[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5183 Introduced in House (IH)]
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117th CONGRESS
1st Session
H. R. 5183
To amend the Internal Revenue Code of 1986 to provide for an increase
in energy credit for solar facilities placed in service with low-income
communities, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
September 7, 2021
Mr. Danny K. Davis of Illinois (for himself, Ms. Sanchez, Ms. Sewell,
Mr. Horsford, Mr. Evans, Mr. Gomez, and Mr. Espaillat) introduced the
following bill; which was referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide for an increase
in energy credit for solar facilities placed in service with low-income
communities, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Low-Income Housing Renewable Energy
Credit Act''.
SEC. 2. INCREASE IN ENERGY CREDIT FOR SOLAR FACILITIES PLACED IN
SERVICE IN CONNECTION WITH LOW-INCOME COMMUNITIES.
(a) In General.--Section 48 is amended by adding at the end the
following new subsection:
``(e) Special Rules for Certain Solar Facilities Placed in Service
in Connection With Low-Income Communities.--
``(1) In general.--In the case of any qualified solar
facility with respect to which the Secretary makes an
allocation of environmental justice solar capacity limitation
under paragraph (4)--
``(A) equipment described in paragraph (3)(B) shall
be treated for purposes of this section as energy
property described in subsection (a)(2)(A)(i),
``(B) the energy percentage otherwise determined
under subsection (a)(2) with respect to any eligible
property which is part of such facility shall be
increased by--
``(i) in the case of a facility described
in subclause (I) of paragraph (2)(A)(iii) and
not described in subclause (II) of such
paragraph, 10 percentage points, and
``(ii) in the case of a facility described
in subclause (II) of paragraph (2)(A)(iii) and
not described in subclause (I) of such
paragraph, 20 percentage points, and
``(C) the increase in the credit determined under
subsection (a) by reason of this subsection for any
taxable year with respect to all property which is part
of such facility shall not exceed the amount which
bears the same ratio to the amount of such increase
(determined without regard to this subparagraph) as--
``(i) the environmental justice solar
capacity limitation allocated to such facility,
bears to
``(ii) the total megawatt nameplate
capacity of such facility.
``(2) Qualified solar facility.--For purposes of this
subsection--
``(A) In general.--The term `qualified solar
facility' means any facility--
``(i) which generates electricity solely
from property described in subsection
(a)(3)(A)(i),
``(ii) which has a nameplate capacity of 5
megawatts or less, and
``(iii) which--
``(I) is located in a low-income
community (as defined in section
45D(e)), or
``(II) is part of a qualified low-
income residential building project or
a qualified low-income economic benefit
project.
``(B) Qualified low-income residential building
project.--A facility shall be treated as part of a
qualified low-income residential building project if--
``(i) such facility is installed on a
residential rental building which participates
in a covered housing program (as defined in
section 41411(a) of the Violence Against Women
Act of 1994 (34 U.S.C. 12491(a)(3))), a Housing
Development Fund Corporation cooperative under
Article XI of the New York State Private
Housing Finance Law, a housing assistance
program administered by the U.S. Department of
Agriculture under title V of the Housing Act of
1949, or such other affordable housing programs
as the Secretary may provide, and
``(ii) the financial benefits of the
electricity produced by such facility are
allocated equitably among the occupants of the
dwelling units of such building.
``(C) Qualified low-income economic benefit
project.--A facility shall be treated as part of a
qualified low-income economic benefit project if at
least 50 percent of the financial benefits of the
electricity produced by such facility are provided to
households with income of--
``(i) less than 200 percent of the poverty
line applicable to a family of the size
involved, or
``(ii) less than 70 percent of area median
gross income (as determined under section
142(d)(2)(B)).
``(D) Financial benefit.--For purposes of
subparagraphs (B) and (C), electricity acquired at a
below-market rate shall not fail to be taken into
account as a financial benefit.
``(3) Eligible property.--
``(A) In general.--For purposes of this section,
the term `eligible property' means--
``(i) energy property which is described in
subsection (a)(3)(A)(i), including any property
that stores electricity which is installed in
connection with such energy property, and
``(ii) the amount of any expenditures which
are paid or incurred by the taxpayer for
qualified interconnection property installed in
connection with the installation of property
described in subparagraph (A) to provide for
the transmission or distribution of the
electricity produced or stored by such
property, and which are properly chargeable to
the capital account of the taxpayer.
``(B) Definitions.--For purposes of subparagraph
(A)--
``(i) Qualified interconnection property.--
The term `qualified interconnection property'
means, with respect to a qualified facility
which is not a microgrid, any tangible
property--
``(I) which is part of an addition,
modification, or upgrade to a
transmission or distribution system
which is required at or beyond the
point at which the qualified facility
interconnects to such transmission or
distribution system in order to
accommodate such interconnection,
``(II) either--
``(aa) which is
constructed, reconstructed, or
erected by the taxpayer, or
``(bb) for which the cost
with respect to the
construction, reconstruction,
or erection of such property is
paid or incurred by such
taxpayer, and
``(III) the original use of which,
pursuant to an interconnection
agreement, commences with the utility.
``(ii) Interconnection agreement.--The term
`interconnection agreement' means an agreement
entered into by a utility and the taxpayer for
the purposes of interconnecting the qualified
facility owned by such taxpayer to the
transmission or distribution system of such
utility.
``(iii) Utility.--The term `utility' means
the owner or operator of an electrical
transmission or distribution system which is
subject to the regulatory authority of--
``(I) the Federal Energy Regulatory
Commission, or
``(II) a State public utility
commission or other appropriate State
agency.
``(C) Special rule for interconnection property.--
In the case of expenses paid or incurred for
interconnection property, amounts otherwise chargeable
to capital account with respect to such expenses shall
be reduced under rules similar to the rules of section
50(c).
``(4) Allocations.--
``(A) In general.--Not later than 180 days after
the date of enactment of this subsection, the Secretary
shall establish a program to allocate amounts of
environmental justice solar capacity limitation to
qualified solar facilities.
``(B) Limitation.--The amount of environmental
justice solar capacity limitation allocated by the
Secretary under subparagraph (A) during any calendar
year shall not exceed the annual capacity limitation
with respect to such year.
``(C) Annual capacity limitation.--For purposes of
this paragraph, the term `annual capacity limitation'
means 1.8 gigawatts for each of calendar years 2022
through 2031, and zero thereafter.
``(D) Carryover of unused limitation.--If the
annual capacity limitation for any calendar year
exceeds the aggregate amount allocated for such year
under this paragraph, such limitation for the
succeeding calendar year shall be increased by the
amount of such excess. No amount may be carried under
the preceding sentence to any calendar year after 2033.
``(E) Placed in service deadline.--
``(i) In general.--Paragraph (1) shall not
apply with respect to any property which is
placed in service after the date that is 4
years after the date of the allocation with
respect to the facility of which such property
is a part.
``(ii) Application of carryover.--Any
amount of environmental justice solar capacity
limitation which expires under clause (i)
during any calendar year shall be taken into
account as an excess described in subparagraph
(C) (or as an increase in such excess) for such
calendar, subject to the limitation imposed by
the last sentence of such subparagraph.
``(F) Selection criteria.--In determining to which
qualified solar facilities to allocate environmental
justice solar capacity limitation under this paragraph,
the Secretary shall take into consideration which
facilities will result in--
``(i) the greatest health and economic
benefits for individuals described in section
45D(e)(2),
``(ii) the greatest employment and wages
for such individuals, and
``(iii) the greatest engagement with,
outreach to, or ownership by, such individuals,
including through partnerships with local
governments and community-based organizations.
``(G) Disclosure of allocations.--The Secretary
shall, upon making an allocation of environmental
justice solar capacity limitation under this paragraph,
publicly disclose the identity of the applicant and the
amount of the environmental justice solar capacity
limitation allocated to such applicant.
``(5) Recapture.--The Secretary shall, by regulations or
other guidance, provide for recapturing the benefit of any
increase in the credit allowed under subsection (a) by reason
of this subsection with respect to any property which ceases to
be property eligible for such increase (but which does not
cease to be investment credit property within the meaning of
section 50(a)). The period and percentage of such recapture
shall be determined under rules similar to the rules of section
50(a). Such recapture shall not apply with respect to any
property if, within 12 months after the date the taxpayer
becomes aware (or reasonably should have become aware) of the
such property ceasing to be property eligible for such
increase, the eligibility of such property for such increase is
restored. The preceding sentence shall not apply more than once
with respect to any facility.''.
(b) Effective Date.--The amendments made by this section shall
apply to periods after December 31, 2021, under rules similar to the
rules of section 48(m) of the Internal Revenue Code of 1986 (as in
effect on the day before the date of the enactment of the Revenue
Reconciliation Act of 1990).
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