BP BHEAD INT S [atlas:bill]

AN ACT Relating to improving air quality through the use of tax exemptions and credits to reduce agricultural burning of cereal grains, and field and turf grass grown for seed; adding a new section to chapter 82.08 RCW; adding a new section to chapter 82.12 RCW; adding new sections to chapter 82.04 RCW; creating new sections; providing an effective date; and providing an expiration date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. INTENT. It is the intent of the legislature to provide tax exemptions and credits to reduce straw and stubble burning of cereal grains, and field and turf grass grown for seed, and to encourage alternatives to straw and stubble burning. The legislature also intends that the exemptions and credits apply to existing and new facilities, machinery, and equipment.

NEW SECTION. Sec. 2. A new section is added to chapter 82.08 RCW to read as follows:

SALES TAX EXEMPTION FOR GROWERS. (1) The tax levied by RCW 82.08.020 does not apply to sales of machinery and equipment used primarily for removing straw and stubble, including raking, baling, loading, handling, storing, or transporting straw from the field to on-farm storage if the following conditions are met:

(a) In order to qualify for the exemption in this subsection a grower must have conducted, under a state permit, straw or stubble burning in the previous five years. The straw and stubble handled by the machinery and equipment, for which the exemption is taken, must be greater than fifty percent of the total tonnage handled by the machinery and equipment.

(b) A grower who conducts straw or stubble burning within five years of taking the exemption shall be immediately liable for the tax exempted and shall be subject to penalties and interest under chapter 82.32 RCW.

(c) A grower taking the exemption under this section must keep records as deemed necessary by the department to verify eligibility under this section.

(2) The department of agriculture and the department of ecology shall provide the department with the information the department deems necessary to administer this section.

NEW SECTION. Sec. 3. A new section is added to chapter 82.12 RCW to read as follows:

USE TAX EXEMPTION FOR GROWERS. (1) The provisions of this chapter do not apply in respect to a grower's use of machinery and equipment used primarily for removing straw and stubble, including raking, baling, loading, handling, storing, or transporting straw from the field to on-farm storage if the following conditions are met:

(c) A grower taking the exemption under this section must keep records as deemed necessary by the department to verify eligibility under this section.

(2) The department of agriculture and the department of ecology shall provide the department with the information the department deems necessary to administer this section.

NEW SECTION. Sec. 4. A new section is added to chapter 82.04 RCW to read as follows:

BUSINESS AND OCCUPATION TAX CREDIT FOR STRAW-BASED PRODUCT MANUFACTURES. (1) A manufacturer of straw-based products may take a credit against the tax imposed by this chapter, subject to the limitations in this section.

(2)(a) The credit under this section may be taken for tax years 2001 and 2002 if the total acreage of straw and stubble burned in the state has been reduced by twenty-five percent from 1998 levels in 2000 as certified by the department of ecology. By December 15, 2000, the department of ecology shall notify the department whether the reduction has been achieved. By January 1, 2001, the department shall notify persons eligible for the credit under this section, whether the credit is authorized for tax years 2001 and 2002.

(b) The credit under this section may be taken for tax years 2003 and 2004 if the total acreage of straw and stubble burned in the state has been reduced by fifty percent from 1998 levels in 2002 as certified by the department of ecology. By December 15, 2002, the department of ecology shall notify the department whether the reduction has been achieved. By January 1, 2003, the department shall notify persons eligible for the credit under this section, whether the credit is authorized for tax years 2003 and 2004.

(c) The credit under this section may be taken for tax years 2005 and 2006 if the total acreage of wheat stubble burned in the state has been reduced by seventy-five percent from 1998 levels in 2004 as certified by the department of ecology. By December 15, 2004, the department of ecology shall notify the department whether the reduction has been achieved. By January 1, 2005, the department shall notify persons eligible for the credit under this section, whether the credit is authorized for tax years 2005 and 2006.

(d) The credit under this section may be taken for tax years 2007 and 2008 if the total amount of straw and stubble burned in the state has been reduced by ninety percent from 1998 levels in 2006 as certified by the department of ecology. By December 15, 2006, the department of ecology shall notify the department whether the reduction has been achieved. By January 1, 2007, the department shall notify persons eligible for the credit under this section, whether the credit is authorized for tax years 2007 and 2008.

NEW SECTION. Sec. 5. A new section is added to chapter 82.04 RCW to read as follows:

DEFINITIONS. The definitions in this section apply throughout sections 2 through 4 of this act unless the context clearly requires otherwise.

(1) "Grower" means any person who is engaged in the business of growing or producing cereal grains or field and turf grass, upon the person's own lands or upon the lands in which the person has a present right of possession, for sale or for use by the person in a manufacturing process.

(2) "Machinery and equipment" means equipment designed and used for raking, baling, loading, handling and transporting straw from the field to on-farm storage, but does not include machinery used for highway purposes.

(3) "Straw" means the residual of a crop, harvested for its seeds, that is pulled or cut from the ground after harvest.

(4) "Stubble" means the residual of a crop, harvested for its seeds, that remains attached to the ground after harvest.

(5) "Straw-based product" means a manufactured product containing no less than fifty percent straw.

NEW SECTION. Sec. 6. Captions used in this act are not any part of the law.

NEW SECTION. Sec. 7. This act takes effect July 1, 2000.

NEW SECTION. Sec. 8. Sections 2 through 5 of this act expire December 31, 2008.