HF 988

as introduced - 89th Legislature (2015 - 2016) Posted on 02/18/2015 11:13am

A bill for an act
relating to taxation; property; creating an exemption for certain electric
generation facilities; amending Minnesota Statutes 2014, section 272.02, by
adding a subdivision.

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

Section 1.

Minnesota Statutes 2014, section 272.02, is amended by adding a
subdivision to read:

new text begin Subd. 100. new text end

new text begin Electric generation facility; personal property. new text end

new text begin (a) Notwithstanding
subdivision 9, paragraph (a), attached machinery, transformers, and other personal
property that (1) is part of a natural gas-fired combined heat and power facility, (2)
generates electricity and steam for at least partial consumption as part of an industrial use,
including corn processing, (3) is less than 80,000 kilowatts of installed capacity, and (4)
meets the requirements of this subdivision, are exempt.
new text end

new text begin (b) At the time of construction, the facility must:
new text end

new text begin (1) be designed to utilize natural gas as a primary fuel;
new text end

new text begin (2) not be owned by a public utility as defined in section 216B.02, subdivision 4;
new text end

new text begin (3) be located within 15 miles of an existing natural gas pipeline and within one mile
of an existing electrical transmission substation; and
new text end

new text begin (4) be located outside the metropolitan area as defined in section 473.121,
subdivision 2.
new text end

new text begin (c) Construction of the facility must commence after January 1, 2015, and
before January 1, 2019. Property eligible for this exemption does not include electric
transmission lines and interconnections, or gas pipelines and interconnections, appurtenant
to the property or the facility.
new text end

new text begin (d) In lieu of personal property taxes each year, the owner of the combined heat and
power facility shall pay a base payment of 0.14 cents per kilowatt-hour of electricity
produced by the facility during the previous calendar year. In addition to the base payment
and in lieu of personal property taxes each year, the owner of the combined heat and power
facility shall pay an additional payment of 0.08 cents per kilowatt-hour of electricity
produced by the facility during the previous calendar year if, during the previous calendar
year, the host township or city had an agreement with a municipal utilities commission
to share the cost of acquiring, developing, and marketing land for industrial purposes,
and under such agreement both the host township or city and the municipal utilities
commission provided funds during the previous calendar year as part of a cost-sharing
agreement. The additional payment to be paid by the owner of the combined heat and
power facility shall be the lesser of 0.08 cents per kilowatt-hour of electricity produced
by the facility or 57 percent of the amount funded by the host township or city during
the previous calendar year pursuant to the aforementioned cost-sharing agreement. The
payments imposed under this section shall be paid to the county treasurer for the benefit of
the host township or city, at the time and in the manner provided for payment of property
taxes under section 277.01, subdivision 3. If unpaid, the payments are subject to the same
enforcement, collection, and interest and penalties as delinquent personal property taxes.
Except to the extent inconsistent with this section, sections 277.01 to 277.24 and 278.01
to 278.13 apply to the payments imposed under this section, and for purposes of those
sections the payments imposed under this section are considered personal property taxes.
new text end

new text begin (e) The owner of the combined heat and power facility shall file a report with the
commissioner of revenue annually on or before February 1, detailing the amount of
electricity in kilowatt-hours that was produced by the facility and the amount funded by
the host township or city in accordance with the cost-sharing agreement described in
paragraph (d) during the previous calendar year. The commissioner shall prescribe the
form of the report. The report must contain the information required by the commissioner
to determine the payments due under this section payable in the current year. If an owner
of the facility subject to taxation under this section fails to file the report by the due date,
the commissioner of revenue shall determine the payments based upon the nameplate
capacity of the system multiplied by a capacity factor of 85 percent.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for taxes payable beginning in 2016
and thereafter.
new text end