Connecticut Seal

General Assembly

 

Raised Bill No. 1033

January Session, 2009

 

LCO No. 3531

 

*03531_______PD_*

Referred to Committee on Planning and Development

 

Introduced by:

 

(PD )

 

AN ACT ESTABLISHING A TAX CREDIT FOR GREEN BUILDINGS.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective July 1, 2009, and applicable to income years commencing on or after January 1, 2012) (a) As used in this section:

(1) "Allowable costs" means the amounts chargeable to a capital account, including, but not limited to: (A) Construction or rehabilitation costs; (B) commissioning costs; (C) interest paid during the construction or rehabilitation period; (D) legal, architectural, engineering and other professional fees allocable to construction or rehabilitation, including energy modeling; (E) closing costs for construction or mortgage loans; (F) recording taxes and filing fees for construction or rehabilitation; (G) site costs, such as temporary electric wiring, scaffolding, demolition costs and fencing and security facilities; and (H) costs of carpeting, partitions, walls and wall coverings, ceilings, lighting, plumbing, electrical wiring, mechanical, heating, cooling and ventilation but "allowable costs" does not include the purchase of land, any remediation costs or the cost of telephone systems or computers;

(2) "Brownfield" shall have the same meaning as in subsection (g) of section 32-9cc of the general statutes;

(3) "Eligible project" means a real estate development project located in the state that is designed to meet or exceed the applicable LEED Green Building Rating System gold certification and located within one-quarter of a mile walking distance of publicly available bus transit service or within one-half of a mile walking distance of adequate rail, light rail, streetcar or ferry transit service; provided if a single project comprises more than one building, "eligible project" means only that building or buildings within such project that is designed to meet or exceed the applicable LEED Green Building Rating System gold certification and located within one-quarter of a mile walking distance of publicly available bus transit service or within one-half of a mile walking distance of adequate rail, light rail, streetcar or ferry transit service;

(4) "Energy Star" means the voluntary labeling program administered by the United States Environmental Protection Agency designed to identify and promote energy-efficient products, equipment and buildings;

(5) "Enterprise zone" means an area in a municipality designated by the Commissioner of Economic and Community Development as an enterprise zone in accordance with the provisions of section 32-70 of the general statutes;

(6) "LEED Accredited Professional Program" means the professional accreditation program for architects, engineers and other building professionals as administered by the United States Green Building Council;

(7) "LEED Green Building Rating System" means the Leadership in Energy and Environmental Design green building rating system developed by the United States Green Building Council as of the date that the project is registered with the United States Green Building Council;

(8) "Mixed-use development" means a development of one or more buildings that includes residential use and no more than seventy-five per cent of interior square footage with one or more of the following uses: (A) Commercial space; (B) office space; (C) retail space; or (D) any other nonresidential use that the Office of Policy and Management has determined does not pose a public health threat or nuisance to nearby residential areas;

(9) "Secretary" means the Secretary of the Office of Policy and Management; and

(10) "Site improvements" means any construction work on, or improvement to, streets, roads, parking facilities, sidewalks, drainage structures and utilities.

(b) For income years commencing on and after January 1, 2012, there shall be allowed a credit for all taxpayers against any tax due under the provisions of chapter 207, 208, 209, 210, 212 or 229 of the general statutes for the construction or renovation of an eligible project that meets the requirements of subsection (c) of this section, and, in the case of a newly constructed building, for which a certificate of occupancy has been issued not earlier than January 1, 2010. The amount of the credit shall not exceed twenty-five million dollars in the aggregate for the duration of the program.

(c) (1) To be eligible for a tax credit under this section any project shall: (A) Not require a sewer extension of more than one-eighth of a mile, (B) not have energy use exceeding the energy use permitted by the state energy code by (i) seventy per cent for new construction, or (ii) eighty per cent for renovation of a building, and (C) use equipment and appliances that meet Energy Star standards, if applicable, including, but not limited to, refrigerators, dishwashers and washing machines.

(2) The credit shall be equivalent to a base credit as follows: (A) for new construction or major renovation of a building but not other site improvements certified by the LEED Green Building Rating System, (i) eight per cent of allowable costs for a gold rating, and (ii) ten and one-half per cent of allowable costs for a platinum rating, (B) for core and shell or commercial interior projects, (i) five per cent of allowable costs for a gold rating, and (ii) seven per cent of allowable costs for a platinum rating, (C) for a mixed-use development, one-half of one per cent of allowable costs, and (D) for development in a brownfield or enterprise zone, one-half of one per cent of allowable costs.

(d) (1) The Secretary of the Office of Policy and Management shall issue an initial credit certificate if the secretary determines that the applicant is likely, within a reasonable time, to place in service property which would warrant the allowance of a credit under this section. Such certificate shall state: (A) The first taxable year for which the credit may be claimed, (B) the maximum amount of credit allowable, and (C) an expiration date by which such property must be placed in service, which expiration date may be extended at the discretion of the secretary. Such certificate shall reserve the credit allowable for the applicant named in the application until the expiration date. The reservation of the tax credit may be extended at the discretion of the secretary.

(2) No initial credit certificates in the aggregate for more than twenty-five million dollars shall be issued by the secretary.

(3) For each income year for which a taxpayer claims a credit under this section, the taxpayer shall obtain an eligibility certificate from an architect or professional engineer licensed to practice in this state and accredited through the LEED Accredited Professional Program. Such certificate shall consist of a certification, under the seal of such architect or engineer, that the building, base building or tenant space with respect to which the credit is claimed, meets or exceeds the applicable LEED Green Building Rating System gold certification in effect at the time such certification is made. Such certification shall set forth the specific findings upon which the certification is based and shall state that the architect or engineer is accredited through the LEED Accredited Professional Program.

(4) To obtain the credit, the taxpayer shall file the initial credit certificate described in subdivision (1) of subsection (d) of this section, the eligibility certificate described in subdivision (2) of said subsection (d) and an application to claim the credit with the Commissioner of the Department of Revenue Services. The applicant shall send a copy of all such documents to the secretary.

(e) (1) A taxpayer may claim not more than a total of twenty-five per cent of allowable costs in any income year, and any percentage of tax credit that the taxpayer would otherwise be entitled to in accordance with subsection (c) of this section may be carried forward for a period of not more than five years.

(2) Any credit allowed pursuant to this section may be sold, assigned or otherwise transferred to one or more taxpayers. If an applicant sells, assigns or otherwise transfers such credit, the transferor and transferee shall jointly submit written notification of such transfer to the Commissioner of Revenue Services not later than thirty days after such transfer. The notification shall include any information required by said commissioner. Failure to comply with this subdivision shall result in a disallowance of such credit until there is full compliance by the transferor and transferee.

(f) Notwithstanding any provision of the general statutes, any subsequent successor in interest to the property that is eligible for a credit in accordance with subsection (c) of this section may claim such credit if the deed transferring the property assigns the subsequent successor such right, unless the deed specifies that the seller shall retain the right to claim such credit. Any subsequent tenant of a building for which a credit was granted to a taxpayer pursuant to this section may claim the credit for the period after the termination of the previous tenancy that such credit would have been allowable to the previous tenant.

Sec. 2. (NEW) (Effective July 1, 2009) Not later than January 1, 2011, the Secretary of the Office of Policy and Management, in consultation with the Commissioner of Revenue Services, shall adopt regulations, in accordance with the provisions of chapter 54 of the general statutes, as necessary to implement the provisions of section 1 of this act.

Sec. 3. (Effective July 1, 2009) On or before July 1, 2013, the Secretary of the Office of Policy and Management, in consultation with the Commissioner of the Department of Revenue Services, shall prepare and submit to the Governor and the joint standing committees of the General Assembly having cognizance of matters relating to planning and development and to finance, revenue and bonding, a written report containing (1) the number of taxpayers applying for the credits provided in section 1 of this act; (2) the amount of such credits granted; (3) the geographical distribution of such credits granted; and (4) any other information deemed appropriate. A preliminary draft of the report shall be submitted on or before July 1, 2012, to the Governor and the joint standing committees of the General Assembly having cognizance of matters relating to planning and development and to finance, revenue and bonding. Such reports shall be submitted in accordance with the provisions of section 11-4a of the general statutes.

This act shall take effect as follows and shall amend the following sections:

Section 1

July 1, 2009, and applicable to income years commencing on or after January 1, 2012

New section

Sec. 2

July 1, 2009

New section

Sec. 3

July 1, 2009

New section

Statement of Purpose:

To establish a tax credit for projects that meet or exceed LEED Green Building Rating System Certification.

[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]