HCS HB 978 & 1028 -- ENERGY AND THE ENVIRONMENT

SPONSOR:  Bivins

COMMITTEE ACTION:  Voted "do pass" by the Committee on Energy and
Environment by a vote of 9 to 2.

This substitute changes the laws regarding energy and the
environment.

INCOME TAX CREDIT FOR HOMES BUILT UNDER GREEN BUILD STANDARDS

Beginning January 1, 2010, the substitute authorizes an income
tax credit for homes built using green build standards.  The
credit ranges from 45 cents to $1.15 per square foot of the home
and will be based on the percentage of the level of green build
standards met as verified by a program-certified, third-party
verifier.  The credit is not refundable, but can be transferred
or carried back or carried forward to any taxable year.  The
credit will be on a first-come, first-served filing basis and
cannot exceed $2 million per fiscal year.

LINKED DEPOSIT LOAN PROGRAM

The substitute:

(1)  Expands the Linked Deposit Loan Program to include eligible
alternative energy consumers and eligible governmental entities;

(2)  Revises the definition of "eligible job enhancement
business" to limit the amount of the linked deposit to not exceed
$50,000 per job created or retained plus the initial cost of the
physical expansion, renovation, or capital outlay when an
applicant can demonstrate the significant costs associated with
the physical expansion, renovation, or modernization of a
facility or equipment;

(3)  Increases from less than 25 to less than 100 the number of
employees a company can employ in order to be considered an
eligible small business; and

(4)  Specifies that the total amount of tax credits available for
qualified investments in Missouri small businesses cannot exceed
$30 million and at least $20 million of that amount must be for
the manufacture of alternative power generation equipment.
Currently, the total amount of tax credits cannot exceed $13
million.

SALES AND INSTALLATION OF HOME GENERATORS

The substitute prohibits a utility or affiliate from selling and
installing home generators for electrical production unless there
are no existing heating, ventilation, or air conditioning
providers in the service area.  Every utility must comply with
all local permit and code requirements.

MISSOURI ALTERNATIVE ENERGY LOAN AUTHORITY

The Missouri Alternative Energy Loan Authority is established
within the Department of Natural Resources to provide
low-interest loans on a need-based program to public and private
entities for the purpose of financing various energy-saving
projects and services.  The authority will consist of seven
members appointed by the Governor with the advice and consent of
the Senate.  The members' terms, eligibility, and qualifications
are specified in the substitute.  Action may be taken upon the
affirmative vote of at least three members.  The authority must
file an annual financial statement with the department director.

An initial appropriation of $14 million to the newly created
Missouri Alternative Energy Loan Authority Fund will be made; and
the fund may receive annual appropriations from the General
Assembly as well as from any gifts, contributions, grants, or
bequests.

MISSOURI PROPANE EDUCATION AND RESEARCH COUNCIL

The substitute changes the laws regarding the Missouri Propane
Education and Research Council.  In its main provisions, the
substitute:

(1)  Removes the provision allowing the director of the council
to initiate a referendum on the abolishment of the council;

(2)  Removes the director's authority to:

(a)  Fill council vacancies;

(b)  Approve or modify council budgets.  The council will approve
or modify the budget after a 30-day public comment period;

(c)  Require additional reports from the council; and

(d)  Establish alternative means to collect the odorized propane
assessment fee and establish a late payment charge and the rate
of interest not to exceed the legal rate for judgments; and

(3)  Requires the Missouri council to keep funds resulting from
the federal assessment rebate on propane fees and not to
coordinate its operation with the National Propane Education and
Research Council in conjunction with the United States Secretary
of Energy.

WATER WELL REGULATIONS

The substitute specifies that any water system that serves a
benevolent or charitable organization and draws less than 15,000
gallons per month will be exempt from all rules relating to well
construction except those applying to domestic wells which are
determined to present a threat to groundwater.

GREEN SCHOOL GRANTS FOR SCHOOL BUILDINGS

Any public school district seeking state reimbursement for bond
offering costs related to new construction or renovation must
certify a cost analysis of building to certification issued by
the United States Green Building Council under the Leadership in
Energy and Environmental Design Green Building Rating System
(LEED) or an equivalent certification versus the cost of owning
and operating a new or renovated building without LEED standards.

ENVIRONMENTAL AUDITS

The substitute allows companies to conduct voluntary
environmental audits in order to discover and correct
noncompliance with environmental regulations.  If a company
complies with the voluntary audit requirements, it will be exempt
from certain types of criminal and administrative penalties and
may keep its voluntary audit reports confidential.  Companies
will not be exempt from any tort actions by private parties.  In
order to comply with the voluntary audit requirements, a company
must:

(1)  Discover noncompliance during a voluntary environmental
audit or through a compliance management system;

(2)  Disclose its noncompliance to the Department of Natural
Resources within 21 days;

(3)  Make the disclosure prior to any legal actions or regulatory
investigations concerning the audit;

(4)  Correct any noncompliance within 60 days or as determined by
the department;

(5)  Agree to take steps to prevent future noncompliance with
environmental regulations;

(6)  Document that the reported noncompliance was not part of a
pattern and that a similar noncompliance did not occur in the
previous three years or within the past five years at another
facility owned by the company;

(7)  Prove that the noncompliance did not cause actual harm or
violate an administrative order or agreement; and

(8)  Provide certain specified information to the department.

The department cannot disclose any audit report information
relating to scientific and technological innovations in which the
owner has a proprietary interest that is protected from
disclosure by law.

The provisions of the substitute regarding the tax credit for
homes built using green building standards expire December 31
five years from the effective date.

FISCAL NOTE:  Estimated Cost on General Revenue Fund of
$14,110,682 to $19,777,349 in FY 2010, $140,494 to $5,807,161 in
FY 2011, and $157,564 to $5,824,230 in FY 2012.  (The fiscal note
does not reflect the possibility that some of the tax credits
could be utilized by insurance companies against insurance
premium taxes.  If this occurs, the loss in tax revenue would be
split between the General Revenue Fund and the County Foreign
Insurance Fund, which ultimately goes to local school districts.)
Estimated Effect on Other State Funds of an Income of Unknown to
a Cost of Unknown in FY 2010, FY 2011, and FY 2012.

PROPONENTS:  Supporters of House Bill 978 say that the bill will
create incentives for environmental friendly green building
without defraying all of the costs for homebuilders or
homeowners.  It is a big step in the right direction toward
encouraging contractors to build to the standards that may be
required in the future.

Supporters of House Bill 1028 say that the bill will encourage
more environmentally friendly power production and will make the
benefits of linked deposit loans available to political
subdivisions and universities as well as more businesses.  It
increases the overall benefits that any eligible entity can
receive under the program which will encourage its use.

Testifying for HB 978 were Representative Pratt; Homebuilders
Association of Greater Kansas City; Richard Schuessler, United
States Green Building Council; St. Louis Home Builders
Association; Kevin Enyeart; and Kansas City Power and Light.

Testifying for HB 1028 were Representative Schoeller; Midwest
Alliance for Renewable Energy; and Yaull Lawson.

OPPONENTS:  There was no opposition voiced to the committee.

OTHERS:  Others testifying on House Bill 1028 were there to
answer any questions.

Testifying on HB 1028 was FCS Financial.

Missouri House of Representatives
95th General Assembly, 1st Regular Session
Last Updated November 17, 2009 at 9:26 am