself and any such taxing district's fund having
44 a different geographical boundary than such taxing district itself.
45 (jk) The term "tax levy" means the total tax levies fixed by each taxing
46 district, as defined herein, in the prior calendar year. next preceding.
47 (kl) The term "WPPSS 4 and 5 costs" means, for a cooperative electrical
48 association which is a participant under the Washington public power supply
49 system nuclear projects numbers 4 and 5 participants' agreement, dated July
50 14, 1976, all of its costs in connection with Washington public power supply
51 system nuclear projects numbers 4 and 5.
52 (lm) The term "weighted wire mileage factor" means a figure which is
53 arrived at by multiplying the tax levy of each taxing unit by the number of
54 wire miles of transmission and distribution lines of such cooperative electri-
55 cal association situated in such taxing unit.
3
1 (mn) The term "gas line mileage factor" means a figure which is arrived
2 at by multiplying the tax levy of each taxing unit by the number of miles of
3 natural gas transmission and distribution lines of such cooperative natural
4 gas association situated in such taxing unit.
5 SECTION 2. That Chapter 35, Title 63, Idaho Code, be, and the same is
6 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
7 ignated as Section 63-3502B, Idaho Code, and to read as follows:
8 63-3502B. LEVY OF TAX ON WIND ENERGY ELECTRICAL PRODUCTION. There shall
9 be levied against every producer of electricity by means of wind energy a wind
10 energy tax equal to three percent (3%) of such producer's gross wind energy
11 earnings. This wind energy tax shall be in lieu of all other taxes on the
12 operating property, as defined in section 63-3501(h), Idaho Code, of such wind
13 energy producer.
14 SECTION 3. That Chapter 35, Title 63, Idaho Code, be, and the same is
15 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
16 ignated as Section 63-3503B, Idaho Code, and to read as follows:
17 63-3503B. FILING OPERATORS' STATEMENTS -- ALLOTMENT AND APPORTIONMENT OF
18 TAX DUE FROM PRODUCERS OF ELECTRICITY BY MEANS OF WIND ENERGY BY STATE TAX
19 COMMISSION. Every producer of electricity by means of wind energy in this
20 state shall file with the state tax commission of the state of Idaho an
21 operator's statement in the manner as provided for in section 63-404, Idaho
22 Code, and shall include thereon a statement of the prior calendar year's gross
23 wind energy earnings. Upon examining and verifying said statement, the state
24 tax commission shall compute the amount of the wind energy tax based on the
25 gross wind energy earnings and shall allot to each county in which the operat-
26 ing property of such producer is situate that proportion of the total wind
27 energy tax of such producer shown to be due as the same proportion that the
28 total original cost of operating property situate in such county bears to the
29 total original cost of operating property of such producer for the wind energy
30 project. The state tax commission shall then, for each county, apportion the
31 wind energy tax so allotted to such county among the several taxing units
32 thereof within which any operating property of such producer is situate, by
33 apportioning to each such taxing unit that proportion of the wind energy tax
34 so allotted to such county. For such apportionment, the state tax commission
35 shall calculate the weighted original cost which shall be the product of the
36 original cost of such operating property within such taxing unit times such
37 taxing unit's property tax levy for the prior year and the weighted apportion-
38 ment rate which shall be the ratio of the wind energy tax, allotted to such
39 county, to the aggregate weighted original cost for all such taxing units
40 within which the operating property is located and then shall calculate the
41 apportionment of the wind energy tax for each such taxing unit to be equal to
42 the product of the weighted original cost times the weighted apportionment
43 rate. The state tax commission shall, on or before the second Monday in
44 August, notify the state superintendent of public instruction, the county
45 auditor, and the county treasurer of such allotment and apportionment and the
46 amounts thereof. On or before the third Monday in August, the county auditor
47 shall notify the appropriate taxing units of the amount of wind energy tax
48 being apportioned.
49 SECTION 4. That Section 63-3504, Idaho Code, be, and the same is hereby
50 amended to read as follows:
4
1 63-3504. COLLECTION BY COUNTY TREASURER -- PENALTY AND INTEREST IMPOSED
2 WHEN DELINQUENT. Upon receipt of the notification of the allotment and appor-
3 tionment of such taxes by the state tax commission by the county treasurer,
4 said county treasurer shall, not later than June 15th of each year, notify
5 each cooperative electrical association, and each natural gas cooperative, and
6 producer of electricity by means of wind energy, of the amount of taxes owed,
7 and the apportionment thereof to the county and to the several taxing dis-
8 tricts in the county and such tax shall be due and payable not later than July
9 1, following and, upon the payment thereof, the county treasurer shall pay
10 over to each taxing district its apportionment as herein determined. Any such
11 taxes not paid by July 1, as aforesaid, shall become delinquent and a penalty
12 of five percent (5%) thereof shall be imposed, together with interest at the
13 rate of one percent (1%) per month from July 1 until paid.
14 SECTION 5. That Section 63-3505, Idaho Code, be, and the same is hereby
15 amended to read as follows:
16 63-3505. TAXES A LIEN ON PROPERTY OF ASSOCIATION OR PRODUCER UNTIL PAID.
17 All taxes due and payable under this act chapter shall be a lien on all prop-
18 erty, real and personal, of the electrical, or natural gas association, or the
19 producer of electricity by means of wind energy, owing the same, as of June
20 15th of each year and shall be discharged only by the payment thereof. In any
21 action to enforce payment of any delinquent taxes due under this act chapter,
22 the county prosecuting such action shall be entitled to a judgment for the
23 reasonable costs of prosecuting such action, as well as for the delinquent
24 taxes, penalty and interest.
25 SECTION 6. That Section 63-3506, Idaho Code, be, and the same is hereby
26 amended to read as follows:
27 63-3506. ASSESSMENT OF NONOPERATING PROPERTY BY ASSESSOR. The
28 nonoperating property of any cooperative electrical or natural gas
29 association, or producer of electricity by means of wind energy, shall be
30 assessed by the county assessor of the county wherein such property is situ-
31 ate, and taxes levied against the same shall be a lien, and shall be due and
32 payable, in the same manner as are any other taxes on property.
33 SECTION 7. That Chapter 6, Title 63, Idaho Code, be, and the same is
34 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
35 ignated as Section 63-602JJ, Idaho Code, and to read as follows:
36 63-602JJ. PROPERTY EXEMPT FROM TAXATION -- CERTAIN OPERATING PROPERTY OF
37 PRODUCER OF ELECTRICITY BY MEANS OF WIND ENERGY. The following property is
38 exempt from taxation: operating property of producers of electricity by means
39 of wind energy exclusively used to produce electricity by means of wind energy
40 on which the tax on gross wind energy earnings will be paid.
41 SECTION 8. An emergency existing therefor, which emergency is hereby
42 declared to exist, this act shall be in full force and effect on and after its
43 passage and approval, and retroactively to January 1, 2007.
STATEMENT OF PURPOSE
RS 16923
The purpose of this proposed legislation is to change the method
of taxation on producers of wind energy from a property tax to a
tax on production. The legislation also provides for the filing
of operators' statements and provides for the computation,
allotment and apportionment of tax due from producers of wind energy.
The legislation details how the distribution of taxes paid by producers
of wind energy will be accomplished and to provide tax liens on property
of producers of wind energy. The proposed legislation also provides
for the assessment of nonoperating property of producers of wind energy
and provides for this act to be retroactive to January 1, 2007 after its
passage and approval.
FISCAL NOTE
No fiscal impact to the general fund.
CONTACT:
Rep. George Eskridge
Phone 208-322-1000
Dar Olberding, Ridgeline Energy
Phone 208-761-6012
Stan Boyd, Ridgeline Energy
Phone 208-344-2271
STATEMENT OF PURPOSE / FISCAL NOTE H 189