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A BILL TO BE ENTITLED
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AN ACT
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relating to a franchise tax deduction for certain energy-generating |
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equipment. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter C, Chapter 171, Tax Code, is amended |
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by adding Section 171.110 to read as follows: |
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Sec. 171.110. DEDUCTION OF COST OF COMBINED HEAT AND POWER |
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PROJECT FROM MARGIN APPORTIONED TO THIS STATE. (a) In this |
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section, "combined heat and power project" means the construction |
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or installation of one or more components of a system that is |
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designed to: |
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(1) provide the sequential generation of power and |
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thermal energy for a facility and have an overall efficiency of |
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energy that exceeds 60 percent; |
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(2) store thermal energy; or |
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(3) capture waste heat to generate electricity. |
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(b) A taxable entity may deduct from its apportioned margin |
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10 percent of the amortized cost of equipment: |
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(1) that is used in a combined heat and power project; |
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(2) that is acquired by the taxable entity for use in |
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sequential generation of power and thermal energy, storage of |
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thermal energy, or capture of waste heat for generation of |
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electricity; |
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(3) that the taxable entity uses in this state; and |
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(4) the cost of which is amortized in accordance with |
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Subsection (c). |
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(c) The amortization of the cost of capital used in a |
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combined heat and power project must: |
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(1) be for a period of at least 60 months; |
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(2) provide for equal monthly amounts; |
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(3) begin in the month during which the equipment is |
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placed in service in this state; and |
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(4) cover only a period during which the equipment is |
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used in this state. |
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(d) A taxable entity that makes a deduction under this |
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section shall file with the comptroller an amortization schedule |
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showing the period for which the deduction is to be made. On the |
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request of the comptroller, the taxable entity shall file with the |
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comptroller proof of the cost of the equipment or proof of the |
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equipment's operation in this state. |
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SECTION 2. This Act applies only to a report originally due |
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on or after the effective date of this Act. |
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SECTION 3. This Act takes effect January 1, 2016. |