BILL REQ. #:  Z-1146.1 

Read first time 01/21/10.   Referred to Committee on Finance.

     AN ACT Relating to extending expiring tax incentives for certain clean alternative fuel vehicles, producers of certain biofuels, and federal aviation regulation part 145 certificated repair stations; amending RCW 82.04.250, 82.08.809, 82.12.809, 84.36.635, 84.36.640, and 82.29A.135; repealing 2008 c 81 s 19 (uncodified); repealing 2007 c 54 s 30 (uncodified); repealing 2006 c 177 s 14 (uncodified); repealing 2005 c 296 s 6 (uncodified); repealing 2007 c 54 s 5; and providing an expiration date.

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

Sec. 1   RCW 82.04.250 and 2008 c 81 s 5 are each amended to read as follows:
     (1) Upon every person engaging within this state in the business of making sales at retail, except persons taxable as retailers under other provisions of this chapter, as to such persons, the amount of tax with respect to such business ((shall be)) is equal to the gross proceeds of sales of the business, multiplied by the rate of 0.471 percent.
     (2) Upon every person engaging within this state in the business of making sales at retail that are exempt from the tax imposed under chapter 82.08 RCW by reason of RCW 82.08.0261, 82.08.0262, or 82.08.0263, except persons taxable under RCW 82.04.260(11) or subsection (3) of this section, as to such persons, the amount of tax with respect to such business ((shall be)) is equal to the gross proceeds of sales of the business, multiplied by the rate of 0.484 percent.
     (3) Until July 1, 2024, upon every person classified by the federal aviation administration as a federal aviation regulation part 145 certificated repair station and that is engaging within this state in the business of making sales at retail that are exempt from the tax imposed under chapter 82.08 RCW by reason of RCW 82.08.0261, 82.08.0262, or 82.08.0263, as to such persons, the amount of tax with respect to such business ((shall be)) is equal to the gross proceeds of sales of the business, multiplied by the rate of .2904 percent.

Sec. 2   RCW 82.08.809 and 2005 c 296 s 1 are each amended to read as follows:
     (1) The tax levied by RCW 82.08.020 does not apply to sales of new passenger cars, light duty trucks, and medium duty passenger vehicles, which are exclusively powered by a clean alternative fuel.
     (2) The seller must keep records necessary for the department to verify eligibility under this section.
     (3) As used in this section, "clean alternative fuel" means natural gas, propane, hydrogen, or electricity, when used as a fuel in a motor vehicle that meets the California motor vehicle emission standards in Title 13 of the California code of regulations, effective January 1, 2005, and the rules of the Washington state department of ecology.
     (4) This section expires July 1, 2015.

Sec. 3   RCW 82.12.809 and 2005 c 296 s 3 are each amended to read as follows:
     (1) Until July 1, 2015, the provisions of this chapter do not apply in respect to the use of new passenger cars, light duty trucks, and medium duty passenger vehicles, which are exclusively powered by a clean alternative fuel.
     (2) "Clean alternative fuel" has the same meaning as provided in RCW 82.08.809.
     (3) A taxpayer is not liable for the tax imposed in RCW 82.12.020 on the use, on or after July 1, 2015, of a passenger car, light duty truck, or medium duty passenger vehicle exclusively powered by a clean alternative fuel, if the taxpayer used such vehicle in this state before July 1, 2015, and the use was exempt under this section from the tax imposed in RCW 82.12.020.

Sec. 4   RCW 84.36.635 and 2008 c 268 s 1 are each amended to read as follows:
     (1) For the purposes of this section:
     (a) "Alcohol fuel" means any alcohol made from a product other than petroleum or natural gas, which is used alone or in combination with gasoline or other petroleum products for use as a fuel for motor vehicles, farm implements, and machines or implements of husbandry.
     (b) "Anaerobic digester" has the same meaning as provided in RCW 82.08.900.
     (c) "Biodiesel feedstock" means oil that is produced from an agricultural crop for the sole purpose of ultimately producing biodiesel fuel.
     (d) "Biodiesel fuel" means a mono alkyl ester of long chain fatty acids derived from vegetable oils or animal fats for use in compression-ignition engines and that meets the requirements of the American society of testing and materials specification D 6751 in effect as of January 1, 2003.
     (2)(a) All buildings, machinery, equipment, and other personal property which are used primarily for the manufacturing of alcohol fuel, biodiesel fuel, biodiesel feedstock, or the operation of an anaerobic digester, the land upon which this property is located, and land that is reasonably necessary in the manufacturing of alcohol fuel, biodiesel fuel, biodiesel feedstock, or the operation of an anaerobic digester, but not land necessary for growing of crops, which together comprise a new manufacturing facility or an addition to an existing manufacturing facility, are exempt from property taxation for the six assessment years following the date on which the facility or the addition to the existing facility becomes operational.
     (b) For manufacturing facilities which produce products in addition to alcohol fuel, biodiesel fuel, or biodiesel feedstock, the amount of the property tax exemption ((shall be)) is based upon the annual percentage of the total value of all products manufactured that is the value of the alcohol fuel, biodiesel fuel, and biodiesel feedstock manufactured.
     (3) Claims for exemptions authorized by this section ((shall)) must be filed with the county assessor on forms prescribed by the department of revenue and furnished by the assessor. Once filed, the exemption is valid for six years and ((shall)) may not be renewed. The assessor ((shall)) must verify and approve claims as the assessor determines to be justified and in accordance with this section. No claims may be filed after December 31, ((2009)) 2015, except for claims for anaerobic digesters, which may be filed no later than December 31, 2012.
     The department of revenue may promulgate such rules, pursuant to chapter 34.05 RCW, as necessary to properly administer this section.

Sec. 5   RCW 84.36.640 and 2003 c 339 s 9 are each amended to read as follows:
     (1) For the purposes of this section, "wood biomass fuel" means a pyrolytic liquid fuel or synthesis gas-derived liquid fuel, used in internal combustion engines, and produced from wood, forest, or field residue, or dedicated energy crops that do not include wood pieces that have been treated with chemical preservatives such as creosote, pentachlorophenol, or copper-chroma-arsenic.
     (2)(a) All buildings, machinery, equipment, and other personal property which is used primarily for the manufacturing of wood biomass fuel, the land upon which this property is located, and land that is reasonably necessary in the manufacturing of wood biomass fuel, but not land necessary for growing of crops, which together comprise a new manufacturing facility or an addition to an existing manufacturing facility, are exempt from property taxation for the six assessment years following the date on which the facility or the addition to the existing facility becomes operational.
     (b) For manufacturing facilities which produce products in addition to wood biomass fuel, the amount of the property tax exemption ((shall be)) is based upon the annual percentage of the total value of all products manufactured that is the value of the wood biomass fuel manufactured.
     (3) Claims for exemptions authorized by this section ((shall)) must be filed with the county assessor on forms prescribed by the department of revenue and furnished by the assessor. Once filed, the exemption is valid for six years and ((shall)) may not be renewed. The assessor ((shall)) must verify and approve claims as the assessor determines to be justified and in accordance with this section. No claims may be filed after December 31, ((2009)) 2015.
     The department of revenue may promulgate such rules, pursuant to chapter 34.05 RCW, as necessary to properly administer this section.

Sec. 6   RCW 82.29A.135 and 2008 c 268 s 2 are each amended to read as follows:
     (1) For the purposes of this section:
     (a) "Alcohol fuel" means any alcohol made from a product other than petroleum or natural gas, which is used alone or in combination with gasoline or other petroleum products for use as a fuel for motor vehicles, farm implements, and machines or implements of husbandry.
     (b) "Anaerobic digester" has the same meaning as provided in RCW 82.08.900.
     (c) "Biodiesel feedstock" means oil that is produced from an agricultural crop for the sole purpose of ultimately producing biodiesel fuel.
     (d) "Biodiesel fuel" means a mono alkyl ester of long chain fatty acids derived from vegetable oils or animal fats for use in compression-ignition engines and that meets the requirements of the American society of testing and materials specification D 6751 in effect as of January 1, 2003.
     (e) "Wood biomass fuel" means a pyrolytic liquid fuel or synthesis gas-derived liquid fuel, used in internal combustion engines, and produced from wood, forest, or field residue, or dedicated energy crops that do not include wood pieces that have been treated with chemical preservatives such as creosote, pentachlorophenol, or copper-chroma-arsenic.
     (2)(a) All leasehold interests in buildings, machinery, equipment, and other personal property which are used primarily for the manufacturing of alcohol fuel, wood biomass fuel, biodiesel fuel, biodiesel feedstock, or the operation of an anaerobic digester, the land upon which this property is located, and land that is reasonably necessary in the manufacturing of alcohol fuel, wood biomass fuel, biodiesel fuel, biodiesel feedstock, or the operation of an anaerobic digester, but not land necessary for growing of crops, which together comprise a new manufacturing facility or an addition to an existing manufacturing facility, are exempt from leasehold taxes for a period of six years from the date on which the facility or the addition to the existing facility becomes operational.
     (b) For manufacturing facilities which produce products in addition to alcohol fuel, wood biomass fuel, biodiesel fuel, or biodiesel feedstock, the amount of the leasehold tax exemption ((shall be)) is based upon the annual percentage of the total value of all products manufactured that is the value of the alcohol fuel, wood biomass fuel, biodiesel fuel, and biodiesel feedstock manufactured.
     (3) Claims for exemptions authorized by this section ((shall)) must be filed with the department of revenue on forms prescribed by the department of revenue and furnished by the department of revenue. Once filed, the exemption is valid for six years and ((shall)) may not be renewed. The department of revenue ((shall)) must verify and approve claims as the department of revenue determines to be justified and in accordance with this section. No claims may be filed after December 31, ((2009)) 2015, except for claims for anaerobic digesters, which may be filed no later than December 31, 2012.
     The department of revenue may promulgate such rules, pursuant to chapter 34.05 RCW, as are necessary to properly administer this section.

NEW SECTION.  Sec. 7   The following acts or parts of acts are each repealed:
     (1) 2008 c 81 s 19 (uncodified);
     (2) 2007 c 54 s 5;
     (3) 2007 c 54 s 30 (uncodified);
     (4) 2006 c 177 s 14 (uncodified); and
     (5) 2005 c 296 s 6 (uncodified).