! The Capitol Complex is closed to the public due to COVID-19. All meetings will be held virtually online. View procedures and guidelines for remote public comment

Download Zipped Enrolled WordPerfect HB0106.ZIP
[Introduced][Amended][Status][Bill Documents][Fiscal Note][Bills Directory]

H.B. 106 Enrolled

             1     

CLEAN AIR AND EFFICIENT VEHICLE TAX

             2     
INCENTIVES

             3     
2008 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Chief Sponsor: Rosalind J. McGee

             6     
Senate Sponsor: Gregory S. Bell

             7      Cosponsors:
             8      Jackie Biskupski
             9      Rebecca Chavez-Houck
             10      Tim M. Cosgrove
             11      John Dougall
             12      Carl W. Duckworth
             13      Janice M. Fisher
             14      Craig A. Frank
             15      James R. GowansNeil A. Hansen
Wayne A. Harper
Lynn N. Hemingway
Eric K. Hutchings
Christine A. Johnson
Brad King
David Litvack
Karen W. MorganCarol Spackman Moss
Merlynn T. Newbold
Phil Riesen
Jennifer M. Seelig
LaWanna Lou Shurtliff
Aaron Tilton
Mark A. Wheatley
Larry B. Wiley              16     
             17      LONG TITLE
             18      General Description:
             19          This bill provides a tax credit for new vehicles meeting air quality and fuel economy
             20      standards, eliminates the clean fuel certificate, and imposes a fuel tax on compressed
             21      natural gas for vehicles.
             22      Highlighted Provisions:
             23          This bill:
             24          .    eliminates the clean special fuel tax certificate;
             25          .    defines terms;
             26          .    reduces the tax credit available for certain vehicles to the lesser of $2,500 or 35% of
             27      the vehicle's purchase price;
             28          .    provides a tax credit of $750 for a new vehicle meeting air quality and fuel economy
             29      standards;
             30          .    eliminates a provision excluding hybrid electric-gasoline vehicles from the tax credit;
             31          .    imposes a fuel tax on the purchase of compressed natural gas for vehicles; and


             32          .    makes technical changes.
             33      Monies Appropriated in this Bill:
             34          None
             35      Other Special Clauses:
             36          This bill takes effect on January 1, 2009.
             37      Utah Code Sections Affected:
             38      AMENDS:
             39          41-1a-418, as last amended by Laws of Utah 2007, Chapters 173, 217, and 325
             40          41-6a-1508, as renumbered and amended by Laws of Utah 2005, Chapter 2
             41          59-7-605, as last amended by Laws of Utah 2007, Chapter 306
             42          59-10-1009, as last amended by Laws of Utah 2007, Chapter 306
             43          59-13-103, as last amended by Laws of Utah 1997, Chapter 271
             44          59-13-301, as last amended by Laws of Utah 2003, Chapters 7 and 268
             45          59-13-304, as last amended by Laws of Utah 2005, First Special Session, Chapter 1
             46          59-13-314, as last amended by Laws of Utah 2003, Chapter 7
             47          72-2-124, as last amended by Laws of Utah 2006, Chapters 11 and 135
             48     
             49      Be it enacted by the Legislature of the state of Utah:
             50          Section 1. Section 41-1a-418 is amended to read:
             51           41-1a-418. Authorized special group license plates.
             52          (1) The division shall only issue special group license plates in accordance with this
             53      section through Section 41-1a-422 to a person who is specified under this section within the
             54      categories listed as follows:
             55          (a) disability special group license plates issued in accordance with Section 41-1a-420 ;
             56          (b) honor special group license plates, as in a war hero, which plates are issued for a:
             57          (i) survivor of the Japanese attack on Pearl Harbor;
             58          (ii) former prisoner of war;
             59          (iii) recipient of a Purple Heart;


             60          (iv) disabled veteran; or
             61          (v) recipient of a gold star award issued by the United States Secretary of Defense if the
             62      recipient is the spouse, parent, or sibling of a servicemember killed;
             63          (c) unique vehicle type special group license plates, as for historical, collectors value, or
             64      other unique vehicle type, which plates are issued for a:
             65          (i) special interest vehicle;
             66          (ii) vintage vehicle;
             67          (iii) farm truck; or
             68          (iv) vehicle powered by clean fuel [and for which a current clean special fuel certificate
             69      is maintained as provided in Section 59-13-304 ] as defined in Section 59-13-102 ;
             70          (d) recognition special group license plates, as in a public official or an emergency
             71      service giver, which plates are issued for a:
             72          (i) current member of the Legislature;
             73          (ii) current member of the United States Congress;
             74          (iii) current member of the National Guard;
             75          (iv) licensed amateur radio operator;
             76          (v) currently employed, volunteer, or retired firefighter;
             77          (vi) emergency medical technician;
             78          (vii) current member of a search and rescue team; or
             79          (viii) current honorary consulate designated by the United States Department of State;
             80      and
             81          (e) support special group license plates, as for a contributor to an institution or cause,
             82      which plates are issued for a contributor to:
             83          (i) an institution's scholastic scholarship fund;
             84          (ii) the Division of Wildlife Resources;
             85          (iii) the Department of Veterans' Affairs;
             86          (iv) the Division of Parks and Recreation;
             87          (v) the Department of Agriculture and Food;


             88          (vi) the Guardian Ad Litem Services Account and the Children's Museum of Utah;
             89          (vii) the Boy Scouts of America;
             90          (viii) spay and neuter programs through No More Homeless Pets in Utah;
             91          (ix) the Boys and Girls Clubs of America;
             92          (x) Utah public education; or
             93          (xi) programs that provide support to organizations that create affordable housing for
             94      those in severe need through the Division of Real Estate.
             95          (2) Beginning January 1, 2003, the division may not issue a new type of special group
             96      license plate unless the division receives:
             97          (a) a start-up fee established under Section 63-38-3.2 for production and administrative
             98      costs for providing the new special group license plates; or
             99          (b) a legislative appropriation for the start-up fee provided under Subsection (2)(a).
             100          (3) (a) A sponsoring organization that qualifies for tax-exempt status under Internal
             101      Revenue Code Section 501(c)(3) may request the commission to authorize a new type of special
             102      group license plate for the sponsoring organization. The sponsoring organization shall:
             103          (i) collect a minimum of 200 applications; and
             104          (ii) pay a start-up fee established under Section 63-38-3.2 for production and
             105      administrative costs for providing the new type of special group license plates.
             106          (b) If the provisions of Subsection (3)(a) are met, the commission shall approve the
             107      request and the division shall:
             108          (i) design a license plate in accordance with Section 41-1a-419 ; and
             109          (ii) issue the new type of special group license plates.
             110          Section 2. Section 41-6a-1508 is amended to read:
             111           41-6a-1508. Low-speed vehicle.
             112          (1) Except as otherwise provided in this section, a low-speed vehicle is considered a
             113      motor vehicle for purposes of the Utah Code including requirements for:
             114          (a) traffic rules under Title 41, Chapter 6a, Traffic Code;
             115          (b) driver licensing under Title 53, Chapter 3, Uniform Driver License Act;


             116          (c) motor vehicle insurance under Title 41, Chapter 12a, Financial Responsibility of
             117      Motor Vehicle Owners and Operators Act;
             118          (d) vehicle registration, titling, odometer statements, vehicle identification numbers,
             119      license plates, and registration fees under Title 41, Chapter 1a, Motor Vehicle Act;
             120          (e) vehicle taxation under Title 59, Chapter 13, Motor and Special Fuel Tax Act, and
             121      fee in lieu of property taxes or in lieu fees under Section 59-2-405 ;
             122          (f) motor vehicle dealer licensing under Title 41, Chapter 3, Motor Vehicle Business
             123      Regulation Act;
             124          (g) motor vehicle safety inspection requirements under Section 53-8-205 ; and
             125          (h) safety belt requirements under Title 41, Chapter 6a, Part 18, Motor Vehicle Safety
             126      Belt Usage Act.
             127          (2) (a) A low-speed vehicle shall comply with federal safety standards established in 49
             128      C.F.R. 571.500 and shall be equipped with:
             129          (i) headlamps;
             130          (ii) front and rear turn signals, tail lamps, and stop lamps;
             131          (iii) turn signal lamps;
             132          (iv) reflex reflectors one on the rear of the vehicle and one on the left and right side and
             133      as far to the rear of the vehicle as practical;
             134          (v) a parking brake;
             135          (vi) a windshield that meets the standards under Section 41-6a-1635 , including a device
             136      for cleaning rain, snow, or other moisture from the windshield;
             137          (vii) an exterior rearview mirror on the driver's side and either an interior rearview
             138      mirror or an exterior rearview mirror on the passenger side;
             139          (viii) a speedometer and odometer; and
             140          (ix) braking for each wheel.
             141          (b) A low-speed vehicle that complies with this Subsection (2) and Subsection (3) and
             142      that is not altered from the manufacturer is considered to comply with equipment requirements
             143      under Part 16, Vehicle Equipment.


             144          (3) A person may not operate a low-speed vehicle that has been structurally altered
             145      from the original manufacturer's design.
             146          [(4) A user of a low-speed vehicle shall obtain an annual clean special fuel tax certificate
             147      for each low-speed vehicle as required under Section 59-13-304 .]
             148          [(5)] (4) A low-speed vehicle is exempt from a motor vehicle emissions inspection and
             149      maintenance program requirements under Section 41-6a-1642 .
             150          [(6)] (5) (a) Except to cross a highway at an intersection, a low-speed vehicle may not
             151      be operated on a highway with a posted speed limit of more than 35 miles per hour.
             152          (b) In addition to the restrictions under Subsection [(6)] (5)(a), a highway authority,
             153      may prohibit or restrict the operation of a low-speed vehicle on any highway under its
             154      jurisdiction, if the highway authority determines the prohibition or restriction is necessary for
             155      public safety.
             156          [(7)] (6) A person may not operate a low-speed vehicle on a highway without
             157      displaying on the rear of the low-speed vehicle, a slow-moving vehicle identification emblem
             158      that complies with the Society of Automotive Engineers standard SAE J943.
             159          [(8)] (7) A person who violates Subsection (2), (3), [(6)] (5), or [(7)] (6) is guilty of a
             160      class C misdemeanor.
             161          Section 3. Section 59-7-605 is amended to read:
             162           59-7-605. Definitions -- Tax credit -- Cleaner burning fuels.
             163          (1) As used in this section:
             164          (a) "Air quality standards" means that a vehicle's emissions are equal to or cleaner than
             165      the standards established in bin 2 in Table S04-1, of 40 C.F.R. 86.1811-04(c)(6).
             166          [(a)] (b) "Board" means the Air Quality Board created under Title 19, Chapter 2, Air
             167      Conservation Act.
             168          [(b)] (c) "Certified by the board" means that:
             169          (i) a motor vehicle on which conversion equipment has been installed meets the
             170      following criteria:
             171          (A) before the installation of conversion equipment, the vehicle does not exceed the


             172      emission cut points for a transient test driving cycle, as specified in 40 C.F.R. Part 51, Appendix
             173      E to Subpart S, or an equivalent test for the make, model, and year of the vehicle;
             174          (B) the motor vehicle's emissions of regulated pollutants, when operating on a fuel
             175      listed in Subsection (2)[(a)(ii)(A)](c)(i) or [(2)(a)(ii)(B)] (ii), is less than the emissions were
             176      before the installation of conversion equipment; and
             177          (C) a reduction in emissions under Subsection (1)[(b)](c)(i)(B) is demonstrated by:
             178          (I) certification of the conversion equipment by the federal Environmental Protection
             179      Agency or by a state whose certification standards are recognized by the board;
             180          (II) testing the motor vehicle, before and after installation of the conversion equipment,
             181      in accordance with 40 C.F.R. Part 86, Control of Emissions from New and In-use Highway
             182      Vehicles and Engines, using all fuel the motor vehicle is capable of using; or
             183          (III) any other test or standard recognized by board rule; or
             184          (ii) special mobile equipment on which conversion equipment has been installed meets
             185      the following criteria:
             186          (A) the special mobile equipment's emissions of regulated pollutants, when operating on
             187      fuels listed in Subsection (2)[(a)(iii)(A)](d)(i) or [(2)(a)(iii)(B)] (ii), is less than the emissions
             188      were before the installation of conversion equipment; and
             189          (B) a reduction in emissions under Subsection (1)[(b)](c)(ii)(A) is demonstrated by:
             190          (I) certification of the conversion equipment by the federal Environmental Protection
             191      Agency or by a state whose certification standards are recognized by the board; or
             192          (II) any other test or standard recognized by board rule.
             193          [(c)] (d) "Clean fuel grant" means a grant awarded under Title 19, Chapter 1, Part 4,
             194      Clean Fuels and Vehicle Technology Program Act, for reimbursement of a portion of the
             195      incremental cost of an OEM vehicle or the cost of conversion equipment.
             196          [(d)] (e) "Conversion equipment" means equipment referred to in Subsection
             197      (2)[(a)(ii)](c) or [(2)(a)(iii)] (d).
             198          [(e) "Electric-hybrid vehicle" is as defined in 42 U.S.C. Sec. 13435.]
             199          (f) "Fuel economy standards" means that a vehicle's combined fuel economy, as


             200      determined in 40 C.F.R. 600.209-95(d) is equal to or greater than:
             201          (i) 31 miles per gallon for gasoline-fueled vehicles;
             202          (ii) 36 miles per gallon for diesel-fueled vehicles;
             203          (iii) 19 miles per gallon for vehicles fueled by a blend of 85% ethanol and 15% gasoline;
             204          (iv) 19 miles per gallon for liquified petroleum gas-fueled vehicles; or
             205          (v) standards consistent with 40 C.F.R. 600.209-95(d) that are adopted by the Air
             206      Quality Board by rule.
             207          [(f)] (g) "Incremental cost" has the same meaning as in Section 19-1-402 .
             208          [(g)] (h) "OEM vehicle" has the same meaning as in Section 19-1-402 .
             209          (i) "Original purchase" means the purchase of a vehicle that has never been titled or
             210      registered and has been driven less than 7,500 miles.
             211          [(h)] (j) "Special mobile equipment":
             212          (i) means any mobile equipment or vehicle that is not designed or used primarily for the
             213      transportation of persons or property; and
             214          (ii) includes construction or maintenance equipment.
             215          (2) [(a) Except as provided in Subsection (2)(b), for] For taxable years beginning on or
             216      after January 1, [2001] 2009, but beginning on or before December 31, [2010] 2013, a taxpayer
             217      may claim a tax credit against tax otherwise due under this chapter or Chapter 8, Gross
             218      Receipts Tax on Certain Corporations Not Required to Pay Corporate Franchise or Income Tax
             219      Act, in an amount equal to:
             220          [(i) 50% of the incremental cost of an OEM vehicle registered in Utah minus the
             221      amount of any clean fuel grant received, up to a maximum tax credit of $3,000 per vehicle, if
             222      the vehicle:]
             223          [(A) is fueled by propane, natural gas, or electricity;]
             224          [(B) is fueled by other fuel the board determines annually on or before July 1 to be at
             225      least as effective in reducing air pollution as fuels under Subsection (2)(a)(i)(A); or]
             226          [(C) meets the clean-fuel vehicle standards in the federal Clean Air Act Amendments of
             227      1990, 42 U.S.C. Sec. 7521 et seq.;]


             228          (a) $750 for the original purchase of a new vehicle that is not fueled by compressed
             229      natural gas if the vehicle is registered in Utah and meets air quality and fuel economy standards;
             230          (b) for the purchase of a vehicle fueled by compressed natural gas that is registered in
             231      Utah, the lesser of:
             232          (i) $2,500; or
             233          (ii) 35% of the purchase price of the vehicle;
             234          [(ii)] (c) 50% of the cost of equipment for conversion, if certified by the board, of a
             235      motor vehicle registered in Utah minus the amount of any clean fuel grant received, up to a
             236      maximum tax credit of $2,500 per motor vehicle, if the motor vehicle is to:
             237          [(A)] (i) be fueled by propane, natural gas, or electricity;
             238          [(B)] (ii) be fueled by other fuel the board determines annually on or before July 1 to be
             239      at least as effective in reducing air pollution as fuels under Subsection (2)[(a)(ii)(A)](c)(i); or
             240          [(C)] (iii) meet the federal clean-fuel vehicle standards in the federal Clean Air Act
             241      Amendments of 1990, 42 U.S.C. Sec. 7521 et seq.; and
             242          [(iii)] (d) 50% of the cost of equipment for conversion, if certified by the board, of a
             243      special mobile equipment engine minus the amount of any clean fuel grant received, up to a
             244      maximum tax credit of $1,000 per special mobile equipment engine, if the special mobile
             245      equipment is to be fueled by:
             246          [(A)] (i) propane, natural gas, or electricity; or
             247          [(B)] (ii) other fuel the board determines annually on or before July 1 to be:
             248          [(I)] (A) at least as effective in reducing air pollution as the fuels under Subsection
             249      (2)[(a)(iii)(A)](d)(i); or
             250          [(II)] (B) substantially more effective in reducing air pollution than the fuel for which
             251      the engine was originally designed.
             252          [(b) Notwithstanding Subsection (2)(a), for taxable years beginning on or after January
             253      1, 2006, a taxpayer may not claim a tax credit under this section with respect to an
             254      electric-hybrid vehicle.]
             255          (3) A taxpayer shall provide proof of the purchase of an item for which a tax credit is


             256      allowed under this section by:
             257          (a) providing proof to the board in the form the board requires by rule;
             258          (b) receiving a written statement from the board acknowledging receipt of the proof;
             259      and
             260          (c) retaining the written statement described in Subsection (3)(b).
             261          (4) Except as provided by Subsection (5), the tax credit under this section is allowed
             262      only:
             263          (a) against any Utah tax owed in the taxable year by the taxpayer;
             264          (b) in the taxable year in which the item is purchased for which the tax credit is claimed;
             265      and
             266          (c) once per vehicle.
             267          (5) If the amount of a tax credit claimed by a taxpayer under this section exceeds the
             268      taxpayer's tax liability under this chapter for a taxable year, the amount of the tax credit
             269      exceeding the tax liability may be carried forward for a period that does not exceed the next five
             270      taxable years.
             271          (6) The tax credit provided by this section may be taken only once per vehicle.
             272          Section 4. Section 59-10-1009 is amended to read:
             273           59-10-1009. Definitions -- Cleaner burning fuels tax credit.
             274          (1) As used in this section:
             275          (a) "Air quality standards" means that a vehicle's emissions are equal to or cleaner than
             276      the standards established in bin 2 in Table S04-1, of 40 C.F.R. 86.1811-04(c)(6).
             277          [(a)] (b) "Board" means the Air Quality Board created in Title 19, Chapter 2, Air
             278      Conservation Act.
             279          [(b)] (c) "Certified by the board" means that:
             280          (i) a motor vehicle on which conversion equipment has been installed meets the
             281      following criteria:
             282          (A) before the installation of conversion equipment, the vehicle does not exceed the
             283      emission cut points for a transient test driving cycle, as specified in 40 C.F.R. Part 51, Appendix


             284      E to Subpart S, or an equivalent test for the make, model, and year of the vehicle;
             285          (B) the motor vehicle's emissions of regulated pollutants, when operating on fuels listed
             286      in Subsection (2)[(a)(ii)(A)](c)(i) or [(2)(a)(ii)(B)] (ii), is less than the emissions were before the
             287      installation of conversion equipment; and
             288          (C) a reduction in emissions under Subsection (1)[(b)](d)(i)(B) is demonstrated by:
             289          (I) certification of the conversion equipment by the federal Environmental Protection
             290      Agency or by a state whose certification standards are recognized by the board;
             291          (II) testing the motor vehicle, before and after installation of the conversion equipment,
             292      in accordance with 40 C.F.R. Part 86, Control Emissions from New and In-use Highway
             293      Vehicles and Engines, using all fuels the motor vehicle is capable of using; or
             294          (III) any other test or standard recognized by board rule; or
             295          (ii) special mobile equipment on which conversion equipment has been installed meets
             296      the following criteria:
             297          (A) the special mobile equipment's emissions of regulated pollutants, when operating on
             298      fuels listed in Subsection (2)[(a)(iii)(A)](c)(i) or [(2)(a)(iii)(B)] (ii), is less than the emissions
             299      were before the installation of conversion equipment; and
             300          (B) a reduction in emissions under Subsection (1)[(b)](c)(ii)(A) is demonstrated by:
             301          (I) certification of the conversion equipment by the federal Environmental Protection
             302      Agency or by a state whose certification standards are recognized by the board; or
             303          (II) any other test or standard recognized by the board.
             304          [(c)] (d) "Clean fuel grant" means a grant a claimant, estate, or trust receives under
             305      Title 19, Chapter 1, Part 4, Clean Fuels and Vehicle Technology Program Act, for
             306      reimbursement of a portion of the incremental cost of the OEM vehicle or the cost of
             307      conversion equipment.
             308          [(d)] (e) "Conversion equipment" means equipment referred to in Subsection
             309      (2)[(a)(ii)](c) or [(2)(a)(iii)] (d).
             310          [(e) "Electric-hybrid vehicle" is as defined in 42 U.S.C. Sec. 13435.]
             311          (f) "Fuel economy standards" means that a vehicle's combined fuel economy, as


             312      determined in 40 C.F.R. 600.209-95(d) is equal to or greater than:
             313          (i) 31 miles per gallon for gasoline-fueled vehicles;
             314          (ii) 36 miles per gallon for diesel-fueled vehicles;
             315          (iii) 19 miles per gallon for vehicles fueled by a blend of 85% ethanol and 15% gasoline;
             316          (iv) 19 miles per gallon for liquified petroleum gas-fueled vehicles; or
             317          (v) standards consistent with 40 C.F.R. 600.209-95(d) that are adopted by the Air
             318      Quality Board by rule.
             319          [(f)] (g) "Incremental cost" has the same meaning as in Section 19-1-402 .
             320          [(g)] (h) "OEM vehicle" has the same meaning as in Section 19-1-402 .
             321          (i) "Original purchase" means the purchase of a vehicle that has never been titled or
             322      registered and has been driven less than 7,500 miles.
             323          [(h)] (k) "Special mobile equipment":
             324          (i) means any mobile equipment or vehicle not designed or used primarily for the
             325      transportation of persons or property; and
             326          (ii) includes construction or maintenance equipment.
             327          (2) [(a) Except as provided in Subsection (2)(b), for] For taxable years beginning on or
             328      after January 1, [2001] 2009, but beginning on or before December 31, [2010] 2013, a claimant,
             329      estate, or trust may claim a nonrefundable tax credit against tax otherwise due under this
             330      chapter in an amount equal to:
             331          [(i) 50% of the incremental cost of an OEM vehicle registered in Utah minus the
             332      amount of any clean fuel grant received, up to a maximum tax credit of $3,000 per vehicle, if
             333      the vehicle:]
             334          [(A) is fueled by propane, natural gas, or electricity;]
             335          [(B) is fueled by other fuel the board determines annually on or before July 1 to be at
             336      least as effective in reducing air pollution as fuels under Subsection (2)(a)(i)(A); or]
             337          [(C) meets the clean-fuel vehicle standards in the federal Clean Air Act Amendments of
             338      1990, 42 U.S.C. Sec. 7521 et seq.;]
             339          (a) $750 for the original purchase of a new vehicle that is not fueled by compressed


             340      natural gas if the vehicle is registered in Utah and meets air quality and fuel economy standards;
             341          (b) for the purchase of a vehicle fueled by compressed natural gas that is registered in
             342      Utah, the lesser of:
             343          (i) $2,500; or
             344          (ii) 35% of the purchase price of the vehicle;
             345          [(ii)] (c) 50% of the cost of equipment for conversion, if certified by the board, of a
             346      motor vehicle registered in Utah minus the amount of any clean fuel conversion grant received,
             347      up to a maximum tax credit of $2,500 per vehicle, if the motor vehicle:
             348          [(A)] (i) is to be fueled by propane, natural gas, or electricity;
             349          [(B)] (ii) is to be fueled by other fuel the board determines annually on or before July 1
             350      to be at least as effective in reducing air pollution as fuels under Subsection (2)[(a)(ii)(A)](c)(i);
             351      or
             352          [(C)] (iii) will meet the federal clean fuel vehicle standards in the federal Clean Air Act
             353      Amendments of 1990, 42 U.S.C. Sec. 7521 et seq.; and
             354          [(iii)] (d) 50% of the cost of equipment for conversion, if certified by the board, of a
             355      special mobile equipment engine minus the amount of any clean fuel conversion grant received,
             356      up to a maximum tax credit of $1,000 per special mobile equipment engine, if the special mobile
             357      equipment is to be fueled by:
             358          [(A)] (i) propane, natural gas, or electricity; or
             359          [(B)] (ii) other fuel the board determines annually on or before July 1 to be:
             360          [(I)] (A) at least as effective in reducing air pollution as the fuels under Subsection
             361      (2)[(a)(iii)(A)](d)(i); or
             362          [(II)] (B) substantially more effective in reducing air pollution than the fuel for which
             363      the engine was originally designed.
             364          [(b) Notwithstanding Subsection (2)(a), for taxable years beginning on or after January
             365      1, 2006, a claimant, estate, or trust may not claim a tax credit under this section with respect to
             366      an electric-hybrid vehicle.]
             367          (3) A claimant, estate, or trust shall provide proof of the purchase of an item for which


             368      a tax credit is allowed under this section by:
             369          (a) providing proof to the board in the form the board requires by rule;
             370          (b) receiving a written statement from the board acknowledging receipt of the proof;
             371      and
             372          (c) retaining the written statement described in Subsection (3)(b).
             373          (4) Except as provided by Subsection (5), the tax credit under this section is allowed
             374      only:
             375          (a) against any Utah tax owed in the taxable year by the claimant, estate, or trust;
             376          (b) in the taxable year in which the item is purchased for which the tax credit is claimed;
             377      and
             378          (c) once per vehicle.
             379          (5) If the amount of a tax credit claimed by a claimant, estate, or trust under this section
             380      exceeds the claimant's, estate's, or trust's tax liability under this chapter for a taxable year, the
             381      amount of the tax credit exceeding the tax liability may be carried forward for a period that does
             382      not exceed the next five taxable years.
             383          (6) The tax credit provided by this section may be taken only once per vehicle.
             384          Section 5. Section 59-13-103 is amended to read:
             385           59-13-103. List of clean fuels provided to tax commission -- Report to the
             386      Legislature.
             387          (1) The Air Quality Board shall annually provide to the tax commission a list of fuels
             388      that are clean fuels under Section 59-13-102 .
             389          (2) The Air Quality Board created under Section 19-2-103 shall in conjunction with the
             390      State Tax Commission prepare and submit to the Legislature before January 1, 1995, a report
             391      evaluating the impacts, benefits, and economic consequences of the clean fuel [certificate]
             392      provisions of Sections 59-13-201 and 59-13-301 .
             393          Section 6. Section 59-13-301 is amended to read:
             394           59-13-301. Tax basis -- Rate -- Exemptions -- Revenue deposited with treasurer
             395      and credited to Transportation Fund -- Reduction of tax in limited circumstances.


             396          (1) (a) Except as provided in Subsections (2), (3), [and] (11), and (12) and Section
             397      59-13-304 , a tax is imposed at the same rate imposed under Subsection 59-13-201 (1)(a) on the:
             398          (i) removal of undyed diesel fuel from any refinery;
             399          (ii) removal of undyed diesel fuel from any terminal;
             400          (iii) entry into the state of any undyed diesel fuel for consumption, use, sale, or
             401      warehousing;
             402          (iv) sale of undyed diesel fuel to any person who is not registered as a supplier under
             403      this part unless the tax has been collected under this section;
             404          (v) any untaxed special fuel blended with undyed diesel fuel; or
             405          (vi) use of untaxed special fuel[,] other than [a clean special fuel] propane or electricity.
             406          (b) The tax imposed under this section shall only be imposed once upon any special
             407      fuel.
             408          (2) (a) No special fuel tax is imposed or collected upon dyed diesel fuel which:
             409          (i) is sold or used for any purpose other than to operate or propel a motor vehicle upon
             410      the public highways of the state, but this exemption applies only in those cases where the
             411      purchasers or the users of special fuel establish to the satisfaction of the commission that the
             412      special fuel was used for purposes other than to operate a motor vehicle upon the public
             413      highways of the state; or
             414          (ii) is sold to this state or any of its political subdivisions.
             415          (b) No special fuel tax is imposed on undyed diesel fuel [which] or clean fuel that:
             416          (i) is sold to the United States government or any of its instrumentalities or to this state
             417      or any of its political subdivisions;
             418          (ii) is exported from this state if proof of actual exportation on forms prescribed by the
             419      commission is made within 180 days after exportation;
             420          (iii) is used in a vehicle off-highway;
             421          (iv) is used to operate a power take-off unit of a vehicle;
             422          (v) is used for off-highway agricultural uses;
             423          (vi) is used in a separately fueled engine on a vehicle that does not propel the vehicle


             424      upon the highways of the state; or
             425          (vii) is used in machinery and equipment not registered and not required to be registered
             426      for highway use.
             427          (3) No tax is imposed or collected on special fuel if it is:
             428          (a) (i) purchased for business use in machinery and equipment not registered and not
             429      required to be registered for highway use; and
             430          [(b)] (ii) used pursuant to the conditions of a state implementation plan approved under
             431      Title 19, Chapter 2, Air Conservation Act[.]; or
             432          (b) propane or electricity.
             433          (4) Upon request of a buyer meeting the requirements under Subsection (3), the
             434      Division of Air Quality shall issue an exemption certificate that may be shown to a seller.
             435          (5) The special fuel tax shall be paid by the supplier.
             436          (6) (a) The special fuel tax shall be paid by every user who is required by Sections
             437      59-13-303 and 59-13-305 to obtain a special fuel user permit and file special fuel tax reports.
             438          (b) The user shall receive a refundable credit for special fuel taxes paid on purchases
             439      which are delivered into vehicles and for which special fuel tax liability is reported.
             440          (7) (a) Except as provided under Subsections (7)(b) and (c), all revenue received by the
             441      commission from taxes and license fees under this part shall be deposited daily with the state
             442      treasurer and credited to the Transportation Fund.
             443          (b) An appropriation from the Transportation Fund shall be made to the commission to
             444      cover expenses incurred in the administration and enforcement of this part and the collection of
             445      the special fuel tax.
             446          (c) Five dollars of each special fuel user trip permit fee paid under Section 59-13-303
             447      may be used by the commission as a dedicated credit to cover the costs of electronic
             448      credentialing as provided in Section 41-1a-303 .
             449          (8) The commission may either collect no tax on special fuel exported from the state or,
             450      upon application, refund the tax paid.
             451          (9) (a) The United States government or any of its instrumentalities, this state, or a


             452      political subdivision of this state that has purchased special fuel from a supplier or from a retail
             453      dealer of special fuel and has paid the tax on the special fuel as provided in this section is
             454      entitled to a refund of the tax and may file with the commission for a quarterly refund in a
             455      manner prescribed by the commission.
             456          (b) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
             457      commission shall make rules governing the application and refund provided for in Subsection
             458      (9)(a).
             459          (10) (a) The purchaser shall pay the tax on diesel fuel or clean fuel purchased for uses
             460      under Subsections (2)(b)(i), (iii), (iv), (v), (vi), and (vii) and apply for a refund for the tax paid
             461      as provided in Subsection (9) and this Subsection (10).
             462          (b) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
             463      commission shall make rules governing the application and refund for off-highway and
             464      nonhighway uses provided under Subsections (2)(b)(iii), (iv), (vi), and (vii).
             465          (c) A refund of tax paid under this part on diesel fuel used for nonhighway agricultural
             466      uses shall be made in accordance with the tax return procedures under Section 59-13-202 .
             467          (11) (a) Beginning on April 1, 2001, a tax imposed under this section on special fuel is
             468      reduced to the extent provided in Subsection (11)(b) if:
             469          (i) the Navajo Nation imposes a tax on the special fuel;
             470          (ii) the tax described in Subsection (11)(a)(i) is imposed without regard to whether the
             471      person required to pay the tax is an enrolled member of the Navajo Nation; and
             472          (iii) the commission and the Navajo Nation execute and maintain an agreement as
             473      provided in this Subsection (11) for the administration of the reduction of tax.
             474          (b) (i) If but for Subsection (11)(a) the special fuel is subject to a tax imposed by this
             475      section:
             476          (A) the state shall be paid the difference described in Subsection (11)(b)(ii) if that
             477      difference is greater than $0; and
             478          (B) a person may not require the state to provide a refund, a credit, or similar tax relief
             479      if the difference described in Subsection (11)(b)(ii) is less than or equal to $0.


             480          (ii) The difference described in Subsection (11)(b)(i) is equal to the difference between:
             481          (A) the amount of tax imposed on the special fuel by this section; less
             482          (B) the tax imposed and collected by the Navajo Nation on the special fuel.
             483          (c) For purposes of Subsections (11)(a) and (b), the tax paid to the Navajo Nation on
             484      the special fuel does not include any interest or penalties a taxpayer may be required to pay to
             485      the Navajo Nation.
             486          (d) In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
             487      commission shall make rules governing the procedures for administering the reduction of tax
             488      provided under this Subsection (11).
             489          (e) The agreement required under Subsection (11)(a):
             490          (i) may not:
             491          (A) authorize the state to impose a tax in addition to a tax imposed under this chapter;
             492          (B) provide a reduction of taxes greater than or different from the reduction described
             493      in this Subsection (11); or
             494          (C) affect the power of the state to establish rates of taxation;
             495          (ii) shall:
             496          (A) be in writing;
             497          (B) be signed by:
             498          (I) the chair of the commission or the chair's designee; and
             499          (II) a person designated by the Navajo Nation that may bind the Navajo Nation;
             500          (C) be conditioned on obtaining any approval required by federal law;
             501          (D) state the effective date of the agreement; and
             502          (E) state any accommodation the Navajo Nation makes related to the construction and
             503      maintenance of state highways and other infrastructure within the Utah portion of the Navajo
             504      Nation; and
             505          (iii) may:
             506          (A) notwithstanding Section 59-1-403 , authorize the commission to disclose to the
             507      Navajo Nation information that is:


             508          (I) contained in a document filed with the commission; and
             509          (II) related to the tax imposed under this section;
             510          (B) provide for maintaining records by the commission or the Navajo Nation; or
             511          (C) provide for inspections or audits of suppliers, distributors, carriers, or retailers
             512      located or doing business within the Utah portion of the Navajo Nation.
             513          (f) (i) If, on or after April 1, 2001, the Navajo Nation changes the tax rate of a tax
             514      imposed on special fuel, any change in the amount of the reduction of taxes under this
             515      Subsection (11) as a result of the change in the tax rate is not effective until the first day of the
             516      calendar quarter after a 60-day period beginning on the date the commission receives notice:
             517          (A) from the Navajo Nation; and
             518          (B) meeting the requirements of Subsection (11)(f)(ii).
             519          (ii) The notice described in Subsection (11)(f)(i) shall state:
             520          (A) that the Navajo Nation has changed or will change the tax rate of a tax imposed on
             521      special fuel;
             522          (B) the effective date of the rate change of the tax described in Subsection
             523      (11)(f)(ii)(A); and
             524          (C) the new rate of the tax described in Subsection (11)(f)(ii)(A).
             525          (g) If the agreement required by Subsection (11)(a) terminates, a reduction of tax is not
             526      permitted under this Subsection (11) beginning on the first day of the calendar quarter after a
             527      30-day period beginning on the day the agreement terminates.
             528          (h) If there is a conflict between this Subsection (11) and the agreement required by
             529      Subsection (11)(a), this Subsection (11) governs.
             530          (12) Beginning on January 1, 2009, a tax imposed under this section on compressed
             531      natural gas is imposed at a reduced rate of 8-1/2 cents per gasoline gallon equivalent to be
             532      increased or decreased proportionately with any increase or decrease in the rate in Subsection
             533      59-13-201 (1)(a).
             534          Section 7. Section 59-13-304 is amended to read:
             535           59-13-304. Inspection of clean fuel vehicles.


             536          [(1) (a) Except as provided in Subsection (4), a user of special fuel who owns a vehicle
             537      powered by a clean special fuel as defined under Section 59-13-102 shall pay a clean special fuel
             538      tax as provided under this section for use of clean special fuel.]
             539          [(b) A user of special fuel who qualifies for the clean special fuel tax shall annually
             540      purchase from the commission a clean special fuel tax certificate for each vehicle owned or
             541      leased that is powered by a clean special fuel.]
             542          [(c) Clean special fuel tax certificates are provided to encourage the use of clean fuels
             543      to reduce air pollution.]
             544          [(2) (a) The fee for a clean special fuel tax certificate is:]
             545          [(i) 70/.19 of the tax per gallon imposed under Subsection 59-13-201 (1)(a), rounded up
             546      to the nearest dollar, for qualified motor vehicles as defined under Section 59-13-102 ; and]
             547          [(ii) 36/.19 of the tax per gallon imposed under Subsection 59-13-201 (1)(a), rounded
             548      up to the nearest dollar, for other vehicles.]
             549          [(b)] (1) The commission may require each clean fuel vehicle to be inspected for safe
             550      operation [before issuing the certificate].
             551          [(c)] (2) Each clean fuel vehicle shall be equipped with an approved and properly
             552      installed carburetion system if it is powered by a fuel that is gaseous at standard atmospheric
             553      conditions.
             554          [(3) (a) Beginning January 1, 2001 through December 31, 2010, there is imposed a
             555      surcharge of $35 on each clean special fuel tax certificate issued under this section.]
             556          [(b) (i) Until Subsection (3)(b)(ii) applies, surcharges imposed under Subsection (3)(a)
             557      shall be deposited into the Centennial Highway Fund Restricted Account created under Section
             558      72-2-118 .]
             559          [(ii) When the highway general obligation bonds have been paid off and the highway
             560      projects completed that are intended to be paid from revenues deposited in the Centennial
             561      Highway Fund Restricted Account as determined by the Executive Appropriations Committee
             562      under Subsection 72-2-118 (6)(d), the surcharge imposed under Subsection (3)(a) shall be
             563      deposited into the Transportation Investment Fund of 2005 created by Section 72-2-124 .]


             564          [(4) A governmental entity identified in Subsection 59-13-301 (9) that owns or leases a
             565      vehicle powered by a special fuel that qualifies as a clean special fuel is exempt from the clean
             566      special fuel tax imposed under this section.]
             567          Section 8. Section 59-13-314 is amended to read:
             568           59-13-314. Special fuel user permit required before registration of vehicle.
             569          Before registering any motor vehicle which is operated by special fuels, the registered
             570      owner or lessee of the vehicle shall obtain[: (1)] a valid special fuel user permit for the current
             571      year if required under Section 59-13-303 [; or].
             572          [(2) a valid clean special fuel tax certificate for the current year if required under
             573      Section 59-13-304 .]
             574          Section 9. Section 72-2-124 is amended to read:
             575           72-2-124. Transportation Investment Fund of 2005.
             576          (1) There is created a special revenue fund entitled the Transportation Investment Fund
             577      of 2005.
             578          (2) The fund consists of monies generated from the following sources:
             579          (a) any voluntary contributions received for the maintenance, construction,
             580      reconstruction, or renovation of state and federal highways; and
             581          (b) appropriations made to the fund by the Legislature.
             582          (3) When the highway general obligation bonds have been paid off and the highway
             583      projects completed that are intended to be paid from revenues deposited in the Centennial
             584      Highway Fund Restricted Account as determined by the Executive Appropriations Committee
             585      under Subsection 72-2-118 (6)(d), the fund shall also consist of monies generated from the
             586      following sources:
             587          (a) registration fees designated under Subsection 41-1a-1201 (6)(a); and
             588          [(b) the clean special fuel tax certificate surcharge under Subsection 59-13-304 (3); and]
             589          [(c)] (b) the sales and use tax amounts provided for in Section 59-12-103 .
             590          (4) (a) The fund shall earn interest.
             591          (b) All interest earned on fund monies shall be deposited into the fund.


             592          (5) (a) Except as provided in Subsections (5)(b) and (c), the executive director may use
             593      fund monies only to pay the costs of maintenance, construction, reconstruction, or renovation to
             594      state and federal highways prioritized by the Transportation Commission through the
             595      prioritization process for new transportation capacity projects adopted under Section 72-1-304 .
             596          (b) The executive director may use fund monies deposited into the fund in fiscal year
             597      2006 only to pay the costs of maintenance, construction, reconstruction, or renovation to state
             598      and federal highways prioritized by the Transportation Commission.
             599          (c) The executive director may use fund monies to exchange for an equal or greater
             600      amount of federal transportation funds to be used as provided in Subsection (5)(a).
             601          Section 10. Effective date.
             602          This bill takes effect on January 1, 2009.


[Bill Documents][Bills Directory]