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Introduced by Representatives Klein of East Montpelier, Ancel of Calais, Botzow of Pownal, Chen of Mendon, Cheney of Norwich, Copeland-Hanzas of Bradford, Courcelle of Rutland City, Davis of Washington, Deen of Westminster, Donovan of Burlington, Edwards of Brattleboro, Emmons of Springfield, Fisher of Lincoln, French of Randolph, Gilbert of Fairfax, Haas of Rochester, Hunt of Essex, Hutchinson of Randolph, Kitzmiller of Montpelier, Larson of Burlington, Leriche of Hardwick, Lorber of Burlington, Maier of Middlebury, Marek of Newfane, Martin of Springfield, McCullough of Williston, Minter of Waterbury, Mitchell of Barnard, Monti of Barre City, Mook of Bennington, Mrowicki of Putney, Nuovo of Middlebury, Pearson of Burlington, Pellett of Chester, Peltz of Woodbury, Potter of Clarendon, Sharpe of Bristol, Weston of Burlington and Zuckerman of Burlington

Referred to Committee on


Subject:  Taxation; electric generating facility kilowatt hour tax  

Statement of purpose:  This bill proposes to replace the current megawatt hour tax on certain electric generating facilities with a tax based on kilowatt hours produced.


It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1.  32 V.S.A. § 8661 is amended to read:


(a)  There is hereby assessed each year upon electric generating plants constructed in the state subsequent to July 1, 1965, and having a name plate generating capacity of 200,000 kilowatts, or more, a state tax in accordance with the following table:

If megawatt hour production is:                         tax is:

Less than 2,300,000 megawatt hours                $2.0 million

2,300,000 to 3,800,000 megawatt hours          $2.0 million plus $0.40 per   megawatt hour over 2,300,000

3,800,001 to 4,200,000 megawatt hours          $2.6 million

Over 4,200,000 megawatt hours                       $2.6 million plus $0.40 per

                                                                         megawatt hour over 4,200,000

For purposes of this section, “megawatt hour production” means the average of net production for sale in the three most recent preceding calendar years.  The tax imposed by this section shall be paid to the commissioner in equal quarterly installments on or before the 25th day of March, June, September, and December by the person or corporation then owning or operating such electric generating plant. imposed at a rate per kWh of electrical energy produced by the facility as determined by the public service department for the average of the past three calendar years.  The rate of the tax shall be:

(1)  $0.00225 per kWh in fiscal year 2010;

(2)  $0.0025 in fiscal year 2011; and

(3)  $0.003 in fiscal year 2012 and thereafter.

(b)  If an entity subject to this tax generates no electricity during the tax year due to termination or expiration of a necessary license, or due to permanent cessation of operations, no tax shall be due for that year.

(c)  A person or corporation failing to make returns or pay the tax imposed by this section within the time required shall be subject to and governed by the provisions of sections 3202, 3203, 5868, and 5873 of this title.

(d)  The tax imposed by this section shall be collected quarterly and shall be due on the last day of the month following the end of the quarter.  It shall be paid to the commissioner of taxes by the person or corporation then owning or operating such electric generating plant.

(e)  Annually, of the revenues received:

(1)  42 percent shall be deposited in the education fund of the state established in section 4025 of Title 16 to be expended for the purposes of that fund.

(2)  58 percent shall be deposited in the general fund of the state.

Sec. 2.  REPEAL

32 V.S.A. § 5402a (electric generating plant education property tax) is repealed.

Sec. 3.  REPORT

By January 15, 2009, the commissioner of taxes shall present recommendations to the senate committee on finance and the house committee on ways and means with regard to transitioning from the existing tax established in 32 V.S.A. § 8661 to the tax as established under this act.


     This act shall take effect upon passage, except Secs. 1 and 2 of this act which shall take effect July 1, 2009.

Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont