[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 2766 Introduced in Senate (IS)]
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117th CONGRESS
1st Session
S. 2766
To amend the Internal Revenue Code of 1986 to provide a manufacturing
investment tax credit and a production tax credit for manufacturing
facilities that produce offshore wind turbine components.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
September 21, 2021
Mr. Markey (for himself, Mr. Booker, Mr. Menendez, Ms. Warren, Mr. Van
Hollen, and Mr. Ossoff) introduced the following bill; which was read
twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide a manufacturing
investment tax credit and a production tax credit for manufacturing
facilities that produce offshore wind turbine components.
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 ``Offshore Wind American Manufacturing
Act of 2021''.
SEC. 2. OFFSHORE WIND MANUFACTURING CREDIT.
(a) In General.--Subpart C of part IV of subchapter A of chapter 1
of the Internal Revenue Code is amended by inserting after section 36B
the following new section:
``SEC. 36C. OFFSHORE WIND MANUFACTURING CREDIT.
``(a) Allowance of Credit.--There shall be allowed as a credit
against the tax imposed by this subtitle for any taxable year an amount
equal to the sum of--
``(1) the offshore wind manufacturing investment credit,
and
``(2) the offshore wind manufacturing production credit.
``(b) Credit Amounts.--For purposes of this section--
``(1) Manufacturing investment credit.--
``(A) In general.--The offshore wind manufacturing
investment credit for any taxable year is an amount
equal to 30 percent of the qualified investment for
such taxable year.
``(B) Qualified investment.--The qualified
investment for any taxable year is the basis of any
advanced offshore wind manufacturing property placed in
service in the United States by the taxpayer during
such taxable year.
``(C) Advanced offshore wind manufacturing
property.--The term `advanced offshore wind
manufacturing property' means property--
``(i) which is used predominantly to
manufacture or process any qualified offshore
wind component,
``(ii) which respect to which depreciation
(or amortization in lieu of depreciation) is
allowable, and
``(iii) which--
``(I) is constructed,
reconstructed, or erected by the
taxpayer, or
``(II) which is acquired by the
taxpayer, if the original use of such
property commences with the taxpayer.
``(2) Manufacturing production credit.--
``(A) In general.--The offshore wind manufacturing
production credit is an amount equal to the applicable
rate with respect to any qualified offshore wind
component or related vessel which--
``(i) is produced by the taxpayer at a
qualified manufacturing facility, and
``(ii) during the taxable year--
``(I) is sold by the taxpayer to--
``(aa) an unrelated person,
or
``(bb) a related person for
the use of such person in their
trade or business (with the
exception of any trade or
business related to resale of
such offshore wind component
without any subsequent
modification, assembly, or
integration into a project), or
``(II) if not sold, is placed in
service or operation by the taxpayer or
any other person.
``(B) Applicable rate.--The applicable rate is--
``(i) with respect to any qualified
offshore wind component, the total rated
capacity (expressed on a per direct current
watt basis) of the completed offshore wind
turbine for which the component is designed,
multiplied by--
``(I) in the case of any blade,
gearbox, generator, or foundation (or
dedicated subcomponent described in
subsection (c)(1)(A)(ii) thereof), 2
cents,
``(II) in the case of any tower (or
such a dedicated subcomponent thereof),
3 cents, and
``(III) in the case of any nacelle
(or such a dedicated subcomponent
thereof), 5 cents, and
``(ii) with respect to any related vessel,
an amount equal to 10 percent of the sale price
of such vessel.
``(C) Qualified manufacturing facility.--The term
`qualified manufacturing facility' means any new or
existing facility--
``(i) which is located in the United
States, and
``(ii) which manufactures or assembles
qualified offshore wind components,
subcomponents, and related vessels.
``(D) Production and sale must be in trade or
business.--Any qualified offshore wind component
produced and sold by the taxpayer shall be taken into
account under subparagraph (A)(ii)(I) only if the
production and sale described in subparagraph (A) is in
a trade or business of the taxpayer.
``(c) Definitions.--For purposes of this section--
``(1) Qualified offshore wind component.--
``(A) In general.--The term `qualified offshore
wind component' means--
``(i) any blade, tower, nacelle, generator,
gearbox, or foundation, and
``(ii) any dedicated subcomponent necessary
to the production, construction, and operation
of any such property.
``(B) Definitions.--
``(i) Blade.--The term `blade' means an
airfoil-shaped blade which is responsible for
converting offshore wind energy to low speed
rotational energy.
``(ii) Tower.--The term `tower' means a
tubular steel, concrete, or steel lattice which
supports the structure of an offshore wind
turbine.
``(iii) Nacelle.--The term `nacelle' means
the assembly of the cover housing for drive
train and other tower-top components of an
offshore wind turbine.
``(iv) Generator.--The term `generator'
means the component which is housed in the
nacelle and converts the mechanical energy from
the rotor to electrical energy.
``(v) Gearbox.--The term `gearbox' means
the component housed in the nacelle which
converts the low-speed, high-torque rotation of
the rotor for input into the generator.
``(vi) Foundation.--The term `foundation'
means the component which secures an offshore
wind tower and above-water turbine components
to the sea floor using offshore wind monopiles,
jackets, gravity-based foundations, fixed, or
floating platforms.
``(2) Related vessel.--The term `related vessel' means any
vessel which is purpose-built or retrofitted for purposes of
the transport, installation, or maintenance of offshore wind
components and offshore wind turbines.
``(d) Special Rules.--For purposes of this section--
``(1) Secretary.--Any reference to the Secretary means the
Secretary in consultation with the Secretary of Energy.
``(2) Labor conditions.--Any property shall be treated as
advanced offshore wind manufacturing property, and any facility
shall be treated as a qualified manufacturing facility, only if
all laborers and mechanics employed by all contractors and
subcontractors in the manufacture of such property or at such
facility are paid wages at rates not less than the prevailing
rates for work of a similar character in the locality as
determined by the Secretary of Labor, in accordance with
sections 3141 through 3144, 3146, and 3147 of title 40, United
States Code.
``(3) Certain rules made applicable for investment
credit.--For purposes of the offshore wind manufacturing
investment credit determined under subsection (b)(1), rules
similar to the rules of subsections (a) and (c) of section 50
shall apply.
``(4) Coordination with general investment credit.--No
credit shall be allowed under section 48C with respect to any
facility taken into account for purposes of the credit under
subsection (b)(2), or any facility with respect to which any
qualified investment is taken into account for purposes of the
credit under subsection (b)(1). The credit under this section
shall be allowed without regard to whether any qualified
investment (as defined in section 48C(b)) with respect to a
facility has been taken into account for purposes of section
48C in any preceding taxable year.
``(e) Registration.--
``(1) In general.--No credit shall be allowed under this
section unless the taxpayer registers with the Secretary, at
such time, in such form and manner, and subject to such terms
and conditions, as the Secretary may by regulations prescribe.
Such registration shall include a demonstration of compliance
with the requirements of subsection (d)(2).
``(2) Registration in event of change in ownership.--Under
regulations prescribed by the Secretary, the taxpayer (other
than a corporation the stock of which is regularly traded on an
established securities market) shall be required to re-register
under this subsection if after a transaction (or series of
related transactions) more than 50 percent of ownership
interests in, or assets of, the taxpayer are held by persons
other than persons (or persons related thereto) who held more
than 50 percent of such interests or assets before the
transaction (or series of related transactions).
``(3) Denial, revocation, or suspension of registration.--
Rules similar to the rules of section 4222(c) shall apply to
registration under this section.
``(4) Information reporting.--The Secretary may require--
``(A) information reporting by any person
registered under this subsection, and
``(B) information reporting by such other persons
as the Secretary deems necessary to carry out this
section.
``(f) Termination.--
``(1) Offshore wind manufacturing investment tax credit.--
``(A) In general.--Except as provided in
subparagraph (B), in the case of any qualified
investment with respect to advanced offshore wind
manufacturing property which is placed in service after
December 31, 2028, the amount of the credit determined
under subsection (b)(1) (without regard to this
subsection) shall be reduced by--
``(i) in the case of property placed in
service in calendar year 2029, 30 percent,
``(ii) in the case of property placed in
service in calendar year 2030, 65 percent, and
``(iii) in the case of property placed in
service after December 31, 2030, 100 percent.
``(B) Certain progress expenditure rules made
applicable.--Rules similar to the rules of subsections
(c)(4) and (d) of section 46 (as in effect on the day
before the date of the enactment of the Revenue
Reconciliation Act of 1990) shall apply for purposes of
subparagraph (A).
``(2) Offshore wind manufacturing production tax credit.--
No credit shall be allowed under subsection (b)(2) in the case
of any qualified offshore wind component first sold or placed
in service after December 31, 2030.''.
(b) Clerical Amendment.--The table of sections for subpart C of
part IV of subchapter A of chapter 1 of the Internal Revenue Code is
amended by inserting after the item relating to section 36B the
following new item:
``Sec. 36C. Offshore wind manufacturing credit.''.
(c) Conforming Amendment.--Paragraph (2) of section 1324(b) of
title 31, United States Code, is amended by inserting ``, 36C'' after
``36B''.
(d) Effective Date.--The amendments made by this section shall
apply to--
(1) any qualified investment (as defined in section
36C(b)(1)(B) of the Internal Revenue Code of 1986, as added by
this section) with respect to property placed in service
beginning after August 1, 2021, and
(2) qualified offshore wind components (as defined in
section 36C(c)(1) of such Code, as so added) first sold or
placed in service after August 1, 2021.
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