To enact comprehensive tax incentives for businesses manufacturing solar energy systems using photovoltaic modules and to encourage these industries to locate in counties with high unemployment. See companion HB 1760.   Official Text and Analysis.

By Chris Cheney, Washington Dairy Federation; Jim White, Chelan PUD; Jeremy Smithson, Solar Washington; Danielle Dixon, Northwest Energy Coalition; Toni Potter, League of Women's Voters of Washington. They testified that this bill will create renewable energy manufacturing jobs in Washington. The bill will also allow the state to maintain its edge in the solar market and stop additional solar industries from leaving the state. The solar industry is currently a $150 million dollar industry in the state with companies involved in silicon purification, crystal growth and inverter production. The bill will help capture the remaining elements of the solar energy "value chain" by creating a solar module manufacturing industry. The state's proximity to the markets for inputs and end-use products can provide a competitive edge for manufacturers locating here.

To modify the original bill. The original bill contained two B&O tax rates, one statewide rate, and the other for counties with high unemployment. The substitute provides a single rate at 0.138 percent. The substitute also includes a new provision allowing a B&O tax credit for manufacturing taxes paid. The qualifier of a high unemployment rate is replaced with a provision allowing other exemptions and credits for rural counties. A new definition of rural counties is created.

To remove unnecessary administrative provisions, and clarify that the sales tax exemption on new building included tangible personal property.

To delete the section of the 2nd substitute bill that calls for the Joint Legislative Audit and Review Committee to report to the legislature by 11/1/2010 and 11/1/2013 on the specific effectiveness of the tax exemptions. The report would have provided guidelines for the legislature to use in determining whether or not the exemptions should be continued.

To enact comprehensive tax incentives for businesses manufacturing solar energy systems.

By the House Technology, Energy, and Communications Committee, to require the department of Revenue to use existing information to provide information to the Legislature regarding the impact of the incentives. In addition, the amendment changes the year for the incentives to expire from 2014 to 2010. The amendment clarifies that a person claiming credit under existing law for qualified employment positions in a rural county or for employment positions for the manufacturing of semiconductors cannot also receive the B&O job tax credit.

By the House Finance Committee, to strike everything after the enacting clause and insert a new bill. (H2996.1).

By the House Technology, Energy, and Communications Committee, to change the year in which all of the tax incentives provided in the act will expire to 2010 instead of 2014. It provides that, using existing information, the Department of Revenue must, by December 1, 2009, report to the appropriate committees of the legislature regarding the impact of the act. The report shall measure impacts of the act, including the total number of solar energy system manufacturing companies in the state, any change in the number of solar energy system manufacturing companies in the state, and, where relevant, the effect on job creation, the number of jobs created for Washington residents, and such other factors as the department selects.

To apply the business and occupations tax rate to persons manufacturing silicon components of solar energy systems using photovoltaic modules.

To terminate the preferential business and occupation tax rate June 30, 2014, instead of June 30, 2010. It requires the Department of Revenue to report on the impacts of the program by December 1, 2013 instead of December 1, 2009. (MATT 057).

To reduce the business and occupation rate for solar energy systems manufacturers and wholesalers from 0.2904 percent to 0.138 percent.

To concur in House amendments.

To enact comprehensive tax incentives for businesses manufacturing solar energy systems.