Chapter
305
2005 -- H 5786 SUBSTITUTE A
Enacted 07/15/05
A N A C T
RELATING TO TAXATION
Introduced By: Representatives Moura, Ginaitt, Anguilla, Petrarca, and Long
Date Introduced: February
17, 2005
It is enacted
by the General Assembly as follows:
SECTION
1. Section 44-56-1 of the General Laws in Chapter 44-56 entitled
"Renewable
Energy
Sales Tax Credit" is hereby repealed:
44-56-1.
Renewable energy sales tax refund -- Sales tax refund on sales of qualifying
renewable
energy systems. -- (a) (1)
The division of taxation shall refund any tax paid pursuant
to
the provisions of chapter 18 of this title resulting from the sale of any
qualifying renewable
energy
system.
(2) As used in this section, a qualifying renewable energy system shall be
either a
photovoltaic
system, a solar domestic hot water system, solar space heating system or wind-
generating
system.
(i) For photovoltaic systems, the system shall be able to generate electricity
directly from
sunlight
and be able to have it provide electricity for the home. These systems shall
either be
"stand
alone" systems that use batteries for storage of electricity or "grid
interconnected" systems
that allow
the electric meter to spin backwards during periods where the photovoltaic
system is
generating
more electricity than the load of the house. These systems shall have an
electrical
permit
that has had a final inspection done by the electrical inspector for the city
or town of the
installation.
(ii) For solar domestic hot water systems, the system shall consist of solar
collectors,
pump,
heat exchanger, and storage tank designed to heat water. These systems must
have a
plumbing
permit that has had a final inspection done by the plumbing inspector for the
city or
town
of the installation.
(iii) For solar space heating systems, the system shall consist of solar
collectors, pump,
heat
exchanger, storage tank(s), and a method of distributing the heat to areas of
the house that
need
heat. These systems shall have a mechanical permit that has had a final
inspection done by
the
mechanical/plumbing inspector for the city or town of the installation.
(iv) For wind energy systems, the system shall produce electricity through the
use of
wind
generators or wind turbines, that can be used directly, as in water pumping
applications, or
can
be stored in batteries for household usage. Wind energy systems can be used
alone, or can be
used
as part of a hybrid system in which their output is combined with
photovoltaics, and/or a
fossil
fuel generator.
(b)
Purchasers of qualifying renewable energy systems shall receive a sales tax
refund
upon
application to the state division of taxation upon submission of:
(1) A form prescribed by the tax administrator containing;
(i) A list of equipment purchased;
(ii) The names and addresses of vendor and purchaser; and
(iii) Addresses of the building upon which the equipment has been installed;
(2) Copies of appropriate receipts; and
(3) A systems certification pursuant to section 44-57-6 to verify that the
purchased items
were
actually used in qualifying systems.
(c) For purposes of local municipal property tax assessment, qualifying
renewable
energy
systems shall not be assessed at more than the value of a conventional heating,
conventional
hot domestic hot water systems, or energy production capacity that otherwise
could
be
necessary to install in the building. Qualifying systems shall include
photovoltaic systems
(renewable
energy systems), solar domestic hot water systems, and active solar space
heating
systems.
SECTION
2. Section 44-18-30 of the General Laws in Chapter 44-18 entitled "Sales
and
Use
Taxes - Liability and Computation" is hereby amended to read as follows:
44-18-30.
Gross receipts exempt from sales and use taxes. -- There are exempted
from
the
taxes imposed by this chapter the following gross receipts:
(1) Sales and uses beyond constitutional power of state. - From the sale and
from the
storage,
use, or other consumption in this state of tangible personal property the gross
receipts
from the
sale of which, or the storage, use, or other consumption of which, this state
is prohibited
from
taxing under the Constitution of the United States or under the constitution of
this state.
(2) Newspapers.
(i) From the sale and from the storage, use, or other consumption in this state
of any
newspaper.
(ii) "Newspaper" means an unbound publication printed on newsprint,
which contains
news,
editorial comment, opinions, features, advertising matter, and other matters of
public
interest.
(iii) "Newspaper" does not include a magazine, handbill, circular,
flyer, sales catalog, or
similar
item unless the item is printed for and distributed as a part of a newspaper.
(3) School meals. - From the sale and from the storage, use, or other
consumption in this
state of
meals served by public, private, or parochial schools, school districts,
colleges,
universities,
student organizations, and parent teacher associations to the students or
teachers of a
school,
college, or university whether the meals are served by the educational
institutions or by a
food
service or management entity under contract to the educational institutions.
(4) Containers.
(i) From the sale and from the storage, use, or other consumption in this state
of:
(A) Non-returnable containers, including boxes, paper bags, and wrapping
materials
which
are biodegradable and all bags and wrapping materials utilized in the medical
and healing
arts, when
sold without the contents to persons who place the contents in the container
and sell
the
contents with the container.
(B) Containers when sold with the contents if the sale price of the contents is
not
required
to be included in the measure of the taxes imposed by this chapter.
(C) Returnable containers when sold with the contents in connection with a
retail sale of
the
contents or when resold for refilling.
(ii) As used in this subdivision, the term "returnable containers"
means containers of a
kind
customarily returned by the buyer of the contents for reuse. All other
containers are "non-
returnable
containers."
(5) (i) Charitable, educational, and religious organizations. - From the sale
to as in
defined
in this section, and from the storage, use, and other consumption in this state
or any other
state of
the United States of America of tangible personal property by hospitals not
operated for a
profit,
"educational institutions" as defined in subdivision (18) not operated
for a profit, churches,
orphanages,
and other institutions or organizations operated exclusively for religious or
charitable
purposes,
interest free loan associations not operated for profit, nonprofit organized
sporting
leagues
and associations and bands for boys and girls under the age of nineteen (19)
years, the
following
vocational student organizations that are state chapters of national vocational
students
organizations:
Distributive Education Clubs of America, (DECA); Future Business Leaders of
America,
phi beta lambda (FBLA/PBL); Future Farmers of America (FFA); Future Homemakers
of
America/Home Economics Related Occupations (FHA/HERD); and Vocational
Industrial
Clubs of
America (VICA), organized nonprofit golden age and senior citizens clubs for
men and
women,
and parent teacher associations.
(ii) In the case of contracts entered into with the federal government, its
agencies or
instrumentalities,
this state or any other state of the United States of America, its agencies,
any
city,
town, district, or other political subdivision of the states, hospitals not
operated for profit,
educational
institutions not operated for profit, churches, orphanages, and other
institutions or
organizations
operated exclusively for religious or charitable purposes, the contractor may
purchase
such materials and supplies (materials and/or supplies are defined as those
which are
essential
to the project) that are to be utilized in the construction of the projects
being performed
under the
contracts without payment of the tax.
(iii) The contractor shall not charge any sales or use tax to any exempt
agency,
institution,
or organization but shall in that instance provide his or her suppliers with
certificates
in the
form as determined by the division of taxation showing the reason for
exemption; and the
contractor's
records must substantiate the claim for exemption by showing the disposition of
all
property
so purchased. If any property is then used for a nonexempt purpose, the contractor
must
pay the
tax on the property used.
(6) Gasoline. - From the sale and from the storage, use, or other consumption
in this state
of: (i)
gasoline and other products taxed under chapter 36 of title 31, and (ii) fuels
used for the
propulsion
of airplanes.
(7) Purchase for manufacturing purposes.
(i) From the sale and from the storage, use, or other consumption in this state
of
computer
software, tangible personal property, electricity, natural gas, artificial gas,
steam,
refrigeration,
and water, when the property or service is purchased for the purpose of being
manufactured
into a finished product for resale, and becomes an ingredient, component, or
integral
part of the manufactured, compounded, processed, assembled, or prepared
product, or if
the
property or service is consumed in the process of manufacturing for resale
computer software,
tangible
personal property, electricity, natural gas, artificial gas, steam,
refrigeration, or water.
(ii) "Consumed" means destroyed, used up, or worn out to the degree
or extent that the
property
cannot be repaired, reconditioned, or rendered fit for further manufacturing
use.
(iii) "Consumed" includes mere obsolescence.
(iv) "Manufacturing" means and includes manufacturing, compounding,
processing,
assembling,
preparing, or producing.
(v) "Process of manufacturing" means and includes all production
operations performed
in the
producing or processing room, shop, or plant, insofar as the operations are a
part of and
connected
with the manufacturing for resale of tangible personal property, electricity,
natural gas,
artificial
gas, steam, refrigeration, or water and all production operations performed
insofar as the
operations
are a part of and connected with the manufacturing for resale of computer
software.
(vi) "Process of manufacturing" does not mean or include
administration operations such
as
general office operations, accounting, collection, sales promotion, nor does it
mean or include
distribution
operations which occur subsequent to production operations, such as handling,
storing,
selling, and transporting the manufactured products, even though the
administration and
distribution
operations are performed by or in connection with a manufacturing business.
(8) State and political subdivisions. - From the sale to, and from the storage,
use, or other
consumption
by, this state, any city, town, district, or other political subdivision of
this state.
Every redevelopment
agency created pursuant to chapter 31 of title 45 is deemed to be a
subdivision
of the municipality where it is located.
(9) Food products.
(i) From the sale and the storage, use, or other consumption in this state,
subsequent to
March
31, 1948, of food products for human consumption.
(ii) "Food products" includes, except as otherwise provided in this
subdivision, cereals
and
cereal products; milk and milk products, other than candy and confectionery,
but including
ice cream;
oleomargarine; meat and meat products; fish and fish products; eggs and egg
products;
vegetables
and vegetable products; fruit and fruit products, including pure fruit juices;
spices,
condiments,
and salt; sugar and sugar products other than candy and confectionery; coffee
and
coffee
substitutes; tea, cocoa, and cocoa products, other than candy and
confectionery; and non-
carbonated
and non-effervescent bottled waters sold for human consumption.
(iii) "Food products" does not include spirituous, malt, or vinous
liquors; soft drinks,
sodas,
or beverages that are ordinarily dispensed at bars or soda fountains or in
connection
therewith;
medicines, tonics, vitamins, and preparations in liquid, powdered, granular,
tablet,
capsule,
lozenge, or pill form, sold as dietary supplements or adjuncts, except when
sold on the
prescription
of a physician; or mineral and carbonated bottled waters and ice.
(iv) "Food products" also does not include meals served on or off the
premises of the
retailer;
or drinks or food furnished, prepared, or served for consumption at tables,
chairs, or
counters,
or from trays, glasses, dishes, or other tableware provided by the retailer.
(v) The sale of meals and other food products ordinarily sold for immediate consumption
on or
off the premises of the retailer is a taxable sale even though the products are
sold on a "take
out"
or "to go" order, and are actually packaged or wrapped and taken from
the premises.
(10) Medicines and drugs. - From the sale and from the storage, use, or other
consumption
in this state, subsequent to March 31, 1948, of "medicines" and
"drugs" as defined
in
section 5-19-1 [repealed] sold on prescriptions and proprietary medicines, popularly
called
patent
medicines, including, but not limited to, disposable or reusable devices, such
as syringe
infusers,
ambulatory drug delivery pumps and supplies used with these items which are
sold on
prescription
to individuals to be used by them to dispense or administer prescription drugs,
and
related
ancillary dressings and supplies used to dispense or administer prescription
drugs.
(11) Prosthetic and orthopedic appliances. - From the sale and from the
storage, use, or
other
consumption in this state, subsequent to March 31, 1948, of crutches,
artificial limbs,
dentures,
spectacles and eyeglasses, artificial eyes, artificial hearing devices, and
other prostheses
or
orthopedic appliances, designed and purchased to be worn on the person of the
owner or user.
(12) Coffins, caskets, and burial garments. - From the sale and from the
storage, use, or
other
consumption in this state of coffins or caskets, and shrouds or other burial
garments which
are
ordinarily sold by a funeral director as part of the business of funeral
directing.
(13) Motor vehicles sold to nonresidents.
(i) From the sale, subsequent to June 30, 1958, of a motor vehicle to a bona
fide
nonresident
of this state who does not register the motor vehicle in this state, whether
the sale or
delivery
of the motor vehicle is made in this state or at the place of residence of the
nonresident.
A motor
vehicle sold to a bona fide nonresident whose state of residence does not allow
a like
exemption
to its nonresidents is not exempt from the tax imposed under section 44-18-20.
In that
event
the bona fide nonresident pays a tax to Rhode Island on the sale at a rate
equal to the rate
that
would be imposed in his or her state of residence not to exceed the rate that would
have been
imposed
under section 44-18-20. Notwithstanding any other provisions of law, a licensed
motor
vehicle
dealer shall add and collect the tax required under this subdivision and remit
the tax to the
tax
administrator under the provisions of chapters 18 and 19 of this title. When a
Rhode Island
licensed
motor vehicle dealer is required to add and collect the sales and use tax on
the sale of a
motor
vehicle to a bona fide nonresident as provided in this section, the dealer in
computing the
tax
takes into consideration the law of the state of the nonresident as it relates
to the trade-in of
motor
vehicles.
(ii) The tax administrator, in addition to the provisions of sections 44-19-27
and 44-19-
28, may
require any licensed motor vehicle dealer to keep records of sales to bona fide
nonresidents
as the tax administrator deems reasonably necessary to substantiate the
exemption
provided
in this subdivision, including the affidavit of a licensed motor vehicle dealer
that the
purchaser
of the motor vehicle was the holder of, and had in his or her possession a
valid out of
state
motor vehicle registration or a valid out of state driver's license.
(iii) Any nonresident who registers a motor vehicle in this state within ninety
(90) days
of the
date of its sale to him or her is deemed to have purchased the motor vehicle
for use,
storage,
or other consumption in this state, and is subject to, and liable for the use
tax imposed
under
the provisions of section 44-18-20.
(14) Sales in public buildings by blind people. - From the sale and from the
storage, use,
or other
consumption in all public buildings in this state of all products or wares by
any person
licensed
under section 40-9-11.1.
(15) Air and water pollution control facilities. - From the sale, storage, use,
or other
consumption
in this state of tangible personal property or supplies acquired for
incorporation into
or used
and consumed in the operation of a facility, the primary purpose of which is to
aid in the
control
of the pollution or contamination of the waters or air of the state, as defined
in chapter 12
of title
46 and chapter 25 of title 23, respectively, and which has been certified as
approved for
that
purpose by the director of environmental management. The director of
environmental
management
may certify to a portion of the tangible personal property or supplies acquired
for
incorporation
into those facilities or used and consumed in the operation of those facilities
to the
extent
that that portion has as its primary purpose the control of the pollution or
contamination of
the
waters or air of this state. As used in this subdivision, "facility"
means any land, facility,
device,
building, machinery, or equipment.
(16) Camps. - From the rental charged for living quarters, or sleeping or
housekeeping
accommodations
at camps or retreat houses operated by religious, charitable, educational, or
other
organizations and associations mentioned in subdivision (5), or by privately
owned and
operated
summer camps for children.
(17) Certain institutions. - From the rental charged for living or sleeping
quarters in an
institution
licensed by the state for the hospitalization, custodial, or nursing care of
human beings.
(18) Educational institutions. - From the rental charged by any educational
institution for
living
quarters, or sleeping or housekeeping accommodations or other rooms or
accommodations
to any
student or teacher necessitated by attendance at an educational institution.
"Educational
institution"
as used in this section means an institution of learning not operated for
profit which is
empowered
to confer diplomas, educational, literary, or academic degrees, which has a
regular
faculty,
curriculum, and organized body of pupils or students in attendance throughout
the usual
school
year, which keeps and furnishes to students and others records required and
accepted for
entrance
to schools of secondary, collegiate, or graduate rank, no part of the net
earnings of which
inures
to the benefit of any individual.
(19) Motor vehicle and adaptive equipment for persons with disabilities.
(i) From the sale of: (A) special adaptations, (B) the component parts of the
special
adaptations,
or (C) a specially adapted motor vehicle; provided, that the owner furnishes to
the
tax
administrator an affidavit of a licensed physician to the effect that the
specially adapted motor
vehicle
is necessary to transport a family member with a disability or where the
vehicle has been
specially
adapted to meet the specific needs of the person with a disability. This
exemption
applies
to not more than one motor vehicle owned and registered for personal,
noncommercial
use.
(ii) For the purpose of this subsection the term "special adaptations"
includes, but is not
limited
to: wheelchair lifts; wheelchair carriers; wheelchair ramps; wheelchair
securements; hand
controls;
steering devices; extensions, relocations, and crossovers of operator controls;
power-
assisted
controls; raised tops or dropped floors; raised entry doors; or alternative
signaling
devices
to auditory signals.
(iii) For the purpose of this subdivision the exemption for a "specially
adapted motor
vehicle"
means a use tax credit not to exceed the amount of use tax that would otherwise
be due
on the
motor vehicle, exclusive of any adaptations. The use tax credit is equal to the
cost of the
special
adaptations, including installation.
(20) Heating fuels. - From the sale and from the storage, use, or other consumption
in
this
state of every type of fuel used in the heating of homes and residential
premises.
(21) Electricity and gas. - From the sale and from the storage, use, or other
consumption
in this
state of electricity and gas furnished for domestic use by occupants of
residential premises.
(22) (i) Manufacturing machinery and equipment. - From the sale and from the
storage,
use, or
other consumption in this state of tools, dies, and molds, and machinery and
equipment
(including
replacement parts), and related items to the extent used in an industrial plant
in
connection
with the actual manufacture, conversion, or processing of tangible personal
property,
or to
the extent used in connection with the actual manufacture, conversion or processing
of
computer
software as that term is utilized in industry numbers 7371, 7372, and 7373 in
the
standard
industrial classification manual prepared by the technical committee on
industrial
classification,
office of statistical standards, executive office of the president, United
States
bureau
of the budget, as revised from time to time, to be sold, or that machinery and
equipment
used in
the furnishing of power to an industrial manufacturing plant. For the purposes
of this
subdivision,
"industrial plant" means a factory at a fixed location primarily
engaged in the
manufacture,
conversion, or processing of tangible personal property to be sold in the
regular
course
of business;
(ii) Machinery and equipment and related items are not deemed to be used in
connection
with the
actual manufacture, conversion, or processing of tangible personal property, or
in
connection
with the actual manufacture, conversion or processing of computer software as
that
term is
utilized in industry numbers 7371, 7372, and 7373 in the standard industrial
classification
manual
prepared by the technical committee on industrial classification, office of
statistical
standards,
executive office of the president, United States bureau of the budget, as
revised from
time to
time, to be sold to the extent the property is used in administration or
distribution
operations;
(iii) Machinery and equipment and related items used in connection with the
actual
manufacture,
conversion, or processing of any computer software or any tangible personal
property
which is not to be sold and which would be exempt under subdivision (7) or this
subdivision
if purchased from a vendor or machinery and equipment and related items used
during any
manufacturing, converting or processing function is exempt under this
subdivision
even if
that operation, function, or purpose is not an integral or essential part of a
continuous
production
flow or manufacturing process;
(iv) Where a portion of a group of portable or mobile machinery is used in
connection
with the
actual manufacture, conversion, or processing of computer software or tangible
personal
property
to be sold, as previously defined, that portion, if otherwise qualifying, is
exempt under
this
subdivision even though the machinery in that group is used interchangeably and
not
otherwise
identifiable as to use.
(23) Trade-in value of motor vehicles. - From the sale and from the storage,
use, or other
consumption
in this state of so much of the purchase price paid for a new or used
automobile as is
allocated
for a trade-in allowance on the automobile of the buyer given in trade to the
seller or of
the
proceeds applicable only to the motor vehicle as are received from an insurance
claim as a
result
of a stolen or damaged motor vehicle, or of the proceeds applicable only to the
automobile
as are
received from the manufacturer of automobiles for the repurchase of the
automobile
whether
the repurchase was voluntary or not towards the purchase of a new or used
automobile
by the
buyer; provided, that the proceeds from an insurance claim or repurchase is in
lieu of the
benefit
prescribed in section 44-18-21 for the total loss or destruction of the
automobile; and
provided,
further, that the tax has not been reimbursed as part of the insurance claim or
repurchase.
For the purpose of this subdivision, the word "automobile" means a
private passenger
automobile
not used for hire and does not refer to any other type of motor vehicle.
(24) Precious metal bullion.
(i) From the sale and from the storage, use, or other consumption in this state
of precious
metal
bullion, substantially equivalent to a transaction in securities or
commodities.
(ii) For purposes of this subdivision, "precious metal bullion" means
any elementary
precious
metal which has been put through a process of smelting or refining, including,
but not
limited
to, gold, silver, platinum, rhodium, and chromium, and which is in a state or
condition
that its
value depends upon its content and not upon its form.
(iii) The term does not include fabricated precious metal which has been
processed or
manufactured
for some one or more specific and customary industrial, professional, or
artistic
uses.
(25) Commercial vessels. - From sales made to a commercial ship, barge, or
other vessel
of fifty
(50) tons burden or over, primarily engaged in interstate or foreign commerce,
and from
the
repair, alteration, or conversion of the vessels, and from the sale of property
purchased for the
use of
the vessels including provisions, supplies, and material for the maintenance
and/or repair
of the
vessels.
(26) Commercial fishing vessels. - From the sale and from the storage, use, or
other
consumption
in this state of vessels and other water craft which are in excess of five (5)
net tons
and
which are used exclusively for "commercial fishing", as defined in
this subdivision, and from
the
repair, alteration, or conversion of those vessels and other watercraft, and
from the sale of
property
purchased for the use of those vessels and other watercraft including
provisions,
supplies,
and material for the maintenance and/or repair of the vessels and other
watercraft and
the
boats nets, cables, tackle, and other fishing equipment appurtenant to or used
in connection
with the
commercial fishing of the vessels and other watercraft. "Commercial
fishing" means the
taking
or the attempting to take any fish, shellfish, crustacea, or bait species with
the intent of
disposing
of them for profit or by sale, barter, trade, or in commercial channels. The
term does
not
include subsistence fishing, i.e., the taking for personal use and not for sale
or barter; or sport
fishing;
but shall include vessels and other watercraft with a Rhode Island party and
charter boat
license
issued by the department of environmental management pursuant to section
20-2-27.1
which
meet the following criteria: (i) the operator must have a current U.S.C.G.
license to carry
passengers
for hire; (ii) U.S.C.G. vessel documentation in the coast wide fishery trade;
(iii)
U.S.C.G.
vessel documentation as to proof of Rhode Island home port status or a Rhode
Island
boat
registration to prove Rhode Island home port status; (iv) the vessel must be
used as a
commercial
passenger carrying fishing vessel to carry passengers for fishing. The vessel
must be
able to
demonstrate that at least fifty percent (50%) of its annual gross income
derives from
charters
or provides documentation of a minimum of one hundred (100) charter trips
annually; (v)
the
vessel must have a valid Rhode Island party and charter boat license. The tax
administrator
shall
implement the provisions of this subdivision by promulgating rules and
regulations relating
thereto.
(27) Clothing and footwear. - From the sales of articles of clothing, including
footwear,
intended
to be worn or carried on or about the human body. For the purposes of this
section,
"clothing
or footwear" does not include special clothing or footwear primarily
designed for
athletic
activity or protective use and which is not normally worn except when so used;
and sales
of
wearing materials or any cloth made of natural or synthetic fibers and used for
clothing
purposes.
(28) Water for residential use. - From the sale and from the storage, use, or
other
consumption
in this state of water furnished for domestic use by occupants of residential
premises.
(29) Bibles. - [Unconstitutional; see Ahlburn v. Clark, 728 A.2d 449 (R.I.
1999); see
Notes to
Decisions.]From the sale and from the storage, use, or other consumption in the
state of
any
canonized scriptures of any tax-exempt nonprofit religious organization
including, but not
limited
to, the Old Testament and the New Testament versions.
(30) Boats.
(i) From the sale of a boat or vessel to a bona fide nonresident of this state
who does not
register
the boat or vessel in this state, or document the boat or vessel with the
United States
government
at a home port within the state, whether the sale or delivery of the boat or
vessel is
made in
this state or elsewhere; provided, that the nonresident transports the boat
within thirty
(30)
days after delivery by the seller outside the state for use thereafter solely
outside the state.
(ii) The tax administrator, in addition to the provisions of sections 44-19-17
and 44-19-
28, may
require the seller of the boat or vessel to keep records of the sales to bona
fide
nonresidents
as the tax administrator deems reasonably necessary to substantiate the
exemption
provided
in this subdivision, including the affidavit of the seller that the buyer
represented
himself
or herself to be a bona fide nonresident of this state and of the buyer that he
or she is a
nonresident
of this state.
(31) Youth activities equipment. - From the sale, storage, use, or other
consumption in
this
state of items for not more than twenty dollars ($20.00) each by nonprofit
Rhode Island
eleemosynary
organizations, for the purposes of youth activities which the organization is
formed
to
sponsor and support; and by accredited elementary and secondary schools for the
purposes of
the
schools or of organized activities of the enrolled students.
(32) Farm equipment. - From the sale and from the storage or use of machinery
and
equipment
used directly for commercial farming and agricultural production; including,
but not
limited
to, tractors, ploughs, harrows, spreaders, seeders, milking machines, silage
conveyors,
balers,
bulk milk storage tanks, trucks with farm plates, mowers, combines, irrigation
equipment,
greenhouses
and greenhouse coverings, graders and packaging machines, tools and supplies
and
other
farming equipment, including replacement parts, appurtenant to or used in
connection with
commercial
farming and tools and supplies used in the repair and maintenance of farming
equipment.
"Commercial farming" means the keeping or boarding of five (5) or
more horses or
the
production within this state of agricultural products, including, but not
limited to, field or
orchard
crops, livestock, dairy, and poultry, or their products, where the keeping,
boarding, or
production
provides at least two thousand five hundred dollars ($2,500) in annual gross
sales to
the
operator, whether an individual, a group, a partnership, or a corporation for
exemptions issued
prior to
July 1, 2002; for exemptions issued or renewed after July 1, 2002, there shall
be two (2)
levels.
Level I shall be based on proof of annual gross sales from commercial farming
of at least
twenty-five
hundred dollars ($2,500) and shall be valid for purchases subject to the
exemption
provided
in this subdivision except for motor vehicles with an excise tax value of five
thousand
dollars
($5,000) or greater; Level II shall be based on proof of annual gross sales
from
commercial
farming of at least ten thousand dollars ($10,000) or greater and shall be
valid for
purchases
subject to the exemption provided in this subdivision including motor vehicles
with an
excise
tax value of five thousand dollars ($5,000) or greater. For the initial
issuance of the
exemptions,
proof of the requisite amount of annual gross sales from commercial farming
shall be
required
for the prior year; for any renewal of an exemption granted in accordance with
this
subdivision
at either Level I or Level II, proof of gross annual sales from commercial
farming at
the
requisite amount shall be required for each of the prior two (2) years.
Certificates of
exemption
issued or renewed after July 1, 2002, shall clearly indicate the level of the
exemption
and be
valid for four (4) years after the date of issue. This exemption applies even
if the same
equipment
is used for ancillary uses, or is temporarily used for a non-farming or a non-
agricultural
purpose, but shall not apply to motor vehicles acquired after July 1, 2002,
unless the
vehicle
is a farm vehicle as defined pursuant to section 31-1-8 and is eligible for
registration
displaying
farm plates as provided for in section 31-3-31.
(33) Compressed air. - From the sale and from the storage, use, or other
consumption in
the
state of compressed air.
(34) Flags. - From the sale and from the storage, consumption, or other use in
this state
of
United States, Rhode Island or POW-MIA flags.
(35) Motor vehicle and adaptive equipment to certain veterans. - From the sale
of a
motor
vehicle and adaptive equipment to and for the use of a veteran with a
service-connected
loss of or
the loss of use of a leg, foot, hand, or arm, or any veteran who is a double
amputee,
whether
service connected or not. The motor vehicle must be purchased by and especially
equipped
for use by the qualifying veteran. Certificate of exemption or refunds of taxes
paid is
granted
under rules or regulations that the tax administrator may prescribe.
(36) Textbooks. - From the sale and from the storage, use, or other consumption
in this
state of
textbooks by an "educational institution" as defined in subdivision
(18) of this section and
as well
as any educational institution within the purview of section 16-63-9(4) and
used textbooks
by any
purveyor.
(37) Tangible personal property and supplies used in on-site hazardous waste
recycling,
reuse,
or treatment. - From the sale, storage, use, or other consumption in this state
of tangible
personal
property or supplies used or consumed in the operation of equipment, the
exclusive
function
of which is the recycling, reuse, or recovery of materials (other than precious
metals, as
defined
in subdivision (24)(ii) of this section) from the treatment of "hazardous
wastes", as
defined
in section 23-19.1-4, where the "hazardous wastes" are generated in
Rhode Island solely
by the
same taxpayer and where the personal property is located at, in, or adjacent to
a generating
facility
of the taxpayer in Rhode Island. The taxpayer shall procure an order from the
director of
the
department of environmental management certifying that the equipment and/or
supplies as
used, or
consumed, qualify for the exemption under this subdivision. If any information
relating
to
secret processes or methods of manufacture, production, or treatment is
disclosed to the
department
of environmental management only to procure an order, and is a "trade
secret" as
defined
in section 28-21-10(b), it is not open to public inspection or publicly
disclosed unless
disclosure
is required under chapter 21 of title 28 or chapter 24.4 of title 23.
(38) Promotional and product literature of boat manufacturers. - From the sale
and from
the
storage, use, or other consumption of promotional and product literature of
boat
manufacturers
shipped to points outside of Rhode Island which either: (i) accompany the
product
which is
sold, (ii) are shipped in bulk to out of state dealers for use in the sale of
the product, or
(iii)
are mailed to customers at no charge.
(39) Food items paid for by food stamps. - From the sale and from the storage,
use, or
other
consumption in this state of eligible food items payment for which is properly
made to the
retailer
in the form of U.S. government food stamps issued in accordance with the Food
Stamp
Act of
1977, 7 U.S.C. section 2011 et seq.
(40) Transportation charges. - From the sale or hiring of motor carriers as
defined in
section
39-12-2(l) to haul goods, when the contract or hiring cost is charged by a
motor freight
tariff
filed with the Rhode Island public utilities commission on the number of miles
driven or by
the
number of hours spent on the job.
(41) Trade-in value of boats. - From the sale and from the storage, use, or
other
consumption
in this state of so much of the purchase price paid for a new or used boat as
is
allocated
for a trade-in allowance on the boat of the buyer given in trade to the seller
or of the
proceeds
applicable only to the boat as are received from an insurance claim as a result
of a stolen
or
damaged boat, towards the purchase of a new or used boat by the buyer.
(42) Equipment used for research and development. - From the sale and from the
storage,
use, or other consumption of equipment to the extent used for research and
development
purposes
by a qualifying firm. For the purposes of this subdivision, "qualifying
firm" means a
business
for which the use of research and development equipment is an integral part of
its
operation,
and "equipment" means scientific equipment, computers, software, and
related items.
(43) Coins. - From the sale and from the other consumption in this state of
coins having
numismatic
or investment value.
(44) Farm structure construction materials. - Lumber, hardware and other
materials used
in the
new construction of farm structures, including production facilities such as,
but not limited
to,
farrowing sheds, free stall and stanchion barns, milking parlors, silos,
poultry barns, laying
houses,
fruit and vegetable storages, rooting cellars, propagation rooms, greenhouses,
packing
rooms, machinery
storage, seasonal farm worker housing, certified farm markets, bunker and
trench
silos, feed storage sheds, and any other structures used in connection with
commercial
farming.
(45) Telecommunications carrier access service. - Carrier access service or
telecommunications
service when purchased by a telecommunications company from another
telecommunications
company to facilitate the provision of telecommunications service.
(46) Boats or vessels brought into the state exclusively for winter storage,
maintenance,
repair
or sale. - Notwithstanding the provisions of sections 44-18-10, 44-18-11,
44-18-20, the tax
imposed
by section 44-18-20 is not applicable for the period commencing on the first
day of
October
in any year to and including the 30th day of April next succeeding with respect
to the use
of any
boat or vessel within this state exclusively for purposes of: (i) delivery of
the vessel to a
facility
in this state for storage, including dry storage and storage in water by means
of apparatus
preventing
ice damage to the hull, maintenance, or repair; (ii) the actual process of
storage,
maintenance,
or repair of the boat or vessel; or (iii) storage for the purpose of selling
the boat or
vessel.
(47) Jewelry display product. - From the sale and from the storage, use, or
other
consumption
in this state of tangible personal property used to display any jewelry
product;
provided,
that title to the jewelry display product is transferred by the jewelry
manufacturer or
seller and
that the jewelry display product is shipped out of state for use solely outside
the state
and is
not returned to the jewelry manufacturer or seller.
(48) Boats or vessels generally. - Notwithstanding the provisions of this
chapter, the tax
imposed
by sections 44-18-20 and 44-18-18 shall not apply with respect to the sale and
to the
storage,
use, or other consumption in this state of any new or used boat. The exemption
provided
for in
this subdivision does not apply after October 1, 1993, unless prior to October
1, 1993, the
federal
ten percent (10%) surcharge on luxury boats is repealed.
(49) Banks and Regulated investment companies interstate toll-free calls. -
Notwithstanding
the provisions of this chapter, the tax imposed by this chapter does not apply
to
the
furnishing of interstate and international, toll-free terminating
telecommunication service that
is used
directly and exclusively by or for the benefit of an eligible company as
defined in this
subdivision;
provided, that an eligible company employs on average during the calendar year
no
less
than five hundred (500) "full-time equivalent employees", as that
term is defined in section
42-64.5-2.
For purposes of this section, an "eligible company" means a "regulated
investment
company"
as that term is defined in the Internal Revenue Code of 1986, 26 U.S.C. section
1 et
seq., or
a corporation to the extent the service is provided, directly or indirectly, to
or on behalf of
a
regulated investment company, an employee benefit plan, a retirement plan or a
pension plan or
a state
chartered bank.
(50) Mobile and manufactured homes generally. - From the sale and from the
storage,
use, or
other consumption in this state of mobile and/or manufactured homes as defined
and
subject
to taxation pursuant to the provisions of chapter 44 of title 31.
(51) Manufacturing business reconstruction materials.
(i) From the sale and from the storage, use or other consumption in this state
of lumber,
hardware,
and other building materials used in the reconstruction of a manufacturing
business
facility
which suffers a disaster, as defined in this subdivision, in this state.
"Disaster" means any
occurrence,
natural or otherwise, which results in the destruction of sixty percent (60%)
or more
of an
operating manufacturing business facility within this state.
"Disaster" does not include any
damage
resulting from the willful act of the owner of the manufacturing business
facility.
(ii) Manufacturing business facility includes, but is not limited to, the
structures housing
the
production and administrative facilities.
(iii) In the event a manufacturer has more than one manufacturing site in this
state, the
sixty
percent (60%) provision applies to the damages suffered at that one site.
(iv) To the extent that the costs of the reconstruction materials are
reimbursed by
insurance,
this exemption does not apply.
(52) Tangible personal property and supplies used in the processing or
preparation of
floral
products and floral arrangements. - From the sale, storage, use, or other
consumption in this
state of
tangible personal property or supplies purchased by florists, garden centers,
or other like
producers
or vendors of flowers, plants, floral products, and natural and artificial
floral
arrangements
which are ultimately sold with flowers, plants, floral products, and natural
and
artificial
floral arrangements or are otherwise used in the decoration, fabrication,
creation,
processing,
or preparation of flowers, plants, floral products, or natural and artificial
floral
arrangements,
including descriptive labels, stickers, and cards affixed to the flower, plant,
floral
product
or arrangement, artificial flowers, spray materials, floral paint and tint,
plant shine, flower
food,
insecticide and fertilizers.
(53) Horse food products. - From the sale and from the storage, use, or other
consumption
in this state of horse food products purchased by a person engaged in the
business of
the
boarding of horses.
(54) Non-motorized recreational vehicles sold to nonresidents.
(i) From the sale, subsequent to June 30, 2003, of a non-motorized recreational
vehicle to
a bona
fide nonresident of this state who does not register the non-motorized
recreational vehicle
in this
state, whether the sale or delivery of the non-motorized recreational vehicle
is made in this
state or
at the place of residence of the nonresident; provided, that a non-motorized
recreational
vehicle
sold to a bona fide nonresident whose state of residence does not allow a like
exemption
to its
nonresidents is not exempt from the tax imposed under section 44-18-20;
provided, further,
that in
that event the bona fide nonresident pays a tax to Rhode Island on the sale at
a rate equal
to the
rate that would be imposed in his or her state of residence not to exceed the
rate that would
have
been imposed under section 44-18-20. Notwithstanding any other provisions of
law, a
licensed
non-motorized recreational vehicle dealer shall add and collect the tax
required under
this
subdivision and remit the tax to the tax administrator under the provisions of
chapters 18 and
19 of
this title. Provided, that when a Rhode Island licensed non-motorized
recreational vehicle
dealer
is required to add and collect the sales and use tax on the sale of a
non-motorized
recreational
vehicle to a bona fide nonresident as provided in this section, the dealer in
computing
the tax
takes into consideration the law of the state of the nonresident as it relates
to the trade-in
of motor
vehicles.
(ii) The tax administrator, in addition to the provisions of sections 44-19-27
and 44-19-
28, may
require any licensed non-motorized recreational vehicle dealer to keep records
of sales to
bona
fide nonresidents as the tax administrator deems reasonably necessary to
substantiate the
exemption
provided in this subdivision, including the affidavit of a licensed
non-motorized
recreational
vehicle dealer that the purchaser of the non-motorized recreational vehicle was
the
holder
of, and had in his or her possession a valid out-of-state non-motorized
recreational vehicle
registration
or a valid out-of-state driver's license.
(iii) Any nonresident who registers a non-motorized recreational vehicle in
this state
within
ninety (90) days of the date of its sale to him or her is deemed to have
purchased the non-
motorized
recreational vehicle for use, storage, or other consumption in this state, and
is subject
to, and
liable for the use tax imposed under the provisions of section 44-18-20.
(iv) "Non-motorized recreational vehicle" means any portable dwelling
designed and
constructed
to be used as a temporary dwelling for travel, camping, recreational, and
vacation use
which is
eligible to be registered for highway use, including, but not limited to,
"pick-up coaches"
or
"pick-up campers," "travel trailers," and "tent
trailers" as those terms are defined in chapter 1
of title
31.
(55) Sprinkler and fire alarm systems in existing buildings. - From the sale in
this state of
sprinkler
and fire alarm systems, emergency lighting and alarm systems, and from the sale
of the
materials
necessary and attendant to the installation of those systems, that are required
in
buildings
and occupancies existing therein in July 2003, in order to comply with any
additional
requirements
for such buildings arising directly from the enactment of the Comprehensive
Fire
Safety
Act of 2003, and that are not required by any other provision of law or
ordinance or
regulation
adopted pursuant to that Act. The exemption provided in this subdivision shall
expire
on
December 31, 2008.
(56) Aircraft. - [Effective January 1, 2005.]Notwithstanding the provisions of
this
chapter,
the tax imposed by sections 44-18-18 and 44-18-20 shall not apply with respect
to the
sale and
to the storage, use, or other consumption in this state of any new or used
aircraft or
aircraft
parts.
(57)
Renewable energy products. - Notwithstanding any other provisions of Rhode
Island
general
laws the following products shall also be exempt from sales tax: solar
photovoltaic
modules
or panels, or any module or panel that generates electricity from light; solar
thermal
collectors,
including, but not limited to, those manufactured with flat glass plates,
extruded
plastic,
sheet metal, and/or evacuated tubes; geothermal heat pumps, including both
water-to-
water
and water-to-air type pumps; wind turbines; towers used to mount wind turbines
if
specified
by or sold by a wind turbine manufacturer; DC to AC inverters that interconnect
with
utility
power lines; manufactured mounting racks and ballast pans for solar collector,
module or
panel
installation. Not to include materials that could be fabricated into such
racks; monitoring
and
control equipment, if specified or supplied by a manufacturer of solar thermal,
solar
photovoltaic,
geothermal, or wind energy systems or if required by law or regulation for such
systems
but not to include pumps, fans or plumbing or electrical fixtures unless
shipped from the
manufacturer
affixed to, or an integral part of, another item specified on this list; and
solar storage
tanks
that are part of a solar domestic hot water system or a solar space heating
system. If the
tank
comes with an external heat exchanger it shall also be tax exempt, but a
standard hot water
tank
is not exempt from state sales tax.
SECTION
3. Sections 44-57-2, 44-57-4, 44-57-5 and 44-57-7 of the General Laws in
Chapter
44-57 entitled "Residential Renewable Energy System Tax Credit" are
hereby amended
to read
as follows:
44-57-2.
Definitions. -- As used in this chapter unless the context otherwise
requires:
(1) "Active" means a solar renewable energy system that uses
mechanical parts to
collect,
store, and move heat;
(2) "Applicant" means a party who files a Rhode Island tax return and
applies for a
residential
alternative energy device tax credit under this section;
(3) "Application form" means the form that goes to the state energy
office that will
determine
if systems meet the requirements for this tax credit;
(4) "Array" means any number of photovoltaic modules connected
together electrically
to
provide a single electrical output;
(5) "BTU" means British thermal unit;
(6) "Consumer disclosure" means a form provided by the state energy
office describing
the
renewable energy system. The contractor fills this form out and gives it to the
buyer of a
renewable
energy system. It shows estimated energy savings of the renewable energy
system,
required
conservation items, required maintenance, and freeze protection information and
other
data required
by the state energy office;
(7) "Consumer information" means literature that is provided by the
state energy office
to
contractors, solar dealers, and consumers informing them about the tax credit
contained in this
chapter
and general consumer information;
(8) "Contractor" means a person or company who sells and/or installs
renewable energy
systems;
(9) "Contractors' certification" means a contractor system
certification issued by the state
energy
office to a contractor for a specific renewable energy system. The system shall
allow the
contractor
to install that device for the tax credit without getting a separate system
certification
for each
job;
(10) "Contractors' registration board" means the board established
pursuant to the
provisions
of chapter 65 of title 5 responsible for issuing contractors' registration
numbers and
cards to
contractors who are required by state law to be registered. The board is also
responsible
for
ensuring that all registered contractors abide by the guidelines of the
contractors' registration
board;
(11) "Director" means the director of the Rhode Island state energy
office or the
director's
representative;
(12) "Domestic water heating" means the heating of water used in a dwelling
for bathing,
clothes
washing, dishwashing, and other related functions;
(13) "Dwelling" means real property inhabited as a principal or
secondary residence and
located
within this state. "Dwelling" includes, but is not limited to, an
individual unit within
multiple
unit residential housing. For purposes of this subdivision:
(i) "Principal residence" means the dwelling owned by the applicant
who on the date of
the
application has legal title to a dwelling, including the mortgagor under a duly
recorded
mortgage
of real property, the trustor under a duly recorded deed of trust, or a
purchaser under a
duly
recorded contract for the purchase of real property, and who inhabits the
dwelling for no
fewer
than fourteen (14) days in the calendar year for which the credit is claimed;
(ii) "Secondary residence" means vacation property owned by the
applicant;
(iii) Primary or secondary residences do not include motor homes or
recreational
vehicles;
(14) "Grid interconnect form" means the form required on
"grid-connected photovoltaic
systems"
that is signed by the contractor, the master electrician who makes the grid
interconnection,
and the homeowner. This form shall be sent to both the participating utility
company
and the state energy office;
(15) "Hybrid" means a renewable energy system that uses some active
and passive
elements
as part of the system;
(16) "Installing contractor" means the contractor or subcontractor
who actually installs
the
renewable energy system. This may or may not be the same person or company as
the solar
dealer;
(17) "Inverter" means the device used to convert direct current (DC)
to alternating
current
(AC) in a photovoltaic system;
(18) "kWh" means kilowatt-hour; one kWh = 3,413 BTUs;
(19) "Module" means the smallest non-divisible self-contained
physical structure
housing
interconnected photovoltaic cells and providing a single DC electrical output;
(20) "MM" means million;
(21) "Net cost" means what the applicant paid to purchase the
renewable energy system.
Net cost
includes permit and inspection fees. Net costs may include the value of federal
tax
credits,
grants, or utility incentives. Net cost does not include service contracts,
rebates,
discounts,
or refunds;
(22) "Owner-built" means a renewable energy system that is assembled
and installed on
an
owner's property and with an owner's labor only;
(23) "Passive" means a renewable energy system that relies on heated
liquid or air rising
to
collect, store, and move heat without mechanical devices;
(24) "Placed in service" means the date when a renewable energy
system is ready and
available
to produce useable energy;
(25) "Solar dealer" means the person or company who signs a contract
or proposal with a
customer
to provide and/or install solar equipment;
(26) "Solar domestic hot water system" means a configuration of solar
collectors, pump,
heat exchanger,
and storage tank designed to heat water. System types include forced
circulation,
integral
collector storage, thermosyphon, and self-pumping. For the purpose of
determining
system
yields, a configuration of components is considered a new system if changes
occur in any
of the
following: type or size of collectors; heat exchanger type or effectiveness;
size of storage
tank; or
system type;
(27) "State energy office" means the Rhode Island state energy
office, also known as the
governor's
office of energy assistance, within the department of administration;
(28) "System certification" means certification that a renewable
energy system as
described
in the application meets criteria for the tax credit;
(29) "System approval" means an approval given to renewable energy
systems that meet
all of
the requirements of the state energy office;
(30) "Used equipment" means any solar tank or collector which
previously has been
installed
or any piece of equipment not under current manufacturers' warranty;
(31) "Verification form" means a form filed with the division of
taxation (upon request)
by an
applicant claiming eligibility for the tax credit. A contractor shall submit a
copy of the form
to the
state energy office;
(32) "Watt" means the electrical unit of power or rate of doing work.
The rate of energy
transfer
equivalent to one ampere of electrical current at one-volt potential;
(33) "Wh" means watt hours-power consumed by a load over a specified
time. As used
herein,
1,000 Wh = one kilowatt-hour (kWh);
(34) "Wind energy system dealer" means the person or company who
signs a contract or
proposal
with a customer to provide and/or install wind energy equipment;
(35) "Wind energy system" means a system that produces electricity
through the use of
wind
generators or wind turbines. The electricity shall be used directly, as in
water pumping
applications,
or shall be stored in batteries for household usage. Wind energy systems shall
be
used
alone, or they shall be used as part of a hybrid system, in which their output
is combined
with
photovoltaics and/or a fossil fuel generator; and
(36) "Wp" means Watts peak, or the rated maximum power output of a
photovoltaic
device measured
under standard conditions of twenty-eight degrees C (28 degrees C) cell
temperature
and 1000 W/m2 incident sunlight.; and
(37)
“Geothermal system” means a system that produces and stores energy to heat
buildings,
cool buildings or produces hot water.
44-57-4.
Eligible devices. -- (a) To earn a tax credit pursuant to the
provisions of this
chapter,
the renewable energy system shall be either a photovoltaic system, a solar
domestic hot
water
system, an active solar space heating system, a geothermal system or a
wind-generating
system:
(1) For photovoltaic systems, the system must be able to generate electricity
directly
from
sunlight and be able to have it provide electricity for the home. These systems
can either be
"stand
alone" systems that use batteries for storage of electricity or "grid
interconnected" systems
that
allow the electric meter to spin backwards during periods where the
photovoltaic system is
generating
more electricity than the load of the house. These systems must have an
electrical
permit
that has had a final inspection done by the electrical inspector for the city
or town of the
installation.
(2) For solar domestic hot water systems, the system must consist of solar
collectors,
pump,
heat exchanger, and storage tank designed to heat water. These systems must
have a
plumbing
permit that has had a final inspection done by the plumbing inspector for the
city or
town of
the installation.
(3) For solar space heating systems, the system must consist of solar
collectors, pump,
heat
exchanger, storage tank(s), and a method of distributing the heat to areas of
the house that
need
heat. These systems must have a mechanical or plumbing permit and has had a
final
inspection
done by the mechanical/plumbing inspector for the city or town of the
installation.
(4)(a) For wind energy systems, the energy produced by wind generation
can be used
directly,
as in water pumping applications, or it can be stored in batteries for
household usage.
Wind
generators can be used alone, or they can be used as part of a hybrid system,
in which their
output
is combined with photovoltaics, and/or a fossil fuel generator, and shall:
(i) Be a system that is built, installed, and operated in accord with the manufacturer's
specifications;
(ii) Be a system with manufacturers' warranties against defects in products and
materials;
(iii) Be a system that complies with general and specific standards set forth
in this
chapter
as they apply to renewable energy systems. These shall include:
(A) A photovoltaic system;
(B) A solar domestic hot water system;
(C) An active solar space heating system; and
(D) A wind energy system.; and
(E) A geothermal system.
(b) The following systems and/or devices shall not be used to qualify for a
solar tax
credit:
(1) A passive solar space heating system;
(2) Passive solar hot water system;
(3) A sunspace or solar greenhouse;
(4) Photovoltaic systems installed on boats or recreational vehicles;
(5) Solar pool collectors;
(6) Existing renewable energy systems;
(7) Used equipment;
(8) Repairs and replacements of existing renewable energy systems; and
(9) Wind systems installed on boats or installed vehicles.
(5)
For geothermal systems, the system shall use conventional vapor compression
heat
pumps
to extract low-grade solar energy from the earth. The system shall be used to
heat
buildings,
cool buildings and/or provide hot water. The system shall include all
geothermal
energy
collectors, pumps, including both water to water and water to air type pumps,
heat
exchangers,
storage tanks and heat distribution equipment. Such systems shall have a
mechanical
permit
that has had a final inspection done by the mechanical/plumbing inspector for
the city or
town
of the installation.
(6)
Notwithstanding any other provisions of the general laws, for purposes of local
municipal
property tax assessment, qualifying renewable energy systems shall not be
assessed at
more
than the value of a conventional heating, conventional hot domestic hot water
systems, or
energy
production capacity that otherwise could be necessary to install in the
building. Qualifying
systems
shall include photovoltaic systems (renewable energy systems), solar domestic
hot water
systems,
and active solar space heating systems.
44-57-5.
Computation of tax credit. -- (a) The tax credit on each system as
provided for
in this
chapter shall be determined as follows:
(1) Photovoltaic systems:
(i) (A) Photovoltaic systems shall have a minimum module size of twenty-four
(24)
square
feet; and
(B) Be connected to a battery storage system or be grid interconnected;
(ii) Qualifying systems shall receive a tax credit of:
(A) Twenty-five percent (25%) of the cost of the system. for systems
claimed in year
2000;
(B) Twenty percent (20%) of the cost of the system for systems claimed in
year 2001;
(C) Fifteen percent (15%) of the cost of the system for systems claimed in
year 2002;
(D) Ten percent (10%) of the cost of the system for systems claimed in year
2003;
(E) Five percent (5%) of the cost of the system for systems claimed in year
2004.
(iii) The maximum cost of the system shall not exceed fifteen thousand dollars
($15,000).
Provided, systems costing more than fifteen thousand dollars ($15,000) will
receive a
tax
credit based on a fifteen thousand dollar ($15,000) system cost.
(2) Solar domestic hot water systems:
(i) (A) Solar domestic hot water systems shall have a minimum collector area of
sixty
(60)
square feet; and
(B) A solar storage tank that is at least eighty (80) gallons.
(ii) Qualifying systems shall receive a tax credit of:
(A) Twenty-five percent (25%) of the cost of the system. for systems
claimed in year
2000;
(B) Twenty percent (20%) of the cost of the system for systems claimed in
year 2001;
(C) Fifteen percent (15%) of the cost of the system for systems claimed in year
2002;
(D) Ten percent (10%) of the cost of the system for systems claimed in year
2003;
(E) Five percent (5%) of the cost of the system for systems claimed in year
2004.
(iii) The maximum cost of the system shall not exceed seven thousand dollars
($7,000).
Provided,
systems costing more than seven thousand dollars ($7,000) will receive a tax
credit
based on
a seven thousand dollar ($7,000) system cost.
(3) Active solar heating systems:
(i) (A) Active solar space heating systems shall have a minimum collector area
of one
hundred
twenty-five (125) square feet; and
(B) A system for storing and/or distributing the heat to the living area of the
house.
(ii) Qualifying systems shall receive a tax credit of:
(A) Twenty-five percent (25%) of the cost of the system. for systems
claimed in year
2000;
(B) Twenty percent (20%) of the cost of the system for systems claimed in
year 2001;
(C) Fifteen percent (15%) of the cost of the system for systems claimed in year
2002;
(D) Ten percent (10%) of the cost of the system for systems claimed in year
2003;
(E) Five percent (5%) of the cost of the system for systems claimed in year
2004.
(iii) The maximum cost of the system shall not exceed fifteen thousand dollars
($15,000).
Provided, systems costing more than fifteen thousand dollars ($15,000) will
receive a
tax
credit based on a fifteen thousand dollar ($15,000) system cost.
(4) Wind energy systems:
(i) (A) Wind energy systems must have a rotor diameter of at least forty-four
inches
(44");
and
(B) Have a minimum factory rated output of at least two hundred fifty (250)
watts at
twenty-eight
(28) mph.
(ii) Qualifying systems shall receive a tax credit of:
(A) Twenty-five percent (25%) of the cost of the system. for systems
claimed in year
2000;
(B) Twenty percent (20%) of the cost of the system for systems claimed in
year 2001;
(C) Fifteen percent (15%) of the cost of the system for systems claimed in year
2002;
(D) Ten percent (10%) of the cost of the system for systems claimed in year
2003;
(E) Five percent (5%) of the cost of the system for systems claimed in year
2004.
(iii) The maximum cost of the system shall not exceed fifteen thousand dollars
($15,000).
Provided, systems costing more than fifteen thousand dollars ($15,000) will
receive a
tax
credit based on a fifteen thousand dollar ($15,000) system cost.
(5)
Geothermal systems:
(i)
Geothermal systems must have either a coefficient of performance of 3.4 or
greater or
an
efficiency ratio of sixteen (16) or greater. All geothermal systems must have a
commissioning
sign-off
by the manufacturer or distributor of the equipment to verify the proper
installation and
performance
of the system. All geothermal systems must meet the following standards:
(A)
ARI/ASHRAE/ISO-13256-1 for water to air geothermal systems;
(B)
ARI/ASHRAE/ISO-13256-2 for water to water geothermal systems;
(C)
ARI/ASHRAE/ISO-13256 GWHP for groundwater heat pumps;
(D)
ARI/ASHRAE/ISO-13256 GLHP for closed loop heat pumps;
(ii)
Qualifying systems shall receive a tax credit of:
(A)
Twenty-five percent (25%) of the cost of the system.
(iii)
The maximum cost of the system shall not exceed seven thousand dollars
($7,000).
Provided,
systems costing more than seven thousand dollars ($7,000) will receive a tax
credit
based
on a seven thousand dollar ($7,000) system cost.
(b)
For purposes of the tax credit, the cost of the renewable energy system shall
be the net
cost of acquiring
the system, and shall not include:
(1) Unpaid labor including the applicant's labor;
(2) Operating and maintenance costs;
(3) Land costs;
(4) Legal and court costs;
(5) Patent search fees;
(6) Fees for variances;
(7) Loan interest;
(8) Service contracts;
(9) Cost of moving a used renewable energy system from one site to another;
(10) Cost of repair or resale of a system;
(11) Any part of the purchase price that is optional, such as an extended
warranty or an
upgraded
monitoring system; and
(12) Delivery fees.
44-57-7.
Forms of application for system certification. -- Application forms for
the
renewable
energy system certification for the respective systems shall contain the
following:
(1) Photovoltaic systems. - Renewable energy credit application form for
photovoltaic
systems
shall include:
(i) A proof of purchase, which can be the contract or invoices, dated in the
year for
which
the applicant is claiming the credit;
(ii) A copy of the signed electrical permit and a completed grid interconnect
application
form;
(iii) The cost of the renewable energy system;
(iv) The brand name of the module;
(v) The module(s) area;
(vi) A description of the storage provided if storage is a part of the system;
(vii) Storage brand and model;
(viii) Storage capacity;
(ix) The brand name of the inverter if an inverter is part of the system;
(x) The capacity of the inverter;
(xi) Orientation and tilt of the device;
(xii) The name, address, and phone number of the solar dealer; and
(xiii) The name, addresses, and phone number of the installing contractor
including any
required
licenses.
(2) Solar domestic hot water systems. - Renewable energy system certification
application
form for solar domestic hot water systems shall include:
(i) A proof of purchase which can be the contract or invoices dated in the year
for which
the
applicant is claiming the credit;
(ii) The number of collectors;
(iii) The manufacturer and/or supplier;
(iv) The collector dimensions and/or the net area of the collectors;
(v) The amount of heat storage;
(vi) The system type;
(vii) A description of the freeze protection of the system;
(viii) A description of the overheat protection for the system;
(ix) The system model;
(x) The orientation and tilt of the device;
(xi) A consumer disclosure signed by the applicant and the contractor or
supplier, if any;
(xii) A statement that the purchaser has received a copy of consumer
information
supplied
by the state energy office of Rhode Island.
(3) Solar space heating systems. - Renewable energy system certification
application
form for
solar space heating systems shall include:
(i) All of the data required for solar domestic hot water systems above;
(ii) A description of the heat distribution system;
(iii) A heat loss estimate for the house;
(iv) An estimate for the solar contribution of the heating load.
(4) Wind energy systems. - Renewable energy tax credit application form for
wind
energy
systems shall include:
(i) A proof of purchase, which can be the contract or invoices, dated in the
year for
which
the applicant is claiming the credit;
(ii) A copy of the signed electrical permit and a completed grid interconnect
application
form if
applicable;
(iii) The cost of the renewable energy system;
(iv) The brand name of the wind generator or wind turbine;
(v) The rotor diameter of the wind generator or wind turbine;
(vi) The voltage of the wind generator or wind turbine;
(vii) The output of the wind generator or wind turbine;
(viii) A drawing or description of the mounting system;
(ix) A description of the storage provided if storage is a part of the system;
(x) Storage brand and model;
(xi) Storage capacity;
(xii) The brand name of the inverter if part of the system;
(xiii) The capacity of the inverter;
(xiv) Site plan showing the existing buildings on the property, the location of
the wind
generator
or wind turbine, the height of the tower if applicable including the set-back
from all
property
lines, and the distance to the batteries and/or inverter. On systems using a
tower, show
all
objects (trees, buildings, etc.) that are under thirty (30) feet below anything
within five
hundred
(500) feet. Show the prevailing wind direction on the site plan;
(xv) The name, address, and phone number of the wind energy system dealer; and
(xvi) The name, addresses, and phone number of the installing contractor
including any
required
licenses.
(4)
Geothermal systems. – Renewable energy system certification forms for
geothermal
systems
shall include:
(i)
The proof of purchase which can be the contract or invoices dated in the year
for the
applicant
is claiming the credit;
(ii)
The amount of heat storage, if any;
(iii)
The system type;
(iv)
The system mode;
(v)
Site plan for any work done outside of the building;
(vi)
The identity of the manufacturer and supplier;
(vii)
The name, address and telephone number of the geothermal energy system dealer;
(viii)
The name, address and telephone number of the geothermal energy system
installer;
(ix)
A copy of the signed electrical permit;
(x)
A consumer disclosure signed by the applicant and the contractor or supplier;
if any;
(xi)
A statement that the purchaser has received a copy of consumer information
supplied
by
the state energy office.
SECTION 4. This act shall
take effect upon passage.
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LC01132/SUB A
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