DAR File No. 41626

Environmental Quality, Air Quality

Rule R307-122

General Requirements: Heavy Duty Vehicle Tax Credit

Notice of Proposed Rule

(Amendment)

DAR File No.: 41626
Filed: 05/15/2017 09:04:04 AM

RULE ANALYSIS

Purpose of the rule or reason for the change:

During the 2017 General Session, the Legislature passed S.B. 24, which amended the definition of a "qualified heavy duty vehicle" to include heavy duty vehicles that have hydrogen-electric and 100% electric drivetrains. This amendment updates Rule R307-122 so that it matches the current statute.

Summary of the rule or change:

Rule R307-122 has been amended to include references that are consistent with the most recent changes in Section 59-10-1033. This includes adding "100% electric drivetrain" and "hydrogen-electric drivetrain" wherever the rule previously mentioned "OEM natural gas vehicle."

Statutory or constitutional authorization for this rule:

• Section 59-7-618
• Section 59-10-1033
• Section 19-2-104

Anticipated cost or savings to:

the state budget:

The proposed amendment does not impact the state budget because the Utah Code already includes the new definition of a "qualified heavy duty vehicle." Rule R307-122 only provides procedures that help implement the program that is already required by Section 59-10-1033. Also, the fiscal note attached to S.B. 24, which prompted this rule amendment, states a cost of $0. The cost of adding new types of vehicles to the "qualified vehicle" list is zero because there is a dollar limit on the total money spent on tax credits that was not impacted by S.B. 24. Once the money has been spent, there are no longer any tax credits awarded during that year, regardless of which type of vehicles apply for the credit.

local governments:

The proposed amendment does not impact money spent by local governments because the Utah Code already includes the new definition of a "qualified heavy duty vehicle." Rule R307-122 only provides procedures that help implement the program that is already required by Section 59-10-1033. Also, the fiscal note attached to S.B. 24, which prompted this rule amendment, states a cost of $0. The cost of adding new types of vehicles to the "qualified vehicle" list is zero because there is a dollar limit on the total money spent on tax credits that was not impacted by S.B. 24. Once the money has been spent, there are no longer any tax credits awarded during that year, regardless of which type of vehicles apply for the credit.

small businesses:

This rule amendment will not cost small businesses any money because the rule is merely a set of procedures that must be followed to qualify for a tax credit for owning a "qualified heavy duty vehicle." However, the rule could help small businesses save money if they take advantage of the tax credit. The tax credit is worth up to $25,000 (Subsection 59-10-1033(2)(a)).

persons other than small businesses, businesses, or local governmental entities:

This rule amendment will not cost "other persons" any money because the rule is merely a set of procedures on obtaining a tax credit for owning a "qualified heavy duty vehicle." However, the rule could help people who are not small businesses, businesses, or local government entities save money if they take advantage of the tax credit. The tax credit may be as high as $25,000 (Subsection 59-10-1033(2)(a)).

Compliance costs for affected persons:

No compliance costs are anticipated for affected persons because the rule will still be implemented in the same way as before, which did not include any compliance costs. The only change is that there are now more people who are eligible to receive the tax credit. People only have to comply with this rule if they want to receive the tax credit. If a person does comply with the rule and receives a tax credit, then they will end up saving money.

Comments by the department head on the fiscal impact the rule may have on businesses:

This rule amendment will not cost businesses any money because the rule is merely a set of procedures that must be followed to qualify for a tax credit for owning a "qualified heavy duty vehicle." However, the rule could help businesses save money if they take advantage of the tax credit. The tax credit is worth up to $25,000 (Subsection 59-10-1033(2)(a)).

Alan Matheson, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Office of Administrative Rules, or at:

Environmental Quality
Air QualityRoom Fourth Floor
195 N 1950 W
SALT LAKE CITY, UT 84116-3085

Direct questions regarding this rule to:

• Mat Carlile at the above address, by phone at 801-536-4116, by FAX at 801-536-4136, or by Internet E-mail at mcarlile@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

07/03/2017

This rule may become effective on:

07/10/2017

Authorized by:

Bryce Bird, Director

R307. Environmental Quality, Air Quality.

R307-122. General Requirements: Heavy Duty Vehicle Tax Credit.

R307-122-1. Authorization and Purpose.

(1) This rule is authorized by Sections 59-7-618 and 59-10-1033. These statutes establish criteria and definitions used to determine eligibility for an income tax credit.

(2) R307-122 establishes procedures to provide proof of a qualified purchase, in accordance with 59-7-618(6)(a) or 59-10-1033(6)(a), to the director for a qualified heavy duty vehicle for which an income tax credit is allowed under Sections 59-7-618 or 59-10-1033.

 

R307-122-2. Definitions.

The following additional definitions apply to R307-122.

"Heavy duty vehicle" means heavy duty vehicle as defined in Subsection 59-7-618(1)([b]c) and 59-10-1033(1)([b]c).

"Original equipment manufacturer (OEM) vehicle" means original equipment manufacturer (OEM) as defined in Subsection 19-1-402(8).

"Qualified heavy duty vehicle" means qualified heavy duty vehicle as defined in 59-7-618(1)([d]e) and 59-10-1033(1)([d]e).

"Qualified purchase" means qualified purchase as defined in 59-7-618(1)([e]f) and 59-10-1033(1)([e]f).

"Qualified taxpayer" means qualified taxpayer as defined in 59-7-618(1)([f]g) and 59-10-1033(1)([f]g).

 

R307-122-3. Reservation of a Qualified Heavy Duty Vehicle Tax Credit.

(1) A qualified taxpayer shall reserve a qualified heavy duty vehicle tax credit before submitting proof of qualified purchase to obtain approval from the division for the heavy duty vehicle tax credit. A qualified taxpayer shall apply to reserve the tax credit on forms provided by the division, which will include the following:

(a) the name of the qualified taxpayer and the qualified taxpayers registered name with the United States Department of Transportation (USDOT),

(b) the last four digits of the qualified taxpayer's social security number(SSN) or employer identification number (EIN),

(c) the qualified taxpayer's address, and

(d) the qualified taxpayer's USDOT number.

(2) The tax credit shall be reserved for the qualified taxpayer for up to 180 calendar days from the division's approval of the request to reserve the credit.

(3) If the qualified taxpayer does not meet all of the requirements of R307-122-4 before 181 calendar days after the division's approval of the request to reserve the tax credit, the tax credit will no longer be reserved for the qualified taxpayer.

 

R307-122-4. Proof of Qualified Purchase for a Qualified Heavy Duty Vehicle.

To demonstrate that a heavy duty vehicle is eligible for the tax credit, proof of qualified purchase shall be made in accordance with 59-7-605(6)(a) or 59-10-1009(6)(a), by submitting the following documents to the director:

(1)(a) a copy of the motor vehicle's window sticker, which includes its Vehicle Identification Number (VIN), or equivalent manufacturer's documentation showing that the heavy duty vehicle[is an OEM natural gas vehicle; or]:

(i) is an OEM natural gas vehicle;

(ii) has a 100% electric drivetrain; or

(iii) has a hydrogen-electric drivetrain; or

(b) a signed statement by either an Automotive Service Excellence (ASE)-certified technician or Canadian Standards Association (CSA) America CNG Fuel System Inspector that includes the VIN, the technician's ASE or CSA America certification number, and states that the heavy duty vehicle[is an OEM natural gas vehicle;]:

(i) is an OEM natural gas vehicle;

(ii) has a 100% electric drivetrain; or

(iii) has a hydrogen-electric drivetrain;

(2) an original or copy of the purchase order, customer invoice, or receipt that includes the name of the qualified taxpayer seeking the credit, the name of the seller of the heavy duty vehicle, the VIN, purchase date, and price of the heavy duty vehicle;

(3) a copy of the current Utah vehicle registration in the name of the qualified taxpayer seeking the credit; and

(4) the certification required under Subsection 59-7-618(2)(b) and 59-10-1033(2)(b).

 

KEY: air pollution, alternative fuels, tax credits, heavy duty vehicles

Date of Enactment or Last Substantive Amendment: [September 3, 2015]2017

Authorizing, and Implemented or Interpreted Law: 19-2-104; 19-1-402; 59-7-618; 59-10-1033