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SB 016: WATER HARVESTING INCOME TAX CREDIT

An Act Relating To Taxation; Creating The Water Harvesting Income Tax Credit; Authorizing The Taxation And Revenue Department To Reveal Aggregate Tax Credit Or Deduction Information To Facilitate A Report To Legislative Committees

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MILD SB 016
WATER HARVESTING INCOME TAX CREDIT

Legislative URL:
SB 016 on nmlegis.gov
Emergency Clause:
No
Germane:
Yes
Location:
SFC
Action:
Actions: (Key to Abbreviations) SPREF [2] SCC/SCONC/SCORC/SFC-SCC-germane-SCONC [5] DP/a-SCORC [11] DNP-CS/DP-SFC API.
Issue(s):

Related Legislators

Bill Sponsor:

Related Documents

Downloads:
Introduced
SCC Committee Report
SCONC Committee Report
SCORC Committee Report
SCORC Committee Substitute
Fiscal Impact Report
Summary

This piece of legislation creates a “water harvesting income tax credit” for taxpayers who purchase and install a certified water harvesting system after January 1, 2014 and before December 31, 2024 in a residence or business in New Mexico. The credit will be for an amount up to 20% of the purchase and installation costs of the system but no more than $5,000. The Regulation and Licensing Department must certify the system for it to qualify for the tax credit.

 

The measure defines a “water harvesting system” as a “system that is designed to provide for the collection of rainwater or snowmelt from the rooftop of a building and is capable of storing the rainwater or snowmelt for future use.” The purpose of the credit is to provide an incentive for homeowners and businesses to use harvested water for future use.

 

The New Mexico Taxation and Revenue Department (TRD) must compile an annual report on the water harvesting income tax credit detailing the number of taxpayers approved for the credit, the aggregate amount of credits approved and any other information necessary to evaluate the effectiveness of the credit. Beginning in 2019 and every five years thereafter, TRD must also prepare an analysis of the effectiveness and cost of the credit.

 

The bill also amends the Tax Administration Act to allow employees of the TRD to give certain tax return information to the Interim Revenue Stabilization and Tax Policy Committee and the Legislative Finance Committee that is necessary to facilitate the compilation of a report to those committees on the effectiveness of a tax credit or deduction. This part of the legislation would apply to all tax credits and deductions for which the law requires a report of effectiveness.

 

This bill may be a positive step towards encouraging taxpayers to purchase and install water harvesting systems and thus help to address New Mexico’s water shortage. One question might be whether the credit is enough to provide the needed incentive. Another might be whether the cost of these kinds of improvements and the amount of the credit are feasible for lower- and mid-level income households.

 

Date of Summary:  1/21/2014

Outcome:

SB 016 died in the Senate Finance Committee.

 

Updated 7/31/14