SB0566

SENATE BILL 566

51st legislature - STATE OF NEW MEXICO - first session, 2013

INTRODUCED BY

John M. Sapien

AN ACT

RELATING TO TAXATION; CREATING EFFICIENT COMMERCIAL BUILDING TAX CREDITS.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. A new section of the Income Tax Act is enacted to read:

"[NEW MATERIAL] EFFICIENT COMMERCIAL BUILDING INCOME TAX CREDIT.--

A. A taxpayer who is not a dependent of another individual and who constructs an efficient commercial building in New Mexico or who renovates a building in New Mexico to make it an efficient commercial building on or after July 1, 2014 and prior to July 1, 2019 is eligible for a credit equal to one dollar eighty cents ($1.80) per square foot of qualified building floor area. A taxpayer may claim the credit for the taxable year in which or within one taxable year after which the taxpayer finishes construction or renovation. The credit provided by this section may be referred to as the "efficient commercial building income tax credit".

B. The purpose of the efficient commercial building income tax credit is to encourage the use of energy efficient technologies in new and existing buildings, reduce energy consumption and costs and promote job and revenue growth.

C. That portion of the efficient commercial building income tax credit allowed by the department that exceeds a taxpayer's income tax liability in the taxable year in which the credit is claimed shall not be refunded to the taxpayer. If the amount of the credit exceeds the taxpayer's tax liability for that taxable year, the excess may be carried forward for five consecutive years. The credit shall not be transferred to another taxpayer.

D. A husband and wife who file separate returns for a taxable year for which they could have filed a joint return may each claim only one-half of the efficient commercial building income tax credit that would have been claimed on a joint return.

E. A taxpayer may be allocated the right to claim an efficient commercial building income tax credit in proportion to the taxpayer's ownership interest if the taxpayer owns an interest in a business entity that is taxed for federal income tax purposes as a partnership. The total credit claimed by all members of the partnership or limited liability company shall not exceed the credit allowed pursuant to Subsection A of this section.

F. A taxpayer who claims the efficient commercial building income tax credit is ineligible for any other credit that may be taken for the same building construction or renovation. A credit shall not exceed five million dollars ($5,000,000) in any taxable year.

G. The energy, minerals and natural resources department shall adopt rules establishing procedures for certification of a taxpayer who wishes to claim the efficient commercial building income tax credit and designating the computer modeling software that may be used to calculate energy and power consumption. The energy, minerals and natural resources department shall issue to a qualifying taxpayer a dated certificate of eligibility stating information identifying the taxpayer, the amount of credit for which the taxpayer is eligible and any other information required by the taxation and revenue department. Certificates of eligibility shall be sequentially numbered. The energy, minerals and natural resources department shall maintain an account of all issued and destroyed certificates. The taxation and revenue department shall periodically audit the records related to the credit and maintained by the energy, minerals and natural resources department to ensure that the credit is being administered effectively and in compliance with the Tax Administration Act and this section.

H. To claim an efficient commercial building income tax credit, the taxpayer shall provide to the department a certificate of eligibility. If the provisions of this section have been complied with, the department shall allow the credit. I. The department shall annually report the number of taxpayers who have claimed the efficient commercial building income tax credit. If otherwise lawful, the department may disclose to the revenue stabilization and tax policy committee the number of applicants for the credit, the amount of each credit claimed, the number of buildings constructed or renovated, the total annual amount of credits claimed and information that helps in evaluating the effectiveness of the credit.

J. In 2018, the revenue stabilization and tax policy committee shall review the effectiveness of the efficient commercial building income tax credit.

K. As used in this section, "efficient commercial building" means a building:

(1) for which efficiency measures are implemented as part of a plan designed to reduce by fifty percent or more, compared with a reference building that meets the minimum requirements of ASHRAE Standard 90.1-2004, the total annual energy and power costs of the interior lighting systems, heating, cooling, ventilation and hot water systems of the entire building; provided that reductions from other energy uses, such as receptacles, process loads, refrigeration, cooking and elevators, do not count toward the reduction measure;

(2) for which efficiency measures are implemented in the:

(a) interior lighting systems;

(b) heating, cooling, ventilation and hot water systems; or

(3) that is certified by a professional engineer and the energy, minerals and natural resources department as meeting the requirements of Paragraphs (1) and (2) of this subsection."

SECTION 2. A new section of the Corporate Income and Franchise Tax Act is enacted to read:

"[NEW MATERIAL] EFFICIENT COMMERCIAL BUILDING CORPORATE INCOME TAX CREDIT.--

A. A taxpayer that constructs an efficient commercial building in New Mexico or that renovates a building in New Mexico to make it an efficient commercial building on or after July 1, 2014 and prior to July 1, 2019 is eligible for a credit equal to one dollar eighty cents ($1.80) per square foot of qualified building floor area. A taxpayer may claim the credit for the taxable year in which or within one taxable year after which the taxpayer finishes construction or renovation. The credit provided by this section may be referred to as the "efficient commercial building corporate income tax credit".

B. The purpose of the efficient commercial building corporate income tax credit is to encourage the use of energy efficient technologies in new and existing buildings, reduce energy consumption and costs and promote job and revenue growth.

C. That portion of the efficient commercial building corporate income tax credit allowed by the department that exceeds a taxpayer's corporate income tax liability in the taxable year in which the credit is claimed shall not be refunded to the taxpayer. If the amount of the credit exceeds the taxpayer's tax liability for that taxable year, the excess may be carried forward for five consecutive years. The credit shall not be transferred to another taxpayer.

D. A taxpayer that claims the efficient commercial building corporate income tax credit is ineligible for any other credit that may be taken for the same building construction or renovation. A credit shall not exceed five million dollars ($5,000,000) in any taxable year.

E. The energy, minerals and natural resources department shall adopt rules establishing procedures for certification of a taxpayer that wishes to claim the efficient commercial building corporate income tax credit and designating the computer modeling software that may be used to calculate energy and power consumption. The energy, minerals and natural resources department shall issue to a qualifying taxpayer a dated certificate of eligibility stating information identifying the taxpayer, the amount of credit for which the taxpayer is eligible and any other information required by the taxation and revenue department. Certificates of eligibility shall be sequentially numbered. The energy, minerals and natural resources department shall maintain an account of all issued and destroyed certificates. The taxation and revenue department shall periodically audit the records related to the credit and maintained by the energy, minerals and natural resources department to ensure that the credit is being administered effectively and in compliance with the Tax Administration Act and this section.

F. To claim an efficient commercial building corporate income tax credit, the taxpayer shall provide to the department a certificate of eligibility. If the provisions of this section have been complied with, the department shall allow the credit.

G. The department shall annually report the number of taxpayers that have claimed the efficient commercial building corporate income tax credit. If otherwise lawful, the department may disclose to the revenue stabilization and tax policy committee the number of applicants for the credit, the amount of each credit claimed, the number of buildings constructed or renovated, the total annual amount of credits claimed and information that helps in evaluating the effectiveness of the credit.

H. In 2018, the revenue stabilization and tax policy committee shall review the effectiveness of the efficient commercial building corporate income tax credit.

I. As used in this section, "efficient commercial building" means a building:

(2) for which efficiency measures are implemented in the:

(a) interior lighting systems;

(b) heating, cooling, ventilation and hot water systems; or

(3) that is certified by a professional engineer and the energy, minerals and natural resources department as meeting the requirements of Paragraphs (1) and (2) of this subsection."

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