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7 LONG TITLE
8 General Description:
9 This bill enacts corporate and individual tax credits for the purchase and installation of
10 water efficient landscaping and fixtures in new homes.
11 Highlighted Provisions:
12 This bill:
13 ▸ enacts nonrefundable corporate and individual tax credits for the purchase and
14 installation of water efficient landscaping and fixtures by a homebuilder;
15 ▸ establishes a process for a homebuilder to receive a tax credit certificate from the
16 Division of Water Resources (the division) before claiming the tax credit;
17 ▸ establishes a cap on the amount of tax credit certificates that the division may issue
18 per year; and
19 ▸ schedules the repeal of the tax credit but requires legislative review before the
20 repeal.
21 Money Appropriated in this Bill:
22 None
23 Other Special Clauses:
24 This bill provides retrospective operation.
25 Utah Code Sections Affected:
26 AMENDS:
27 63I-1-259, as last amended by Laws of Utah 2022, Chapter 218
28 63I-1-273, as last amended by Laws of Utah 2022, Chapters 68, 79
29 73-10-18, as last amended by Laws of Utah 2021, Chapter 179
30 ENACTS:
31 59-7-627, Utah Code Annotated 1953
32 59-10-1046, Utah Code Annotated 1953
33 73-10-38, Utah Code Annotated 1953
34
35 Be it enacted by the Legislature of the state of Utah:
36 Section 1. Section 59-7-627 is enacted to read:
37 59-7-627. Nonrefundable tax credit for purchase and installation of water
38 efficient landscaping and fixtures.
39 (1) As used in this section:
40 (a) "Division" means the Division of Water Resources created in Section 73-10-18.
41 (b) "Eligible expense" means the cost to a qualifying taxpayer to purchase and install a
42 WaterSense fixture or water wise landscaping in a new single family or multifamily home.
43 (c) "Qualifying taxpayer" means a taxpayer that:
44 (i) builds a new single family or multifamily home; and
45 (ii) receives a tax credit certificate in accordance with Section 73-10-38.
46 (d) "WaterSense fixture" means a fixture that meets the criteria established by the
47 Environmental Protection Agency to receive a WaterSense label.
48 (e) (i) "Water wise landscaping" means the same as that term is defined in Section
49 10-9a-536.
50 (ii) "Water wise landscaping" includes water efficient landscaping as determined by the
51 division by rule.
52 (2) For a taxable year beginning on or after January 1, 2023, and beginning before
53 January 1, 2026, a qualifying taxpayer may claim a nonrefundable tax credit for eligible
54 expenses in an amount equal to the amount stated on the tax credit certificate.
55 (3) A qualifying taxpayer may carry forward, to the next taxable year, the amount of
56 the qualifying taxpayer's tax credit that exceeds the qualifying taxpayer's income tax liability
57 for the taxable year.
58 Section 2. Section 59-10-1046 is enacted to read:
59 59-10-1046. Nonrefundable tax credit for purchase and installation of water
60 efficient landscaping and fixtures.
61 (1) As used in this section:
62 (a) "Eligible expense" means the cost to a qualifying claimant to purchase and install a
63 WaterSense fixture or water wise landscaping in a new single family or multifamily home.
64 (b) "Qualifying claimant" means a claimant that:
65 (i) builds a new single family or multifamily home; and
66 (ii) receives a tax credit certificate in accordance with Section 73-10-38.
67 (c) "WaterSense fixture" means the same as that term is defined in Section 59-7-627.
68 (d) "Water wise landscaping" means the same as that term is defined in Section
69 59-7-627.
70 (2) For a taxable year beginning on or after January 1, 2023, and beginning before
71 January 1, 2026, a qualifying claimant may claim a nonrefundable tax credit for eligible
72 expenses in an amount equal to the amount stated on the tax credit certificate.
73 (3) A qualifying claimant may carry forward, to the next taxable year, the amount of
74 the qualifying claimant's tax credit that exceeds the qualifying claimant's income tax liability
75 for the taxable year.
76 Section 3. Section 63I-1-259 is amended to read:
77 63I-1-259. Repeal dates: Title 59.
78 (1) Section 59-1-213.1 is repealed May 9, 2024.
79 (2) Section 59-1-213.2 is repealed May 9, 2024.
80 (3) Subsection 59-1-405(1)(g) is repealed May 9, 2024.
81 (4) Subsection 59-1-405(2)(b) is repealed May 9, 2024.
82 (5) Section 59-7-618.1 is repealed July 1, 2029.
83 (6) Section 59-7-627 is repealed July 1, 2026.
84 [
85 [
86 (9) Section 59-10-1046 is repealed July 1, 2026.
87 Section 4. Section 63I-1-273 is amended to read:
88 63I-1-273. Repeal dates: Title 73.
89 (1) Title 73, Chapter 27, Legislative Water Development Commission, is repealed
90 January 1, 2031.
91 (2) Subsection 73-10-18(2)(c) is repealed July 1, 2026.
92 (3) Section 73-10-38 is repealed July 1, 2026.
93 [
94 on July 1, 2025:
95 (a) Section 73-10g-202 is repealed; and
96 (b) Section 73-10g-203 is repealed.
97 [
98 appoint an advisory council that includes in the advisory council's duties advising on boating
99 policies, is repealed July 1, 2024.
100 [
101 1, 2027.
102 [
103 2030:
104 (a) Subsection 73-1-4(2)(e)(xi) is repealed;
105 (b) Subsection 73-10-4(1)(h) is repealed; and
106 (c) Title 73, Chapter 31, Water Banking Act, is repealed.
107 Section 5. Section 73-10-18 is amended to read:
108 73-10-18. Division of Water Resources -- Creation -- Power and authority.
109 (1) There is created the Division of Water Resources, which shall be within the
110 Department of Natural Resources under the administration and general supervision of the
111 executive director of the Department of Natural Resources and under the policy direction of the
112 Board of Water Resources.
113 (2) Except for the waters of the Colorado River system that are governed by Title 63M,
114 Chapter 14, Colorado River Authority of Utah Act, the Division of Water Resources shall:
115 (a) be the water resource authority for the state; [
116 (b) assume all of the functions, powers, duties, rights, and responsibilities of the Utah
117 water and power board except those which are delegated to the board by this act and is vested
118 with such other functions, powers, duties, rights and responsibilities as provided in this act and
119 other law[
120 (c) issue tax credit certificates in accordance with Section 73-10-38.
121 Section 6. Section 73-10-38 is enacted to read:
122 73-10-38. Tax credit certificate for installation of water-efficient landscaping and
123 fixtures.
124 (1) As used in this section:
125 (a) "Division" means the Division of Water Resources created in Section 73-10-18.
126 (b) "Eligible expense" means the cost to purchase and install a WaterSense fixture or
127 water wise landscaping in a new single family or multifamily home.
128 (c) "Qualifying application" means an application for a tax credit certificate that meets
129 the requirements of Subsection (3) from a person that the division determines is eligible to
130 receive a tax credit certificate.
131 (d) "WaterSense fixture" means the same as that term is defined in Section 59-7-627.
132 (e) "Water wise landscaping" means the same as that term is defined in Section
133 59-7-627.
134 (2) A person that seeks to claim a tax credit under Section 59-7-627 or 59-10-1046
135 shall apply to the division for a tax credit certificate.
136 (3) The person shall include in the application for a tax credit certificate the following
137 information for the year in which the person seeks a tax credit certificate:
138 (a) evidence that the person built a new single family or multifamily home;
139 (b) a list of any WaterSense fixtures or water wise landscaping the person purchased
140 and installed;
141 (c) the cost to purchase and install each WaterSense fixture or water wise landscaping
142 project; and
143 (d) any other information required by the division that relates to the person's eligibility
144 for a tax credit.
145 (4) (a) The division shall issue a tax credit certificate to a person that the division
146 determines has eligible expenses for the taxable year.
147 (b) Subject to Subsections (4)(c) and (5), the tax credit certificate shall state the amount
148 of tax credit, which is an amount equal to 10% of eligible expenses.
149 (c) The maximum amount of tax credit that the division may certify per person in a
150 taxable year is $100,000.
151 (d) A person that receives a tax credit certificate in accordance with this section shall
152 retain the tax credit certificate for the same time period that a person is required to keep books
153 and records under Section 59-1-1406.
154 (5) (a) The maximum aggregate amount of tax credit certificates the division may issue
155 over three years is $10,000,000.
156 (b) (i) The division may issue up to $3,000,000 in tax credit certificates for a taxable
157 year beginning on or after January 1, 2023, but beginning before January 1, 2024.
158 (ii) The division may issue up to $3,000,000 in tax credit certificates for a taxable year
159 beginning on or after January 1, 2024, but beginning before January 1, 2025.
160 (iii) The division may issue the difference between $10,000,000 and the amounts
161 issued in tax credit certificates in accordance with Subsections (5)(b)(i) and (ii) for a taxable
162 year beginning on or after January 1, 2025, but beginning before January 1, 2026.
163 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
164 division shall establish by rule a process for prioritizing tax credit certificate applications if the
165 qualifying application amounts exceed the aggregate amount of tax credit certificates that the
166 division may issue for the year.
167 (6) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
168 division may make rules defining water efficient landscaping.
169 (7) (a) The division shall submit to the State Tax Commission an electronic list that
170 includes:
171 (i) the name and identifying information for each person to which the division issues a
172 tax credit certificate; and
173 (ii) for each person, the amount of the tax credit stated on the tax credit certificate.
174 (b) The division shall provide the electronic list described in Subsection (7)(a) on or
175 before January 31 of the year following the year in which the division issued the certificates.
176 Section 7. Retrospective operation.
177 (1) The following sections have retrospective operation to January 1, 2023:
178 (a) Section 73-10-18; and
179 (b) Section 73-10-38.
180 (2) The following sections have retrospective operation for a taxable year beginning on
181 or after January 1, 2023:
182 (a) Section 59-7-627; and
183 (b) Section 59-10-1046.