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H.B. 145
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5 This act modifies the Natural Resources Code to create the Utah Energy Office within the
6 Department of Natural Resources. This act moves certain energy-related programs,
7 including the Clean Fuels Vehicle program and fund, from the Department of Community
8 and Economic Development to the Department of Natural Resources to be administered by
9 the Utah Energy Office.
10 This act affects sections of Utah Code Annotated 1953 as follows:
11 AMENDS:
12 9-1-201, as last amended by Chapter 66, Laws of Utah 1993
13 59-7-605, as last amended by Chapter 287, Laws of Utah 2000
14 59-10-127, as last amended by Chapter 287, Laws of Utah 2000
15 63-34-5, as last amended by Chapter 66, Laws of Utah 1993
16 ENACTS:
17 63-34-101, Utah Code Annotated 1953
18 63-34-201, Utah Code Annotated 1953
19 63-34-202, Utah Code Annotated 1953
20 63-34-203, Utah Code Annotated 1953
21 63-34-204, Utah Code Annotated 1953
22 REPEALS:
23 9-1-702, as last amended by Chapter 287, Laws of Utah 2000
24 9-1-703, as last amended by Chapter 287, Laws of Utah 2000
25 9-1-706, as last amended by Chapter 287, Laws of Utah 2000
26 Be it enacted by the Legislature of the state of Utah:
27 Section 1. Section 9-1-201 is amended to read:
28 9-1-201. Department of Community and Economic Development -- Creation --
29 Powers and duties.
30 (1) There is created the Department of Community and Economic Development.
31 (2) The department shall:
32 (a) be responsible for community and economic development within the state;
33 (b) perform economic development planning for the state;
34 (c) coordinate the program plans of the various divisions within the department;
35 (d) administer and coordinate all state or federal grant programs which are, or become,
36 available for community and economic development;
37 [
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39 [
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41 [
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43 [
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45 [
46 supervision by the governor;
47 [
48 [
49 (3) The department may solicit and accept contributions of moneys, services, and facilities
50 from any other sources, public or private, but may not use these funds for publicizing the exclusive
51 interest of the donor.
52 (4) Moneys received pursuant to Subsection (3) shall be deposited in the General Fund as
53 restricted revenues of the department.
54 Section 2. Section 59-7-605 is amended to read:
55 59-7-605. Definitions -- Credit -- Cleaner burning fuels.
56 (1) As used in this section:
57 (a) "Board" means the Air Quality Board created under Title 19, Chapter 2, Air
58 Conservation Act.
59 (b) "Certified by the board" means that:
60 (i) a motor vehicle on which conversion equipment has been installed meets the following
61 criteria:
62 (A) before the installation of conversion equipment, the vehicle does not exceed the
63 emission cut points for a transient test driving cycle, as specified in 40 CFR 51, Appendix E to
64 Subpart S, or an equivalent test for the make, model, and year of the vehicle;
65 (B) the motor vehicle's emissions of regulated pollutants, when operating on fuels listed
66 in Subsection (2)(b), is less than the emissions were before the installation of conversion
67 equipment; and
68 (C) a reduction in emissions under Subsection (1)(b)(i)(B) is demonstrated by:
69 (I) certification of the conversion equipment by the federal Environmental Protection
70 Agency or by a state whose certification standards are recognized by the board;
71 (II) testing the motor vehicle, before and after installation of the conversion equipment,
72 in accordance with 40 CFR 86, Control of Air Pollution from New and In-use Motor Vehicle
73 Engines: Certification and Test Procedures, using all fuel the motor vehicle is capable of using;
74 or
75 (III) any other test or standard recognized by board rule; or
76 (ii) special mobile equipment on which conversion equipment has been installed meets the
77 following criteria:
78 (A) the special mobile equipment's emissions of regulated pollutants, when operating on
79 fuels listed in Subsection (2)(c), is less than the emissions were before the installation of
80 conversion equipment; and
81 (B) a reduction in emissions under Subsection (1)(b)(ii)(A) is demonstrated by:
82 (I) certification of the conversion equipment by the federal Environmental Protection
83 Agency or by a state whose certification standards are recognized by the board; or
84 (II) any other test or standard recognized by board rule.
85 (c) "Clean fuel grant" means a grant awarded under Title 9, Chapter 1, Part 7, Clean Fuels
86 Conversion Program Act, for reimbursement of a portion of the incremental cost of an OEM
87 vehicle or the cost of conversion equipment.
88 (d) "Conversion equipment" means equipment referred to in Subsection (2)(b) or (2)(c).
89 (e) "Incremental cost" has the same meaning as in Section [
90 (f) "OEM vehicle" has the same meaning as in Section [
91 (g) "Special mobile equipment":
92 (i) means any mobile equipment or vehicle that is not designed or used primarily for the
93 transportation of persons or property; and
94 (ii) includes construction or maintenance equipment.
95 (2) For taxable years beginning on or after January 1, 2001, but beginning on or before
96 December 31, 2005, a taxpayer may claim a credit against tax otherwise due under this chapter or
97 Chapter 8, Gross Receipts Tax on Certain Corporations Not Required to Pay Corporate Franchise
98 or Income Tax Act, in an amount equal to:
99 (a) 50% of the incremental cost of an OEM vehicle registered in Utah minus the amount
100 of any clean fuel grant received, up to a maximum tax credit of $3,000 per vehicle, if the vehicle:
101 (i) is fueled by propane, natural gas, or electricity;
102 (ii) is fueled by other fuel the board determines annually on or before July 1 to be at least
103 as effective in reducing air pollution as fuels under Subsection (2)(a)(i); or
104 (iii) meets the clean-fuel vehicle standards in the federal Clean Air Act Amendments of
105 1990, [
106 (b) 50% of the cost of equipment for conversion, if certified by the board, of a motor
107 vehicle registered in Utah minus the amount of any clean fuel grant received, up to a maximum
108 tax credit of $2,500 per motor vehicle, if the motor vehicle is to:
109 (i) be fueled by propane, natural gas, or electricity;
110 (ii) be fueled by other fuel the board determines annually on or before July 1 to be at least
111 as effective in reducing air pollution as fuels under Subsection (2) (b)(i); or
112 (iii) meet the federal clean-fuel vehicle standards in the federal Clean Air Act
113 Amendments of 1990, [
114 (c) 50% of the cost of equipment for conversion, if certified by the board, of a special
115 mobile equipment engine minus the amount of any clean fuel grant received, up to a maximum tax
116 credit of $1,000 per special mobile equipment engine, if the special mobile equipment is to be
117 fueled by:
118 (i) propane, natural gas, or electricity; or
119 (ii) other fuel the board determines annually on or before July 1 to be:
120 (A) at least as effective in reducing air pollution as the fuels under Subsection (2)(c)(i);
121 or
122 (B) substantially more effective in reducing air pollution than the fuel for which the engine
123 was originally designed.
124 (3) A taxpayer shall provide proof of the purchase of an item for which a credit is allowed
125 under this section by:
126 (a) providing proof to the board in the form the board requires by rule;
127 (b) receiving a written statement from the board acknowledging receipt of the proof; and
128 (c) attaching the written statement obtained from the board to the tax return in which the
129 credit is claimed.
130 (4) Except as provided by Subsection (5), this credit is allowed only:
131 (a) against any Utah tax owed in the taxable year by the taxpayer;
132 (b) in the taxable year in which the item is purchased for which the credit is claimed; and
133 (c) once per vehicle.
134 (5) If the amount of a tax credit claimed by a taxpayer under this section exceeds the
135 taxpayer's tax liability under this chapter for a taxable year, the amount of the credit exceeding the
136 liability may be carried forward for a period that does not exceed the next five taxable years.
137 Section 3. Section 59-10-127 is amended to read:
138 59-10-127. Definition -- Credit -- Cleaner burning fuels.
139 (1) As used in this section:
140 (a) "Board" means the Air Quality Board created in Title 19, Chapter 2, Air Conservation
141 Act.
142 (b) "Certified by the board" means that:
143 (i) a motor vehicle on which conversion equipment has been installed meets the following
144 criteria:
145 (A) before the installation of conversion equipment, the vehicle does not exceed the
146 emission cut points for a transient test driving cycle, as specified in 40 CFR 51, Appendix E to
147 Subpart S, or an equivalent test for the make, model, and year of the vehicle;
148 (B) the motor vehicle's emissions of regulated pollutants, when operating on fuels listed
149 in Subsection(2)(b), is less than the emissions were before the installation of conversion
150 equipment; and
151 (C) a reduction in emissions under Subsection (1)(b)(i)(B) is demonstrated by:
152 (I) certification of the conversion equipment by the federal Environmental Protection
153 Agency or by a state whose certification standards are recognized by the board;
154 (II) testing the motor vehicle, before and after installation of the conversion equipment,
155 in accordance with 40 CFR 86, Control of Air Pollution from New and In-use Motor Vehicle
156 Engines: Certification and Test Procedures, using all fuels the motor vehicle is capable of using;
157 or
158 (III) any other test or standard recognized by board rule; or
159 (ii) special mobile equipment on which conversion equipment has been installed meets the
160 following criteria:
161 (A) the special mobile equipment's emissions of regulated pollutants, when operating on
162 fuels listed in Subsection (2)(c), is less than the emissions were before the installation of
163 conversion equipment; and
164 (B) a reduction in emissions under Subsection (1)(b)(ii)(A) is demonstrated by:
165 (I) certification of the conversion equipment by the federal Environmental Protection
166 Agency or by a state whose certification standards are recognized by the board; or
167 (II) any other test or standard recognized by the board.
168 (c) "Clean fuel grant" means a grant the taxpayer receives under Title 9, Chapter 1, Part
169 7, Clean Fuels Conversion Program Act for reimbursement of a portion of the incremental cost of
170 the OEM vehicle or the cost of conversion equipment.
171 (d) "Conversion equipment" means equipment referred to in Subsection (2)(b) or (2)(c).
172 (e) "Incremental cost" has the same meaning as in Section [
173 (f) "OEM vehicle" has the same meaning as in Section [
174 (g) "Special mobile equipment":
175 (i) means any mobile equipment or vehicle not designed or used primarily for the
176 transportation of persons or property; and
177 (ii) includes construction or maintenance equipment.
178 (2) For taxable years beginning on or after January 1, 2001, but beginning on or before
179 December 31, 2005, a taxpayer may claim a credit against tax otherwise due under this chapter in
180 an amount equal to:
181 (a) 50% of the incremental cost of an OEM vehicle registered in Utah minus the amount
182 of any clean fuel grant received, up to a maximum tax credit of $3,000 per vehicle, if the vehicle:
183 (i) is fueled by propane, natural gas, or electricity;
184 (ii) is fueled by other fuel the board determines annually on or before July 1 to be at least
185 as effective in reducing air pollution as fuels under Subsection (2)(a)(i); or
186 (iii) meets the clean-fuel vehicle standards in the federal Clean Air Act Amendments of
187 1990, [
188 (b) 50% of the cost of equipment for conversion, if certified by the board, of a motor
189 vehicle registered in Utah minus the amount of any clean fuel conversion grant received, up to a
190 maximum tax credit of $2,500 per vehicle, if the motor vehicle:
191 (i) is to be fueled by propane, natural gas, or electricity;
192 (ii) is to be fueled by other fuel the board determines annually on or before July 1 to be at
193 least as effective in reducing air pollution as fuels under Subsection (2) (b)(i); or
194 (iii) will meet the federal clean fuel vehicle standards in the federal Clean Air Act
195 Amendments of 1990, [
196 (c) 50% of the cost of equipment for conversion, if certified by the board, of a special
197 mobile equipment engine minus the amount of any clean fuel conversion grant received, up to a
198 maximum tax credit of $1,000 per special mobile equipment engine, if the special mobile
199 equipment is to be fueled by:
200 (i) propane, natural gas, or electricity; or
201 (ii) other fuel the board determines annually on or before July 1 to be:
202 (A) at least as effective in reducing air pollution as the fuels under Subsection (2)(c)(i);
203 or
204 (B) substantially more effective in reducing air pollution than the fuel for which the engine
205 was originally designed.
206 (3) An individual shall provide proof of the purchase of an item for which a credit is
207 allowed under this section by:
208 (a) providing proof to the board in the form the board requires by rule;
209 (b) receiving a written statement from the board acknowledging receipt of the proof; and
210 (c) attaching the written statement obtained from the board to the tax return in which the
211 credit is claimed.
212 (4) Except as provided by Subsection (5), this credit is allowed only:
213 (a) against any Utah tax owed in the taxable year by the taxpayer;
214 (b) in the taxable year in which the item is purchased for which the credit is claimed; and
215 (c) once per vehicle.
216 (5) If the amount of a tax credit claimed by a taxpayer under this section exceeds the
217 taxpayer's tax liability under this chapter for a taxable year, the amount of the credit exceeding the
218 liability may be carried forward for a period that does not exceed the next five taxable years.
219 Section 4. Section 63-34-5 is amended to read:
220 63-34-5. Executive director of natural resources -- Appointment -- Removal --
221 Compensation -- Responsibilities -- Department fee schedule.
222 (1) (a) The chief administrative officer of the Department of Natural Resources shall be
223 an executive director appointed by the governor with the advice and consent of the Senate.
224 (b) The executive director may be removed at the will of the governor.
225 (c) The executive director shall receive a salary established by the governor within the
226 salary range fixed by the Legislature in Title 67, Chapter 22, State Officer Compensation.
227 (2) The executive director shall:
228 (a) administer and supervise the Department of Natural Resources and provide for
229 coordination and cooperation among the boards [
230 (b) approve the budget of each board and division;
231 (c) (i) coordinate state governmental functions regarding energy development and use;
232 (ii) facilitate the development and implementation of policies and programs relating to
233 energy production, processing, utilization, and technology in the state;
234 (iii) coordinate and consolidate energy resource data collection throughout state
235 government;
236 (iv) perform forecasts of state-level energy production, consumption, and prices;
237 (v) monitor federal laws and regulations relating to energy development, processing, or
238 use, and recommend policy positions for the state;
239 (vi) participate in regulatory proceedings as appropriate to the functions and duties of the
240 department;
241 (vii) represent the state on regional and national energy matters on his own initiative or
242 as requested by the governor; and
243 (viii) provide the Legislature and the governor with:
244 (A) a biennial report addressing the current status of energy markets in the state; and
245 (B) an independent assessment of energy issues.
246 (d) report at the end of each fiscal year to the governor on department activities, and
247 activities of the boards and divisions; and
248 (e) perform other duties as provided by the Legislature by statute.
249 (3) Unless otherwise provided by statute, the department may adopt a schedule of fees
250 assessed for services provided by the department. The fee shall be reasonable and fair and shall
251 reflect the cost of services provided. Each fee established in this manner shall be submitted to and
252 approved by the Legislature as part of the department's annual appropriations request. The
253 department may not charge or collect any fee proposed in this manner without approval of the
254 Legislature.
255 Section 5. Section 63-34-101 is enacted to read:
256
257 63-34-101. Utah Energy Office created -- Utah Energy Office duties.
258 (1) There is created within the Department of Natural Resources the Utah Energy Office.
259 (2) The Utah Energy Office shall:
260 (a) administer federally funded state programs regarding renewable energy, energy
261 efficiency, and energy conservation in accordance with applicable federal program guidelines;
262 (b) coordinate and facilitate the development and implementation of programs relating to
263 procurement, consumption, conservation, and efficient use of energy in state buildings;
264 (c) if requested by the governor, prepare a state energy emergency plan in accordance with
265 Title 63, Chapter 53a, Energy Emergency Powers of Governor; and
266 (d) participate in regulatory proceedings as appropriate to promote the development,
267 conservation, and efficient use of energy.
268 Section 6. Section 63-34-201 is enacted to read:
269
270 63-34-201. Title.
271 This part is known as the "Clean Fuels Conversion Program Act."
272 Section 7. Section 63-34-202 is enacted to read:
273 63-34-202. Definitions.
274 As used in this part:
275 (1) "Certified by the Air Quality Board" means that a motor vehicle on which conversion
276 equipment has been installed meets the following criteria:
277 (a) before the installation of conversion equipment, the motor vehicle does not exceed the
278 emission cut points for a transient test driving cycle, as specified in 40 CFR 51, Appendix E to
279 Subpart S, or an equivalent test for the make, model, and year of the motor vehicle;
280 (b) the motor vehicle's emissions of regulated pollutants, when operating with clean fuel,
281 is less than the emissions were before the installation of conversion equipment; and
282 (c) a reduction in emissions under Subsection (1)(b) is demonstrated by:
283 (i) certification of the conversion equipment by the federal Environmental Protection
284 Agency or by a state whose certification standards are recognized by the Air Quality Board;
285 (ii) testing the motor vehicle, before and after the installation of the conversion equipment,
286 in accordance with 40 CFR 86, Control of Air Pollution from New and In-use Motor Vehicle
287 Engines: Certification and Test Procedures, using all fuel the motor vehicle is capable of using;
288 or
289 (iii) any other test or standard recognized by Air Quality Board rule.
290 (2) "Clean fuel" means:
291 (a) propane, compressed natural gas, or electricity;
292 (b) other fuel the Air Quality Board determines to be at least as effective as fuels under
293 Subsection (2)(a) in reducing air pollution; or
294 (c) other fuel that meets the clean-fuel vehicle standards in the federal Clean Air Act
295 Amendments of 1990, 42 U.S.C. Sec. 7521 et seq.
296 (3) "Clean-fuel vehicle" means a vehicle that:
297 (a) uses a clean fuel; and
298 (b) meets clean-fuel vehicle standards in the federal Clean Air Act Amendments of 1990,
299 42 U.S.C. Sec. 7521 et seq.
300 (4) "Fund" means the Clean Fuels Vehicle Fund created in Section 63-34-203 .
301 (5) "Government vehicle" means a motor vehicle registered in Utah and owned and
302 operated by the state, a public trust authority, a school district, a county, a municipality, a town,
303 or a city, including a metropolitan rapid transit motor vehicle, bus, truck, law enforcement vehicle,
304 or emergency vehicle.
305 (6) "Incremental cost" means the difference between the cost of the OEM vehicle and the
306 same vehicle model manufactured without the clean-fuel fueling system.
307 (7) "OEM vehicle" means a vehicle manufactured by the original vehicle manufacturer or
308 its contractor to use a clean fuel.
309 (8) "Private sector business vehicle" means a motor vehicle registered in Utah that is
310 owned and operated solely in the conduct of a private business enterprise.
311 (9) "Refueling equipment" means compressors when used separately, compressors used
312 in combination with cascade tanks, and other equipment that constitute a central refueling system
313 capable of dispensing vehicle fuel.
314 Section 8. Section 63-34-203 is enacted to read:
315 63-34-203. Clean Fuels Vehicle Fund -- Contents -- Loans or grants made with fund
316 monies.
317 (1) (a) There is created a revolving fund known as the Clean Fuels Vehicle Fund.
318 (b) The fund consists of:
319 (i) appropriations to the fund;
320 (ii) other public and private contributions made under Subsection (1)(d);
321 (iii) interest earnings on cash balances; and
322 (iv) all monies collected for loan repayments and interest on loans.
323 (c) All money appropriated to the fund is nonlapsing.
324 (d) The department may accept contributions from other public and private sources for
325 deposit into the fund.
326 (2) (a) The department may make loans or grants with monies available in the fund for:
327 (i) the conversion of private sector business vehicles and government vehicles to use a
328 clean fuel, if certified by the Air Quality Board; or
329 (ii) the purchase of OEM vehicles for use as private sector business vehicles or government
330 vehicles.
331 (b) The amount of a loan for any vehicle may not exceed:
332 (i) the actual cost of the vehicle conversion;
333 (ii) the incremental cost of purchasing the OEM vehicle; or
334 (iii) the cost of purchasing the OEM vehicle if there is no documented incremental cost.
335 (c) The amount of a grant for any vehicle may not exceed:
336 (i) 50% of the actual cost of the vehicle conversion minus the amount of any tax credit
337 claimed under Section 59-7-605 or 59-10-127 for the vehicle for which a grant is requested; or
338 (ii) 50% of the incremental cost of purchasing an OEM vehicle minus the amount of any
339 tax credit claimed under Section 59-7-605 or 59-10-127 for the vehicle for which a grant is
340 requested.
341 (d) (i) Subject to the availability of monies in the fund, the department may make loans
342 for the purchase of vehicle refueling equipment for private sector business vehicles and
343 government vehicles.
344 (ii) The maximum amount loaned per installation of refueling equipment may not exceed
345 the actual cost of the refueling equipment.
346 (3) Administrative costs of the fund shall be paid from the fund.
347 (4) (a) The fund balance may not exceed $10,000,000.
348 (b) Interest on cash balances and repayment of loans in excess of the amount necessary to
349 maintain the fund balance at $10,000,000 shall be deposited in the General Fund.
350 (5) (a) Loans made from monies in the fund shall be supported by loan documents
351 evidencing the intent of the borrower to repay the loan.
352 (b) The original loan documents shall be filed with the Division of Finance and a copy
353 shall be filed with the department.
354 Section 9. Section 63-34-204 is enacted to read:
355 63-34-204. Department duties -- Rulemaking -- Loan repayment.
356 (1) The department shall:
357 (a) establish and administer the loan and grant program to encourage government officials
358 and private sector business vehicle owners and operators to obtain and use clean-fuel vehicles; and
359 (b) make rules in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking
360 Act:
361 (i) specifying the amount of money in the fund to be dedicated annually for grants;
362 (ii) limiting the amount of a grant given to any person claiming a tax credit under Section
363 59-7-605 or 59-10-127 for the motor vehicle for which a grant is requested to assure that the sum
364 of the tax credit and grant does not exceed:
365 (A) 50% of the incremental cost of the OEM vehicle; or
366 (B) 50% of the cost of conversion equipment;
367 (iii) limiting the number of motor vehicles per fleet operator that may be eligible for a
368 grant in a year;
369 (iv) specifying criteria the department shall consider in prioritizing and awarding loans and
370 grants;
371 (v) specifying repayment periods;
372 (vi) specifying procedures for:
373 (A) awarding loans and grants; and
374 (B) collecting loans; and
375 (vii) requiring all loan and grant applicants to:
376 (A) apply on forms provided by the department;
377 (B) agree in writing to use the clean fuel for which each vehicle is converted or purchased
378 using loan or grant proceeds for a minimum of 70% of the vehicle miles traveled beginning from
379 the time of conversion or purchase of the vehicle;
380 (C) agree in writing to notify the department if a vehicle converted or purchased using loan
381 or grant proceeds becomes inoperable through mechanical failure or accident and to pursue a
382 remedy outlined in department rules;
383 (D) provide reasonable data to the department on vehicles converted or purchased with
384 loan or grant proceeds; and
385 (E) submit vehicles converted or purchased with loan or grant proceeds to inspections by
386 the department as required in department rules and as necessary for administration of the loan and
387 grant program.
388 (2) (a) When developing repayment schedules for the loans, the department shall consider
389 the projected savings from use of the clean-fuel vehicle.
390 (b) A repayment schedule may not exceed ten years.
391 (c) Loans made from the fund for private sector vehicles shall be made at an interest rate
392 equal to the annual return earned in the state treasurer's Public Treasurer's Pool as determined the
393 month immediately preceding the closing date of the loan.
394 (d) Loans made from the fund for government vehicles shall be made at a zero interest
395 rate.
396 (3) The Division of Finance is responsible for collection of and accounting for the loans
397 and has custody of all loan documents, including all notes and contracts, evidencing the
398 indebtedness of the fund.
399 Section 10. Repealer.
400 This act repeals:
401 Section 9-1-702, Definitions.
402 Section 9-1-703, Clean Fuels Vehicle Fund -- Contents -- Loans or grants made with
403 fund monies.
404 Section 9-1-706, Rulemaking -- Department duties -- Loan repayment.
Legislative Review Note
as of 1-28-02 11:44 AM
A limited legal review of this legislation raises no obvious constitutional or statutory concerns.