83R5624 ADM-F
	By: Rodriguez of Travis	H.B. No. 2074

	A BILL TO BE ENTITLED
	AN ACT
	relating to a franchise tax deduction for certain energy-generating
	equipment.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Subchapter C, Chapter 171, Tax Code, is amended
	by adding Section 171.109 to read as follows:
	Sec. 171.109.  DEDUCTION OF COST OF COMBINED HEAT AND POWER
	PROJECT FROM MARGIN APPORTIONED TO THIS STATE. (a) In this
	section, "combined heat and power project" means the construction
	or installation of one or more components of a system that is
	designed to provide the sequential generation of power and thermal
	energy with an overall efficiency of energy that exceeds 60 percent
	with or without thermal energy storage.
	(b)  A taxable entity may deduct from its apportioned margin
	10 percent of the amortized cost of equipment:
	(1)  that is used in a combined heat and power project;
	(2)  that is acquired by the taxable entity for use in
	sequential generation of power and thermal energy;
	(3)  that the taxable entity uses in this state; and
	(4)  the cost of which is amortized in accordance with
	Subsection (c).
	(c)  The amortization of the cost of capital used in a
	combined heat and power project must:
	(1)  be for a period of at least 60 months;
	(2)  provide for equal monthly amounts;
	(3)  begin in the month during which the equipment is
	placed in service in this state; and
	(4)  cover only a period during which the equipment is
	used in this state.
	(d)  A taxable entity that makes a deduction under this
	section shall file with the comptroller an amortization schedule
	showing the period for which the deduction is to be made.  On the
	request of the comptroller, the taxable entity shall file with the
	comptroller proof of the cost of the equipment or proof of the
	equipment's operation in this state.
	SECTION 2.  This Act applies only to a report originally due
	on or after the effective date of this Act.
	SECTION 3.  This Act takes effect January 1, 2014.